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‘As Safe as Houses’: Four things you need to know before investing overseas

PUBLISHED : Tuesday, 06 October, 2015, 11:26am
UPDATED : Tuesday, 06 October, 2015, 11:26am

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The commonly used English phrase ‘as safe as houses’ has been ringing true for local investors making property purchases overseas in recent years.  After the great railway bust in the eighteenth century, investors poured their money into investments that were secure and unlikely to see a drastic decline - which is how the phrase came about. 

Today, investing in property still offers the same security, but the returns you receive are entirely dependent on your choice of property. Therefore, it is vital that you do some careful research before signing on the dotted line.  The four things I advise my clients to do are as follows:

Compare properties

This is where the first bit of research comes in.  Either do some scouting yourself or ask your buying agent to help compare the property you are purchasing with similar prospects in the area.  It is important to try to do this like-for-like where possible; for example, in a big city like London you can’t compare properties from different neighbourhoods, or indeed a new build with an Edwardian townhouse!  If you’ve done your homework, you can be sure you are paying the right price and getting value for your investment. 

Location, location, location

Choose a city that has a lot going for it.  Here in Hong Kong we tend to sell a lot of properties in London for exactly this reason: it’s an international finance centre, home to many multi-national corporations; London’s global reputation for quality education ensures affluent, professional tenants; and it also has a strong resale market which has continually demonstrated excellent returns on investment for local buyers.

Make the first move

If you are buying a property off-plan try to make your purchase during the first phase of its sale as this will provide you with the best value for money.  Being the early bird really will pay off; you’ll avoid potential future price rises from the developer and it will also leave you with a bit more time to raise the capital needed before completion. 

If you do want to purchase a property during the first release, be sure to let your agent know so that they can contact you directly with suitable opportunities.  I always make sure I contact clients about new projects like The Madison, Canary Wharf in advance of our local marketing campaigns.

Relationships

Find a good local agent to help you to manage your property, especially if you plan to be an overseas landlord.  Building a strong relationship with that agent will help you to keep the property in good shape, and if you are looking for more investment opportunities they should be happy to help you find a favourable deal in future.

For more information about the international properties, please visit our website or contact Mandy Wong at +852 2846 5782 or mandy.wong@ap.jll.com