After the technology bubble burst back in 2000 the stock markets suffered a bleak period of decline and investors chose to place their focus on bricks and mortar rather than falling share prices and they began investing heavily into real estate.

As a result the second home and the buy-to-let real estate markets in many countries around the world such as in the UK, US and Australia boomed.  However, as the real estate affordability gap continues to widen in these nations and fewer first time buyers can even get onto the first rung of the real estate ladder, property price increases have begun to cool off and the ability to generate impressive rental yields and strong capital appreciation has slowed right down for at least the short term.

At the same time the stock markets around the world remain volatile and so now many more investors are looking overseas for alternatives to cooling domestic housing markets and bumpy rides on the stock market.  Many are finding that there’s an abundance of real estate opportunity in emerging countries around the world which has created a strong demand for real estate finance overseas.

For those considering joining the jet-to-let real estate investment set here are the three main options available when it comes to raising real estate finance, loans or mortgages to buy property abroad.

1) In many of the nations that were the first to boom the property markets are now stagnant and because lenders have fewer customers to provide finance for they are actively targeting those who have yet to upsize, release equity or take out a second mortgage and offering them increasingly favourable terms, conditions and interest rates.

For anyone thinking about buying real estate overseas in a country where they believe it will be difficult for them to secure local finance or where interest rates are unattractive, the option may exist for them to re-mortgage their existing property or take out a loan secured against the equity in their primary residence.

The negative side of this option to raise real estate finance to buy overseas property is that the purchaser’s primary residence will be the security against the loan and naturally this introduces an element of risk. (more…)