O
ffshore investment, for some people, may seem like a distant
fancy. Most investors are concerned about investing outside of
their province, never mind ‘abroad’. If you can afford to hold
more than two properties in South Africa then you would probably
want to be able to afford an offshore property. It is still the best way to
hedge your wealth against a devaluing rand. Probably one of the most
frequent questions an investor asks is where the best place to invest is,
offshore. Well, of course it really depends on numerous factors. Your
reasons or objectives are key in your investment decisions; whether you
are investing for emigration, retirement or pure investment. Do you
want to emigrate, for example, with the intention to live there someday,
or do you just want to invest, with the view of getting maximum return?
Global Property Guide has listed the countries that are most popular
for offshore investors. South Africans, for example, mostly invest in
countries like the United Kingdom, followed by Australia, Mauritius,
United States and New Zealand. Europe is also a popular destination,
depending on the motivation.
Property investor criteria on the one hand, investors need to
look at markets where maximum yields can be achieved, but also at
international markets where ease of business and registering property
is done in the most effective way. Global Property Guide has also listed
the countries where ease of business is taking place. Access to offshore
finance as well as openess in terms of local regulations should encourage
investment rather than discourage investment. We have devised 12
steps, or guidelines, to follow for investing offshore.
1
Decide on your goal
The first thing you need to decide when looking to invest
offshore is what you hope to achieve in the process. What’s your
end goal? It’s easy enough to say that you wish to diversify or that you
want to make provision for your pension – but this is simply not clear
enough. Sit down with a pen and paper and write down exactly what
you hope to achieve, and in what time frame. Your goal should read
something like: “I want to build a portfolio that will generate R250
000 per annum by 31 July 2020, so that I can scale down my work
commitments while still maintaining or bettering my current lifestyle.”
This is vitally important because unless you have a clear goal and
plan, you will easily be distracted once you start looking at different
investments, your emotions will take over and before you know it you
have bought a property that can’t produce the results you wanted. No
entrepreneur worth his salt would start a business without a plan – you
should be no different.
2
Decide on your market
Decide on which country you want to invest. This is the first
step forward. Research the country on the Internet, or even by
visiting, although that is not pre‐requisite. Learn about the economy,
political and legal systems.
Location, location, location ‐ it may be a tired cliché, but
understanding where to buy your first offshore investment property is
of paramount importance if you are to achieve success.
These days there are so many different opportunities available to South
Africans who wish to invest offshore, and it’s easy to be overwhelmed by
www.reimag.co.za
Offshore Handbook 2016
7