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Why Invest In Costa Rica Real Estate?

By Jimmy V. Reed

Why all the Fuss about Costa Rica Real Estate Investments?

Have you heard all the buzz in the last few years about investing in Costa Rica? If not, you may be missing some of the best opportunities to make money in real estate right NOW!

Why Costa Rica?

Costa Rica affords a stable, growing economy in an outstanding environment. Only a few hours from the U.S., the “secret” of Costa Rica’s allure is becoming common knowledge, which is increasing tourism and development. Property values, once renowned for their incredibly low prices, are now rising with the increased housing demand. In short, the window of opportunity for major profit is right now!

About Costa Rica:

Costa Rica is flanked by the Pacific Ocean and Caribbean Sea. With a distance of approximately 155 miles between coasts, Costa Rica is well known for the premium it places on peace, education and democracy. In 1949 the government abolished the Army, allocating all would be military expenses to education and health care. As a direct result the literacy rate rose to 95% and continues to be one of the highest rates in the Americas. International ports on coasts, air and freight transportation services, and a well developed infrastructure and a strategic location at the crossroads of two continents make Costa Rica a contender in world markets. The government’s receptiveness toward new business ventures and excellent incentive plans have lured a growing number of multinational corporations to the country.

Spectacular natural beauty and peaceful atmosphere attract residents and tourists year after year. Nine active volcanoes, diverse forest environments, hot springs, wetlands, lakes, island reserves and 600 miles of beaches on two coasts account for the dramatic increase of tourism and residency in the last decade. Costa Rica’s varied terrain provides endless possibilities for activities ranging from hiking and white water rafting through national parks to snorkeling, scuba diving, and surfing off of the Pacific and Caribbean shores. Whether your interest is business or pleasure you will find Costa Rica a country of unequalled beauty.

Last year some statistics showed that there were 89,000 ex patriots living in Costa Rica. They find that the price points and cost of living put them way ahead in living standards and allow for the purchase of houses priced way below that of the United States. These properties are in gated communities with ocean, mountain, and rain forest views. This coupled with very favorable tax situations make it the idea place to invest. I see this first-hand as a developer there myself, because we are able to put our investors around the world into projects that will earn them double and triple returns of  those they may find in the States.

Why You Should Invest in Costa Rica:

There are several projects currently in process in Costa Rica and due to the recent US economy; there is an influx of investors now wanting to participate. As Investors, you should always keep in mind that your goal is to make the safest investment possible with the greatest return to you, in the shortest time period. You should analyze the investment, use your intelligence and make a calculated estimate based on the information you have available. That’s Investing 101! Costa Rica is now one of those investments that make a lot of sense for both the novice and seasoned investor.

Investors I know that have been involved in several development projects in Costa Rica from as small as 100 acres to as large as 1,650 acres. All said they needed expertise help when closing on these projects; they needed a team to help them with everything from writing contracts to title companies. Now there are two to three different American companies in Costa Rica that provide title guarantees. Those corporations provide foreigners with a title land guarantee.  Therefore, if there is a problem with fraud or problems in the title, they can be identified and the buyer can be paid back.

We also want to stress a crucial point to overseas investing and that is taking a little trip to the property you intend to buy or invest in. Now many investors we know have invested in Costa Rica and did not visit the properties firsthand. However some have visited since their purchases and found that they really enjoyed going to Costa Rica and seeing first hand where they have invested their money. One of our goals this last year was to inform investors of the opportunities in Costa Rica by encouraging them to take a FAM trip. A FAM trip is known in the travel industry as Familiarization and Marketing: it’s a trip you take to learn about the area and have a vacation at the same time. I would encourage investors who invest in these countries to hook up with a group that can show you the area, understand the investment, and at the same time give you a little cultural immersion while having fun at the same time.

In the future these types of trips will help the investor who never thought they would invest in another market become more comfortable and familiar with the market they have an interest in.  It’s true that with the help of the internet you can gather plenty of information on markets like Costa Rica fairly easy. Fact is for the first few years of International investing I did all my research on different markets via the internet.  But we also know the value of seeing an investment with our own eyes. Some Investors I know finally took a little trip down to Costa Rica to learn more about the projects. At the same time they had a blast riding around the projects on ATV’s and later on boat trips through the rivers and ocean of one of the most beautiful countries they had ever been to. Now that’s Cultural Immersion!

