All Forum Posts by: Mike Lambert

It's within 50 kilometres from the coast and 100 kms from an international border, so 31 and 62 miles respectively. There are two workarounds:

1. The fideicomiso or bank trust, whereby the title is in the name of the bank but they don't lease the property to you; you're the owner for all intents and purposes. Renewable every 50 years.

2. The Mexican corporation, generally advised if you buy multiple properties, given the higher costs.

Hi Pamela,

The kind of guide you're trying to create can already found all over the internet and are very easy to find and some of them, written by other real estate agencies, are pretty good. Also, with the advent of the likes of ChatGPT, they' might become obsolete and unnecessary. Of course, not everybody is that good at or has the time to do Google searches or know how easy it is to use ChatGPT so it might still make sense for you to provide such a guide to your (potential) clients.

If you don't want to spend time reinventing the wheel, you have other easy options:

a. You search for existing guides, select the best and provide the link or the document to your clients. Of course, I totally understand that you wouldn't want to do if that guide is written by another real estate agency, in which case you have option 2.

b. You take that best guide as a base and put your own spin on it but make sure you don't copy proprietary content or do plagiarism. You're already half way there by asking people what they want to hear. And, voilà, you have your own guide.

Problem is what they'll likely want to know will probably be basic and already covered by those guides. In trying to be more helpful, I came up with two additional ideas:

1. Don't fall into a trap others have fallen into before you. I've been on this platform for many years and, over the years, I've seen new members linked or part to Mexican real estate agencies posting educational content about investing in Mexico out of the blue shortly after becoming new members and then disappear as they realized that their efforts wasn't giving them the amount of business they were hoping for. Why? Presumably because the overall majority of BP members invest only and the US and they're smart and well educated and can tell when people are trying to genuinely help them or are motivated by trying to get business from them.

2. When somebody asks for advice, I always try to put myself in their shoes and understand who they are and what their objectives are so I tried to do that with you with the little amount of info I could garner from your profile. According to your profile, you'd be a representative of a Mexican real estate agency I'd never heard of, even though I've been investing in Mexico since 2017 so I googled the name you give and, surprisingly, I didn't find a proper website, just an influencer-like Instagram account. Also, your profile says that you're a real estate agent in Canada. Are you licensed to sell Mexican properties? You can write the best guide but people want information for credible sources so you might want to clarify all of that or it might be an obstacle all along.

3. I if go back in time when I was a newbie and investor in Mexico and I'd need to get information about how two invest in Mexico, I'd want to hear from other investors who have done it before rather than from people who sell properties and that's exactly what the forums are for. However, when I'd want to buy a property in Mexico, I'd want to hear from real estate agents who would provide me the best possible service. So, coming back to the trap I mentioned in point 1 above, if I were those people, instead of providing content that's already available everywhere, I would focus on being the best possible real estate agent and then shamelessly advertise my services. While BiggerPockets has very strict rules about (disguised) advertising in the forums, there's a whole classifieds section for that.

Hope this helps!

You're welcome and you're correct. However, between the much lower mortgage interest rate in Europe and a better tax treatment in the US, I'd choose the former. There is no contest.

@Levi T. As I suggested and you confirmed, the Côte d'Azur is a great place for capital gains but what I meant isn't necessarily where you're going to get high rental yields.

What @Chris Magistrado mentioned represents a good depiction of the situation in Southern Italy. But Southern Italy is not representative of the majority of Europe. I'm European, spent most of my life in Europe and have owned property in several European countries and I can tell you categorically that it doesn't not reflect the situation in most European markets and, by the way, Chris rightfully never suggested that it does.

Of course, if Americans want to reap the benefits of investing in Europe, they'd ideally need to, as you suggest, get the right market knowledge, understand the local financing and housing laws and I'd add to this the legal system. But isn't that's par for the course? What prevents them from doing that?

Now, if they don't want to do that for whatever reason and don't have anybody to work with who would do that for you, I'd have to agree with you that they'd better invest at home rather than getting involved in something they don't understand. Mind you, even if you invest at home, you need to do the/some work.

Europe is as big as the US and the differences between markets is even bigger because Europe is made up of different countries. Like in the US, there are good and bad areas for investing. The area around Nice isn't the best area to invest (although you might get some nice capital gains there) but here are plenty of areas that are great and where you can get much higher returns than you generally get in the US. Real estate is local.

