Experience International recommends their clients base their property purchasing decisions when looking for property for sale abroad based on the following 5 key principles:

• Credibility
• Ease of Purchase
• Security
• ROI
• Exit Strategy

These stringent principles should be used on every property to ensure it is priced correctly.This is even more important considering the current economic climate to ensure their capital invested provides maximum returns at minimal risk. Through investing in a property using these principles ensures you are buying the right property and at the right price.

Credibility
Credibility is the key to working out the current price of a property and is derived from: Location, Quality of build, Developer’s track record and other comparable projects.  By ensuring the credibility of the development gives strength and guidance on what the asking price should be.

Ease of Purchase
The purchase procedure in every country varies hugely.When reviewing the asking price of a property also ensure you are aware of all the extra costs included.operty.And can include: payment plan options, taxes, solicitors fees, notary fees, finance and mortgage costs as well as the ongoing costs once you have purchased such as maintenance and service charges. The availability of mortgages or other finance should also be fully checked.

Security
As a standard procedure Experience International carry out strict due diligence on every project that they sell, however we also advise all clients to do their own research.Varioua checks need to be done including: seller has clear land title, Correct Licenses for the country, correct planning permission, Developer, banks lending criteria, valuations, comparisons against other developments and security of your deposit.

ROI
The sustainable income achieved from your property during its life time will ultimately be its future value.Buying property during the current economic climate is a real buyers market.The yield and future capital value are vital in determining the success of your investment.

Exit Strategy
A lot of the time clients do not think about their exit strategy during their purchase decision.  The profit is always made when you buy a property not when you sell, this means purchase a property wisely. Knowledge of your exit strategy options is very important to understand such how you will sell, what market exists, how demand and supply trends are moving, your current discount to market value, long term rental market if holding along with risks, what you can do to mitigate these risks and the worst case scenario.

A Case study
Zambrone Villas in Italy is a newly completed property in Calabria development is the perfect example of a holiday home that would suit the typical British holiday maker.  

Its asking prices are from €127,500 (£113,570) which you get a 2 bed, 1 bath semi-detached villa, with terrace, garden and sea views.

Location – Zambrone is a stunning area of Calabria, situated on the coast and boasts one of the best beaches on the Costa Degli De and close to the marina and centre for restaurants, watersports and recreational activities.

Size – the total plot including internal, terrace and garden is 263.95 sqm (£430 per sqm).This is way under current market prices and comparables considering this property is located at coastal location which often carries a premium.

Quality – This completed development has been built to very high standards and is currently being offered at off plan prices.Every property has already been registered at the local Building Registry ensuring purchasing in this development is safe and secure.

Specifications – research properties available nearby.The Zambrone villas are a gated development with a communal swimming pool plus all villas have fantastic sea views.

It is a good idea to compare like for like, so be sure your comparable properties are of a similar specification in terms of the number of bedrooms, bathrooms, reception rooms, furniture included etc. 

Rental Income – When looking for a property to draw in a strong rental income many of the above points will be very important in assessing rental values.  Every factor of this purchase indicates a very strong rental potential.

If you are looking at an investment property you need to work out the potential the weekly rental rate (or monthly if targeting long term local market) and likely occupancy rate. Local rental companies are an obvious source although you cannot always be sure you are getting the full picture. The internet is now an excellent tool for assessing rental values and demand so use it well to ensure the investment stacks up and the comparables you are using for the price will also provide some rental data. So in the case of the Zambrone Villas in Italy then simply do a search for Calabria property for rent in similar locations with the same or similar features and specification.

We hope these tips help and that you find happiness and success with your overseas property purchase and investment.

There are very good reasons to obtain the services of a certified home inspector to inspect a home you are hoping to buy. The job of an inspector is to not only determine the condition of the house, but also give advice on areas of the home that can be improved upon. If there are any significant deficiencies discovered they can be used in further negotiations. Having an inspection done can assist to dodgeunwanted surprises after you purchase and/or be used to reduce the price down further. There are things you can inspect for yourself initially, but you need to have a keen eye and a proper checklist!

Having a prepared checklist with you during your walk-through of the home is essential. This will help you make a thorough inspection. It is possible to have over a hundred points included on a good checklist. Without this list, you would inevitably forget certain things as you walk through the property.

Organize your list by different areas of the home. Start outside. As you inspect the outside of the property you should be looking for items like railings that are unsafe, exterior wall cracks, damaged or leaning chimney, and roof damage to name a few. Make sure you take notes. As an example, if you see down spouts that are not draining far enough away from the home write it down as that information could become useful later on.