In closing, the returns are looking incredible. The market and demand are there. All you need to do is fill the demand just as many other investors are doing. Keep this in mind; investing should be, and can be fun. If you find yourself not comfortable with the investment then walk away. But don’t be like some investors who find something wrong with every investment and so end up never investing in anything. A true investor analyzes the project for what it is and then with all the facts he has moves forward or backs away. Moving forward though may sometimes require a little Leap of Faith.


 

Jimmy V. Reed         

Jimmy V. Reed of Fort Worth, Texas has been investing in real estate since 1987.  In 1991, he started conducting full-day training sessions on Wholesaling.  He then began teaching and mentoring others throughout the country. He is currently the founder of the Fort Worth R.E. club www.1REclub.com and has his own real estate training company that includes Wholesale, Probate, Mentoring & a Biblically based Debt Free training course and more!

More info available at www.JimmyReed.net

 

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Top 5 Reasons Why Real Estate Investors have their Eye on Kumamoto

By Priti Donnelly

If there is one city in Japan to watch for, it is Kumamoto, the capital city of Kumamoto Prefecture on the Kyushu landmass. Here you will find a property market in which opportunities are rare and sell almost as soon as they hit the market. Most investors familiar with the Japanese property market focus on high yields and affordable prices.  A city such as this, in its growth phase also has the potential for increased land value. Hence, Kumamoto is one of those markets with the potential for the best of both worlds.

Population

Kumamoto has experienced remarkable growth. Notable for one of the largest solar farms in Japan and positioned as a hub with a port for people and import/export of cargo. In this satellite city, population has grown from 670,348 in 2008 to 734,917 in 2015. That’s 9.63%! Compare that to 3.91% growth in Fukuoka, 1.31% in Kobe and 1.13% in Sapporo during the same timeframe. The location continues to draw tourists to its natural hot spring resorts and to the impregnable, defensive designs of the historical Kumamoto Castle dating back to 1467.

Affordable High-Yield Properties

Where there is a surge of population in a developing area, investors can find affordable, high yield properties. It’s first come first serve for the rare availability of one room apartment units (“mansion” in Japan) on the market in Kumamoto. Prices can be as low as 2.4 million to 2.8 million JPY (USD $21K to $25K) at between 7.5% to 9% yield net pre-tax, approximately USD $150 to $240 net income per month.

Secure Returns

Governance in Kumamoto supports subsidized employment and volunteer opportunities as well as rehabilitation and housing services for first offence ex-cons, the destitute and homeless. Therefore, along with great price and high yield, unlike other parts of Japan, the government pays rent directly to the landlord. In fact, some realtors and property manager offices specialize in buying vacant buildings to rent entirely to welfare recipients because of the high and secure returns.

Occupancy

From our experience we have never had a vacancy longer than two months in this city. Part of the reason is that properties are generally within ten minutes walking distance to the nearest train station. By comparison, Sapporo has five to six month vacancies, despite its size, high returns and white collar industries, and similar vacancies in Nagoya, the industrial powerhouse city.

Construction Standards

Investors often ask us about the effect of earthquakes in the area. Again, from our personal experience, on the 14 properties under our management, approximately only USD$500 in damages and that was to one window frame and some flooding under it. Even if there had been more damage, investors would have been protected under insurance.

One of the reasons that Kumamoto does not tend to disappoint is that many of the properties were built after 1981when the building standards act was revised for earthquake resistant construction methods. While 1981 is a turning point for some investors, some older buildings built prior to 1981 can be retrofitted to bring them up to code by renovating, repairing and re-strengthening exterior walls.  In assisting buyers with their due diligence, we look to see if the building has sufficient accumulated funds for repairs to cover the cost for work, or alternatively we look for completed work to justify depleted funds. Either of these cases tells us that the building is well managed, common in Kumamoto.

For these reasons, investors say Kumamoto is one of the best high return locations in Japan. if you see an opportunity don’t ponder over it too long. Properties there don’t come up often enough and when they do they most certainly don’t last.


