Estate Living Magazine New Beginnings - Issue 37 January 2019 | Page 62

L I V E
S M A R T
BRICKS AND
MORTAR
LEGACY ABROAD: RETIREMENT PLANNING
YOUR
WITH OFFSHORE PROPERTY INVESTMENT
When reviewing your retirement portfolio, it’s wise to
consider all the available asset classes – including offshore
property. The key, however, is to ensure that you’ve done
your homework and sought expert advice.
The economy and the rand have shown stability since
President Cyril Ramaphosa took office. However, experts
in the property investment arena predict a two-year lag
before South Africans see any real gains attributable to
Ramaphosa’s government. But the unknown ‘elephant
in the room’ is the looming issue of land expropriation
without compensation. If implemented in the manner
sought by the political left (the Populists), property prices
will plummet, and security of tenure will vanish. This
scenario makes it an opportune time to take advantage
of the steadier rand, and to diversify offshore. Purchasing
offshore property presents a double advantage. Acquiring
property in a growth economy will result in value
appreciation over time and, if required, passive income
via rental yields.
The advantages of offshore property as an asset class are
extensive – especially for South Africans who feel more
comfortable with its stability and tangibility. The benefits
include:
• its ability to generate long-term returns
• how it can be leveraged in tier one markets with
historically low interest rates
• the exposure it allows to other currencies
• higher levels of consumer protection in developed
markets
• a hedging opportunity when investing in economically
stable markets in the UK and Europe.
Ideal locations are economic powerhouse cities that offer a
variety of lifestyle and leisure activities, great schools, and
– for those interested in short-term rentals – a high influx
of tourists. As there are tax considerations to investing in
offshore property, it is a good idea to conduct research and
seek professional advice so that tax laws do not jeopardise