“By paying in cash you’ll save some money and it also gives you a position of strength when you negotiate that this is going to be a cash offer,” says Sharpley.
Any money you bring in must be properly identified and transferred legally.
Other financial considerations are exchange rate fluctuations. It’s worth checking out specialist currency companies to see if they offer better exchange rates.
And lastly, each country will have its own set of additional costs such as stamp duty, taxes, and local fees. So be prepared for the extras.
8) Tax considerations
If you plan on renting out your vacation villa, then you have to take into consideration both the tax implications abroad and in Canada. It’s important to check out the inheritance and capital gains tax laws of the country in which you are buying. Bear in mind that you may be required to make a separate will. Your best bet is to seek specialist tax advice from a Canadian international tax expert.
9) Ongoing costs
Don’t forget to factor in the ongoing costs with international real estate investment. If you plan to rent it out you may need to pay property management fees, utility fees, maintenance costs, insurance, marketing costs, and local taxes. Also take into account periods when you may not have renters, such as the low season.
If everything goes to plan, one day you’ll sell your property for a profit. Selling your property when it’s performing at its best will help you get your money back, but that’s easier said than done. At the very least, have all your legal documents ready and make sure there are no liabilities or other issues affecting the property, so when it comes time to selling the property you can do so quickly and with no surprises.
From Canadian Real Estate Wealth Magazine, a monthly publication focused on building value through property investment, covering topics such as values and trends, mortgages, investment strategies, surveys of regional markets and general tips for buyers and sellers.