I Almost Told Him Not To Purchase Property Overseas
The first real estate purchase Lief and I made outside the United States purely as an investment was 16 years ago in Spain.
We’d moved to Ireland the year before. We were renovating the house we’d bought in Waterford for our family to live in, running the business we’d relocated with us from the States, and I was pregnant. Lief was on the road two weeks out of four at least, scouting.
When he called one night from his hotel in Estepona, Spain, to tell me that he’d met that day with a developer with only a handful of units remaining in his pre-construction development on that coast, I was silent.
Was I ok with him returning to the developer’s office the next day and signing a contract for one of those remaining units? He needed to move quickly, Lief told me, because the developer believed the project would sell out within a matter of another couple of days.
At this time, Lief and I had been married but a little over a year. Still, I knew my husband well enough to know he was nobody’s fool. Lief isn’t easily convinced of anything, especially when money is involved. If he believed the developer telling him that this pre-construction condo project on the coast of Estepona, Spain, was going to sell out within a matter of days…well, then, that was probably the case.
Furthermore, I knew that, while my husband had not bought property purely as an investment in any country other than the United States at this point, he had enough general real estate investing experience to be able to size up an opportunity.
At least that’s what I told myself as I listened to the silence on the phone that night.
Had the decision to make that first real estate investment purchase of our lives been left to me, we never would have bought a pre-construction condo on the coast of Estepona, Spain. It was no time for us to be taking this kind of a leap as far as I was concerned. I was focused on making the drafty old Georgian country house we’d bought habitable…and preparing for the new arrival who’d be inhabiting it with us.
I could have come up with a dozen convincing reasons why it was foolishness or worse to make that purchase at that time in that way. Better to return home, I could have told Lief, do more due diligence, and mull things over before jumping. The developer’s probably over-stating things, I could have said. Surely you can take a few days or a week even to consider this more carefully.
I could have made those points and others…wanted to make those points…but, thankfully, I didn’t. I told my husband to do what he thought best in that way that wives have that makes it clear the husband had better, in fact, know what he’s doing.
Lief returned to the developer’s office the next day and signed the paperwork. We’d bought a condo on the coast of Spain.
Well, we’d bought the plan for a condo on the coast of Spain.
Why did Lief act so quickly, in spite of his wife’s passive-aggressive resistance? You can ask him for his answer to that question when you see him. As I see things today, in hindsight, it was because Lief knew enough, even at that starting-out stage, to trust his instincts.
Lief had not before invested in property outside the States when he made that purchase in Spain, but he had dealt with property developers, agents, and sellers in countries all over the world. He’d interviewed, researched, and reported on dozens of markets by this time. He knew what these guys generally are (not to be trusted) and what they generally are capable of (anything). He had a good feeling about the developer in Spain. He trusted him, instinctively and even against the better judgment his long experience demanded.
Lief had done enough research before setting out on that scouting trip to know that Spain was a market he wanted to be in (thus the trip in the first place). He’d seen enough of the country’s coast by this time to be able to compare what was on offer in Estepona with what was available elsewhere.
So he leapt. The opportunity presented itself, and Lief took the chance.
The moral of this story? When opportunity presents itself, take a reality check. Do you understand what’s in front of you? Do you trust the guy behind the offer (at least enough to do this deal)? Do you see an exit? Does the potential return seem reasonable? Worth the risk?
Answer those questions. Then go for it.
You’ve just go to make the leap. First jump is the hardest.
P.S. Didn’t mean to leave you hanging. That is, I’m sure you’re wondering how it all turned out on the coast of Spain years ago…
Lief put the apartment up for resale with the developer immediately after making the down payment. Meantime, we made the regular progress payments over the next 24 months or so. Then, as we were making plans to start looking for financing for the balance due upon completion of the condo, the developer wrote to say he had a buyer for us.
We were able to resell the apartment without coming up with the 70% balance that was due at closing. Lief got on a plane to Spain to sign the sale documents. The buyer sent us our money directly, and then we paid the developer the balance due. The return over the two-plus years we held this investment was a little more than 30% per year.