Anyone thinking about buying a Euro currency property?

[cove]

There is a very real difference in the word investment and a lifestyle purchase of a property to use for several months each year. If all you want to do is live off rental income I don't see the need to do that too far from where you live. If however it is for lifestyle then you have to figure out how to maintain it when you are not there.
Boats as you say are better owned by others.
If you buy a property overseas you will be looking for how to get there best available for the lowest cost.

 

[Alanslegal]

I thought about buying overseas and would base it purely on a lifestyle choice than anything else. To rent/lease it out might take too much time and effort especially being so far away from the property, so in the end decided it would be better financially to just rent an apartment/house for 2-3 months at a time, than to outlay x dollars to buy the property.

 

[clifford]

All this talk is reminding me that I really should do something about renovating my mother's vacant house in the UK. She is still going strong (at the age of 90), but now lives with my sister.

 

[Ric]

I thought about buying overseas and would base it purely on a lifestyle choice than anything else. To rent/lease it out might take too much time and effort especially being so far away from the property, so in the end decided it would be better financially to just rent an apartment/house for 2-3 months at a time, than to outlay x dollars to buy the property.

That's what my financial adviser says. Probably a better way to go.

 

[shifty]

I have been following the Euro currency for some years and now that it is around 0.72 that makes buying a place somewhere in Euroland seem quite inexpensive.
Two members of my family have bought places in Germany and France that came available due to inheritance issues (death duties are high in France).
Any thoughts on this?

Hi Cove, I purchased an apartment June last year in Malta which was in shell form so I didn't make it easy for myself. We managed all the fitout remotely for the most part (I did one quick trip during to get everything on track and order furniture etc). We had been talking about it for years and what put us over the line this time was being annoyed at missing out on a high exchange rate a few years ago, so we got excited when the AUD was above 0.70 Euro again and jumped in. Value for money is awesome. It's certainly a life style choice, that said if we rent it out a few times a year or so it pays all the bills etc. A few legal issues and understandings to jump through, but once you understand the process its pretty painless. Happy to give more info etc. if you need.

 

[JohnK]

Berlin and Barcelona are supposed to be solid long term invearments. I've already invested in Berlin (taking advantage of the generous Deutsche Bank finance planing) and considering Barcelona or Miami (also very appealing city but that's OT).
Prices are a joke compared to Australia.

More expensive?

 

[cove]

Way less in Europe JohnK. In fact Sydney is now a top 10 in expensive places to buy.

 

[burmans]

If all you want to do is live off rental income I don't see the need to do that too far from where you live. If however it is for lifestyle then you have to figure out how to maintain it when you are not there.

Agree in principle but would note that average Australian rental yields are incredibly low at around 2-3% (generally, no doubt there are better yields available but at higher risk). Expanding to overseas markets does give access to in some case MUCH higher yields (though clearly managing away from home introduces its own risk).

 

[boomy]

More expensive?

Similar size apartment close to CBD will cost roughly 5 times more in Melbourne then in Berlin. Rental returns about the same (~5%) after all the fees are deducted but potential growth is much higher over there ATM.

 

[cove]

Residential investment returns are difficult in Australia with State and local governments all in for their cut. You can expect land tax to go up if your particular State government runs tight on their budget.
Real estate prices in most of our capital cities are hurtful for the next generation of buyers.
I don't consider renting a house to tenants in Perth to be anything other than a waste of time.
Have not been to Malta.
Our next trip is to London with several side trips.

 

[JohnK]

Similar size apartment close to CBD will cost roughly 5 times more in Melbourne then in Berlin. Rental returns about the same (~5%) after all the fees are deducted but potential growth is much higher over there ATM.

I thought so. Your statement confused me slightly.

Prices are a joke in Australia and we should continue to allow foreign investors to manipulate our property prices so we then cannot afford them.

 

[cove]

Since I posted this the Aussie dollar has fallen to 0.70 so that means your European dream has risen by about 3 per cent.
Just remember it's only money.

 

[shifty]

...and take off another few % points for the banks actual conversion rate.

 

[lovetravellingoz]

I can't settle on anywhere special, so would prefer to rent for extended periods and get a different experience each time.

That is my view too. The world is a big place, and I am yet to see much of it.......

You would have to find somewhere that you really love to want to just mainly go there. But I guess it also depends what one enjoys doing. Some people just love tp "nest" and to really get involved with a community.

 

[Deleted member]

That is my view too. The world is a big place, and I am yet to see much of it.......

You would have to find somewhere that you really love to want to just mainly go there. But I guess it also depends what one enjoys doing. Some people just love tp "nest" and to really get involved with a community.

If I were to buy an O/S property (Europe) I would really want to be there for most of the time.
It's not the same as say a unit in ZQN , where be can "pop over" for the weekend.

 

[cove]

Some AFFers want to do a weekend run to a U.S. Burger place but not us.
My sons go off to sports matches around Australia over a night or two.
Being older we have seen much of the world that we ever wanted to see and having a base or two somewhere really suits us.I love New York for a week and Las Vegas for a bit less.
Places like Switzerland are ok for a week for us.

 

[marki]

I am in that category of person who has already dipped into the property market in Berlin. It is never painless and requires some ground work. After securing a loan through Commerzbank in English we were able to purchase a property very near to where Angela Merkl lives. Much cheaper then a comparable property in say Melbourne. Also Our First down payment - deposit the Australian dollar was worth around 80 cents.
Our apartment was delayed and as such received compensation, we bought our kitchen with that money. ( in Germany you arrange the kitchen) everything else gets built including your bathroom ( with all fittings).

Most important lesson for us was to have an assessor go through with us at key handover time.

There is tax to be paid, there is a lawyer to be paid and bank fees too.

But we have now a kick cough apartment ( not the most expensive ) but it serves us well when we travel to Central Europe.

We would probably not hire/rent it out as we plan to sell it after sometime. Hopefully with a margin that made the effort worth while.

 

[lovetravellingoz]

Some AFFers want to do a weekend run to a U.S. Burger place but not us.
My sons go off to sports matches around Australia over a night or two.
Being older we have seen much of the world that we ever wanted to see and having a base or two somewhere really suits us.I love New York for a week and Las Vegas for a bit less.
Places like Switzerland are ok for a week for us.

But if only a week here...and a week there, it would still seem better to me to rent even if you wish to just keep revisting the same cities.

To buy I would imagine that you really need to spends months somewhere, otherwise all the buying hassle/ renting it out to tenants etc would just seem to be too much effort to me. Plus financially I think there would be better ways to invest.

Once retired certainly part of my "bucket" list is to live for extended periuods in various areas. ie Say a few months in Tuscanny, France etc. But I envisage blending this in with other trips and time back in Oz with the mates, "footie"....and grandkids if the daiaghters ever get productive

I do see once grankids appear that it may be one way for quality family time. ie That I rent a villa somewhere for several months, and then have for parts of it having the 3 duaghters visit. But before tieing myself down to one spot I would have to really fall in love with it.

 

[seanpodge]

Would AirBnB or similar change the equation? Obviously the main problem is managing the property, but if you can get a property in a major tourist destination, you could make enough to cover expenses. Then when you want to go there yourself, you just make it unavailable for that period. It would avoid the problems of renting out to long term renters. I assume that there are potential legal issues involved, however.