How Global Real Estate Can Maximize Your Investment Returns

Return on investment (ROI) is the name of the game wherever you are and whichever assets you hold. Whether you’ve invested in real estate, stocks, bonds, or even fine art, you want your holdings to appreciate so that your money works for you.

We’re sure you’re aware of the viability of investing in real estate as a way to generate stable returns over the long term. However, if you’re only focused on your domestic or local market, you’re missing out on substantial opportunities abroad. 

Owning commercial or rental property near where you live is a great way to generate passive income, but if you’re focused on only one location, you’re exposed to downturns in the local market without any hedge against them. What’s more, your returns could be even greater in growing cities like Dubai or Singapore. You could even tap into the dynamic rental markets of Bali or Phuket by purchasing and renting out a villa, which could net you an average return of 10%-15%.

Opportunities like these for real estate diversification and high rental yields don’t always exist in your home country. If you’re an investor seeking high returns on your property holdings, you may want to consider global real estate.

The Growing Appeal of Global Real Estate Investment

Real estate markets around the world continue to grow and outperform more volatile stocks. As such, the appeal of the global real estate market has grown in tandem with investors piling into projects in a wide array of regions. 

Generally speaking, real estate is a strong investment, but global real estate offers unique advantages for investors. For example, in tourism hot spots like Bali, rental yields are typically higher than you would find in other regions. With a constant influx of new visitors, occupancy rates are stable all year round. 

Many international markets are also keen to attract foreign investment and, as a result, have enacted ownership laws favorable to foreigners. Plus, you’ll find many offering tax advantages on real estate.

While developed markets in Western Europe and North America offer long-term stability and are a great option for more risk-averse investors, up-and-coming regions like Southeast Asia offer enormous opportunities as urbanization exponentially increases. Furthermore, property prices are lower than in the developed world. With demand projected to continue rising in the foreseeable future, you’ve got an investment that’s likely to pay you back in both rental yields and asset appreciation.    

Key Benefits of Investing in Global Real Estate

As an investor, you know you need to hedge your bets against an uncertain future. That’s the idea of diversifying your real estate investments into international markets. Global real estate offers an excellent avenue for real estate diversification, which is a tried-and-tested strategy to reduce your overall risk. 

Economic fluctuations are a fact of life in the investment world, and real estate is no different. When one market is reaching new heights, another may be plummeting, so having all of your holdings in one area risks you losing a substantial portion of your investment if that particular market goes through a downturn.

Currency exchange also plays a role in market trends. For instance, if you invest in a country with a weaker currency than your own, you could see greater gains when the foreign currency appreciates or after rental income is converted. 

Seeking out countries with growing rental demand is a great way to increase your rental yield. You can invest in a property once, and as demand increases in the market, you can increase the rent you charge each year, which maximizes your ROI without you having to do anything. Rental yields in areas like Cape Town, South Africa, hover around 6% - 8% per year, and you’ll find a similar situation in the Philippines.  

How to Maximize Returns from International Real Estate Investments

To truly maximize your returns from international real estate investments, the first step is conducting thorough research. In-depth knowledge of different real estate markets will inform you about what is best for your situation and where you can see the best returns on your money. 

For instance, while we mentioned that developed countries are usually safer bets, cities like Berlin have stricter rental regulations that could affect your bottom line. At the same time, Dubai is known for its investor-friendly policies and tax advantages. 

Once you’re aware of a local market’s regulations and government policies, make sure you research the market itself. You’ll need to understand the dynamics of the rental environment to understand how it will affect your rental yields. As we mentioned earlier, in tourism hotspots like Bali, your short-term rental yields are likely to be higher, while in other markets, rental yields will be linked to long-term residents.

Furthermore, you can maximize your investments by leveraging technology for market insights. Online platforms like Zillow International and Property24 allow you to research properties in various locations and gather data about pricing, trends and possible ROI. Making use of technology like this can also help investors track global trends and spot where the next best opportunities may spring up.

Key Considerations When Investing in International Properties

Investing in international properties is different than investing in your home country. Each location will have various tax laws and stipulations about what you can do with the property and, potentially, even when you can sell it. You’ll need a deep understanding of the tax implications and local laws and regulations, as these can all affect your returns. 

What’s more, securing financing for international properties can be a bit more complicated than it would be in your domestic market. You can work with local banks, use your own funds, or look into international mortgages. In Dubai, for example, where flexible payment plans are often offered to attract foreign buyers, some investors look for developer financing.

To really maximize your ROI on international properties, it’s advisable to work with a global property management company that knows the local market, will keep you on top of regulations, and can help manage the operation of your rental. This is especially important for tenant screening, dealing with repairs and collecting the rent.

The Potential of Global Real Estate in Maximizing Investment Returns

Global real estate is full of opportunities for investors to maximize their returns. From real estate diversification to favourable tax laws and currency advantages, there are a number of ways you can receive sizable gains on your investment that you wouldn’t be able to in your home country. With booming markets in the developing world and high rental yields, exploring international properties is a fantastic approach to increasing your portfolio’s value. 

As areas around the world urbanize and municipalities look for more investment to satisfy demand, real estate is set to remain a promising avenue for wealth creation. But the opportunities won’t just fall in your lap. You’ll need to actively search for the best locations and most advantageous legal regimes for your situation. 

At Platinum Property Club, our seasoned expertise helps you capitalize on the growing trend of international property investment. We have access to properties and intimate knowledge of markets around the world to help your investments secure your future. Contact us today to see how Platinum Property Club can set you up for success.