The inside of the house will be separated into areas on your list. Items to included on your list could be electrical, plumbing, basement floors and walls, heating and so on. It does not really matter that you are not an expert in various building trades. Just pay attention to areas that are obviously not what they should be. You can bring these up when you come back to the home for a thorough and professional home inspection.

Most home buyers will place a condition of home inspection on their offer to buy a property. This is a great way to protect your investment and it also gives you a bargaining chip to re-negotiate the selling price if the home inspection discovers significant issues. If you do lower your offer make sure it is reflective of the issues found. If the original selling price already took into account the properties problems you may not be able to lower your offer by much.

If the property you are interested looks like it may receive multiple offers you may need to have a pre-offer home inspection. This can be a issue for some purchasers since after spending money on an inspection they may still not get the home. But it can put you in a superior negotiating position if your offer now has less conditions. You can then finalize your deal more quickly if you offer is the one that is accepted.

Noticing that the roof is in need of attention or that the porch railing is loose does not need the eyes of a contracting expert. By doing an initial home inspection when visiting potential houses will help you in your quest for the perfect home. By inspecting the home yourself in the beginning you will be able to make a more informed and unbiased opinion based on facts rather than simply the decor. Your walk-through of the home should only be the beginning and you should consult an expert home inspector who can give you more information and a complete written report.

The following are not your usual home buying tips. For example, almost everyone will tell you that you should buy a home, but the first tip below suggests an alternative.

Consider Renting

This is all about time and place and your own situation. Are you going to be in one place for long? If you are likely to move within a few years, you may be better off renting. Transaction costs of buying and selling will likely eat up any equity gains you get. It may seem profitable to buy at $200,000 and sell at $220,000 two years later, but commissions, closing costs and loan costs can easily add up to $20,000, so where is the gain? Also, there is no guarantee that prices will rise, and if they don’t you suffer a real loss.

Also, it is a matter of the ratio between rental rates and the costs of buying, and what is likely to happen in the market. For example, suppose you are in a slow-growing stable area, and your total monthly cost to buy a home is going to be around $1,200. If rent is anywhere near that for the same size home, you should probably be buying a house.

On the other hand, let’s look at the example of Tucson, Arizona in late 2005. You could buy a small home for about $190,000, with mortgage, taxes and insurance running about $1,325 per month. But you could rent the same home for just $675 per month. Now add to this the fact that home prices had been rising at 20% or more per year for years, and 12% of all recent sales were to speculators, not owner-occupants (a sure sign of a market top).

In this case, it would have made more sense to rent. Had you bought there two years ago, you would have paid $650 per month extra to be a home owner, or $15,600 over these last two years. In addition, the house would probably be worth a little less now than when you bought it. Better to have banked that $15,600 and bought the home today.

Other Home Buying Tips

Compare ALL costs when you look at various homes. It is easy to consider just the price of a home, or what that means in terms of a mortgage payment. However, there are other costs. If the home is in a flood zone, for example, insurance could be $200 per month higher than for other homes. Look at taxes, insurance, utility costs (big homes cost more to heat) and any other regular costs, so you can honestly compare houses according to what they will cost you monthly.

Go to online forums to learn about a new town. Many people like to talk about where they live. They get to do this in various online forums, which you can search for by entering the name of the town and “forum” into any search engine. Be aware that these are often places where locals complain about their town, but you can also find interesting and useful information, and ask questions.

If your real estate agent doesn’t represent you, don’t be loyal. If she is really a seller’s agent, she is obligated to pass on comment you make to the seller, like “I think we can go higher if they reject our first offer.” Even if she represents you, be sure she does it well. If you are shown three houses that have nothing to do with the criteria you laid out, show the agent the door. By all means stick with a good agent who really helps you, but otherwise you can also call the listing agent for each house you want to see.

Inspect the home yourself. You probably plan to have annspection done by a professional before you buy. But you should also visit the home a second time yourself, to do your own. Bring a home inspection checklist and look over everything, even if this takes an hour or more. In this way you can tell the professional inspector what your concerns are, and be ready with questions for him.

There is another reason to do this inspection. It has to do with a concept called “time investment.” Sellers are more likely to accept an offer if they have invested more time and hope into a buyer. Negotiation secrets like this are a whole other area of home buying tips – one that you may want to learn about.