@Taylor Dasch

You can buy the property in your own name if it's outside the so-called restricted zone. If it's in the restricted zone (within 31 miles of the coast or 62 miles from an international border, you have the choice between using a bank trust and paying the fees mentioned above or using a Mexican corporation and bearing the costs of establishing and maintaining  the corporation. Given the latter costs, a corporation can be the best solution only if you buy multiple properties. Bear in mind that the fiscal treatment of the two options in Mexico is different (withholding tax on the gross income with the fideicomiso vs cost deductions with the corporation).

@Mark Hafner

I've been investing internationally for many years but it's very difficult to answer the kind of questions you ask without writing a dissertation so I'd encourage you to ask more precise questions in the forum. If you know what you do and why you're doing it, there's no need for the bad and the ugly, which I personally haven't experienced.

@Jonathan Greene I'm not sure what you mean by "most will not cash flow as an out-of-country investor" as it might suggest that the cash-flow of a given property has something to do with the nationality or residence of the owner but, in any case, you're absolutely correct that, historically, the net rental yields of LTRs in US cash-flow markets like the Mid-West have been typically higher than in the average European market, although that wouldn't be the case for many other US markets like California or New York. Mind you, with mortgage interest rates in the US being so much higher now (and seemingly for the foreseeable future), I wouldn't be surprised if LTRs in Europe would cash flow better than in the whole US nowadays (to be verified).

This being said, I don't and would never invest in LT rentals outside of North America  as I wouldn't want to face unfavourable landlord/tenant laws as a foreigner. Most people who invest internationally invest in short-term rentals and, unsurprisingly, that's what Mark is asking about. ST rentals are much more profitable and command cash flows are often higher than in the US if you buy the right property in the right market.

As an international investor, I find Ladislas Maurice interesting but there are different types of international investors and most international investors I know wouldn't go through the hassle of what he does for the kind of returns that he gets. Indeed, you can get higher returns than that in the stock market at the click of a mouse and, when investing internationally, you'd typically want a higher return than you can get domestically or in the stock market, unless you're mainly looking for diversification or parking your money.

On another unrelated note, I love your latest podcast episode. BP should make you a guest host! :)

@Jacob St. Martin

The situation in Switzerland is particular and completely different than in the rest of Europe. Switzerland does impose some restrictions on foreign and non-residents buying property but you can still buy and several members of my family actually own property there. In any case, I doubt many people on BP would want to buy properties in Switzerland given the very low returns that can be achieved there. Most foreign buyers are high net worth individuals who want to park their money there in a safe haven and they don't need BP.

No restrictions apply to American buyers in the countries they'd generally want to buy, including those mentioned by Federico and many other popular countries.

When it comes to Spain specifically, some more conservative banks will ask you for a 40% downpayment (that would be the maximum) but that isn't the rule. Some other banks will tell you 40% to manage your expectations but if you have a good credit and a the deal makes sense, the down payment shouldn't be above 30%.

As to the managing of properties, if you can self-manage out-of-state in the US, there are no reasons as to why you couldn't do it internationally too and some investors do.

@Federico Dallo

I'm an investor based in Canada, which is a market quite similar to that of the US. While I've owned property in the US and Canada, I decided a few years ago to focus on real estate outside of Canada and the US. So, as you can imagine, I completely disagree with the opinion that investing in the US is better. While I could write a whole dissertation as to way, I have no appetite to enter into a kind of discussion in which too often egos become prevalent over helping one another.

What I would do if I was in your position is to ask about investing in the US to somebody who actively invests there and ask about investing overseas to somebody who actively invests in Europe and the Caribbean and then draw your own conclusions. So feel free to DM me if you think I could help.

The other reason for me to reply to you is to debunk some untruths that are being circulated about international investing, as it could help all readers who bump into this thread.

It's not true that many European countries require you to be a citizen or a permanent resident to invest in real estate there and certainly not in the countries that you mentioned. I had never heard or read that one before so I'm not sure where it comes from. Actually, an ever growing number of Americans are investing in Europe and they're welcomed with open arms. Also, while you might have to put down 40%+ in some countries, it isn't typical and, again, it's not the case in some of the countries you mention. Don't take my word for it though. A 2-min Google or Chat GPT search will confirm.

Hope this helps.

@Anna Pugolovko

I'm afraid you're way too late to the party. I started investing in the area in 2017 but stopped a few years back as it's being completely overbuilt. But, ultimately, it could work if you don't mind a low ROI.

It could make sense if you look at a lifestyle rather than an investment purchase and you're just happy to cover your costs. Mind you, it would be much less expensive to rent when you go there given the very low nightly rates due to the overbuilding. Also, I'm not sure why you'd want to buy close to the station, as that would probably one of the worst places where you could buy IMHO.

Hope this helps.