4
Cash Flow from Property Overseas Can Make You Rich (While Creating Diversification, Asset Protection, and a Legacy for Your Heirs)

Property is a cornerstone of any long-term wealth strategy and building a real estate investment portfolio anywhere including in the United States can make you rich. However, we've known too many property investors who have lost everything. When this happens, it's usually a result of too much leverage and not enough diversification—investing in just one market, in the United States or overseas, or in only one type of property.

In 2005, we met a young and aggressive investor making hard-money developer loans in Iowa. He was earning 12% and scoffed when we suggested he diversify outside the United States or at least beyond Iowa. Yes, we agreed, it'd be hard to match the 12% net per year, but his portfolio and therefore his returns would be safer long term. The guy lost everything in 2008 when the bottom fell out of the Iowa market and borrowers couldn't repay his loans. We could tell you a dozen versions of that story to do with a dozen nondiversified property investors.

Over the past two-and-a-half decades, we've proven that investing in real estate overseas is a strategy for both generating reliable cash flow and building real wealth. We are confident you can make good or great money this way. We also know that slow and steady wins this race. Don't be tempted to go too big or too far too fast.

If you're starting from nothing, you'll need to build seed capital using other people's money, as Lief did in Chicago at the start of his investing career. Don't jump straight to investing in real estate overseas until you have a portfolio to diversify in the first place. That said, you don't need to be rich to invest overseas. We'll introduce you to markets where you could buy in with less than $100,000 as well as markets where you can leverage.

When we met, Lief had just sold his three-flat in Chicago, and Kathleen was preparing to sell her home in Baltimore in advance of the move to Ireland. We pooled the proceeds of those two sales to come up with the down payment for our purchase in Waterford. We sold that property for four times our investment, giving us the funds for the biggest purchase of our careers by that point in Paris.

We were able to afford Lief's preconstruction purchase on the coast of Spain, thanks to developer terms that allowed us to set aside enough each month to come up with the scheduled payments. The cash from that flip gave us the down payment for the rental we purchased preconstruction in Panama.

A colleague has followed a similarly organic approach. He started with one preconstruction investment in Panama City, then another. Then, a few years later, he invested in Santa Marta, Colombia. Two decades from his first purchase, he holds a portfolio of rentals in Panama, Colombia, the Philippines, and Russia that earns him 20% per year. He's well diversified across economies and currencies, and he travels continuously, checking in on his holdings and scouting new markets. “Now I have my sights set on Portugal,” he told us recently. “I have no European exposure, and, with the dollar strong versus the euro, it seems like the time to address that.”

How do you get rich investing in real estate overseas? You make one purchase in a market generating decent yields. Rent it, setting aside the excess cash flow each month, until the property's value has appreciated to a level where it makes sense to sell. Roll over the accumulated rental income and the capital gain into a next property in a next market. Do this until you're accumulating enough excess cash flow that you can afford to buy a next investment without selling one you already own. Continue in this way, on and on, until, in time, you're a bona-fide global property baron earning enough cash flow to fund a life of travel and the retirement of your dreams.

..................Content has been hidden....................

You can't read the all page of ebook, please click here login for view all page.
Reset
44.210.240.31