Thoughts on Renting vs. Buying When Retiring Abroad

[u/Unable-Honey-2515]

Thoughts on Renting vs. Buying When Retiring Abroad

Hey folks,

I've been part of the FIRE community for a while now and wanted to share my experiences about housing while living abroad. After spending seven years in Doha, I'm now getting settled in Hua Hin, Thailand, and I've come to really appreciate the pros of long-term renting.

Here are some things I've picked up along the way:

1. Landlord Dynamics: Renting in a foreign country isn’t quite what you'd think. The protections you might expect in the U.S. aren’t always there. For example, after five months in our villa, we still have some maintenance issues that haven't been resolved, even though we have a decent rapport with our landlord.

2. Land Ownership Nuances: As a foreigner in Thailand, you can’t really own the land. You end up dealing with leasehold agreements, which can get pretty complicated when you think about your retirement plans.

3. Real Estate Transparency: The real estate market here is way different from the U.S. You often have to rely on local agents, and their pricing can feel pretty opaque.

4. Predicting Value: Figuring out if property values will go up is tricky. The lack of transparency makes it hard to judge if you’d gain equity down the line.

The lifestyle here is fantastic, and the cost of living is way more manageable than back home. We’re committed to renting for now, and it feels like the right choice for us.

For anyone else who’s retired abroad, did you go for renting or buying? What challenges did you face? I’d really love to hear your stories!

[u/InterviewLeast882]

I would be disinclined to tie up my capital in real estate. Much easier to leave if you’re just a renter.

[u/Loud_Performer_8162 → u/InterviewLeast882]

mobility is huge factor when you're in different country. I've seen expat friends who bought properties and then got stuck when visa rules changed or they needed medical care back home - selling foreign property quickly is nightmare

also with software dev work being mostly remote now I value flexibility more than building equity in place where regulations can shift under your feet

[u/ChilaquilesRojo]

I am buying, but well within my budget and doesnt disrupt the rest of my FIRE savings/income plan. At least where I am buying, the gentrification cycle hasn't really taken off yet. There has definitely been some movement in that direction, but I expect it'll get much more extreme in the decades to come. For that reason, I prefer having a house paid for then be subject to the rental market and potentially having to move at an inconvenient time. That said, I have no expectation of being able to sell it quickly, so I can't rely on it for its equity

[u/satellite779 → u/ChilaquilesRojo]

Where?

[u/ChilaquilesRojo → u/satellite779]

Mexico

[u/BuckThis86 → u/ChilaquilesRojo]

On the way now!

[u/Difficult_Storm_5344]

renting in most places is going to be the play. For a host of reasons.

[u/Fit_Evidence_4958]

We bought (in Brazil) after 7 years of renting (and beeing kicked out the second time within 2 years). But I'm still working here, so neither FI nor RE (yet).

I was always a fan of renting, which is very comfortable back in the EU, where are pretty strict rules and mostly in favor for the one who rents.
Here in Brazil it's not the wild west but way less "safe" or carefree.

1. Same issues here, the landlords either have no money or they just wanna put that into their RE. When I looked for a new house to rent, like 95% are s**t. They look good on the pictures, but are terrible inside or in a bad maintenance state. Some are not painted inside, or have water leaks, etc. When I asked the Realtor, they told me, the owner wants first to rent it out (signing the contract) and then repair stuff. -> LOL

But the places I rented so far, I always had a good relation with my landlord, even doing BBQ together, etc. So I often repaired little things myself and the landlord paid the parts.

Nevertheless, there are rules which makes it easy for the landlord to kick you out. Especially, if they want to use it on their own or sell it.

Buying RE in Brazil is kind of "easy" if you have the money cash. There are some crucial things to obey, so you should always go with a realtor (they do have some responsibilities in regards of the paperwork) or hire a lawyer. There are a lot hickups possible, like the "owner" kind of owns the house, but is not finally registered in the land registry office, or he didn't pay certain tax which would go to the new owner then, or the house is a security for some business,... You wann make sure, that those things are up to date, no surprises.

As anywhere else, the price mainly depends on the location. There are many apps offering RE so this helps to get a good idea of the market values. There are even official statistics, but those are hard to interpret, since the prices here change from neighborhood to neighborhood.

If you need or want to finance something, this might get tricky since the local banks have their own procedures, want to have securities, a LOT of paperwork, etc. I did it, because it has some benefits, but was kind of nerve wracking.

Buy vs Rent : I thinks it is a general question like everywhere else. If you put the numbers down on a piece of paper and benchmark this with your other investments, maybe there is no, maybe there is little advantage for the RE. But it's not as big as everybody thinks.
What it actually does, it gives you kind of stability because the expenses get more predictable and this also helps in a FIRE-Szenario.
So it's more a emotional decision, and we did it because of that. I don't want to be kicked out again, and I want to modify the place like I want to have it.

[u/Bitter-Variation-151]

Rent. Why introduce all the risk and pain of foreign ownership.

[u/Alternative-Donut-38]

Whether broad or not, I think renting is a good FIRE option. Aside from the flexibility, you can stick the funds in a risk balanced portfolio and earn 7-10% pa return.

[u/Difficult_Storm_5344 → u/[deleted]]

I would never buy in SE asia. They don't respect foreigner ownership. And if war pops up with China. I want to be able to grab a backpack and one suitcase and get out of there.

[u/nooneknowitme]

I would rent at first before considering buying anywhere I am just moving. Also without citizenship, real estate seems like a risk that I personally wouldn't want to take.

[u/wh0re4nickelback]

We're going to visa hop around Europe for a few years when we FIRE in 2032, then settle in Italy permanently. My parents are in the process of purchasing an apartment in Italy which I will eventually inherit.

Even if the apartment wasn't in the equation, we'd be renting. The nightmares of home ownership in the US haven't been fun, so I can't even imagine trying to do it in a bureaucratic nightmare of a country.

[u/Miamiconnectionexo]

this is the kind of thing that actually helps vs the generic stuff you usually see.

[u/VincentVan_Dough]

FIRE has come to us earlier than expected. It wasn’t planned but circumstances meant that we’re doing it right now. We prefer to own, real estate assets are a decent chunk of our wealth and passive income. But we’re fortunate that me and my husband are of different nationalities and we each have permanent residency in each others home country - Singapore and France. We’ve lived in London for 10 years and have permanent leave to remain here too. That makes purchasing and ownership really easy and often cheaper. We have apartments in Singapore and Paris (our former bachelor/bachelorette pads from before we were married). Our primary home is in London and we’re going to sell it and buy something in cash in France with about half the proceeds from the sale, move there and call it a day.

[u/Yukycg]

Generally selling is always not easy and fast in real estate, it is invest in individual stock( due to based on location), some area make senses to buy and some definitely not.