Has security become an overriding consideration in Overseas Property Buying?

We have always wanted to travel and buy overseas property safely. However, there seems to be a heightened sense of awareness regarding Muslim nations, following the terrorist attacks in New York and London and the recent anniversaries.

Country Security

So for example some people are put off of Morocco because it is a Muslim nation. However, Morocco has a very open culture and in reality is one of the most tolerant of African and Muslim nations. French is widely spoken (giving a more European feel) and some English, it is not all Arabic. Whilst it makes sense to pay some respect for local customs, women dressed in Niqabs and Hijab are fewer than might be expected. Its forward thinking leader, King Mohammed VI, who acceded to the throne in 1999 and whose 'Vision 2010' project aims to increase tourist figures to a sustainable 10 million, has created the right conditions for Morocco property investors and home buyers.

For the initiated, it is a country which provides a wonderful combination of the exotic with the same fabulous Mediterranean coastline as Spain. Saïdia for example is a purpose built resort with three 18 hole golf courses and internationally renowned hotels such as Best Western, Radisson, Hivernage. Properties are clustered in separate resorts around these hotels which offer the added comfort of security. The resort offers a medical centre and all the facilities for if someone is seeking to retire there or take extended holiday stays.

Apartments start at £90,000 and houses at just over £200,000.

Montenegro, is a country that is politically and economically stable, but at times there is the perception among many British that it still has trouble with its neighbour, Serbia. Montenegro became independent from Serbia in June 2006, and is now attracting inward investment in its own right e.g. interest from overseas investors in electricity generation and infrastructure projects.

The Government is looking to establish a business friendly, open economy with low taxes and minimal state interference. Montenegro is a member of the UN (6.'06), European Bank for Reconstruction and Development (EBRD) 9.'06, the European Investment Bank, the IMF and World Bank since Jan '07, so demonstrating its political and economic stability. The combination of historically strong GDP growth –although this has slowed during the Global downturn - low inflation and a significant inflow of foreign direct investment (more than $1 bn over two years), alongside adoption of the Euro, have contributed to the stability of this nation.

Last year Montenegro applied for EU candidate status and recently submitted answers to questions of conformity.

Apartments are available from £126,000 in the Herceg Novi area, at Djenovici Springs with beautiful views of the Boka Kotorska Fjord and within walking distance of a supermarket and waterside restaurants

Security of Purchase

In terms of safety of purchase, clients are certainly, on the whole preferring ready-built, to off-plan buying. Some of the high profile TV programmes such as “Spain – Paradise Lost” or ITV’s “Homes from Hell” have highlighted issues with Off-plan buying e.g. developers going bust and not finishing work off. Some individuals have not found Off-plan buying has worked for them in a falling market, particularly those who saw off-plan buying as a bit of a gold-rush: who bought several properties off-plan, expecting to “flip” the contract (sell it on), never having to complete and pay stamp duty, or other completion-related expenses, only to find the pool of potential buyers suddenly dried up and they were left completing on purchases they could not afford. So some of the highly attractive offers we see now like “buy-one-get-one-free” properties are as a result of individuals taking higher risks than they might normally have done.

Conclusion

At the end of the day, a lot of this comes down to an individual’s risk profile, which doesn’t change dramatically over a period of time. Although evidently news stories can influence how people buy and what they are comfortable with.

The global property scene has become far more accessible as greater levels of information have become available via the internet. Buyers are able to inform themselves better and this can reassure some buyers sufficiently to buy abroad. However, lots of mis-information exists and misunderstanding, particularly of nations such as Morocco or Montenegro.

^{Posted by Louise Reynolds 2nd August '10}  

Property Venture^® is an independent, UK-based agent. We help time-strapped investors and holiday home purchasers, buy abroad by guiding through the buying process, so reducing the hassle. We visit the countries you buy in, so we can offer common-sense, grounded advice. Overseas members of NAEA. This means we have been subjected to the membership criteria and have signed up to follow the professional Code of Conduct established to help you, the potential buyer or investor, buy property with confidence