Priti Donnelly – Manager, Sales and Marketing

Nippon Tradings International (NTI)

Priti Donnelly is the sales and marketing manager at Nippon Tradings International, a proxy and buyers’ agency representing foreign investors with purchasing, selling and managing real estate in Japan. She helps real estate investors, new to the Japan property market understand both the value of the cash flow property market, the challenges, as well as assisting with individual needs in growing cash flow portfolios.

http://www.nippontradings.com

 

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Foreign Investors Approach to Real Estate Investing Under $50K

By Priti Donnelly

Real estate investing does not necessarily have to be in your backyard. In fact, with volatile markets around the world, many investors are expanding their criteria to more diverse international real estate portfolios.  International properties can be much more rewarding, both in affordability and higher yield. To qualify for the under $50K option you must meet the following requirements:  have an open mind to foreign real estate, an interest in cash flow rather than capital appreciation;  and interested in investing under $50k.

The Prospect

Now that you qualify, let’s take a look at properties in the Japan market. Outside of Tokyo you can easily find properties from $30K to $50K. Even more impressive is the yield of 6% to 12% because prices haven’t risen as sharply as they have in other cities. For example, in the center of big cities, or first tier cities such as Fukuoka and Nagoya you can expect a yield of 6% to 8%. In second tier cities such as metropolitan Sapporo, you will find properties with a yield of 9% to 10%. In the third tier are smaller townships, albeit with good profiles, a yield of 10% to 12%, all net pre-tax. With an occupancy rate of 93% to 94% properties are usually occupied bringing your investment property immediate income of $250 to $400 a month on average.

Method

To invest in real estate in Japan, investors work with an agent/proxy acting as an extension of themselves for the property purchase and management. This is mainly because of the language barrier. As agents/proxies ourselves, we communicate on investors’ behalf with the property/rent manager, building management company, tax authorities, and insurance company. Since non-residents cannot open local bank accounts, by having a physical address and telephone number in Japan to manage the portfolio, we are able to pay bills, collect rental income, and transfer/accept overseas funds.  In fact, you actually never need to travel to close the purchase, unless of course, you want to take a leisurely trip to take in the culture, historic traditions and breathtaking scenery.

Tenants

Japan is a landlord’s paradise — high, stable and reliable cash flow, very affordable, and because of Japanese ethics, tenants are polite, docile, trouble free, and honest. Living away from your investment property, you will not need to worry about destruction to your property or evictions.  Of course, the same tenant will not last forever but the average turnover is quite stable at 4.5 years for singles’ units, and higher for larger family sized units, sometime up to 15 years.

Earthquake Concerns

While the recent earthquakes have not deterred investors from properties in Japan, we have had concerns about the effect of earthquakes on properties. Under a standard policy, earthquake, tsunami, volcano and flood damages are covered by insurance policies and insurance is surprisingly inexpensive, only a few dollars a month. Since the building itself carries an accumulated funds pool, any remaining losses not covered by insurance are generally covered by the pool. As part of the due diligence process at the time of the purchase, we check the status of the accumulated funds to determine whether 100% coverage is necessary.

Selling Your Property

Since the market moves very quickly in Japan, properties are listed only a few days before they are sold. Therefore, if you decide to sell your property, there is usually a buyer ready to purchase.  Keep in mind the tax implications. A property owner, whether foreign or local, who sells a Japanese property within five years can expect to pay 40% capital gains tax. After five years, the tax drops to 20%.

Generally, our clients invest in properties for cash flow purposes rather than capital gain. If capital appreciation is what you are looking for then your ideal market would be Australia, U.K., U.S. and even Tokyo and at a considerable price.  But, for steady monthly income, where yield is high, cash flow is immediate and properties are incredibly affordable, the real estate market in Japan could be an option to consider to let your cash flow investment journey begin.


 

Priti Donnelly

Priti Donnelly is the sales and marketing manager at Nippon Tradings International, a proxy and buyers’ agency representing foreign investors with purchasing, selling and managing real estate in Japan. She understands the importance of transparency in today’s international market. Through her insight, she focuses on breaking barriers and helping investors feel confident about their overseas property investments.

Website: http://www.nippontradings.com

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How to Purchase and Manage an Investment Property in Japan

By Priti Donnelly

Real estate investments in Japan continue to attract foreign buyers from around the world for high yield, affordable prices and cash flowing rental income. But, in a foreigner-shy country that speaks mostly Japanese, conducting due diligence, negotiating and making an offer can be almost impossible. To complicate matters further, properties in the Japanese real estate market are sold within days, sometimes hours, making it more difficult to compete against local buyers. So, how then do foreign buyers successfully manage to invest in the market?

