Robert Leonard (03:12):
Yeah, that international component is what I found most interesting or that you’re doing and you’re doing it with your clients. And I want to chat a bit about that. I know you can’t buy or sell real estate even in different states in the US unless you’re also licensed in those states. So, what is the licensing process for someone like you who helps clients buy and sell real estate domestically and internationally? Is there a specific license for each country? Is there something that’s more uniform?
Christian Ross (03:40):
So, it really varies by country. A lot of times I work with a partner agent in that country and I also have a business license in two countries. So, like the Dominican Republic just requires a business license. So, not an actual real estate license. They actually do not have an MLS system. So, you just can’t go on and Google Dominican MLS and find homes in one uniform place.
Robert Leonard (04:03):
As I was doing research before our call, I saw that you have a program called the Fly and Buy Program and that really interested me. My guess is you’re probably not the only one doing this, but it’s the first time that I had personally come across it. So, I found it interesting. Explain to us what this program is and how it works.
Christian Ross (04:21):
Yeah. So, basically, you get your airline ticket. We take care of everything. It is a concierge approach to looking at real estate. So you fly down, we come, we have a set schedule for you. You’ll look at development properties. You’ll look at resale depending on the country that we’re at. And then if you decide to buy, especially if it’s a developer property, you will get reimbursed usually up to $2,000 and that’s still dependent on the state that you’re from because there are regulations regarding that. But really, we just want you to have an opportunity to look at real estate, understand the financial investment, understand the legal component to it, what the ROI is. And just in a non-pressure environment where you can just come look and still have a little fun like we’re going to have a catamaran type of tour. It’s going to be great for you to understand the culture as well as the real estate.
Robert Leonard (05:09):
Through this program, where are you seeing most people buy? Is it pretty spread out or is there a common country or area where most people are buying?
Christian Ross (05:17):
People love Mexico. They love Mexico. And I personally, I love Mexico. I just got back from Mexico City, which was my first time. And I’m in love and on Delta every day looking at flights back. But I know for me, vacation-wise, I don’t want to sit at home. I want to see the ocean. I want to be able to walk to a beach. So, a lot of people love Mexico. I think for Canadians, they love the Dominican Republic. They like Mexico too. And then Costa Rica is a big one. Costa Rica is just blowing up and they have exceptional healthcare. John Hopkins actually has a kind of like a sister hospital in Costa Rica. So, when people are looking at medical tourism, a lot of places that we’re looking at for medical tourism also kind of coincide where they’re looking at for real estate, too.
Robert Leonard (05:59):
What is the most common reason for people buying internationally? Are most people buying it as a vacation home or are they doing it as an investment?
Christian Ross (06:07):
So, most times it’s a mix of both. It’s vacation and it’s investment. And then I would say probably 25% of the time, someone in their family has an attachment to that particular place. So, maybe they went to summers there, or their grandmother was from that place. So, they’re just trying to have that connection with that place. But a lot of times it is vacation/investment with the focus on investment.
Robert Leonard (06:30):
How does the financing of international properties work?
Christian Ross (06:34):
So, a lot of times it’s cash. However, there are a lot of loan programs out there where if you’re putting 25 to 30% down, you can easily get a loan. The biggest thing I always tell people just to be aware of is what is your exit strategy? Are you really trying to buy, hold and enjoy? Are you looking at it as a flip? International real estate is not where you want to flip. It’s just not where you want to flip. You want to hold it, you want to enjoy it and you want to get the cashflow
Robert Leonard (06:59):
Are the loans with US-based banks or are they international banks wherever you’re buying the property?
Christian Ross (07:04):
It’s a mix. So, there are private money lenders and those private money lenders are based here in the US and then there’s Scotia Bank. Scotia Bank does a lot, and they handle Mexico a lot in the Caribbean. Not sure if they go as far as Costa Rica, but they definitely handle a lot in the Caribbean. And you’re mostly going to go through a private money lender, or you’re going to do a home equity on a property that you own. And then sometimes there’s owner financing. If you make a big enough down payment, there’s a lot of owner financing. So, while that’s not as common in the US, it’s definitely common abroad.
Robert Leonard (07:34):
It’s a lot more common there than it is here?
Christian Ross (07:36):
Yeah. It’s definitely more common where you can put down maybe 30% just like you would a bank and just make your payments. Get 30-year term. It won’t be a 30-year term.
Robert Leonard (07:46):
Right. And what are the terms usually look like? Is there a standard for owner financing?
