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Where to buy a property?

Discussion in 'Teaching abroad' started by MayaJones, Jul 2, 2019.

  1. MayaJones

    MayaJones New commenter

    Hi all,

    I would like to invest around £100 000 in a property. Ideally I would rent it out as an Airbnb. I am unlikely to be living in it as I get accommodation provided from whatever school I work in.

    Fancy a place in the sun that an agency can take care of for me so I do not need to go there too often. I would like it to be worth considerably more than the 2019 price in fifteen years' time.

    I currently work in southern Portugal.

    Any tips on the best place to invest?


  2. the hippo

    the hippo Lead commenter Community helper

    Bulgaria, of course! And you won't need a hundred thousand or even fifty. Fifteen perhaps. The bad news? It will not go up in price and so it is not really an "investment" at all. But who cares if you have a nice holiday home? If you are primarily interested in making more cash, then the obvious place to buy a property is in the UK. But you will need a fairly big mortgage. The good news is that the cost of your mortgage can be set against tax. Renting out my property in a foreign country is not something I would want to do. Perhaps you are a lot braver than I am, MayaJones!
    FrightfulWind and dumbbells66 like this.
  3. djphillips1408

    djphillips1408 New commenter

    You are asking the impossible, no-one can predict accurately where the next property hotspot is going to be and certainly not teachers on this forum. If you want a return from your investment in property then buy somewhere near where you live and manage it yourself, otherwise if you want a guaranteed return on your investment take an ISA or set up a share dealing account and spread your risk in a diverse portfolio.
  4. frogusmaximus

    frogusmaximus Occasional commenter

    I feel your pain over the present low interest rates for savings.

    Given you live in Portugal, would it not make sense to invest there. It is a popular destination and you can manage it yourself, thus saving on costs. As above, so hard to predict where property prices would grow. Like Hippo suggests, economies that will move forward and develop over the next decade OR become a tourist hit, would be ideal. It would also have to be somewhere where Airbnb is established and used by tourists.

    For that sum of money, there are also good interest rates (and i'm talking over 5%) to be found out of the UK in 'safe' investment so it would be worthwhile getting some financial advice from someone who knows what they are talking about. In the country in which I presently live, even investing in short term bank deposits brings in a good return, so don't assume rates are low everywhere, but of course you cannot simply open an account as an individual and need an investment vehicle. I dabbled with shares for a similar length of time that you are looking at and did not enjoy the experience, which felt like gambling to me, and came out at the end barely ahead. Not for me.
  5. february31st

    february31st Established commenter

    Well 100,000 GBP in Shanghai would not even buy you a parking space, so I would stick with Portugal.
  6. kpjf

    kpjf Occasional commenter

    Let me ask you: would you go onto a car owners' forum to ask about pedagogy? I don't think you've thought through this plan well.

    It seems a bit naive to think oh just pay an agency and they do all the work for me and hey presto in 15 years' time I sell and make a fortune ( also, nobody can truly 100% predict if house prices will increase in x country, even experts, so even worse to ask expat teachers).

    What happens when there's a problem with the boiler, or the tenant isn't paying rent etc. Will the agency sort all that out? Ok, let's say they do all of that, but at what cost? You really need to be in the country or at least know the country very well. I knew a retired guy and he bought a house in Spain as a holiday home, but was scammed and lost thousands and thousands of euros.

    Furthermore, you talk about airbnb, so that would mean the agency have to go and meet the tourist every single time to give them the keys and any info to give them. Typically, I imagine the average airbnb user stays 2-3 nights. How much is that service going to cost? Additionally, there's the moral side of using airbnb in such a way.

    And which country is that if it's not a secret? And what is the rate?

    I went into half a dozen UK banks last summer looking to invest long-term last year and NOT ONE was offering even close to 5%. Can you tell me the exact bank and plan that is offering 5% with a link?

    In Europe, the only one I read about that was awesome was Monobank in Ukraine where if you did 10,000 steps a day they were offering 21%. It seems too good to be true! https://www.theguardian.com/world/2...t-links-interest-to-exercise-monobank-ukraine
    TeacherMan2019 likes this.
  7. james_1979

    james_1979 New commenter

    £100k to invest. In property in the sun that would be significantly more in 15 years time..? It's a tough one and the only real answer is 1) Sydney back in the year 2000. Two... The Borough of Hackney in 2008-2009.

    In 2019. The phrase significant value in today's economic climate may prove tough. Although not sunny, the lovely 1 bedder cottage somewhere in the West country and a 30s walk to the high street is, without rental increases, is on track to make 50-55% of the purchase price + all mortgage fees back from rent in 15 years. This may not sound significant for some. But not a bad return to either hold on to or sell. The location was strategic, close to the in-laws, close to some of the best private and comprehensive secondary and primary schools, and a place the wife and I can actually retire in.

    As for Portugal, realistically you can purchase a property by cash but the language and its processes may sting you. Had a Portuguese colleague (and all other at owners in the building) got absolutely hood winked by the so called "building super".

    Lastly, remember each person is different. Is the £100k all your eggs or will you have a good cushion after splitting baskets?
  8. frogusmaximus

    frogusmaximus Occasional commenter

    Hi there. Don't wish to provide the exact details to your questions, sorry, but I can buy Government bonds in the country in which i reside. It is a safe option and very low risk and I could be earning far higher if I so chose to alter that stance. The after tax rate is 7%.

