You don't have to be incredibly wealthy to buy property abroad. Well, yes, it helps; but no, it isn't absolutely necessary.
In fact, in some places it is so economical to hold land that language and culture are more important problems than dollars.
For instance, condos on the Spanish Riviera--the Costa del Sol--go for between $35,000 and $85,000. Taxes are not prohibitive and services aren't bad.
Or a little more upscale, 200-acre horse farms in Ireland, some complete with castle ruins, may be had for as little as $200,000. Financing is available and the cost of living is lower than the United States.
Or how about Hungary, Yugoslavia or even Poland?
"There is a lot of interest in Communist-bloc countries," says international real estate broker William Meyer. "American retirees on fixed incomes purchase property there because of the low cost of living.
"They are fine homes compared to Western Europe. If you have a fixed income of say, $400 a month, you can get a place in Poland for $150 a month, with a maid, and $30 a month will take care of your food."
There are drawbacks, such as food lines and a government that is not always friendly to Americans.
"But for people who speak the language and whose heritage or families are there, buying property may not be a bad idea," Meyer said.
Appeal to Travelers
Meyer, vice president of the American branch of the International Real Estate Federation, says living abroad appeals most to people who have traveled extensively--perhaps with the military or multinational corporations--and who have fond memories of specific places.
Buying abroad also isn't difficult.
The first call goes to your local real estate broker who, assuming he does not deal in foreign properties, then calls his state real estate association to find the nearest office that does. There are about 1,500 such offices nationwide, at least a couple in every state.
A knowledgeable international broker can steer you through the system, including the pros, cons and the red tape.
Thoughts Around World
To get you started, Meyer, president of Begg International brokerage in Washington, offers these thoughts on places around the world:
--Spain: Buy. Oceanfront condos on the Costa del Sol go for $35,000 to $85,000, compared to similar condos on the east coast of Florida priced from $150,000 to $500,000.
--London: Buy. "Address for address, London is about as expensive as New York. Outside of London you can get a little more for your money." Maintenance cost (plumbers, electricians), however, is higher.
--Paris: Lease, don't buy. "More expensive than New York or London. French law (Napoleonic Code) makes it difficult to understand your rights as a property owner. Taxes are 30% higher than in the United States. Both buyer and seller pay a transfer tax when the property is sold. In the United States, you're taxed on capital gains, but there, even if you buy for $100,000 and sell for $90,000, you still pay a tax."
--Ireland: Buy. Property often changes hands by auction rather than straight sale. Interest rates tend to be about 20% below U. S. rates. Services (auto mechanics, etc.) are much cheaper.
--Italy: Lease, don't buy. "Americans are taxed 20% on resale of property, double what Italians pay. The politics are unstable." But if you lease, "for $600 per month you can get a nice villa with a maid, within walking distance of downtown Florence."
--West Germany: Buy or rent. "Proximity of Russian tanks is unnerving for some Americans." Homes are built to last 100 years, so construction costs are higher per square foot, but maintenance is lower. "Taxes are pretty equitable."
--Copenhagen: Stable socialist country with a tax structure of 40% of income. Profits from resale are taxed at that rate.
--Hong Kong: A two-bedroom, mid-level apartment rents for $10,000 per month.
--Australia: U. S. resort developers are beginning to buy property on the western coast. Prices are climbing.
--Mexico: Don't buy. Confusing laws subject to radical change. "Americans and Mexicans aren't taxed in the same way. It's inexpensive to live, but I wouldn't risk a lot of money there. If you buy, plan to hold as long as you live and don't expect a profit."
--Brazil: Stable low taxes, but inflation of 40%. Land value is up, but repatriation of cash is difficult. If you make more than $20,000 in U. S. currency on resale, you must report it to the government, making it subject to high taxes or perhaps insistence that profits be reinvested inside the country.
--Canada: Typically, you can buy 60% more for your money, but interest payments are not deductible.
--China: The Chinese can't even buy property in China.
--Soviet Union: Don't try.