Christian Ross (07:50):
Not really a standard, but I would say kind of like two to five years, which allows you the opportunity to get the financing to pay the rest off. And by then, you already have a sizeable chunk that you’ve paid down in two to five years as well.
Robert Leonard (08:02):
What are you seeing for prices? You mentioned people a lot of times pay cash. I’m wondering if these people just have a lot of cash that they can put in these properties, or maybe they’re cheaper there than they are here in the US, and I mean, I’m sure it varies, right? Depending on which country you’re in, but just generally speaking, are they cheaper, internationally than they are here in the US?
Christian Ross (08:20):
Yeah, I would say they’re cheaper to a degree. They’re cheaper in the sense that if we’re looking at let’s just take Talum, for instance, Talum is growing like crazy outside of [inaudible 00:08:30]. Last year, you could have bought a property for like $40,000 and it would be new construction. And it may be, you’re starting to see more micro-units where they’re smaller. But that’s the point, they’re meant to just run out, stay for a few days, maybe two weeks. I mean, now those properties are probably 70,000. But still, that’s not a crazy amount of money and developers are also financing. So, you may be able to go through developer financing if it’s something brand new. So, there’s a lot of options, but I would say your medium price point might be around 300 something thousand and of course, once you start talking about villas and larger places and oceanfront, it can run the gamut.
Christian Ross (09:07):
But if you’re in the Northern part of the Dominican Republic, which really isn’t as popular, they’re just getting their cruise port, that one, you hit an oceanfront condo, two-bedroom, two-bath, beautiful high ceiling for $285,000. And you could never get that oceanfront in Jamaica, or Truxton [inaudible 00:09:23]. Those are going to be million-dollar properties in those countries.
Robert Leonard (09:26):
It might be different for every country, but generally speaking, how do taxes and insurance work for international properties? How is it similar to the US and how is it different?
Christian Ross (09:38):
So, a lot of times, I would say it’s similar in the fact that you have taxes and insurance. But other than that, it’s not similar. The tax bases, especially if you’re a foreigner, a lot of times, it’s actually a little bit less. And if you’re going with the development, a lot of times, those developers have negotiated like 10 to 15-year tax abatements, where you won’t have any taxes at all. So, a lot of times it really works to go to new construction when you’re looking at foreign property, because of the fact that you’ll get a tax break. And insurance-wise, it really depends on where you’re at because we all know we’re seeing the effects of what’s going on with the hurricane. So, it really depends on how many storms that that plays. What does the weather look like? But the insurance you’re probably looking at almost double than what you are here. So, a lot of times for resale homes here, it’s around a thousand dollars a year. Depending on your content, you’re probably be looking at 2000 abroad.
Robert Leonard (10:31):
What are some of the biggest challenges or drawbacks you’ve seen when dealing with international real estate?
Christian Ross (10:37):
I think some of the biggest drawbacks are just, well, first I think one of the biggest things is making sure that you have your expectations set. What do you want to do with this property? Are you looking for a cash cow? Are you looking for something that’s luxurious that you can also rent out and have your friends come down? Like, what is your purpose for that property? And I think one of the drawbacks is definitely the financing is you will have a higher interest rate. So, as people see twos and threes, when they’re getting their primary home, that’s not the case with international. You’re going to see a five and a six, and that’s just because of the risk. But those were actually the interest rates in the US in like 2005, so it’s not that bad. But I think those are the biggest drawbacks.
Christian Ross (11:20):
And then just understanding that a lot of the contracts that you sign will be in the language of the country. So, make sure you have a translator, make sure you have a solid attorney where you’re looking who can properly walk you through everything so that you understand and you’re not getting any surprises. And one of the wonderful things is the fact that the title insurance companies that are here in the US, a lot of them are in Mexico and abroad. So, Stewart Title, Chicago, like you can actually get title insurance from companies that are here that would give title insurance for your own home.
Robert Leonard (11:51):
One of the oldest adages in real estate is location, location, location. And I know firsthand from helping people learn how to buy rental properties and long-distance, even within the US that becoming comfortable with the property’s location is often a challenge for people. How can a buyer become comfortable with the specific location of their international property? How do they know it’s a good and safe area? Is it simply from the Fly and Buy Program? What if they don’t go on that type of retreat?
Christian Ross (12:19):
Yeah. I would say really fly down and then talk to, just talk to people there. Talk to experts there. There’s always an expert community wherever you go. And they will be very upfront to say, “Oh, no, not there.” Or, “Have you looked here instead? I like this area better.” And the reality is too, you’re not always looking for experts, but you want someone who also understands your American experience that you have. So, someone who is an expert, they’re from the US, they’ve been living there can definitely make you feel a lot more comfortable, but I would always say still fly there, take a look and make sure whatever deposit you put down, that you know the timeline to get it back.
