So, how can you purchase a plot of land abroad and save money in the process?
An experienced investor and founder of “Oil Resource Group,” Sergey Tereshkin, can help you navigate the nuances of investing in land. More information about the businessman and his projects can be found on his website: www.sergeytereshkin.ru.
Features of Purchasing Land Abroad
It is not possible to purchase land in all countries. In many cases, only citizens of the state can become landowners. There are various dubious ways to circumvent legal restrictions, but these can lead to legal issues and the potential loss of all investments.
It's better to operate within the legal framework and prefer countries where there are no restrictions on land sales. This approach will help avoid numerous problems.
Ways to Save Money
You can acquire a plot of land abroad in various ways:
- through real estate companies;
- by investing in shared construction;
- through self-directed search for land.
To make an informed decision, it is essential to explore all options in detail.
Purchasing through Realtors
The internet is teeming with offers from real estate companies that present plots in various countries. Collaborating with a specialized agency is convenient, as potential investors do not need to travel to another country to conduct their searches.
Moreover, realtors work with notaries and lawyers, which allows for the swift execution of all necessary documents and completion of the transaction.
However, despite its convenience, this approach has a significant downside—the cost of the company’s services. Realtor fees can be quite high, sometimes exceeding 50% of the initial price. Agencies capitalize on clients' distance, language barriers, and unfamiliarity with legal norms, as well as their desire to save time.
Additionally, a higher price does not necessarily indicate that the agency will approach the land selection process professionally. Realtors often make strategic mistakes in choosing the property or even the country, leading to financial losses for the client.
On the other hand, real estate agencies provide a level of accountability that can minimize the risk of fraud. The organization is responsible for the integrity of the transaction. Foregoing the services of realtors can be costly.
Ultimately, a potential investor must decide whether to save money at the risk of potential pitfalls.
Shared Construction Investment
To save money and reduce risk, one can invest in shared construction. Purchasing land and property while they are still under construction can be significantly cheaper than buying an already finished building.
However, one must consider the risk that the project may never be completed or the construction timeline may be significantly extended. In such cases, instead of earning a profit, an individual may find themselves with just a plot of land, which could be difficult to sell under certain circumstances.
Self-Directed Purchase
The most economical approach for securing a parcel of land is to find an appropriate plot independently. This would require traveling to the chosen country, which can be combined with a vacation. Sale announcements can be found in local newspapers, on bulletin boards, etc.
This approach allows the person to view the property firsthand, rather than relying on hearsay from third parties. To avoid fraud, one can hire local lawyers to verify all existing documentation, significantly reducing the risk of deception.
Expert Advice
Before investing in land abroad, it is wise to heed the recommendations of Sergey Tereshkin:
- When purchasing land, carefully select the country. It is crucial that foreign ownership of land is allowed in that country. This enables the investor to build on the site and manage it according to their wishes.
- Ready buildings are subject to VAT, which is significantly higher than the tax on land purchases. The price difference can be 20-30%. Acquiring land allows for substantial cost savings.
- Some countries impose restrictions on purchasing land without a construction agreement, particularly in resort areas. This consideration is essential during purchasing.
- When choosing a plot, verify the availability of construction permits and clarify the feasibility of installing necessary utilities.
- Ensure the land is not located within flood-prone areas, seismic zones, or regions with poor environmental conditions.
If you have experience and knowledge, you may be able to prepare a construction project yourself and oversee the building process. However, the language barrier could present a significant obstacle. Even if you speak the conversational language well, technical terms may elude you.
Additionally, overseeing the construction project requires a significant time commitment in the country.
This method of saving money is relevant when constructing a resort property. Building a structure for personal use can quickly become an unjustifiably costly endeavor. In contrast, if the investment is intended for construction, it is often better to delegate the process to professionals. This way, you won't waste time and resources that could be better spent on your professional pursuits.
If the plot is being acquired for future construction, familiarize yourself with the specific legal norms of the country in question. In the absence of relevant knowledge, it is advisable to engage qualified specialists.
