Whether you’ve had an inheritance, saved over the years or have found yourself receiving an unexpected windfall, when it comes to finding somewhere to put a lump sum the options can seem overwhelming. From stocks and shares to savings accounts and everything in between, it often appears as though there’s endless choice.
Real estate as an investment vehicle is a great idea. While nothing’s ever guaranteed, we all know that everyone needs a place to live and work. For that reason, there’s an almost never-ending demand for housing and offices everywhere you go: as an investor, your job is to locate where in the international market the highest returns on this demand are.
Location, location, location
When investing in real estate, one thing is for sure: it’s vital to choose a place where you know you’ll be able to recoup your investment and make returns further down the line. It makes sense to invest in a place where demand has already been demonstrated. For example, places that have a lot of other developments going on around them may seem like saturated markets – but they’re also often a good indicator of high levels of demand.
Foreign exchange rates
You might be slightly put off by investing in real estate abroad because of the risk that currency exchange rates will hamper your returns. The rates are often unpredictable due to political and economic factors, and that might make you want to cut down on your international investments. But by using a money transfer UK to US price comparison service, you can enjoy your returns – and the benefits of an international portfolio – with the least possible loss.
Diversify your investments
One of the main appeals of international investments for many people is the diversification they offer. Placing all of your investment eggs in one basket (or, in other words, one country) can be a real problem if prices plummet in the place where you’ve pinned all of your hopes. To reduce the risk it is best to have interests in several different economies. Investing some of your cash in EU cities like Paris or Frankfurt, for example, can be paired with investment in places like Hong Kong or Singapore to create a balanced portfolio.
Take a small plunge
When it comes to the international real estate market, you may find you’re constantly putting off your decision to invest due to the uncertainties that your own lack of knowledge or the constantly shifting landscape is causing you. But ultimately, it’s only through experimentation that you’ll truly understand what works for you and your portfolio. By investing just a fraction of your cash, perhaps through a managed real estate investment fund that does the hard work for you, you’ll be able to get a feel for this market and decide whether it’s right for you.
With many different factors to consider, investing in the real estate market around the world is a significant decision for any upcoming investor to make. But by taking the time to research the options and then to make a carefully considered decision, there’s no reason not to take the plunge and make your move into this exciting field of investment.