The Baby Boomer generation is changing the face of retirement by investing abroad and planning for a retirement that their parents would have never considered. More and more retirees or those planning their retirement are looking at real estate investments abroad and redefining what retirement means. Investing abroad has risks, like any investment, but the rewards can be huge and with due diligence a overseas investment can mean a comfortable retirement and a whole new chapter of life.
Baby Boomers tend to be better educated and more well-traveled compared to any other generation that has come before them. This knowledge and experience has created a situation where Baby Boomers are thinking outside of the box and looking outside of the U.S. for their retirement plans. Most often retirees are looking for cash flow opportunities where they can combine adventure and profit. Real estate investments abroad can allow for time spent in a foreign country and a source of income, like renting out a vacation home, while not using it. While investing abroad is a great opportunity, there are risks involved and international real estate markets differ greatly from U.S. real estate.
Most Americans are familiar with multiple real estate listing services, allowing for property comparisons and an accurate way to gauge the market. In most international markets, this is not the case. Also, most international real estate markets deal exclusively in cash and loans can be difficult to secure. The process of investing in real estate in a foreign market can be lengthy and quite involved, requiring records from the FBI, local police, and proof of legitimate sources of funding. It can take months to complete an international real estate investment and sound legal advice from a knowledgeable lawyer or real estate agent.
Another important step to investing in real estate abroad is to become familiar with the country before investing. Spending long periods of time abroad can help with the overall transition and ensure that the investment will pay off. Short vacations only offer a glimpse of what life is like in a foreign country. Spending three months at a time or longer can give deeper insights to what living abroad actually entails. Planning a trip to see multiple properties, different regions of a country, and interact with various communities can help paint a bigger picture of where you should end up. If you’ve already spent a lot of time abroad in a certain country, it may be smartest to choose to invest in a country you are already familiar with. If you’re interested in exploring new countries, take the time to properly become acquainted with the culture and the economy to make sure that your international real estate investment will pay off in the end.
And while many Baby Boomers look to residential real estate when investing abroad, getting involved in the local economy is also an option that can have large rewards. It’s not just about investment diversification; it’s a lifestyle diversification that more and more retirees are exploring for their next big adventure.