Done right, flipping fixer uppers is perhaps one of the easiest ways to get into real estate investing. Usually you want to get in and out of the property as quickly as possible, because every day you own a house has costs associated with it. Interest on loans, taxes, insurance, electricity, heating, water, and other ongoing expenses can add up.

However, there is another way to invest in a fixer upper. It is a strategy that let’s you take your time. In fact, it requires you to wait two years before you sell. It also requires that you live in the house.

Your Fixer Upper Home

Since the tax law changes of the 1990s, you can sell your home and pay no capital gains tax on your profit. Have your accountant review your case and verify that you have met the requirements, but essentially you get to sell tax free if you have lived in the home at least two of the past five years, and you are allowed to take such a tax-free profit every two years. The total gain you can have without paying taxes is limited to $250,000, or $500,000 for a married couple.

Some of you may recall that you used to be allowed this capital gains tax exemption just once in your life. What’s more, until you claimed it, you had to always roll your gain from selling a home into another home, always buying-up. Now you can take the money and run, buy a cheaper condo, or do whatever you want with it. This is a major change.

How do you take advantage of this tax law? If you could predict appreciation rates on homes in various cities (good luck), you could move from one quickly appreciating home to another each two years and pocket the profits tax free. What if you don’t want to gamble on your predictions and you don’t want to move to a new town every couple years? Then look for a fixer upper right where you live.

You see, most investors “flip” a fixer upper quickly, meaning they pay ordinary income tax rates on the profits. They don’t even own the property long enough to qualify for the lower long-term capital gains rate. Depending on whether they get classified as business or an investor, this means they can pay as much as 50% out in state and federal taxes. They lose half of their profit!

The alternative? Let’s suppose you find a home in a neighborhood where homes are selling for around $180,000. It’s dirty and in disrepair, so the owner is asking only $136,000. You negotiate and eventually get it for $126,000. You live in the home, spending about $8,000 to clean it up and bring it up to the standards (and value) of the surrounding homes.

After two years home values are up 10%. Your home is worth about $198,000 ($180,000 plus 10% or $18,000), and you sell it for that. After all the costs of buying and selling and repairing it, you have a profit of about $50,000. You buy the next home and repeat the process. Note: perhaps $32,000 is a more accurate estimate of profit, since the same appreciation that provided $18,000 of your gain means you’ll pay that much more for the next one. In any case, this profit is entirely tax-free!

You can see how powerful this fixer upper strategy is. It doesn’t prevent you from pursuing other real estate investing plans at the same time either. You need to live somewhere in any case, so why not take advantage of the law and make some money from your home?

It’s well known that in UK real estate, local real estate markets are falling because individuals and real estate agents may have inflated views of property values. With sales volumes that can be up to 50% lower than the average, the average price of homes for sale is definitely trending downward. Another factor that’s contributing to this growing downward tendency is that many sellers tend to have an inflated idea of what their properties are worth and for this reason, they reject larger numbers of offers. This is caused by a discrepancy that can range up to 30% between buyer and seller. A seller who’s offering £100,000 for a UK real estate property and receives offers in the range of £70,000 is better likely to reject them.

Sellers Are A Major Part of the Problem

Owners aren’t listening when real estate brokers tell them their property value has fallen. In fact, property values in the present market can decline as much as 20% annually. One expert in real estate services places the blame firmly on the sellers: “As a result they [sellers] are unwilling to accept agent advice on appropriate asking prices or offers. Consequently, many properties are withdrawn from the market or remain unsold for long periods, producing an unprecedented low number of transactions. Unless their [sellers] properties are absolutely outstanding it is essential that they [sellers] adopt a realistic attitude and listen to advice if they want to achieve a sale.”

Costly Real Estate is Suffering Too

Another shocking aspect of this trend of UK real estate is that even high-end properties designated as “super prime” are not immune. A super prime property is one worth more than ten million pounds. Every real estate agent knows that despite foreign investment in these properties, the prices are still dropping. Rental prices are also dropping as more and more super prime properties flood the rental market.

Lenders Are Partially to Blame

Add to this the fact that mortgage rates are rising, despite government efforts to support failing banks. Bank of England recently raised rates from .2% to .5% despite interest rates dropping – meaning there’s no benefit to consumers. The banks circle the wagons, each claiming that the rates rise because all the other banks raise their rates. The same group behavior doesn’t take place when some rates get lower. Whether or not this is true, it’s still bad news for real estate in the U.K. And it’s even hurting news for consumers who are seriously looking to buy UK real estate.