Greetings from Down Under! I’m here in New Zealand investigating how successful foreign investors buy real estate. Captivating, beautiful scenery, lush gardens, ocean delights and cash flow! What more can one ask for?

I am meeting with an American investor who has purchased six rentals in the North Island of New Zealand. Why would she do this instead of buy in the U.S.?

Barbara has been a real estate investor for 20 plus years and owns both residential and commercial property in the U.S. She decided several years ago to diversify her portfolio by investing outside of the U.S. After quite a bit of research, she chose New Zealand because of the value of the New Zealand dollar to the American dollar, and the promise of property values increasing. Barbara bought her first property when the exchange rate was 40 cents to the U.S. dollar. Today, it’s 70 cents. Not only has Barbara made money because of the currency fluctuation, she’s made even more as the property values have gone up dramatically.

Barbara rents five of the homes to permanent residents. One other home is rented by the day, week, and month. The cash flow that she receives from these properties more than pays for her visits here and the expenses of property management and maintenance.

If you have ever thought about buying property abroad, here are Barbara’s suggestions:

1. Spend time getting to know the country.
2. Know why you want to invest in that particular country. For example, it was important to Barbara that she invest in a country where the primary language is English. This way, she would not experience a language barrier.
3. Investigate property laws of the country, keep up to date on their economy, and determine if they are friendly to Americans.

Good advice! More to come on Barbara and other international investors.

Lisa

P.S. Another big factor in New Zealand…..no capital gains tax!

This entry was posted on Tuesday, January 30th, 2007 at 8:39 am and is filed under Investing. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.