WS1640 - Risks with Investing Internationally (Part 2) | Evie Brooks

Investing internationally comes with a range of risks. From political instability to inflation to cultural and language differences – these add to the already complex and uncertain nature of international investments. However, our guest, Evie Brooks of My Panama Vacation Realty shares with us how these can be overcome if you work with the right people.

Join Evie in this second part of our podcast series as she explores the risks associated with overseas property investing and what can we do about it to achieve success.

Key Points From This Episode:

• What are the other benefits of investing internationally in real estate?
• What are the risks of investing internationally in real estate?
• What is Panama like for investors? What are the jobs available there? What industries employ the most people? 

Tweetables:

“If I find that you have overcharged and are taking advantage of one of my clients, there are no second chances.”

“You got to just be ultra-cautious, especially when you're not from that region or that country, because they see outside international investors as a one-dollar sign.”

“Safety is not an issue that I've ever been concerned with in Panama. The only time you ever hear about something violent is domestic. I have been down there since 2012. And I've only once had an encounter that created some concern.”

“By being intricately involved in all the different projects and buildings with different developers that we work with, we have a pretty good strong handle on what is a good value.”

“We negotiate with the developers to get a really below market retail price that they're selling for the projects that we offer to our clients.”

“You would need to get with a CPA, which we do have CPAs that we work with, and that we do recommend to actually see how that ties into your plan.”

“Your taxes in Panama are

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Transcript

Speaker 1  0:00  
I have seen people throw money away with developers that were one off developers and they would be building a building. And they would have a real great presentation, you know, song and dance. And so people would give them their money, and they would need that money to do the next little portion of building, and then they would not survive. Or they would take eight years, literally eight years to complete a project that was promised in three years. I mean, so there's been so many types of situations, you got to just be ultra cautious, especially when you're not from that region or that country, because they see outside international investors as $1 sign.

Speaker 2  0:41  
Today, we are welcoming back our guests, Evie Brooks, I hope that you listen to to yesterday's show where we got started with international investing. But today, we're gonna dive into more benefits, risks, different challenges that you need to think about as you are considering investing internationally. Evie, great to have you back. We're gonna dive right back in where we left off yesterday. And we're gonna talk more about this international real estate investing because you are no doubt the expert in just that and many other things. But I want to learn from you. I know the listeners want to learn from you as well. Welcome back.

Speaker  1:15  
Thank you. Thanks for having me again. Yeah. Honored for us to keep going on this topic. And so we talked about some benefits some things yesterday, you know, in that episode, I want to dive in a little more, maybe there's other benefits that you can elaborate on, but also want to dive in on the risks that we should know about? Okay, let's get started there.

Speaker 1  1:31  
All right. So what are the risks of investing internationally, I have seen a lot of people go in and just throw away 10s of 1000s of dollars, for example, they want to get their residency, and they'll work with honestly legal firms that just see gringo dollars. And so they'll charge 234 times what they would normally charge if you don't have somebody working with you, that knows who to work with knows what their fees are. Because you won't find when I first went to Panama in 2012, you wouldn't find anybody that listed their prices online. And now there are a couple of attorneys that I work with, that will list their prices online, because I honestly went through nine attorneys in the first 10 years that I was there with the same promise, I'm going to bring you a ton of business, but you're gonna give me your price list. And for whatever services it is, whether it's, you know, getting a visa, whether it's getting their passports, whether it's, you know, reviewing documents for investments that they're making, whatever it is, I need to have a preset price list. And I had some that gave me some some pushback to start with, and I wouldn't work with them. And the ones that did give it to me, I said, Now I will promise you, I will double check with my clients. And I will find out what you've charged them. And they will tell me because they trust me. And if I find that you have overcharged or taken advantage of one of my clients, there aren't a second chances. took me nine attorneys to find the ones that we work with. So it happened time and time again. So I've seen people that have paid literally 10 to $20,000 more for those services than they should have. I have seen people throw money away with developers that were one off developers and they wouldn't be building a building. And they would have a real great presentations, you know, song and dance. And so people would give them their money, and they would need that money to do the next little portion of building. And then they would not survive. Or they would take eight years, literally eight years to complete a project that was promised in three years. I mean, so there's been so many types of situations, you got to just be ultra cautious, especially when you're not from that region or that country, because they see outside international investors as $1 sign,

