Investing for Survival---Renting overseas

Investing for Survival

4 Tips for Renting Smart Overseas

By Helen Korengold

Chicago natives Joe and Sheila were excited. They finally had enough time to try out life in one of their favorite cities. With a four-month stay in Granada, Nicaragua, lined up, all they needed was a place to live. So via the Internet they rented a pretty, two-bedroom house “only five minutes from the city center.” They paid the four-months’ rent up front. But when they arrived it turned out that the house was much farther than five minutes from the center.

Upbeat folks, Joe and Sheila decided they could live with the longer walk and looked forward to the exercise. But the house was next to a large school and on a busy road and the noise was too much. Finally, the couple moved, only getting a partial refund.

With their boots on the ground, they were able to do their homework on the second rental. And eventually the couple bought and restored a beautiful colonial home.

Wherever you choose as your new home overseas, a trial period—like Joe and Sheila’s—is highly recommended.

But whatever adventure you decide upon, these basic tips make avoiding disappointment easy

1. Don’t rent sight unseen. Especially in a city or location that you are not familiar with. The photos can look fabulous on the website, but once you arrive, you may find yourself in an iffy neighborhood, on a busy street, or next to a bakery that blasts music at 4 a.m. And that promised “five-minute walk to the center” only applies to an Olympic athlete.

You can live with all this for a few days, but probably not for six months. If you only feel comfortable renting before you arrive, make it as short a time as you can (ideally a week or less) while you get your bearings. And don’t pay heaps of money up front. Remember that, in many places, B&B and hotel accommodation is low-cost.

What you can do before you arrive is research. Landing with a short list of places to check out saves you time. Check out local listings for classifieds, and check out discussion groups for ads and advice. Yahoo Groups covers many cities and countries for expat-living sites. Some major expat havens even have their own website; search by name in Google to ferret these out. Get yourself on every mailing list for classifieds, local information, and expat get-togethers so you hit the ground running when you arrive.

2. Talk to locals, other expats, and really look around. No matter how much research you’ve done long-distance, you’ll find more information—and more deals—once you’re “on the ground.” Get yourself settled into a reasonably-priced hotel or B&B (often cheaper and homier) and start getting to know other expats and locals. Talk to everybody. Let folks know you’re looking. Go to real estate agencies and see what they have.

Scope out neighborhoods a little farther away from the center. Talk to the people who live there. Pound the pavement and call the numbers on any “for-rent” ads you see. Get people looking for you. Offer a finder’s fee to locals who can get you what you’re looking for. Give yourself time and don’t rush into anything.

“You’ll find many rentals are negotiable”

3. Figure out what you want. After you’ve looked around for a bit, you’ll get an idea of what is available, what appeals to you and what you can’t live without. Need a fully-equipped-kitchen? Pool? Garden? What size will you be comfortable with? Could you settle for an unfurnished or semi-furnished option?

Remember, you’re not going to live there for the rest of your life, so be flexible. Be open to renting outside the city center, where you may have more options and cheaper rent. Investigate a variety of neighborhoods. The better an idea of the rental market you have, the easier it will be to negotiate a fair rental price.

4. Once you’ve found a house, it’s time to do your due diligence and protect yourself from risk. Here are some steps to consider.

Noise: Check noise levels in the area. Go hang out in the neighborhood at various times of the day, especially at night and on weekends. See if anyone is blasting music, conducting a church service with huge speakers or practicing drums for several hours daily.

Utilities: Verify what the utilities cost and ask to see past bills going back for a year. Keep in mind that bills will be higher if you need heat or air conditioning at certain times of the year. Make sure all bills are paid up, and that electricity cost is not unreasonably high. Compare costs with houses of similar size.

Inspection: Do your own inspection. Note any problems that already exist in the house so that you are not later charged for damages you didn’t do. Get the owner or agent to handle any problems you can’t live with (broken appliances for instance). Make sure you have a written list of these and get the agency or owner to co-sign or note these in the contract. (Consider taking pictures of pre-existing damage as a back-up—and use your camera’s date function when shooting.)

Pricing: Because you’ve done your homework and know the market, you can negotiate a fair rental price. Many rentals are negotiable, especially if they’re longer-term. The longer the term, the cheaper the price.

Contract: Sign a contract that stipulates owner/agent responsibilities, such as repair, maintenance, garden upkeep, and the like. Make sure there’s a way out for both parties without too much loss on either side.