Find a Local Proxy/Agent

The first step is to find a local bilingual (Japanese-English) proxy/agent who will help you familiarize yourself with the property market. Look for someone who is available to you, communicates well and who can provide you with information in a timely fashion. Consider your proxy as an extension of yourself. Expect transparency about their services, keeping you informed at all stages of the purchase process and clearly explaining the management process. Don’t hesitate to ask for client references.

Familiarize Yourself with the Market

There is no need to travel to Japan to scout the area, unless you want to. Your experienced and trusted proxy will work with you to familiarize yourself with the market. They should have strong knowledge of locations, in particular, areas with population growth to ensure tenant demand. Ask about properties close to shopping districts, schools and hospitals where tenant demand would be higher. Another factor to consider is the age of buildings. In 1981, the building standards act changed their policies to ensure earthquake resistant construction methods. This is the turning point that some buyers look to when purchasing an apartment, although many older buildings built prior to 1981, have been retrofitted to bring them up to code.  Next, you may have a certain size and features in mind – one room with a living room, kitchen and dining room, close to a train station is ideal for a student, single or elderly person. Two or more rooms could suit a family. Of course, your budget and yield are naturally of significance.

Analyze the Numbers

Once you have a good idea of the features you have in mind, your proxy will send you analyses of properties to suit your criteria and break down the numbers (price, costs, yield, etc.) For example, with the exception of Tokyo, investment properties across Japan range from $40K to $60K at 6% to 12% yield. In the center of big cities, or first tier cities such as Fukuoka and Nagoya you can expect a yield of 6% to 8%. In second tier cities such as metropolitan Sapporo, you will find properties with a yield of 9% to 10%. In the third tier are smaller townships, albeit with good profiles, 10% to 12%, all net pre-tax. With an occupancy rate of 93% to 94% in these areas, you will generate immediate income of $250 to $400 a month, on average.

Submit an Offer

It’s easy to see why properties are sold within hours or days at the most in this market. As soon as you see something you like, notify your proxy to submit an offer on your behalf. It’s a good idea to have your agreements with your proxy signed in advance to save valuable time. Because properties are sold so quickly, you won’t likely have time to perform thorough due diligence on any particular deal before submitting your offer, but you should have enough information on your deal analysis to determine whether or not you want to submit your offer.

Conduct Due Diligence

If your offer is accepted, you will receive due diligence information from the real estate agent. One of the key items to look for is the accumulated fund, also known in some countries as a sinking fund. This fund goes toward a renovation/repair pool. Due diligence should be able to determine if the size of the funds pool is sufficient for building repairs. If lacking in funds, then the building report should show substantial renovations to the building to justify the shortage. If not, an experienced proxy will advise you to forego this deal. If you do submit an offer and then discover that you are not satisfied with the due diligence including tenancy history, building renovations or accumulated funds, you should be able to pull back your offer.

Seal the Deal

Once you are satisfied with the due diligence, your proxy is there to help you with the contract and deposit, required documents, deposit and settlement. On the day of settlement, your proxy will pay the rest of the funds on your behalf and the scrivener will perform the ownership transfer from the seller to your name. Within a month you will receive the equivalent of a Title Deed. Congratulations! You just purchased property in Japan from around the globe.

Manage Your Property

You have successfully invested in Japanese property. Now it needs to be managed. Most foreigners do not have a local bank account, physical address or local phone number and therefore, the two challenges are communication and banking. Do not worry. On your behalf, your experienced proxy communicates with the property/rent manager, building management company, tax authorities, and insurance company. The right proxy can also act as your bank account to pay the bills, receive rental income, and provide you with a monthly balance sheet and remittance/acceptance of any funds from overseas.

Finally, what you may not know is that unlike many other countries, there are currently no laws or regulations in Japan prohibiting the purchase of real estate by foreigners. This allows 100% ownership of deeded, freehold property, registered to a foreign address. Currently Japan is the second largest real estate investment market in the world, only behind the U.S.

Priti Donnelly, Sales and Marketing Manager, Nippon Tradings International

Priti Donnelly – Manager, Sales and Marketing

Nippon Tradings International (NTI)

http://www.nippontradings.com

 

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Benefits of Diversified Portfolio Benefits in International Real Estate

By Matt Malouf

When it comes to investing in real estate, people tend to be vigilant about their investments options. What they seem to ignore is how the profit and growth ratio investing in real estate abroad can provide them with great success.

