How to Rate Foreign Property Prospects

Property scout Ronan McMahon discusses his system for rating available properties in attractive foreign locations. The “PPD System” calls for first evaluating the places, or geographic locations, that …

Property scout Ronan McMahon discusses his system for rating available properties in attractive foreign locations. The “PPD System” calls for first evaluating the places, or geographic locations, that spark the buyer’s interest. Next, examine available projects in that area, and look for unique attributes (e.g., a reliable development team) that make those projects stand out. Finally, look for deals that include low early buy-in rates, low interest or a discount. McMahon rates each category from 1 to 10, and only properties scoring 24 or higher are considered. For more on this continue reading the following article from International Living.

Today I’m going to show you how to rate the value of any real estate you may be interested in buying. I’ll use a current property for sale as a case study. In fact, this is a  killer deal near the Pacific Coast. For reasons that will soon become clear, I can’t tell you exactly where this is.

In the place pictured here (see photo)…bright, thick green jungle canopy rolls down to a coast of sandy beaches and rocky points. It’s truly stunning. While prices in other parts of the country soared, prices here stayed low because it was difficult to get to. Now a new smoothly paved coastal highway has changed that.

One project along this coast, rich in nature on land and sea, stands out as the gold standard. It’s got the best views to the coast and the turquoise waters beyond. Long established, it has stood the test of time. It’s located only a few minutes from a little town that has restaurants and cafés. There are no fancy community amenities like a clubhouse, bar or restaurant. That’s what the village and the beach is for. Plus, you won’t get hit with hefty HOA fees.

A 1.29-acre lot here lists for $65,000. That’s a good deal. But members of Real Estate Trend Alert can buy the same lot for $40,000—a killer deal.

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This is an “off-market” deal. I can’t tell you the name of the project as it wouldn’t be fair to those who have paid retail (who still got a great deal). Members of my Real Estate Trend Alert service are often discretely offered off-market deals like this with special pricing and terms.

But a discount is only part of what you should consider.

Every year I investigate hundreds of real estate projects and make up to 18 scouting trips. Most of what I review doesn’t make the cut. One of the tools I use to help me separate the ordinary from the exceptional is something I call the PPD System. This is something you can do, too.

Place. Look for places of outstanding natural beauty that have remained undiscovered or undervalued. Or a place where something…like a new highway, for example…is set to make a location more accessible, and therefore more desirable. Which makes real estate there more valuable.

Project. Then drill down to find a unique project that has some special attributes. This  could be a skilled development team…or a natural attribute like the best beach or most spectacular stretch of ocean land.

Deal. Finally, there has to be a special deal. Like a discount…or interest-free financing…or strong early-in pricing.

Each of the three criteria is rated out of 10. Opportunities I consider need a total score of at least 24.

This article was republished with permission from International Living.

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