    Would suspect that certain portfolios and investment vehicles specialise in such advantageous zones throughout the world - i know that for a fact of course as I had a medium risk emerging markets portfolio at one point - but it depends on your sums and attitudes.
  9. Mainwaring

    Mainwaring Lead commenter

    We bought our house here in Spain for cash a while before we retired so it was our holiday home until we moved here year-round. Although we had no interest in renting it out we did briefly consider a management arrangement via our estate agent until he said 'Just leave me your account details and your pin number and I'll make sure everything is OK while you are away'.

    We still travel fairly frequently and at those times a feisty Geordie lady moves in and catches up on the maintenance jobs I have studiously neglected for the previous however many weeks. She's the best cement-renderer I know and the dogs adore her. She also manages a number of holiday properties: everything from refurbishment to regular cleaning, restocking fridges and cupboards and driving visitors to and from the airport. We confidently recommend her to others as do all her clients. This personal kind of arrangement is the ONLY one I would trust with my property. An agency may be able to furnish glowing references but agency staff can change.
  10. T0nyGT

    T0nyGT Lead commenter

    As above, you're absolutely asking in the wrong place.

    I would be very cautious about buying a property for rental in a country you don't know VERY well. There are all sorts of local and national laws, taxes, procedures etc that will mean that you could end up with a very poor investment unless you know the country. Things can change politically too and new parties can make it very difficult for foreigners to make money from property. The tide may turn against AirBnB too, as it has had a very bad effect on local people living in 'desirable' locations who can no longer afford rent as all landlords have decided to AirBnB their apartments. Some government are increasing tax on short term investments to make it more difficult for landlords to destroy the local property market for their own gain.

    Also, a management company may sound like a perfect way of having someone else make the money for you, but you could easily make a mistake here as well. You could buy a property in Greece and not realise that generally property management companies take 100% of the profit as a fee (and pay the exorbitant property taxes in return)
  11. the hippo

    the hippo Lead commenter Community helper

    Well, perhaps it would wiser to buy something super-cheap, as a holiday home and for retirement, and then put any surplus cash into a building society. That would be a lot less risky than letting out your foreign property. I absolutely agree with many of the points T0nyGT has made.

    Yes, if I could afford it, then I would definitely buy a property in the UK as an investment. For the OP, that is not an option, unless she gets quite a substantial mortgage.

    Well, if you really do not fancy Bulgaria, there are still plenty of cheapie places in Spain, if you buy away from the Costas. There might also be plenty of bargains in Greece, if you do your research.

    T0nyGT makes a good point about property taxes. In Bulgaria, we pay 45 leva for our house in the country and 120 for our apartment in Veliko Tarnovo. That is about 20 pounds and 50 pounds a year. Compare that with your typical Council Tax bill in the UK and perhaps you will see why this smelly old hippo likes Bulgaria!

    At the moment, Mrs. H. and her overweight husband are on holiday in Greece. We drove here from Sofia and then took the ferry across from Kilini to Zakynthos. It's lovely and sunny and the food is great, but the general cost of living seems to be about double what you would pay in BG.
    T0nyGT likes this.
  12. T0nyGT

    T0nyGT Lead commenter

    Have a great time in Greece Hippo. Yes, the living costs here are very high, especially in comparison to the wages
  13. krakowiak6

    krakowiak6 Occasional commenter

    I looked at the prices of Barratt homes in Exeter and they started around £364k for a 3 bed semi-detached. Could not afford to move there at that price so have given up on the idea and will have to stay put.
  14. dumbbells66

    dumbbells66 Lead commenter

    For that price you can buy a 6 bedroom, 6 bathroom mansion sitting on 10 000m2 in Warsaw. Outside of the capital you can buy much much much bigger places. I am never buying in the UK its far to over priced.....wait until after Brexshit, and that same house will probably be worth £3.50
    yasf and T0nyGT like this.
  15. krakowiak6

    krakowiak6 Occasional commenter

    @dumbells66 Well tell all the Poles in the UK that. I don't see how Poles are any better off working in the UK. What about Prague? Could the OP get an apartment there for 100k I wonder?
  16. T0nyGT

    T0nyGT Lead commenter

    Yeah as soon as Brexit has hit I'm going to buy a few streets in the North and capitalise on the misery
  17. the hippo

    the hippo Lead commenter Community helper

    Greece has all of the mountains, sea and sunshine, but Bulgaria is where your money will go a long, long way. Buy a nice place in the countryside for twenty thousand, then a new car and lots of holidays. Or you could also buy a ski apartment for another twenty.

    Praha is lovely, but way overpriced. How about Brno? Flipping freezing in the winter, of course.
    belkhas02 likes this.
  18. Zimrilim

    Zimrilim New commenter

    One bedroom, former council flat in Sarf East London, right on the South Circ. Yours for £240.000 cash.
  19. frogusmaximus

    frogusmaximus Occasional commenter

    Not exactly the home you dream about when getting onto the property ladder.

    My sister is based in SE London and has moved about 4 times with her young family, each time edging forwards and borrowing to the max. Doubt she'll own a home outright by the time she gets to pension age, such are her commitments and heaven help her if her or hubby loses their job.
  20. the hippo

    the hippo Lead commenter Community helper

    Yes, my amphibious friend, but just think about all of those estate agents, solicitors, surveyors and mortgage fund managers that your sister has helped. What a kind lady!
    frogusmaximus and yasf like this.

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