Wise Ways to Shop for Foreign Property



Kathleen Peddicord


If you have a sense of adventure -- or just want to get a lot for your
money -- you might want to look overseas for a second home or
retirement residence.

Today, that's more affordable than it has been in many years, thanks
to greater economic stability in many countries with attractive
communities and a low cost of living.

In Buenos Aires, Argentina, for instance, $150,000 is a typical price
for an elegant 1,000-square-foot apartment within walking distance of
shops, cafés and cultural attractions. The same amount will buy a two-
bedroom beachfront house in the Caribbean nation of Belize.

Bargain prices aren't the only advantage of owning overseas property.
Spending at least part of the year abroad can be a doorway to an
exciting new lifestyle.

PLAN AHEAD

Unfortunately, many Americans are rushing into buying overseas
property without realizing that foreign real estate purchases can be
tricky. When looking for overseas property, I recommend that you...

Make at least two visits to a country where you're considering buying
or renting property. Even better, rent a house or apartment there for
a few months. That gives you time to spot problems and opportunities
that might not be apparent on a vacation.

Example: While vacationing in Mexico, you might have fallen in love
with a beachfront resort area in the Yucatán. By spending more time
there, however, you could discover Merida, the inland Yucatán capital.
It offers historic charm that's hard to find along the coast.

If you're considering buying property in an area that attracts a lot
of tourists, make at least one off-season visit when you have a
greater opportunity to socialize with year-round residents who may
become your neighbors.

Get to know members of the local American community, especially those
who own property. These people can recommend real estate agents,
attorneys, notaries and insurance companies that have a history of
working with American clients.

American embassies and consulates usually have contact information for
expatriate groups. For information on embassies, phone 202-647-4000,
or visit http://usembassy.state.gov

..

Also helpful: Visit the site of Expatica (www.expatica.com

), a Web-based company with links to resources for English-speaking
expatriates in Belgium, France, Germany, the Netherlands and Spain.

Be prepared to deal with several real estate agents. Searching for a
house or apartment nearly always takes longer overseas. There is
rarely a multiple listing service (the American system for sharing
real estate data).

In addition to dealing with agents, consult with American residents
and read real estate ads in local papers and English-language
publications.

Take time to understand local property laws. Retain an attorney or
notary who has a history of working with Americans to tell you how
laws differ between the US and the country where you're looking for
property. In some countries, US consulates have information on local
property laws.

In France, for example, property that you pass on to heirs is subject
to a hefty inheritance tax. In Britain, it's common to acquire
property on a "leasehold" basis, meaning that you lease it long-term
instead of buying it outright.

Moreover, when you buy property in some foreign countries, there's
often no way to be sure that the title is valid, a situation that puts
your property at risk if the title is challenged legally.

Safeguard: Title insurance, a type of protection that's now available
worldwide at a cost of about 1% of the purchase price. The largest
company outside the US offering this type of insurance is First
American Title Insurance Company (800-854-3643, www.firstam.com

), which writes policies in nearly all countries. Other carriers can
be located through US brokers or expatriate groups.

Common mistake: Retaining the same attorney who represents the seller
of the property. This might be tempting for the sake of convenience,
especially if the seller urges you to do so, but it never makes sense.
The seller's attorney has no vested interest in helping you make the
best deal and may actually withhold information, such as records of
back taxes.

Self-defense: Retain your own attorney, one who comes with
recommendations from Americans for whom he/she has worked.

Check out the availability and price of health care. Most American
embassies have information on local doctors, hospitals and other
health-care facilities, and so do most expatriate groups.

If you have a particular health problem -- diabetes, for instance --
it's wise to check with one of the US associations that represents
those afflicted with the ailment. Many associations have information
on health care abroad.

TOP CHOICES

Almost any country can be a great place for a second home or
retirement residence as long as you enjoy the lifestyle and have
friends or the opportunity to make them. Some countries stand out as
particularly rich in opportunities...

Argentina. After great economic difficulty in recent years, Argentina
now seems headed for stable times. Buenos Aires, often called the
"Paris of Latin America," has a rich cultural scene with theater,
opera, concerts, art galleries and restaurants. A studio apartment in
the posh Recoleta district recently sold for about $43,000.

Croatia. Only a short time ago, few people would have considered
buying property in this former Communist country. Today, Americans are
attracted by Croatia's uncrowded coastal towns and charming villages.
(Diving legend Jacques Cousteau once described Croatia's waters as the
cleanest and clearest in the world.)

The Croatian village of Plat is an oasis of tranquility where pine and
cypress trees line the beaches. On Croatia's gorgeous Dalmation coast,
you can buy a studio apartment for around $53,000.

France. Apartments in Paris are often pricey, but property in the
beautiful French countryside can still be a bargain. Saint-Martin-de-
Crau, for example, is on the edge of the Camargue, home of Provence's
famous white horses, black bulls and pink flamingos. The recent asking
price for a two-bedroom house in the village was $64,000.

Mexico. Low prices and a moderate climate have attracted thousands of
Americans and Canadians to Mexico, where it's easy to find attorneys,
notaries and real estate agents who work with US citizens.

Lake Chapala is in the country's central highlands, about 45 minutes
by car from Guadalajara. Sur*round*ing the lake are several villages
known for their charm. One of the towns is Ajijic, where a two-bedroom
condominium in a complex of six units was recently priced at $79,900.

Nicaragua. Property is undervalued, largely because so many people
associate Nicaragua with economic and political problems. In fact, the
government has taken steps to make the country a sound investment for
foreigners, who like its warm weather and relaxed lifestyle. A two-
bedroom house in the hills overlooking the clear blue waters of Lake
Apoyo sold recently for $89,900.

Panama. Property in Panama often reminds Americans of luxury estates
in California but is available at a small fraction of the price. The
many Americans who live there are attracted by its weather and
recreation, including world-class golf courses.

An air-conditioned, three-bedroom, two-bathroom townhouse 10 minutes
from downtown Panama City was recently listed for $55,000. A 2.2-acre
estate near Panama's Pacific coast recently sold for $229,000. It
included caretaker's quarters, a gazebo, guesthouse, pool and more
than an acre of orchards.

Thailand. Exotic culture, beautiful coasts and sophisticated night*
life can make life in Thailand exciting.

One of the growing beach resorts is Hua Hin on the west coast of the
Gulf of Thailand, about three hours by car from Bangkok, the capital.
Among other attractions, Hua Hin has a five-mile-long beach and five
excellent golf courses nearby. Residents of Hua Hin have a well-known
neighbor, the king of Thailand. You can find a 2,000-square-foot house
in Hua Hin for about $200,000.

Caution: Because Thailand has many restrictions on foreign ownership
of property, buyers should retain an attorney experienced in the
field.


Bottom Line/Retirement interviewed Kathleen Peddicord, publisher of
International Living, an Ireland-based magazine and online information
service that helps readers buy and rent property throughout Europe,
Latin America, New Zealand and Asia (www.internationalliving.com).