Popular countries with restrictions for investment

[Bruce Lynn]

Occasionally we see people pushing to invest in countries outside their own. There can be trouble with this as many popular countries and introduced or always had restrictions on foreign ownership of real estate. Some don't prohibit it, but enact laws to discourage it with high purchases taxes or restrictions when you sell. Even the US has imposed restrictions on cash transaction in some locals. Treasury started requiring identification of principals behind LLC in certain areas of the country like Florida and New York (https://papers.ssrn.com/sol3/papers.cfm?abstract_i...)  and now there is FIRTA which requires tax withholding on sales by non-residents/non-US citizens.

Here's a list of popular countries, with restrictions:

United States--- Purchases in some areas can require disclosure of principals and FIRTA withholding at sale time approximately 15%.

United Kingdom--- 3% stamp duty on investment buyers and 15% tax if bought in name of shell company.

Thailand--- Foreigners cannot buy freehold land....and only 49% (foreign quota) of certain condo projects.  Plenty of people try to get around these rules by creating companies with Thai majority directors or using usufructs to lease homes long term.  I think you are at risk if you do this.  Sometimes the powers that be can get cranky about falangs trying to skirt the law and the home could be subject to confiscation.  (http://www.thailand-real-estate-law-center.com)

Switzerland--- Limited to 1500 purchases a year with a permit from the government.  There might be exceptions for EU passport holders and in certain locals to boost property prices.  There can be maximum size restrictions as well.  So it may be tough to buy your Swiss Castle. (https://www.swissinfo.ch/eng/buying-property/29263...)

Mexico--- Foreigners typically restricted from buying within 50km of the beach and 100km of the international border.   Of course that's often where we want to buy.    The fideicomiso may be a way to circumvent this law, but there are risks with it.  Obviously there are whole resort towns where you see this is standard practice, but there have also been instances where people lost their homes when trying to skirt both the law and the spirit of the law.  (http://articles.latimes.com/1999/sep/03/news/mn-63...) and also check out this article: (https://www.linkedin.com/pulse/my-investment-mexic...)

Maldives--- Foreigners are restricted to buying 50 year leases in certain resort areas.  

Hong Kong--- Foreigners get a stamp duty of 15%...and there are restrictions on what area you can buy.  Some areas are only available to PR of HKSAR.  

Dubai--- Probably one of the easier countries to hold freehold property or long term leases.  There can be restrictions on areas.  Bonus is Dubai will soon allow 100% foreign ownership of companies.   Seems to be lots of speculators though and that could be an issue.  In 2018 I was asked to attend a "Dubai Property Show" over a weekend with 20,000 properties on offer.  Then got a call on Sunday afternoon saying I should get there soon as the properties were almost all gone.  Somehow I doubt they sold 20,000 properties to my fellow Dallasites over a weekend.

Cambodia--- Typically foreigners cannot own land in Camboida, however there are certain of the newer condo buildings that allow up to 70% of the units to be sold to foreigners.  Some people arrange 50 year renewable leases for foreigners through a company with 51% ownership by a Cambodian national.  There are risks with this....so be careful if you choose this option. 

Belize---  YEAH....maybe one of the easiest places for foreigners to own land and property with the same rights as citizens.   Just need to beware of the scams.   They are plenty.  See: (https://www.wsj.com/articles/ftc-alleges-100-milli...)

Australia--- Foreigners can buy, but have a 8% stamp duty, plus there can be annual taxes and vacancy taxes.  There are also restrictions on banks lending to foreigners.  

What are your thoughts?  What are your successes?   Any failures?

Any other countries that interest you?