Twenty years ago, I was an average, non-professional stock investor.
I made plenty of money up until 1999—when anyone could do it—and lost plenty during the tech crash in 2000.
Since I didn’t lose everything—as many did—I guess it could have been worse.
Then I got another chance in 2008… with the worst financial crisis since the Great Depression. Fortunes were wiped out. Many lost their life savings, and retirement plans went down the drain for millions of people.
This time, I came out ahead… even though my stock holdings took a hit.
The difference?
You see, in 1999, all the money I had to invest was in stocks and mutual funds, along with bonds and CDs… “traditional” investments.
At the time, I thought I had a diversified portfolio because I held both stocks and bonds and because my stocks were of different types.
I was wrong. I wasn’t truly diversified. All my money was in U.S. markets, and almost all of it was in U.S. dollars.
Looking back, I was taking a very narrow view of the investment world.
By contrast, in 2008, over 50% of my investment holdings were in real estate outside the United States.
That year, the S&P 500 lost 38.5%. And, yes, my American market holdings went down. But my real estate holdings increased in value. Here are three that I sold around the time of the Great Recession:
- Our house in Uruguay… for a profit of 87.5%
- The rental apartment in Montevideo… for a profit of 78%
- Our property in Brazil… for a profit of 77%
This was my “advanced” lesson in portfolio diversity.
I’d bet you see where I’m going with this.
We are living right now through one of the most uncertain periods in our lifetimes.
The markets are taking one wild ride. If you’re invested in them, you know what I’m talking about.
I continue to hold stocks and bonds, and, yes, I’m watching the daily market spikes and collapses with interest.
But I’m not panicking.
Because the bulk of my wealth is not in U.S. stock markets… but overseas real estate.
Of course, portfolio diversity, in itself, doesn’t pay the bills.
But the increased opportunity that you’ll find abroad can. It’s been my main source of income since 2001.
And it’s not because real estate abroad is categorically better than real estate in the United States.
It’s that when you open your horizons up to include the entire world, you’re giving yourself access to many more opportunities.
The point I want to make today is that if you have not yet begun building your own real estate of international real estate, it is not too late.
Quite the contrary. It is time.
This opportunity is more than smart and appealing right now. It’s crucial to coming out of what’s coming on top.
If you are just getting started at this, here are a few current opportunities I want to put on your radar:
- In Belize: Most recently, our property guru Lief Simon locked down a deal on brand-new rental units located on the world-famous Ambergris Caye. These studio rentals cost US$92,000, with a projected net return of 7.8%.
- In Brazil: I just learned of a project of new beachfront villas, with an asking price of only US$147,000… with a projected return of a remarkable 14.5%, net, annually.
- In Colombia: Cali’s short-term rental market is producing excellent returns. For just US$25,000, you can buy into an existing project that is producing an amazing 9% dividend.
- In Portugal: In a famous Algarve resort, you can buy a rental suite for just 149,000 euros, with a guaranteed return of 7%… and a possible projected return of 10%.
Further, while these income numbers are great… don’t overlook capital gain potential in rising overseas markets.
To cite a very recent example, Lief Simon just sold a property in Portugal.
That property had produced a decent income over the four years he’d owned it… from a high of 8% to a low of 4.5%. The average income was 5.75% per year.
Then he sold after those four years of income for a gain of 126%. That’s 31.5% annually.
When you add in the rental returns, the total average return was 36.8% per year.
Here’s the real point:
All of these opportunities are beyond U.S. borders.
They can make money… they can provide big capital returns… but, more than anything, right now, they bring diversification into safe haven markets and safe haven assets.
They also bring control.
You control the value (and value-added) of your real estate holdings… while you have absolutely no control over what happens to a stock price.
There is nothing you can do to enhance the value of a company that you’re invested in… no way to increase your potential for earnings or capital gains.
And you have no influence over how their money is spent. I’m invested in AT&T, and, believe me, they didn’t seek my approval when they decided to spend US$67 billion to buy DirecTV.
With real estate, it’s different.
You decide if or when you expand, upgrade, or restore a property, based on your own cost-benefit analysis.
You decide on the actions to take to enhance your returns. You’re able to do what makes sense based on your objectives and the market where you’re invested.
I’ve been investing in overseas real estate markets for nearly 20 years.
What has been the outcome for me?
I haven’t had a job since I retired in 2001, at the age of 49, with a small pension.
My net worth is 250% of what it was on Aug. 30, 2001.
I have not had to use funds from IRAs or 401Ks.
My wife and I have traveled the world… owned numerous properties in seven different countries… including second homes in beautiful places.
We eat out often in good restaurants, drive nice cars, and can spoil our children and grandchildren.
My friend and publisher, Kathleen Peddicord, likes to say, “International real estate is an investment strategy, yes, but, more important, it’s a lifestyle strategy.”
And I’m with her 100% on that idea.
It’s up to you whether you want to build a fortune… or lead an exciting international lifestyle… or both.
Either way, learning the ropes of international real estate investing is a more critical agenda today than it has ever been.
It’s time for you to get started.
Lee Harrison
