Henry Davis has
been invited to participate in an
Overseas Property Investors Advice
feature on Ireland's number 1 business show, the Matt Cooper show on
Today FM He
talked about the benefits and drawbacks of investing in
overseas property in
this 6 week property special
Henry discussed buying investment property in
Bulgaria UK
Spain
Germany
Cyprus and
Romania. Henry was also asked to speak
about Buying
Property Overseas with
Diarmaid Condon, an independent
overseas property journalist
To listen to Henry's broadcast on Today
FM click on the country name
Bulgaria
UK
Spain
Germany
Cyprus
Romania
Buying
Overseas Property
Bulgaria
Henry discusses corruption reform
pressure from the EU in Bulgaria. The country itself
is still undeveloped compared to other EU
states, however there are opportunities for
property investment
Henry advises listeners to find areas in Bulgaria's
cities with a true rental market to assure your property
gets rented by the local market
UK
Henry discusses the popularity of the UK property due to the ease of access
to the UK, same language and similar laws and most
importantly the low transaction costs with properties under
£125,000 incurring no stamp duty
UK properties can be purchased for
as little as £20,000 however tenants in these properties
tend to be more problematic as they are normally receiving
benefits and it often takes a number of months to receive
money for the local authority for the rent
Most buyers are focusing on city
centres or secondary locations with strong rental demand and
low supply of rental properties, Henry advises listeners to
research markets within the overall market to find out which
properties are in short supply and which will be rented
quickly
Mike Gaffney from
KPMG was
also on the show with Henry Davis. He discussed tax laws in
the UK. He advised listeners that they would be
subject to UK tax on surplus rent and when selling the
property they would be subject to capital gains tax. When selling a UK property a foreign
investor is not subject to UK capital gains tax
Spain
Spain has lost some appeal as a
speculators market. There is a slight
correction in the market at the moment with prices falling,
however Henry thinks Spain will continue to be a
very popular area amongst investors as the sun always
shines and the infrastructure in the country is very strong. Mike Gaffney from
KPMG joined Henry again
this week on the show to discuss tax laws in Spain. At
the moment investors pay 25% Spanish tax for the full amount
of rent they receive. They also pay 35% Spanish
capital gains tax, this tax amount is only payable by
foreign investors at the moment. Locals pay 18%
capital gains tax, however the EU is forcing Spain to change
it's law as of January 2007 so that all investors pay 18%
capital gains tax to ensure foreigners are not subject to
discrimination
Henry Davis and Mike Gaffney both discuss corruption in
Spain with over half of the planning department officials
currently in jail for corruption.
Finally Henry advises listeners about areas to invest
in Spain, he suggests that potential buyers visit the area
they plan to invest in as many buyers have been
convinced to buy in resorts in the middle of no where with
little public transport or tourist areas to visit
Germany
The German market is very attractive to buyers,
as there has been a lot
of optimism because of the new government. Investors
are buying commercial, retail and residential property. High growth in residential
investment property however high transaction costs.
Buyer pays estate agent fees rather than the vendor. Germany has a low stamp duty rate making transaction costs
much higher than transaction
costs in other countries such as the UK
Germany has a 40% home ownership rate,
German people tend to rent rather than buy their own
property. Germany's government is weak at the
moment, Henry feels that investors will receive a stable
rental return however economic problems will get sorted out
over the long term rather than the short term
Cyprus
Henry feels that Cyprus is one of the
hottest property markets at the moment with high short term
capital appreciation
His main reasons for this include:
However Matt Cooper points out the limited
access to Cyprus, flights tend to be chartered flights for
holiday goers. Henry believes this isn't anything to
worry about for investment as he feels that as the
investment market grows, flights to Cyprus will be more
regular and the country will become more accessible, the UK
buyers are the biggest buyers in Cyprus for
retirement purposes
Matt mentioned the Greece and Cyprus
civil war 1974 causing some issues with Legal Title, Henry
suggests that potential purchasers stay away from Turkish
part of Cyprus in the north and suggests that investors
should buy in the southern area. He advises that
purchasers should sure they get secure title to avoid
any problems
Romania
Henry discusses buying land
in Romania, to buy land in Romania purchasers must set up a
company. He feels that buying low or middle class
housing could be good for investors. Romania has
a population of 25 million with a very low unemployment
rate. Many people are living in run down communists
blocks, however Henry expects that demand for better housing will
increase
The main buyers in the Romanian market
are the Austrians and the Germans. The main risk for
the investor would be the volatile currency.
Buying overseas property with Henry
Davis & Diarmaid Condon
The Minister for Justice, Michael
McDowell stated that he felt developers selling overseas
investment property to investors should be forced to provide
bonds to protect the investor.
Diarmaid Condon, an
independent overseas property writer for the national
newspapers, agreed with this in order to protect
investors if the development doesn't complete. However
he feels that the main problem with investors buying
overseas property is that the property they purchase is
miss-sold to them rather than it not completing
Henry Davis discusses the
NHBC insurance cover he
provides purchasers in his developments, this covers
purchasers in the event of Henry going out of business
allowing them to get a refund of their deposit or if the
development is almost finished it will cover the rest of the
work needed. Diarmaid, Henry and Matt discuss the pros
and cons of buying property at a property investment
exhibition. Diarmaid and Henry both recommend buyers
to visit the area they want to invest in, learn about the
country and research market value of property and rental
markets
