Frequently asked questions
On this page we are aiming to answer common questions that we are frequently being asked.
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How are off plan investments financed?
Typically a deposit is paid to the developer of c20%. The purchaser can then pay cash for the balance of property when it is completed or arrange a mortgage for the balance.
If the mortgage option is chosen, quite often a payment holiday can be agreed (i.e. no mortgage repayments) until the property is completed. Once completed an interest only period can be agreed with the lender to help ensure that the rent (if this is the chosen investment strategy) has a chance to cover the majority of the mortgage costs in the early years.
QIS works with purchasers to help you find the right solution.
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How do I reduce the risk of buying abroad?
Buying abroad can be a risky business. Our advice is to do your homework thoroughly with as much research as possible. Personal recommendations are also a very good way of minimising potential risk. It is also important to have someone local to keep an eye on your property if you do not plan to live there.
It is this approach that QIS follows using our QIS STeP (Structured Evaluation Process) when searching or appraising investment opportunities. We use a due diligence approach that appraises the Country, the Area, the Developer and the Development. We ensure that all aspects of your investment are researched and that once purchased there is also appropriate support locally to help you maintain, manage, rent or sell.
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I have heard that a lot of developers do not own the land they build on. How can I avoid being caught out by this?
There is no substitute for doing your homework and if working on your own, for employing the services of a truly 'independent' lawyer. Make sure you see the documentation that shows the developer has title to the land and that they also have the relevant planning permission for the development. We would also advise conducting some checks on the financial situation of the developer and finding out if they will still be in business when the development is due to be completed!
At QIS we ensure all these steps are completed before we will consider becoming involved in an investment.
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I want to invest overseas but don't want all the hassle involved in finding a property and then doing all the paperwork. Is there an easy, risk free way?
Nothing in life is free! Investing is intended to be a way of taking calculated risks with the intention of making your money work for you. By its very nature investment is not risk free. If you can't be bothered to do your due diligence we would not recommend investing in property. Put your money in the bank!
If however you are prepared to do some research, talk to people and take some advice then property investment could work for you.
QIS can't get rid of the risk (property value can down as well as up!) but we can do some of the hard work for you in terms of research and we can definitely reduce the hassle (and there is plenty of it when buying abroad!). We can help with the paperwork, liaise with the banks and support you in the 'harvesting' stage of your investment cycle.
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Should I buy residential or commercial property as an investment?
This is a matter of personal preference, personal investment strategy and overall what you know and are comfortable with. Both commercial and residential are equally valid when considered with these factors.
Typically residential property is more easily understood. It can offer both the lifestyle benefits of a home abroad and can be combined with renting it out to holiday makers when you aren't using it. Alternatively it can be permanently rented out to a long term tenant. Residential property also enjoys capital growth benefits which not all commercial property does. Yield (the income as percentage of the purchase price) tends to be lower than commercial. Tenancies are also typically shorter than commercial.
Commercial property offers the benefits of a higher yield typically than residential and therefore offers an income stream potential (any surplus after repaying finance). The capital growth opportunity is often lower than residential and of course if does not offer the lifestyle benefits that a residential property can offer.
Which is better? It depends on your circumstances and objectives. We at QIS believe the property investor should hold a balanced portfolio as you should do with any asset class.
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What markets / countries does QIS work in?
QIS does not work in any market exclusively. We search out what we believe to be some the best international property investment opportunities.
We are currently offering property in Cyprus but are also considering India, Brazil and some of the smaller states in the UAE. This will always change.
As these are released we will make them available on our website and also make our network of serious international property investors aware of each opportunity. If you want to be notified of future opportunities please sign up here.
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Which country offers the best investment opportunity?
The world is now truly global in terms of the opportunities it offers the international property investor. The one thing that can be guaranteed is change. Therefore the opportunities are dynamic. What may represent a good option now may not be quite so good in absolute or relative terms in the future. What the savvy investor needs to do is constantly review the macro and micro economic factors associated with the investment locations that they are considering. It is relatively complicated and a matter ultimately for your commercial judgement.
QIS find countries which it believes offer an excellent opportunity. We look at the long term not the short term and try to gather as much evidence as possible to make an objective recommendation. We utilise as much research data from reputable sources as we can find. We offer this research not only for your use but also ourselves; we invest personally in many of the projects and countries that we recommend.
However, it is worth stating that "The Best Investment" is impossible to find. So much of it depends on the individual's investment strategy and risk profile. What suits one person may not suit another.
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Why is buying off plan a good idea?
Everyone's circumstances and objectives are different. For the investor who is looking for longer term capital growth, off plan investments offer the chance to buy at a discount against the completed property value plus enjoy capital growth whilst the project is being constructed.