Robert Leonard (12:57):
When it comes to being a broker and an agent, what do you spend your time on? Do you do more international stuff? Are you more US-based? Is the international really just a small piece of what you’re doing? Break that down for us.
Christian Ross (13:11):
So, international abroad with my clients is a smaller piece. It’s definitely for me, domestic. However, my business here, I have a lot of international clients. So, I’ve helped sell real estate to clients from over 25 countries and that actually helped to…I would say really helped me look at international real estate as an option because I would always ask questions about their countries, where they’re coming from. We have a different, I would say, perspective of real estate. When you look at Poland or somewhere in Eastern European, that is the family home. Like it’s not getting sold in two years, you’re not flipping it. So, we just have a different perspective of real estate, and our business is definitely more focused here but I do know probably the next two years I’ll be back and forth probably six months out of the year between countries. So, I’m excited about that.
Robert Leonard (14:01):
And so, you help people buy from the US to other countries a lot. But what you just said is you also have a lot of people from outside the US and you help them buy in the US?
Christian Ross (14:10):
Yes.
Robert Leonard (14:11):
Are those mostly investors,
Christian Ross (14:14):
Mostly investors. I would say Australia, Canada, Israel, the Caribbean, I think I said Italy, like all over and they are looking to buy for investment. And then I also have clients who worked for the state department, who have an assignment. It’s probably going to be five years, but they also know that homes are going to steadily appreciate in the US so they want to buy something at home, even though they’re abroad. So, it’s a really big mix.
Robert Leonard (14:38):
In the show, we have a segment called the action plan. And part of the action plan is to answer three questions relatively quickly that give listeners something to implement in their life when they’re done listening to this episode. So, first thing is what is a habit or principle that you follow in your life that not enough people do, but someone listening to the show should?
Christian Ross (14:59):
I would hope everyone does, but I read every single morning. It’s a habit and I feel like when you ingest something good, it helps to lead your day.
Robert Leonard (15:09):
How much are you reading every day?
Christian Ross (15:11):
I read a book for probably about 15 minutes in the morning. And then I listen, depending on where I’m going for about an hour.
Robert Leonard (15:19):
What has been the most influential book in your life? And it doesn’t necessarily have to be your favorite because I think those two things can be different. But what has been the most impactful on you?
Christian Ross (15:28):
The most impactful has definitely been Deep Work.
Robert Leonard (15:32):
By Cal Newport?
Christian Ross (15:34):
Yes. I’m a [inaudible 00:15:36] type of person. So, I kind of, I’m all over the place and Deep Work just helped me realize you need to be still and think about your processes. And it’s just, I’m rereading it again, because I know I didn’t catch all the jewels the first time.
Robert Leonard (15:52):
I’m actually reading a book very similar. I actually haven’t read this one yet. I might’ve listened to the audiobook. I’ve definitely listened to at least one of Cal’s other books. It might’ve been this one or a different one. But anyway, I’m listening or rereading a book called Indistractable by Nir Eyal. Kind of similar idea to doing Deep Work, but it basically helps you deal with your distractions and how to fix them basically. So, that’s another good one that you might want to check out if you really like Deep Work from Cal, you’ll really like this one as well.
Christian Ross (16:21):
Adding that to the list seriously because I’m distraction-attraction.
Robert Leonard (16:26):
It’s a good one for sure. And so, when the listener is done with this episode, what is one action they should take after listening that can help them improve their life, career, or business?
Christian Ross (16:38):
I really think the biggest thing, and this book actually helped me just clarify that it’s just stillness. Just sit still for 20 minutes and just see what comes to your mind. Because when you gain clarity, I think we’ve all gained a tremendous amount of clarity with COVID of what’s important. What do we want to do? And we’ve taken more of a path towards life design, but I think we need to be entirely more intentional about that life design. Stop complaining and just sit down for 20 minutes and just let everything just dump out that comes into your brain. Just keep writing it. And then think about what that next action is. What was that glaring thing that you saw and what are you going to take that? What’s going to be that action point to get you to wherever your thoughts of life design are taking you? Is it a new job? Is it reading a new book and something else you want to learn? What is going to be that next step and do it, put it on your calendar? It’s not on your calendar, it doesn’t exist.
