Investing in overseas real estate is the "smartest and sexiest" investment one can make right now, according to a mass-email sent out today by overseas-investment writer Kathleen Peddicord, linking to a long marketing letter by her husband, Lief Simon.
They claim that a "portfolio of offshore property holdings" would give you unparalleled "diversity, safety and rental yield" with 20 percent annual appreciation.
Also, that the currently strong dollar provides a "whopping discount" at this time if you invest in overseas property valued in other currencies.
It's all a pitch for Lief Simon's $788-per-year investment advisory service, which is also a gateway for those who want to accompany him on his real-estate-investment tours.
Smart and sexy. Really, Kathleen?
There's not a sentence in her letter or Simon's marketing come-on about what happens after the easy part, the purchase, is made.
I am referring to property management.
Do you think you'll feel smart and sexy, reader, when a natural disaster or bug infestation drives out your tenants and your property is temporarily vacant -- producing expenses and no income?
Do you think you'll feel smart and sexy when your property manager gets sick of tenant headaches and quits -- leaving you without your key component in re-renting the unit(s) and fixing the problems?
Will you feel smart and sexy when the roof leaks and you lack a reliable and reasonably-priced way to remediate it?
How about when a tenant's wife has medical problems and they just stop paying rent, but don't move? Eviction proceedings -- months of no rent and possible court delays. How smart and sexy now?
How smart and sexy when a dishwasher gets unplugged, the tenant is blissfully unaware, and your property floods?
And what about when you decide to sell, but the currency exchange now works against you and it takes years to unload an unsuccessful property investment? And when you finally sell, it's for less than you paid for the property. How does that feel?
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It takes a special patience and mentality -- and sometimes deep pockets -- to deal with tenant problems, unexpected expenses and vacancies. These problems can seem unmanageable if you're thousands of miles away.
A fancy portfolio of overseas holdings may work for Lief Simon if he can spend most of his time globetrotting and enjoys the challenges that property management presents.
But don't start buying investment properties yourself -- overseas or at home -- unless you have thought long and hard about whether it could work for you .. or actually might turn your life into a morass of unending, unsatifying headaches and financial nightmares.
cccmedia in Quito