As an opportunistic investor, David Ebrahimzadeh knows what it takes to successfully invest in other countries. Depending on the country and the land, real estate investments can create massive potential gains for a foreign investor. Since land has been one of the best hedges against inflation, real estate is an incredibly valuable asset.
Diversifying Portfolio
By investing in multiple different types of securities, investments are more likely to be protected in addition to the expansion of growth. By mitigating risk exposure, David Ebrahimzadeh uses international real estate investments to increase value.
Real estate investment is a particularly useful way to diversify a portfolio because most properties appreciate in value. A global market is particularly crucial to this development because changes in the overseas economy can have a rippling effect.
A diversified real estate portfolio can be one of the most lucrative asset classes for an investor. By acquiring different asset classes with different properties, real estate investments can procure vacation rentals, fix-ups, apartments, and residential homes.
The Pros and Cons of International Investment
David Ebrahimzadeh looks for potential growth when investing in real estate opportunities. By focusing on properties that have a strong growth potential, he can focus on both real estate and private equity.
The Pros
Potential for Greater Wealth
International markets move at a slightly different pace than domestic markets. Carefully selected properties can be purchased for significantly less than they’re worth. The timing and economy of business and residential real estate investments can be an economical advantage to many investors with the right set of skills and education.
An Increased Network
Investing in international property can increase an investor’s professional network. Many people find that talking to others in the community or field can help them understand overall international real estate more effectively. By broadening experience, both micro and macro markets can be pursued.
Value Appreciates
Depending on the property, real estate will usually appreciate over time. Finding quality property can be found at a discount with the right network. While stock has the potential to hit zero, real estate is a tangible asset that can always have value. The land itself, regardless of how it is used, is an asset in and of itself.
Technology Management
Because of technological advances, managing investments abroad is much easier than it used to be. Not only is investment research available for select locations, but online is an easy way to find tenants. For apartment buildings or other rental properties, tenants can be found directly or through a property management company.
The Cons
Capital is Required
Buying stock requires minimal cash outlay, but real estate investing is not the same, even internationally. To buy a commercial or residential property, a down payment is usually necessary in addition to closing costs. Ongoing expenses are also part of the equation. Property taxes and insurance are a few expenses that will continue after the initial purchase.
Long Investment
A long-term strategy is needed when buying international property. Money can be made before selling through the use of tenants and rental property, but this takes planning. A house or commercial building is a tangible asset that cannot be easily liquidated for cash if there is an emergency.
Wrong Property
Buying the wrong property can be problematic for several reasons. It may not be worth the initial investment. It may also require hidden upkeep. Depending on the land, extra care may or may not be necessarily due to weather or infrastructure. An investor that is familiar with certain international markets may be able to better guide an individual through the process.
Benefits Can Change
Real estate benefits can change. Buying internationally means certain laws may or may not apply depending on the area. In many areas, real estate benefits can be applied for specific income levels. While these tax benefits can be extremely helpful, they do not apply everywhere. Researching specific tax breaks and their qualifications is important before investing internationally. A professional can often help with this.
Investing Overseas
There are a variety of options when it comes to international investments. Learning how to invest is usually the first step. Real estate investment trusts are no longer used in only the United States and can be extremely helpful when diversifying portfolios.
Regardless of where a real estate investment is located, land has several uses. Depending on up-front capital, it can be used for residential or commercial purposes. Hotels and rental properties can increase cash-flow without selling the land.
When looking for international real estate, countries that have experienced a significant price drop should be considered. By finding a real estate consultant that knows the area, investments are often much less risky. Property and title laws vary from each country and having all the knowledge up front proves beneficial.
Global Trends and Opportunities
International trends change on a regular basis. There are a number of causes for this fluctuation including politics, agriculture, infrastructure, and society. Technological advances have made global investments much easier over the course of the past decade. The world is now connected in a way that it has never been able to before.
To find the right international real estate investment, certain strategies are often necessary. Simply buying and selling land may not be the most lucrative way to invest. By having an extensive knowledge base and network, the right property and strategy can be found.
