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Should You Rent Or Buy A House Abroad?

Purchasing a house overseas can be a tricky prospect, especially for those who are planning to recover their investment within a short period of time by renting it out. The location, demand for long- or short-term rental accommodation, rules & regulations, and restrictions all play important roles in the yields you can expect on your investment. All these factors should be researched carefully before you decide to buy any kind of property.In addition, of course, leasing out accommodation in some places is a lot more profitable for home owners compared to others. Read on to find out which are the best countries to rent out a house.


Because of its great weather, scenic beauty and proximity to other important places in Europe, Spain often ranks as the number one destination with holidaymakers. Moreover, every year many expats from the UK and North America retire to Spain. There is therefore a constant high demand for short term and long term property rentals from tourists and other foreigners.

Since 2007, there has been almost a 50% reduction in property prices in Spain, especially in the South and East coastal regions. Real estate prices in the expat-dense areas are stable and may even appreciate soon. Many British investors are jumping into the Spanish real estate market, before the economy improves and property prices start rising once again. Costa Blanca and Costa del Sol (mainly Malaga) are the most popular regions for expats.

It is absolutely essential for all landlords to be aware of the legal implications of renting out a house in Spain. The smallest error on their part could result in a legal problem. Expats are therefore advised to hire a local lawyer or agent who can draw up a written agreement.

The Republic of Moldova

This landlocked country in Eastern Europe is bordered by Ukraine to the North, East, and South, and Romania to the West. Its capital city is Chisinau and the official language in the country is Romanian. The climate can be described as moderately continental. Because of its proximity to the Black Sea, Moldova’s weather is mainly mild and sunny throughout the year. During some parts of the winter, the temperature can drop to -4 ᵒC (25 ᵒF) or lower.

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Moldova has a small number of expats, and many of them work for Embassies, international MNCs or NGOs in Chisinau. A majority of foreigners visit this nation for a short period of time – no more than a couple of months or years – and they therefore prefer renting furnished accommodation instead of buying a house.

Since it is one of the poorest countries in Europe, the cost of living is very low. This also applies to real estate prices. Housing prices have been on the decline for almost four years, and the property market has now come to a standstill. Nevertheless, there is a considerable demand for rental accommodation, especially from foreigners. The average price per square meter across the country is € 965 (US$ 1041, £ 710) and the expected yield per annum is 10% according to the Global Property Guide. Homeowners with properties in safe locations can make a considerable amount of money by renting out their houses.


The world’s largest archipelago, made up of 17,500 islands, is home to thousands of expats from various parts of the globe including Australia & North America. Its climate, educational system, employment opportunities, modern infrastructure, and colorful nightlife attract people of all ages to this Southeast Asian region. A vast majority of the expat population is based in Jakarta, Indonesia’s capital.

It is illegal for foreigners to own land in Indonesia; an expat can purchase an apartment or a house but will not own the land it is built on. This often poses a problem, which is why foreigners usually prefer to rent accommodation during their stay, instead of buying a house.

In the last few decades, there has been a significant increase in the availability of rental apartments in popular expat areas like Kemang, Menteng, Pondok Indah, and Kuningan. While accommodation is a lot more inexpensive in Indonesia compared to most western nations, luxury housing in these popular areas comes at a premium. Home owners also have a tendency to quote higher amounts when leasing their properties out to foreigners as the rents are generally paid by the employers and not the residents themselves. It is therefore best to bargain with the landlord before agreeing on a rental price.


Strategically located at the crossroads of the “Holy Land”, Jordan has been one of the most popular expat destinations of the Middle East for several years now, mainly because of its high living standards, its great infrastructure, and plentiful career opportunities.

Most foreigners living in Jordan tend to work for international MNCs in the education, media, finance, or petroleum sectors. The majority of the expat population is based in Amman, the capital city.

Any foreigner can purchase a house in Jordan as long as there is a reciprocal agreement with the resident’s home country as well as the approval of cabinet ministers. Since you can only sell your house five years after acquiring it, many choose to lease out their houses, in order to recover some of their expense.

