The desire for adventure, favorable exchange rates, and the flexibility to work from anywhere have sparked a renewed interest among Americans in owning property overseas. Take John and Felicia Magliula, for example. As self-proclaimed adventurers, they sought a new place to call home for their growing family and ultimately chose St. Croix in the Caribbean. They purchased a spacious estate there for $1.4 million and have since renovated a guest cottage for short-term rentals. The Magliulas’ story reflects a larger trend of high-net-worth Americans exploring real estate opportunities abroad.
According to Coldwell Banker Global Luxury’s 2022 Trend Report, a staggering 92% of affluent Americans actively considered purchasing international real estate in 2022, with 67% of respondents already owning residential properties outside the United States. The report also indicates that the number of high-net-worth individuals buying homes abroad in 2022 is estimated to be 14% higher than in 2021 and 29% higher than in 2019, as per data from Wealth-X.
Several factors contribute to this growing trend. Firstly, after years of restricted travel, the pent-up wanderlust of wealthy individuals is driving the demand for international properties. Additionally, the challenging economic conditions in the United States during 2022 and surging home prices have prompted affluent buyers to seek alternative investment opportunities overseas. The accessibility of social media platforms has also played a role in demystifying the process of moving abroad, making it more appealing and attainable.
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Kelly Cutchin, the Country Manager USA for Moneycorp Americas, suggests that younger generations with increased wealth from inheritances and self-made fortunes are particularly interested in diversifying their investment portfolios with international real estate. Lief Simon, co-owner of Live and Invest Overseas, highlights that many investors are seeking vacation homes that can generate rental income and cover their expenses.
The COVID-19 pandemic has further amplified the desire for a change in lifestyle and location. Some individuals have sought out properties overseas as potential havens in case of global upheaval. The pandemic has underscored the fleeting nature of life, leading more people to ask themselves, “What else can I do?” With greater financial resources, individuals now have the means to act on their aspirations, even if they may have seemed imprudent in the past.
When it comes to favored locations for American buyers, Central America, North America (Canada and Mexico), and Asia top the list, according to the Coldwell Banker survey. In Central America, Belize, Costa Rica, and Panama are the most sought-after countries for affluent buyers. France, Monaco, Italy, Costa Rica, Spain, and Portugal have also seen substantial interest from U.S. buyers, with many attracted to countries offering “golden passport” programs that provide citizenship or visas for primary and secondary residences.
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While some buyers focus on acquiring one high-value property, it is increasingly common for them to invest in a portfolio of properties across multiple locations. For instance, one couple recently purchased properties in seven countries and plans to expand their holdings. France appeals to many as a destination for vacation homes, while Portugal’s Golden Visa program entices those seeking full-time residency. The stability of the European market is particularly appealing to buyers, especially those concerned about the political climate in Latin America.
Before committing to a specific location, potential buyers must thoroughly research visa and immigration regulations. Understanding the availability and quality of healthcare, educational options, and transportation infrastructure is crucial, particularly for those considering permanent residence or relocating with their families. Evaluating factors such as healthcare and insurance coverage, property taxes, maintenance costs, and the need for property management services is essential when assessing the financial viability of an international investment.
Buyers are advised to seek recommendations from local real estate agents or property managers, especially when dealing with fixer-uppers or properties in need of repairs. Legal and tax considerations should be addressed by consulting with professionals both locally and in the United States to avoid any unforeseen financial implications. It is also important to plan ahead regarding the necessary funds for a deposit, as international transfers often require in-person presence or advanced arrangements with financial institutions.
If you’re thinking of investing in property in Barbados, visit www.nvestestates.com for more information on available properties for sale and for rent and to schedule a viewing.