Speaker 2  3:52  
no doubt about it. Definitely a big risk. And we traveled to a few other countries, but mostly for adoption purposes. And yeah, it's it's very interesting, you know, how you're viewed, you know, when you're in some other countries like that. And you're seen as dollar signs, I think, you know, they see dollar signs when they see you right out. So it's not such a big value having somebody that knows what they're doing. I mean, it was for us, there were times we didn't have somebody with us. And then there were other times we did and it's just night and day, right, even night and day how that other person usually, like they know you got somebody who knows what they're doing, you know, so that's no doubt having somebody like yourself is just so valuable, that knows what they're talking about, whether it's developers or legal counsel or whatever it may be. Let's also talk about some of the well actually any other risks outside of just say, from local providers taken advantage of Yeah, I know a lot of people are concerned about safety. You know, those things to

Speaker 1  4:42  
safety is not an issue I've ever been concerned with in Panama. The only time you ever hear about something violent is domestic. I have been down there since 2012. And I've only one time had an encounter that created some concern and that was in the middle of the day broad daylight and a traffic jam and On Sunday had road rage. Other than that, that was the only time and I am single all over that country running around by myself Daytime, nighttime going into the city and going dancing, salsa dancing and going to the nice restaurants and meeting friends and stuff like that I have never, ever had any issues. Now, of course, you're not going to go into the seedy parts of town just like you wouldn't in Atlanta, Georgia, or Miami or anywhere else, but you know where to go. And you know, the places that are good, and you get referrals. But safety is not an issue. In fact, down there, they're very, very restrictive on actually being able to have guns, weapons in your possession. And most people in Panama don't even own any kind of a weapon at all. It's just a friendly country, live and let live and everybody does their own thing. And it doesn't matter. You know, culture, race, religion, people just don't care. They just go about doing their own thing.

Speaker 2  5:53  
What's the most jobs there? What employs most people? Oh, of

Speaker 1  5:57  
course, you got the Panama Canal, you got the Cobra compromised, then you got the construction industry? And I would say those are going to be the top three.

Unknown Speaker  6:03  
Okay. All right. Well, let's jump back here. I just know, that's a big concern for a lot of people, right? Just am I going to be safe? You know, can

Speaker 2  6:08  
I bring my kids and bring my wife or husband? Or, you know, are we going to feel safe while we're in another country like that, and we can't take our protections in the US for granted, I think often, you know, and then and you start to feel it when you're in another country, or at least, you know, you think about it more anyway. But what about an industry evaluating a property internationally like this, maybe some key metrics, some things that could I know, we talked about cash on cash a little bit in the last episode. But what are some other metrics maybe that are specific to international investing or some other things around metrics that we should consider.

Speaker 1  6:40  
That's another reason why having somebody to work with you that knows the market is going to be so beneficial, because they don't have like an MLS down there. So you can't go in and just do a CMA comparable market analysis. And so by working with the developers I work with, that have multiple buildings like one of the developers, I work with his built, you know, the Fendi building, Lamaze zone, the wonders, you Panama you, I mean, the you projects are big around the world, the Armani projects, those types of things. So you know that you're working with a very reputable company, so you can start doing comps in the building. And then if the buildings are close to each other, then looking at the comps for those buildings, but you got to make sure you're like an apples to apples. And so I do my own CMAs, my terrible market analysis and my comps for my clients so that they can see what has sold, because that's not even public knowledge. The only reason I know is because I've either sold them or I know the realtors and the buildings that have sold them. So it's difficult to do those types of analysis. But if you're just get online and do it the old fashioned way, you find a building, you see what selling, you don't know what it sold for, but you know what the list price is, you know, what people are asking, and you're able to do some evaluation. But by us being intricately involved in all the different projects and buildings with different developers that we work with, we have a pretty good strong handle on, you know, what is a good value. And then we negotiate with the developers to get a really below market retail price that they're selling projects for, for the projects that we offer to our clients.

