More Americans are buying abroad

But international deals often come with complications

New York /
May.May 24, 2015 12:00 PM

A strong dollar means it’s time to look for deals abroad, but making international real estate plays also comes with “complications.”

The number of U.S. buyers searching for homes abroad has increased 30 percent in the last year or so, according to data from Leading Real Estate Companies of the World, cited by the Wall Street Journal. But experts recommend doing some hefty research before taking the plunge.

Mortgages abroad often require a larger down payment than in the U.S. And fixed-rate mortgages can be hard to come by in many markets.

In the Caribbean, minimum down payments often range from 30 to 40 percent and loans are typically repaid with 15 years, Anita Ashton, managing director at Caribbean Mortgage Services, a mortgage broker based in St. James, Barbados, told the Journal.

Moreover, if you are renting out your home abroad, you need to report the income to the IRS, and the lease could be considered a foreign financial asset, David Lifson, an accountant with Crowe Horwath LLP in New York, told the Journal.

And if the house is held by an entity like an LLC, it must be reported as a foreign financial asset.

The upshot: be sure to grill local real estate experts regarding taxes and other costs. [WSJ]Christopher Cameron


Related Articles

arrow_forward_ios
Chinese President Xi Jinping (Getty)
China bans government elites from holding overseas real estate assets
China bans government elites from holding overseas real estate assets
Land in Scotland (HighlandTitles.com)
They’re all winners: Gift bags aimed at Oscar royalty include Scottish land
They’re all winners: Gift bags aimed at Oscar royalty include Scottish land
The amount of vacant office space in Hong Kong is at an all-time high, and new buildings are still on the way. (Getty)
Hong Kong has more vacant office space than ever before — with more on the way
Hong Kong has more vacant office space than ever before — with more on the way
Lloyd's of London headquarters at Lime Street (Lloyd's of London/CC BY 2.5 - via Wikimedia Commons, iStock)
Lloyd’s of London may exit “Inside Out” home after three decades
Lloyd’s of London may exit “Inside Out” home after three decades
From left: Guillermo Lasso, Julio Iglesias, and Abdullah II bin Al-Hussein (Getty, iStock)
Secretive real estate purchases driving offshore economies
Secretive real estate purchases driving offshore economies
A rendering of Pavilia Farm III and CK Asset Holdings chair Victor Li Tzar-kuoi (The Pavilia Farm 360, Getty)
Hong Kong housing prices race toward record highs
Hong Kong housing prices race toward record highs
The Savoy Hotel in London, UK in 1980 (Getty)
UK hospitality employers could cut half a million jobs
UK hospitality employers could cut half a million jobs
Hong Kong's Dragon Lodge. (HK Urbex)
Hauntings and superstitions keep some of Hong Kong’s desirable properties empty
Hauntings and superstitions keep some of Hong Kong’s desirable properties empty
arrow_forward_ios

The Deal's newsletters give you the latest scoops, fresh headlines, marketing data, and things to know within the industry.

Loading...