subject: Overseas Property Investments - Poor Transportation Could Lose You Money [print this page] Overseas Property Investments - Poor Transportation Could Lose You Money
Overseas Property Investments can seem like an overwhelming option, if you have previously focused on domestic real estate alone. Like many of us, money made in previous years in North American real estate markets is no longer an option for me. In many areas I would be looking at paying 30 times the annual rental income for a property and that just makes no sense on any level.
So last year I made the decision to stick with real estate but expand my horizons into international real estate markets. At first I was slightly overwhelmed by the process. Like with any investment due diligence research is essential, but whereas I had always kept to the familiar, I knew nothing about the locations I was looking to invest within.
I have to admit I went a bit overboard and although I knew I wanted to invest in the Caribbean (hot tip for 2011) I ended up getting caught up in "paralysis by analysis" and just did not feel comfortable with any of the investment options I was looking into. So, I kind of cleared the drawing board and went back to real estate basics: trends, industry, transportation and immigration. I have always used this as a basis for my real estate investments previously and found with a bit of a twist the same formula could be used for my overseas property investments. I have used this formula for my successful investments within the Caribbean region.
I was pretty sure I was not the only one that would be suffering from this problem, so I have written a four part article series on how each of the real estate "fundamentals" can be applied to overseas investment. This is the third part of the series looking at transportation. Keep an eye out for my last two articles on trends and industry.
So, in the North American market transportation improvements and strong transport infrastructure can make a massive difference in real estate prices. For example, in studies it has been shown that real estate within a ten minute walk from transportation links, whether this is rail stations, or links to freeways etc. are reflected in the value of land and properties. This is even more so when highway / freeway access and improvements have been made.
When you take transportation factors into the international real estate market, internal road infrastructure is still an important issue, but the biggest factor has to be easy access to airports. Airports are a huge part of a country's transportation infrastructure. They make significant foreign economic investment possible, create employment and allow increased tourism. As we discussed in the industry and trends articles, these are all essential signifiers for investment in a particular region or country.
Airports increase local employment, commerce and foreign investment and actually change consumer behavior. Quality of life and services in the area start to improve and this has a direct impact on the GDP of the economy.
So, after analyzing regional trends and having a close look at country economies my tip would be to check out established airports to your potential investment zone, in addition to looking at any new developments coming up. As I said before, at this point in your research it's really essential to make those local connections so you can keep an eye on developments like airports that indicate major rises in real estate prices.
Overseas property investments may not be familiar, but using established real estate investment techniques, you can make money and massively reduce risk.