The world is a global village now and so it makes sense that people have started investing in international real estate. There’s a certain charm to this move but more than charm, this smart move can help strengthen your capital flows. We understand the importance of global investment strategy and it’s time that you too understand what this option can offer to you.

Most people hesitate to invest in international real estate because of geography. Real estate is generally a long-hold investment strategy and it’s the long distance that generally makes people uncomfortable while investing in international real estate. But there are certain benefits for global diversification on a real estate portfolio. Let’s look at a few.

Investment Diversity

Being a secure and hard asset, real estate has always been a preferred investment choice for people all over the world. With many fast-growing international real estate markets, this investment opportunity is too good to miss. Investors can enjoy low interest rates and avail a variety of lending options. And with a professional team to back you up, these investment opportunities can be the perfect addition to your diversified portfolio.

With this new financial step, you can have another stream of income. That’s the best part about this investment. It can generate income and even appreciate in value over time. The exchange rate can help you make a hefty promise every time. If you are investing in countries with a higher currency rate than the USA, your investment portfolio is surely going to enjoy the benefits. The change in interest rate also has a significant impact on making international real estate investments a lucrative financial move. Since each property has an intrinsic value, your investment would never go to waste. This is just one of the properties that set international real estate apart from other investment options such as stocks.

Risk Management

So what makes investing in international real estate such a glorious option? The best part of this move is the diversification of risk. When you put all your eggs in one basket, there’s a higher risk of losing it all at once. By spreading your investment over several international real estate properties, you can significantly reduce the risk. The real estate market is dynamic and always in transition. Even the slightest economic change can have a drastic effect on your investment choices. These effects can either be extremely beneficial for you or leave you at the brink of bankruptcy.

By investing in international real estate, you can easily diversify your portfolio and give it a global edge. Since the international housing market tends to operate differently, a decline in one market can cause a significant increase in the other one. With this contrasting nature of the international real estate market, you are bound to gain great benefits.       

Ancestral Roots

When you are looking for some international real estate investment opportunities, why not try and connect to your roots? For many of our clients, the first option for investment is mostly their ancestral country. Their way of paying tribute to their heritage is by investing in their ancestral country. This way, they can always have a place to go back to when they want to experience the life that their ancestors lived.

For many people, this is a lucrative option because it gives their children a chance to know their heritage. People whose ancestors immigrated to the USA often go for international real estate investments in their home country. This is a great reason for choosing the right international real estate. As long as the real estate market in your home country isn’t in a steady decline and is showing great potential, including it in your investment portfolio would be a good call.     

Recreational Value

Investing in international real estate doesn’t just create new income streams but also provides you with the perfect vacation home. So when you are looking for opportunities to diversify your portfolio, make sure you go for an option that can serve well as a vacation spot. Even though the main reason behind this investment is purely financial, buying the right property can also add a recreational value to your investment.

If you love the great scenery of ice-capped mountains of a vacation spot, you can turn this passion into a great investment opportunity. There are some countries that allow foreigners to own property and you must be prepared to take full advantage of this prospect. Contact MyLifeWorldWide.com and let our professionals help you get a diversified portfolio for international real estate.   

Cultural Diversity

This is a great opportunity to experience other cultures. Become a local at the place and you’d be able to explore the region to your heart’s content. Your overseas property can provide you with new experiences, enabling you to explore some other parts of the world. If you have the desire to experience cultural diversity, your international real estate portfolio can help you with that.

Residency Eligibility

Owning a property in a country can often make you eligible for residency and/or assist you in a naturalization application. With this change of status, many doors in the country also open up for you. You can get access to the country’s banking and financial services industry. You can use this opportunity to divide up your fortune and taking advantage of the profitable banking prospects.

Investment Security

Unfortunately, retirement funds in the USA are subject to some strict laws and many people have already bore the cost of these policies. Your retirement fund can come under the threat of lawsuits and creditors, hence leaving you vulnerable at the later stage of life. For availing the ultimate retirement fun with security, it’s imperative that you invest abroad. Your diversified portfolio of international real estate can’t be subjected to the laws of USA and even the IRA can’t attack them in any way.

Your properties in the USA might be at risk of lawsuits but your international real estate is insulated from this risk. This is one of the best reasons for you to consider investing in international real estate.