Speaker 2  8:14  
Wow, I hear no, just more I've thought about you know, investing internationally like that, are people buying and selling their much? Uh, you know, from the US or is it mostly buying hold? You know, what, I guess what, how do they feel about? Or is it like a continuous business plan for them, they're where they're growing, or it is

Speaker 1  8:29  
a continuous building a business plan, I have lost count. But I think that got in and out of over 35 projects, since I've been there in 2012. And I've got clients that are currently in anywhere from 10 to 25 different properties, projects and investments in Panama right now. And they'll continue to get in one get out, get into more Get out, get in for more. I just had one client that rolled out of what was it tan, smaller investments and rolled into one big investment and absolutely killed it with the equity in the project. So I mean, you see this all the time. And we're constantly looking for those opportunities, so that we can continue to move our clients forward and continue to build their real estate portfolio International.

Speaker 2  9:17  
Wow. Okay. You know, and then what about this tax implications internationally?

Speaker 1  9:22  
Well, now, I am not a tax advisor. So I can't go into a whole lot of detail. I cannot give advice on that. But there are all kinds of tax perks and benefits, you can come into the country in different areas of investment and the government has no tax required up to a specific amount like up to $350,000 in income per year for agriculture. So it depends on what you want to be in and you would need to get with a CPA, which we do have CPAs that we work with. We do recommend to actually see how that ties into your plan. But what I can tell you is if you're from the United States and pretty much most countries unless you totally become An ex patriot and give up your citizenship in your home country, you still owe taxes to your home country. And that is the way it is in the United States. thing is you're just not double taxed. If you pay taxes in Panama, that is deducted from what you're gonna pay in the United States, and you're not double taxed. But your taxes in Panama are substantially lower for everything.

Speaker 2  10:20  
All right? No, that's, that's great, because that would be another concern, right? It's just taxes and, and we need an advisor on that side as well, no doubt, just like we do in the States, you know, somebody that knows our tax situation here, or maybe tie advisor giving us tax advice here may not be an expert in international tax advice. So is that what you find like, there's specific people that I'm sure specialize in that kind of

Speaker 1  10:42  
it is, but let me tell you the approach that I've taken and many of our clients will take now a lot of people like to have offshore entities and like in Belize, or Switzerland or whatever, I've never gotten into that I believe in paying my taxes and supporting my country and doing what I'm supposed to do. But I don't believe in giving more than I'm supposed to. So the way I've structured is I set up different entities with LLC s, and there's LLC s from the United States are the owner and the beneficiary of the properties internationally. So the tax liability comes to me in the United States versus in that particular investment country. So there's lots of different ways to do it. And that that's a whole different training. I do work with Garrett Sutton, a lot on asset protection, one of the Rich Dad Poor Dad, advisors and

Unknown Speaker  11:30  
Board of Directors members, and he's been on the show as well.

Speaker 1  11:34  
I've worked with him for many years, he is he actually does all of my entity structures in Wyoming. So that's a plug for Garrett. He's phenomenal. But there's many different ways to do it. And it just depends on what you're wanting to accomplish.

Speaker 2  11:47  
Yeah, for sure. Now, Garrett has been on the show as well, would you recommend reaching out to me I've had a number of calls with him offline as well. And so it just seems like a great, great guy. Well, Evie, awesome. I can't thank you enough even for this episode. And we're going to do one more. We're gonna talk about IRAs and how investors can also use them to invest internationally. We're gonna do that tomorrow. I hope the listeners will stick around before we go Evie tell listeners how they can get in touch with you and learn more about you.

Speaker 1  12:12  
Go to eviebrookspanama.com fill out the information sheet there, the the landing page, and you'll get a very solid 10 minute overview Panama and why Panama and if you want to just check out my website is my Panamavacation.realty.com

Speaker 2  12:29  
Thank you for being with us again today. I hope that you have learned a lot from the show. Don't forget to like and subscribe. I hope you're telling your friends about the real estate syndication show and how they can also build wealth in real estate. You can also go to LifeBridge capital.com and start investing today.

Transcribed by https://otter.ai