We hear it all the time, when it is too good to be true, it probably is and you should walk away. This is something that makes a lot of sense yet most of us still find ourselves in deals that seemed ‘fishy’ from the start. We knew very well that we should have pulled out as soon as we started seeing those red flags, but our hope for a big payday kept us going.
But the fact of the matter is that those guys are thoroughly experienced in what they do. You can’t expect to be like them immediately by rushing into deals you think are good opportunities. Avoid unnecessary
Here are examples of when you should say no to a remote property investing deal.
When there is no clear path to the responsible parties
Most foreign countries have a framework that deals with foreign investors. Yes, although some countries do not allow for direct land ownership by none-citizen, there are still structures you can follow to get a piece of the pie. You will find that you are either required to create a business entity in that country (of course, in partnership with a citizen) or you are required to simply own a country-based bank account and so on.
These are structures that have legal standing and can be called into effect should something go wrong with the deal. Even though you might go through a whole lot of running around, you will not lose all of your money with no recourse.
However, when you find that you cannot draw a straight line to the responsible parties or to how the local Government can come into play should the deal go sour, then you should walk away immediately. There would be nothing you can do, short of causing international conflict, should your partners go helter-skeltering with your investment.
The deal is too easy
The old adage we started with holds water. There are no easy international deals. More often than not, if not always, they involve a lot of running around and red tape. In many countries like Spain or Portugal, the running around isn’t that heavy but it is still present. No matter how friendly the property investment atmosphere in any country is to foreigners, you will still need a lot of legal documentation and dealing with Government types.
In short, you will still feel like jumping off a bridge at some point. Should you ever find that there is little to no red tape nor Government types nor solicitors and a mountain of legal documents involved, you should run. That deal would be too easy and therefore very fishy.
It costs too much
No matter what the projections for capital gains look like; no matter how well the country is doing economically and no matter how stable the political atmosphere, if the piece of property in questions costs more than your common sense would allow for such a property anywhere in the world, you should walk away. Yes, it might actually be valued at the current rate, but for how long will it keep growing? If you think the price is outrageous now and are expecting growth over the next 10 years, do you think anyone will be lining it to buy it then? We think not.
In many cases, it is just a matter of using your gut feeling and understanding how complicated international land purchases can be. If it is too easy, too murky and too expensive, let it go. Walk away and find something else. There are plenty of remote investment opportunities available around the globe.