Your international real estate investment would never go to waste if you work with a professional. With their expertise in the industry and years of experience, MyLifeWorldWide.com can help you make some sound financial moves. With a diversified international real estate portfolio, you can yield great profits, without the usual risk that other investment options pose.

So make the best of this opportunity and make some sound investments overseas. Contact us at MyLifeWorldWide.com for more information and custom solutions tailored to your unique situation.

Matt Malouf, International Real Estate Consultant

MyLifeWorldWide.com

Clarity.fm/mattmalouf

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Understanding Japan’s Counter-Intuitive Real Estate Market

By Priti Donnelly

You may think real estate investing is solely about property growth as you would find in Australia, U.K. US, Singapore and similar markets. The Japanese property market is not ripe with prospects for increased property value. So, why then is the market saturated with foreign investors?

Creating Opportunities Beyond Capital Growth

The Japanese property market suffered at least 25 years of declining/flat-lining prices. Although capital growth made a quiet entrance from 2012 to 2016, it was too soon to for investors to comfortably speculate growth. Instead, investors found a new opportunity. Because of the decline, properties became quite affordable while rental rates remained stable. The result, steady and higher yields across Japan– the ideal cash flow market from high yield rental income.

To put it in perspective, for as little as USD $30,000 at 7.5% yield net pre-tax investors can earn monthly rental income of approximately $170/month. As an added benefit, in a prime location you might also gain property value, but that is not the focus of property investing in Japan. This market is about common sense investing without the speculative nature.

Overcoming the Language Barrier

This is not your typical internationally friendly business market. On one hand, you will experience the most reliable and honest professionals in Japan, while on the other, foreigner-shy professionals who likely cannot speak English. Furthermore, to invest in Japanese properties you will need a local address, phone number and a local bank account, impossible without communication and cooperation. To get around this barrier, savvy foreign investors use a trusted local Japanese/English speaking proxy or representative to act on their behalf for both communication and access to the required information.

Understanding Old Structures

Some novice investors shy away from the Japanese property market believing with a huff and a puff, structures could be blown down. It is true that structures built before 1981, including smaller steel-frame buildings, and even wooden frame houses, were not built to last and require major renovations and repairs over time. However, a major change to the Building Standards Act for earthquake resistant construction methods for buildings (reinforced concrete blocks) occurred in 1981. This became the turning point that investors often looked to when purchasing property. That being said, there is still a niche market for older properties because of the higher yield. In truth, regardless of age, with due diligence, if the property has proof of regular maintenance, renovations, repairs to the interior and exterior, as well as sufficient funds for ongoing repairs, and is tenanted, an older higher yielding property could prove to be a diamond in the rough.

Accepting Foreign Real Estate

Today, the best real estate opportunities do not have to be in your own back yard. JPMorgan Chase says the Japanese real estate and infrastructure is becoming more attractive particularly with no more than 50% of leveraged funds. Above that, real estate doesn’t become the driver, but the leverage becomes the driver of your return.

Japan provides opportunities for stable, monthly cash flow from rental income with yields from 5% to 11% net pre-tax. Add to that, currency exchange and the yen’s role as a safe-haven currency and it’s easy to see why this is a booming market for foreign investors, contrary to the standard real estate investment approach.

Priti Donnelly is the sales and marketing manager at Nippon Tradings International, a proxy and buyers’ agency representing foreign investors with purchasing, selling and managing real estate in Japan. She focuses on Japanese Real Estate, an alternative to speculative real estate investment –  steady monthly rental income, high yield, and affordable properties – a market worth considering.

 

Priti Donnelly – Manager, Sales and Marketing

Nippon Tradings International (NTI)

 

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Invest in Overseas Real Estate to Retire Smartly

By Matt Malouf

The 401k plan at your workplace is as traditional as apple pie. You know what it is and you can rely on it. You’ve grown up hearing about this kind of investment being beneficial in life. It’s just something everybody does, and what you should do too.

All it takes is landing a job and investing in your company’s 401k plan throughout your career. After that, you’ll have peace of mind that your retired life is covered.

Wrong!

In fact, a traditional 401k model might be jeopardizing your retirement plans and you don’t even realize it! If you too are investing in a 401k plan and not focusing on other potential investment opportunities out there, are short changing yourself.  You must know that typical plans like these only work as retirement savings plans when everything falls into the right place at the right time. That doesn’t happen all too easily.

