In 2017 I looked at buying property in Vietnam. A rental unit. One bedroom, new construction, and priced at around $17,000. Landlords with similar properties charge around $500 – $600 per month, meaning I’d earn $6,000 a year.

Not bad at all, especially since it would be easy to snowball properties and buy one or two more per year.

Ultimately, I turned the offer down.

In today’s article we’ll look at the pros (and cons) of buying property abroad. Plus, I’ll explain why some countries are great to live in, but not good long-term investments.

1. Look Around You Before Investing Abroad

I often see people complain that they can’t buy land in their home country. All the good real estate is gone and if you want to cash in on the next boom, you’d better look to Mongolia or Kazakhstan.

Sounds like a joke, but I’ve heard Mongolian real estate name dropped in quite a few airport bars over the years…

Anyway, do you really think there’s no land or no opportunities in your own country?

Like many things in life, it’s important to capitalize off your home team advantage.

Namely, that it’s much easier to understand a deal in your native country than it is to untangle what’s going on when buying property abroad.

Going back to that Vietnamese rental unit, the last I heard there was some sort of problem with two different companies warring over who had the property rights. And, some third-party subcontractor was in trouble for stealing money from the maintenance fund (side note: all these things were going on with the high-rise the unit was in, not the one bedroom apartment itself).

After two years, the property is already wrapped up in crazy legal issues. Not a good situation for novice real estate investors.

(Ignore The Potato Quality Image, But An Apartment Like This Nets Around $500 A Month In Rent)

Buying land back home is (usually) a lot more cut and dry. I recently invested in some property (more on that later), and it has a long and stable track record. Pay your taxes, and everything’s good.

Even if the land was more expensive up front, it’s easier to manage and there aren’t any surprises waiting for you, like forged legal documents or embezzling construction companies. Buying property in your own country means it’s easier to understand rules and regulations. Likewise, you can ask around and make sure you’re investing in something legitimate.

I think that alone is worth the higher price tag.

2. The Other Issue With Investing Abroad

(Also Important To Remember: Big Local Banks And Investment Funds Have Already Swooped Up Most Prime Real Estate)

Years ago, there was a semi popular motivational blogger / business guru who always claimed to own tons and tons of real estate in Thailand.

According to him, he took his online profits and used them to buy up apartments, restaurants, and shopping centers.

The only problem with this?

Unlike the United States or Canada, most countries (including Thailand) actually ban foreigners from owning property. If you want to invest in land, you need a local business partner (or wife) and all the real estate is in their name.

That instantly makes things more complicated. It also means you have no legal say in the properties you’ve bought.

This issue is not something to worry about if you are married to a high-quality local girl, or have a trustworthy business partner. But it is still something you need to be aware of.

3. Some Places To Look When Buying Property Abroad

(Passive Income, Land Ownership, And Property Appreciation For Under $50)

Real estate (like stocks) follows the “boring is better” approach. Buying a mansion in Venezuela sounds fun, but the long-term risks outweigh any rewards.

Because of this, you’re better off looking for a safe country that’s well-established and predictable.

Believe it or not, but I actually own some foreign real estate in Asia. But it’s through a REIT and located in Singapore. This is a very safe investment (the country is well-regulated and investments are pretty stable), and I’m paid out at over 5% annual returns.

If you’re hell-bent on buying property abroad, look into purchasing a REIT (short for real estate investment trust) that’s located someplace stable.

This type of investment is way outside the scope of one article, but I will give you some book and website recommendations below.

Resources For Investing Abroad:

• Nomad Capitalist – An awesome website for all things travel and money related. They’ve got quite a few articles on international property ownership too.
• Investing in REITs: Real Estate Investment Trusts – The gold standard in learning about real estate investment trusts. If you want to buy into any fund (overseas or domestic), read this first. It teaches you everything you need to know about maximizing your returns.
• Riches Among The Ruins: Adventures In The Dark Corners Of The Global Economy – Essential reading if you want to buy property abroad or do any investing in an emerging market. You get a true account of many of these cultures treat outside investors, and the obstacles awaiting you.

If you’re looking to live it up in a mansion somewhere exotic, rent your property through Agoda.com. Go nuts, throw parties, and have a ball.

But, when you want a long-term, revenue generating asset, park your money in a safe and stable economy.

If I were looking for diverse international real estate holdings, I’d park my money into a high-quality REIT or trusted hotel chain with some weight to it (like Wynn Resorts). Otherwise, invest in a huge global real estate fund through Vanguard or a similar service.

That’s a lot safer than trying to figure out a whole different country’s property and legal system.

Closing Thoughts

(Buy Enough Boring Assets Back Home And They’ll Cover Your Rental Fees And Hotel Bookings Overseas)

Today’s post isn’t meant to scare you or say that buying property in a foreign country is a bad investment.

It is, however, meant to show you that there are (probably) more than enough good real estate opportunities in your home country or in a well-established nation.

I also want to mention that you don’t have to invest in apartments or shopping malls to make money off real estate. While my Singapore REIT does this, I also own some “utility land” in the USA.

What is this investment?

It’s property that’s used for some kind of utility purpose. Maybe a field for farming, or woods for lumber. That kind of thing.

Pretty boring stuff. You’re not picking up chicks with your potato farm or goat pasture, but the checks still cash the same (depositing one inspired this article). So keep that in mind before you complain about there being no viable real estate opportunities in your home country.

P.S. I’ve never lived in Western Europe. But from what I’ve heard, their international property laws are much easier to figure out than moving to Southeast Asia or Latin America and deciding you’re the next Donald Trump.