In the summers of 1995 and 1996, I had a desk in the legal department of Waterford Crystal. Teenage me had zero legal background. But my dad worked for the company, and it had a scheme to employ workers’ kids over the summer.
For me, it was a sweet deal. The pay scale was better than my local corner shop. I experimented with heels. And, I lapped up all the hereinafters and notwithstandings that I transcribed on a daily basis.
Should I have gone after a career in law?
That’s a question I find myself asking any time a legaldocument drops before me. I asked it last week, sitting with my husband and our Irish lawyer, going over a document for a foreign property purchase…
“Just to let you know,” our lawyer said, “I don’t like foreign powers of attorney.”
I expected no less from him.
Buying property in these times of travel restriction, you may be signing more paperwork from a distance. And, you may find yourself getting more advice than you bargained for from your U.S. attorney… not to mention family and friends.
How do you keep a clear head… and ultimately make the best decision for you?
Overseas Property Alert Director Lief Simon wrote about this challenge for his Offshore Living Letter readers some time back.
You can read Lief’s take below…
Lynn Mulvihill
But My Attorney Says It’s Too Risky
By Lief Simon
“I told them the contract is risky, but they invested anyway.”
That’s what one of my attorney contacts told me about a recent client experience. He was surprised and even appalled that the client didn’t take his advice and walk away from the investment because he, the attorney, had concerns about some of the contract terms. As an investor, I wasn’t.
“Advisors are there to advise,” I explained, “not to make the decision whether to invest or not. That’s up to the investor.”
Dozens of times during the years that I’ve been living and investing overseas full-time, people have come back to me to say that their attorneys, accountants, financial advisors, sometimes even their neighbors have told them they shouldn’t invest in Belize or Panama or Colombia or wherever they had indicated they had interests.
Many have reversed their investment decisions based on comments from folks back home, even when the folks back home have had no experience with the market or the type of investment on the table. In every case, the trouble as far as I could tell was that the “advisor” didn’t have any idea what the would-be investor was talking about… so they reacted negatively. Not out of valid concern but ignorance.
Sure, ignoring advice from advisors, you could wind up investing in something that doesn’t work out. But is that worse than missing out on something that could be a big opportunity because someone who doesn’t understand it recommends against? You need to keep “advice” in perspective.
Advice from your next-door neighbor, dry cleaner, and golf buddies who’ve never made the kind of investment you’re considering should be ignored out-of-hand.
You don’t want to ignore advice from your accountant or your financial advisor (what would be the point of paying them for it in that case?), but, again, you do want to keep it in perspective. Your U.S. accountant or attorney can help you assess risk within their areas of expertise… which is often limited. When they overstep it, they’ll almost always, in my experience, advise that whatever it is you want to do is too risky. Because they just won’t be able to process the opportunity big picture or in full.
For an investment in Belize, you should speak with a Belizean attorney. For an investment in France, seek advice from a French lawyer. Etc.
One of my first overseas property investments was in Spain. To make it, I used a Spanish attorney. I was living in Ireland at the time. I could have sought counsel from my Irish attorney, but I knew that she had no idea about Spanish real estate. My Spanish attorney carried out due diligence on the developer and came back with the details. The company had a strong track record and was part of one of the biggest conglomerates in Spain. I proceeded with the investment, which was a success.
That was in 1999. Had it been in 2008 the investment could have turned out very differently, even with the same developer and all other variables unchanged. Which is to say that, in 2008, I could have gotten the same due diligence report from my attorney that I got in 1999 and chosen not to proceed… perceiving, as I would have, that market timing was not with me (as it was in 1999) but against me.
What you want from your advisors is advice that comes from real experience. You can’t ask your divorce attorney what he thinks about a property investment you’re looking at in Nicaragua.
Similarly, you can’t ask your immigration attorney in Panama what he thinks about a real estate investment if he has no relevant experience.
Every investment has risks—country, currency, management, nature, and to do with the terms and conditions of the contract, as the contact I reference above recently pointed out to his client. In the end, like that client who invested despite the attorney telling him it was too risky, you have to determine your level of risk tolerance in any particular case and make your own decision to invest… or not.
Ireland’s Spookiest Manor—For Sale (Again)
Loftus Hall on the Hook Peninsula in County Wexford has just come back on the market. A Google search will give you the full history of the property (along with some spooky YouTube clips), but by way of quick summary…
One dark and stormy night in the 18th century, a stranger turned up and was welcomed in by the resident Tottenham family. During a card game, Anne—daughter of Lord and Lady Tottenham—bent to pick up a dropped card. Under the table, she saw the stranger’s feet were hooves and let out a scream. In response, the stranger (who witnesses would later identify as the devil himself) rose up and shot through the roof. Anne never fully recovered from the experience and, since her death, is rumored to haunt the property.
Sounds like a load of baloney, but there’s something chilling about the appearance of Loftus Hall on the otherwise attractive peninsula. The Victorian manor was the set for a horror movie in 2017. In the past, it’s been run as a hotel… and the current owners ran tours to help bring in cash.
The property came on the market in 2008 for 1.7 million euros. Three years later, two local brothers bought it for 625,000 euros. They invested 1.5 million euros in repairs and renovations—but there’s still much work to be done…
Today’s asking price is 2.5 million euros—the owners are planning to sell privately.