Jordanian laws and regulations around housing rentals are very strict and must be adhered to at all times. It is therefore essential to hire a lawyer for all the paperwork.

Recent research conducted by the Global Property Guide revealed that Jordan offers the highest returns to homeowners in terms of rental returns across the Middle East. It ranks 4th worldwide, with a gross yield of around 9.25% per annum. Homeowners renting out their properties to foreigners on a short term basis can earn up to 20% more.


In the last few years, Panama has gained a lot of popularity as an expat destination, mainly with those who are keen on retiring or leading a relaxed life overseas. Its proximity to the US gives it an added advantage with North Americans. This country offers great pension programs to seniors, comprising of good quality life, low costs, healthcare and real estate.

Outsiders in Panama can easily purchase a house as they are entitled to the same property ownership rights as the citizens of the country, as long as they fulfill certain criteria as well as follow the laws, rules and regulations that have been laid down by the government.

It is common for rental contracts to last anywhere between one and six months; shorter contracts are likely to attract higher monthly rentals than the longer ones. In Panama City the asking amount may vary considerably between local and foreign customers. Many tenants pay very high amounts for furnished properties that include a maid service.


This South American country attracts thousands of expats every year. Chile is a modern and stable place that offers its residents a high quality of life and healthcare, with good employment opportunities. The government is eager to welcome foreigners and international business into the country.

Chile has a wide range of accommodation options for expats. Compared to other popular expat destinations, even the most top-quality houses in this country tend to be affordable, in terms of both buying and leasing. The older properties, while comfortable, may not be ideal for the country’s weather conditions. For example, these houses may not have central heating or air conditioning. However, the newly constructed buildings come with many modern amenities at only slightly higher prices.

Homeowners usually lease their apartments for a 12-month period, although they will be open to short-term rentals for a higher price. Foreigners may need a local guarantor in order to sign an agreement; very often, the expat’s employer acts as a guarantor for securing the contract.

The estimated yield per annum on rental property in Chile is approximately 9%. This figure is a bit higher in Santiago, the capital.


In the last decade or so, Mexico has become a very popular expat destination, mainly with older Americans and Canadians. This country attracts a lot of foreigners because of its weather, healthcare, low living cost, quality of life and proximity to the US.

The Mexican authorities have made it much easier for foreigners to own houses across the country. However, the procedure to purchase property is slightly different compared to the US and UK. Moreover, rental laws in this country can be quite complicated, especially for a foreigner. It is therefore necessary for all buyers to involve a lawyer in the transaction.

While mortgage options in this country have improved to a great extent, the down-payment amounts are still much higher than in the US and other places. Most expats therefore prefer to rent their homes instead of purchasing. This has lead to a high demand of rental housing across the country, especially areas like Mexico City, Los Cabos, Cancun, Lake Chapala, San Miguel and Puerto Vallarta. Very often, expats rent accommodation at a certain location for a couple of months to check feasibility before deciding to invest in real estate.

The Philippines

The Philippines, a massive Southeast Asian archipelago comprising more than 7,000 islands, can be described as a multicultural and multiethnic nation that has been influenced by many different cultures.

This country offers its residents a good, safe life at fairly low costs. English is widely spoken by Filipinos and this is one of the main reasons why most expats find it easy to settle down here. There is a fairly large expat population mainly based in the capital, Manila, though several foreigners choose to live in the smaller provinces.

The Philippines has a huge variety of housing options, ranging from luxury condominiums to free-standing houses. Real estate prices across the country are relatively low, even when compared to most other Asian countries. Expats from Europe and North America find even the top-quality accommodation in the most expensive areas very reasonable. Yet, foreigners shy away from purchasing property in this country because they can own the apartment or house but not the land it has been built on. The demand for rental accommodation is therefore very high among the expat population.

Luxury condominiums in the heart of the city attract very high rents and enable the home owner to recover their investment fairly quickly. Statistics show that the rental return in the Philippines is around 7.51% per annum. However, this could be as high as 8.62% in certain areas.


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