Robert Leonard (17:31):
I say that all the time, “If something is not on my calendar, I will not do it.” And so, if somebody ever asked me for a meeting, phone call, whatever, I said, “Sure, but send me a calendar invite. If you don’t, I won’t be there.” And it’s just the way I work. And if anybody’s ever seen the movie, Big Fat Liar, where the guy turns blue from jumping in the pool, he has a little device. He lives by that. When he loses it, he literally is lost. And that’s basically me is if I don’t have my phone or my calendar, I’m completely lost. I like to wrap up the show by turning the tables and I let the guests ask me a question. So Christian, what question do you have for me?
Christian Ross (18:04):
So, my question is we’ve of course been in this COVID environment for now, I don’t even know how long it is. Are we 18 months? I don’t know. What’s the biggest lesson that you’ve taken away and the biggest thing that you want to embark on, or just focus more on?
Robert Leonard (18:20):
I think the biggest thing that I’ve learned is probably the importance of having multiple streams of income. And I have to admit, and I don’t mean this from a place of, I can’t even think of the right word. But basically, I understand that some people have had a very hard time during COVID and I have a lot of empathy for those people, but for me, my life hasn’t changed a ton to be completely honest. And so, I’ve been okay throughout the pandemic, both health and financially, but I know that there’s a lot of people out there that have struggled. And so, I think that it’s been really clear to me is that you need multiple streams of income to overcome these types of things. And I think one of the reasons why I have been in a decent spot is because I do have multiple streams of income.
Robert Leonard (19:00):
And so, I think that’s probably been the most clear thing is whether you’ve been impacted by it or not, I think just realizing that things like this can happen, maybe it’s not a pandemic, maybe it’s something else that happens. Maybe that’s a business cycle that ends, and we just enter into a recession, whatever the case is, having different streams of income can be helpful to get through these types of situations. So, I’d say that that’s probably the biggest thing for me. And also with so many people at home, that book you mentioned, Deep Work, really focusing and what I mentioned, Indistractable, being able to really manage your time is really important because you’re at home. I mean, if you thought you had a lot of distractions in the office, I have way more distractions at home and I’m home by myself, like almost 24/7, and I have more distractions at home. So, I’ve learned that too. I think that the passive income streams, and then also really just time management, deep work, being indistractable, those types of things, they’re the biggest things that I’ve learned.
Christian Ross (19:51):
I love that. And I definitely feel like multiple streams of income. I learned that during the recession, the great recession. So yeah. So, I definitely feel that and I’ve been completely blessed through this whole time. So, I understand where you’re coming from. It reiterated that for sure.
Robert Leonard (20:06):
Yeah, exactly. So, where Christian, can people listening to the show, go to find you. Where’s the best place to connect with you?
Christian Ross (20:13):
So, I’m on all social platforms@christiansoldit and my website is christiansoldit.com. And you can go and take a look at the flying by. And if you have time, join us in October and just rock out and look at some real estate and have fun, no pressure.
Robert Leonard (20:29):
Is that tax-deductible for the people that are joining?
Christian Ross (20:33):
I need to find that out.
Robert Leonard (20:35):
I believe it is.
Christian Ross (20:37):
I feel like it is. It’s a business expense.
Robert Leonard (20:40):
I’m not a tax attorney. I’m not a CPA. So, anybody listening, don’t take this to heart, talk to a tax professional, but I just read a tax book. And it said, as long as you’re planning the real estate or business activities ahead of time for the trip, which sounds like it’s all planned ahead, it’s all tax-deductible for your business. And so, something to keep in mind.
Christian Ross (21:00):
Perfect. Thank you. I’m going to check and I’ll be sure to put that on my website as well as soon as I confirm.
Robert Leonard (21:05):
Anybody that’s interested in connecting with Christian, I will put her links in the show notes below. Christian, thanks so much for joining me.
Christian Ross (21:13):
Thank you. Have a good one.
Robert Leonard (21:15):
All right, guys. That’s all I had for this week’s episode of Real Estate Investing. I’ll see you again next week.
Outro (21:21):
Thank you for listening to TIP. Make sure to subscribe to We Study Billionaires by The Investor’s Podcast Network. Every Wednesday we teach you about Bitcoin and every Saturday we study billionaires and the financial markets. To access our show notes, transcripts, or courses, go to theinvestorspodcast.com. This show is for entertainment purposes only. Before making any decision, consult a professional. This show is copyrighted by The Investor’s Podcast Network. Written permission must be granted before syndication or rebroadcasting.
