10 things to consider before investing in a property abroad

With the property values in South Africa under severe pressure, more investors are looking towards foreign investment opportunities outside the borders of South Africa.

Foreign investment involves capital flows from one country to another, granting extensive ownership stakes in domestic companies and assets. Foreign investment denotes that foreigners have an active role in management as a part of their investment.

According to Andrew Thompson, development director at eLan Property Group, there are different factors to consider when it comes to appraising investment opportunities in a foreign country:

  • Owners should consider the availability of the country, making sure that the property is easily accessible. This includes factors like being near to an airport or next to a highway.
  • The language of a foreign country is often also a barrier. Normally owners would look for a destination to invest in where English is the predominant language.
  • Investors also look at second citizenship or permanent residency options, as the attraction which leads to capital growth and returns on investments. It’s important to consider what countries allows visa-free entry and brings more value to your passport.
  • Permanent residency seems to be a attraction to many South Africans, for the extra safety in terms of where you might reside in future.
  • Residency starts at the R2 800 000 mark in various countries around the world.
  • The main driver in a foreign country is your property title, making sure that you own 100% of the property.

According to Thompson, capital growth is yet another important factor to consider. A normal property purchased in South Africa 5 years ago for R 4.5 million is now selling at R5.5 million, making it a 22 % increase in capital growth over the period. A house purchased in Mauritius 5 years ago at R4.5 million is now fetching R16 million – which is a 255% capital growth.

This is why Mauritius is potentially a good option when it comes to property investments, because of the accessibility, economic stability, growth of property values, and the following factors, according to Mr Thompson:

  • The monthly costs that will remain low, it will be easy to manage and your return on investments should be in excess of your normal rates.
  • You will have the ability to open a bank account and your trust account operates a company in the country.
  • As a owner, you can open a company in Mauritius and that can take up to two hours.
  • You can register your property in your own name which will take at least two days.

Investing in Mauritius you will secure you a safe environment to stay in and an unemployment rate of 3%. It will be beneficial and rewarding for you to invest in property in eLan properties.

For more information on property investments or if you plan on owning a property, join the eLan Investor Club and weekly receive property investment tips: www.elaninvestor.com and visit their social media on Facebook (@elaninvestor), or Instagram (@elaninvestor).

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