Kathleen Peddicord - How to Buy Real Estate Overseas

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Copyright 2013 by Kathleen Peddicord. All rights reserved.

Published by John Wiley & Sons, Inc., Hoboken, New Jersey.

Published simultaneously in Canada.

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Library of Congress Cataloging-in-Publication Data:

Peddicord, Kathleen.

How to buy real estate overseas / Kathleen Peddicord.

pages cm

Includes index.

ISBN 978-1-118-51859-5 (cloth); ISBN 978-1-118-60741-1 (ebk);

ISBN 978-1-118-60742-8 (ebk); ISBN 978-1-118-60753-4 (ebk)

1. Real estate investmentForeign countries. 2. Retirement, Places ofForeign countries. 3. RetireesLife skills guides. 4. AmericansForeign countries. I. Title.

HD1382.5.P43 2013

332.63'24dc23

2012047944

For Bill and Mark, who got me started.

I

Launching Your Overseas Property Adventure

I've told the buyer from Dublin that the other buyer, the gentleman from Cork, is considering by how much he'd be willing to increase his offer, John Rohan explained in a hurry as he burst through the door into the little room where my husband, Lief, and I sat waiting. However, the other buyer, the one from Cork, he's gone. He said he'd reached his limit and excused himself from the bidding. He's left the building. Our buyer from Dublin doesn't know this, but it won't be long before he figures it out. This is your chance. If you're selling, you're selling today, now. I believe I can push the Dublin bidder up another 50,000 euro, but that's all I'm going to get out of him.

With that, Mr. Rohan looked squarely at Lief and then at me, gauging our reactions. I glanced over at the monitor mounted on the wall to our right. The room where we'd been told to wait while John Rohan presided over the auction for our home in Waterford, Ireland, had no windows. The monitor on the wall was our only glimpse of the activity going on around us. It showed the auction room itself, where we'd watched, starting an hour earlier, as Mr. Rohan had opened bidding for our Lahardan House before a crowd of about three dozen people. John had prepared us by explaining that most in the room would be bystanders, there just to see what the house might sell for. In the end, we had five serious bidders. Three pulled out quickly, leaving the gentleman from Cork and the gentleman from Dublin, who'd been going back and forth, first in the main auction room and then, eventually, from two separate, private rooms where John Rohan had escorted each in turn, for more than 30 minutes.

The year was 2004, and the Celtic Tiger was roaring. All Ireland was watching all the time to see by how much more property values had appreciated since the last time they'd checked. We'd purchased our Lahardan House, the property on the block that day, about six years earlier. John Rohan's projected selling price, more than $900,000 at the euro-dollar exchange rate of the day, had us tripling our investment. Why were we hesitating to accept it?

Because overseas property investing isn't only about the money.

I've hosted conferences on living, retiring, and investing in real estate overseas for more than 25 years. Lately I've taken to asking the crowd at each of these events a series of questions.

First: How many of you are thinking about buying property overseas for investment? A few hands shoot up.

Then: How many of you are considering purchasing a retirement residence in another country? A flurry of hands in the air.

Finally: How many of you would like what I'd term a second home overseas, a place you intend to occupy, full- or part-time, in retirement or sooner, if possible, but that you hope could earn some income when you're not using it yourself? At the suggestion of this, practically every person in the room raises his or her hand.

These folks seem to understand something that it's taken Lief and me more than 15 years of marriage and more than three dozen property purchases in 21 countries to figure out. Buying real estate overseas makes so much more sense when you do it as part of a big-picture plan.

I didn't set out to become an overseas property investor. It happened by accident and organically. When my husband of but three months, my eight-year-old daughter, and I arrived in Waterford, Ireland, 15 years ago, we needed a place to live. I like old houses the way some women like new shoes and was drawn to the idea of owning an Irish Georgian-style house in the country, a place surrounded by rolling green fields dotted with roaming sheep and spotted cows and bordered by low stone walls and tidy hedgerows. My new husband didn't object, and after a search that extended nearly a year, we purchased Lahardan House, a 200-year-old stone house on 6 acres that became our first home as a new family.

Lahardan House was where my daughter, Kaitlin, born and raised to this point in Baltimore, Maryland, struggled with the transition to our new life overseas and where we welcomed our son, Jackson, born in Waterford just two months after we'd moved in. It was where Kaitlin learned to ride a pony in the front pasture and where Jackson learned to walk in the forever muddy back garden. Lahardan House was our first overseas renovation adventure. The old stone house was dripping with damp, its timbers riddled with rot when we bought it. In time, we transformed it into a comfortable and cozy home kept warm and dry by the big Stanley stove in the kitchen.

Lahardan House was also our first overseas property success story, and not only because, in the end, we accepted the offer that John Rohan coaxed from the gentleman bidder from Dublin, putting aside our emotional attachment to the place and tripling our money. More important, our experience with Lahardan House taught us the fundamentals related to buying and selling real estate overseas that we've learned to respect most, key among which is this: The best purchases are made with your calculator, yes, but also with your heart.