Do you know many of these plans come with hidden expense and fees ratios attached? For instance, if you invest $10,000 in your 401k plan, over 20 years you could easily more than lose $3,000 to hidden expenses or fees. This is not at all a hypothetical scenario. In fact, many TDFs (target-date funds) have huge secondary fees attached to them.

Also, it is not at all a comfortable feeling or a smart decision to invest in a plan where your retirement depends on the words and actions of many other people. As you may know, the return depends on the month, day, political climate as well as rumors on Facebook and Twitter and so on!

So, what is the premier and smart alternative to secure your retirement while exploiting better opportunities for higher returns?

Well, let me suggest – Overseas Real Estate!

People who truly understand the potential of overseas property investment understand what it brings to your table at the age of retirement. Even if you just compare both of these options side-by-side, you will be shocked to learn how much you have already lost by letting other people control your retirement investment in a typical 401k plan.

Here are some of the endless advantages of investing in the overseas real estate;

Tap into Different Housing Markets

One of the main advantages of investing in overseas property is that you can tap into other growing real estate markets.  If you select the country wisely, you are more likely to find a market that is far more profitable than the one in your country.

You can spread your fortune by making property investments in different overseas countries. On the contrary, if you invest the same amount in your home country, the amount of money may only help you buy one or two properties. Whereas the same say USD $200,000 can buy three to five properties diversifying your portfolio even more.

All you need to get a good return is invest into a growing market and you will certainly get the benefits from capital appreciation. There is another good way to utilize your overseas property and that is by renting it out. Think about receiving rental income but in another currency. Isn’t that an excellent way to hedge your financial risk?

Holiday Properties Around the World

An overseas property provides you with different holiday opportunities all over the world. This means that if you fancy jetting off to spend summer in some other country, you have got guaranteed accommodation and that too, for free.

The story doesn’t end there.  Overseas real estate also brings another kind of stability besides a financial one. It’s called personal liability. If you own a place overseas, you can always go there if the need ever arises. In short, you can call it your ‘escape hatch’.  A place to write, brainstorm, think and get away from the daily grind.

There are many cases where owning an overseas real estate properly is the first step to fully obtain residency there. Doesn’t owning an overseas real estate property add appeal to your ‘Plan B’?

Income and Investment Diversity

For sure you must have heard of the saying ‘don’t put all of your eggs in one basket’. This saying holds true for almost every other aspect of your life and undoubtedly investment is a major part of them.

So, if you actually want to maintain a safe financial standing for yourself, especially after your retirement, put your eggs in different baskets. Overseas real estate should certainly be one of those baskets you consider in your overall plan.

Investment in overseas real estate does not only offer diversification in terms of investment but also in terms of currency. For instance, if you are a U.S. resident, then having all the money in U.S. market means you are surely at the mercy of just one economy. In other words, if you are keeping 100% of your investment in one currency (like U.S. dollar), your investment future is highly dependent on the fate of the dollar.

Therefore, in addition to having a diverse investment portfolio, if you set up an income stream abroad (like renting out your overseas property), you generate an income stream that is totally independent of the U. S economy and sometimes dominated in some other country.

Never Underestimate the Security of Hard Assets

Remember that in the current economic climate, nothing is a more sensible and smart investment decision than investing in real estate. Particularly, overseas hard assets are the best and most logical investment class to secure a strong long-term value.

Even from the point of view of above-average returns and rental yields, the foreign country rental market can be a lot more lucrative if you find the right country to invest in. For instance, the gross rental yield (average) in the U.S. is around 4.2%. If you compare it with today’s emerging international market, it’s much less. Costa Rica, for instance, has a 8.4% rental yield. Other emerging economies in South America can yield you over 15%.

Let’s face it. From a smart retirement plan perspective, when you combine these benefits, there is simply no comparison. Overseas real estate investment is clearly the winner by a long shot!

The actual point of this discussion is not to discourage or dissuade you from going for a 401k plan at work but to help you think farther and smarter. Venture outside the box, think of the possibilities on how you can diversify your life and retirement. There is no harm in considering overseas real estate investment in addition to a good 401k plan.

Matt Malouf

Author-Investor-Pioneer

http://www.MyLifeWorldWide.com