5 Jul 2008

Profitable Overseas Property Investments

How do you make real money? Most investors answer that if you put your money into brilliant companies, brilliant sectors and brilliant countries, then hang on, you’ll end up rich। We disagree. When something is that good, most people know about it already and your purchasing price is going to reflect that, which will limit your returns even if things go as well as the market expects. The key to wealth is to make investments “where outcome exceeds consensus expectations”. If the consensus is that something is a basketcase and it turns out instead to be merely mildly mad, or even a recovery candidate, “it’s a sure-fire way to garner riches”. The more widespread the pessimism about an asset class, the more the odds are stacked in favour of “the early and the brave”.Britons looking to expand their portfolios in emerging overseas property markets have been advised that they could face lower returns if they wait and follow the crowd.Off Plan International has said that individual investors face being crowded out of the market if they wait just one or two years after a market has become more well-known.However, the firm acknowledged that it was usually better to look at the capital city of a country, adding that press coverage and word of mouth encouraged investors to move to particular places."My advice for people if they are looking to invest in small value, one or two properties, is to look at capital cities within a country. They are more expensive than other parts of the country but you are not going to lose," noted an Off Plan International spokesperson."If you are a smaller investor, in a place that's been a hot spot for a year or two, you need to be careful where you invest.