Validus believes that international investment properties are generally medium to long-term investments, implying at least a 5-year holding period.

There are a number of reasons for this:

Firstly, selling the property soon after purchase would mean less capital growth and high transaction costs as a ratio to the value of the property assuming property prices rise year-on-year. Where property prices are rising, the longer the property is held, the more its value increases and the less transaction costs will be as a ratio to the property value. However, there are certain scenarios in which selling properties immediately is a profitable strategy.

Secondly, depending on the country or jurisdiction in which the property is held, there may be tax advantages to holding on to the property for longer periods. For example, in the Czech Republic companies are currently exempt from capital gains tax on sales after 5 years, and individuals are exempt after 3 years. As with all such issues, clients are advised to take professional tax and legal advice at all stages.

Thirdly, it may be easier to sell off-plan properties in a development once the whole development has been sold. This is because until all units of a development are sold there is often greater effort, due to greater economic incentives for property companies, to sell yet unsold units than units for resale. Again, there are scenarios where this is not the case, which Validus is happy to discuss with our clients.

For further information about investing with Validus, call us on
020 7517 0580, email ask@validus-invest.com or register here.

view disclaimerPlease note: As with all investment property purchases, you are advised to take proper financial and legal advice at all stages. Investment values can decrease as well as increase. The content of this website is for informational purposes only, and readers are advised to speak to qualified legal experts and financial planners before taking any action. The information, tables, projections, and estimations provided by Validus are for indication only and do not represent factual information unless otherwise stated. The information is supplied without any guarantees whatsoever.