Comments by "Marvin Fine" (@torontovoice1) on "How I Built a Global Property Portfolio (Without Going Crazy)" video.
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When I first saw the topic of your video, I was very interested to watch it. The first two parts of the video such as finding the property, I think it's very much the need to be able to understand the local market. I don't know how are you going to find someone who understands your needs. And I think the biggest concern is all these agents that you're going to hire are biased. They're not representing you, they are representing themselves. They want to make commission. In order for them to do that, they have to find something that appears compatible to yourself. So it's always an issue to try to really find someone who is perhaps fee-based, such as a property appraiser who is not getting paid based on a purchase but rather consulting on the basis of trying to understand your needs and finding the right property for you. Even then, especially in emerging markets, you never know what corruption may exist. Obviously the longer you spend in the country, and the more you travel the country, the more you will learn. I have a skill at looking at areas by doing things that are perhaps strange to some people. People normally buy groceries in the area where they live. I like going to grocery stores and walking around. I can look at the faces of the people in the store, and moreover, I like to look at what they're buying so I look in their basket of groceries. You can really get a good indication of the socioeconomic sector of the population by what they buy. I agree with you that buying anything in a trust really will not give you any asset protection. In fact there have been new laws and acted in many countries where you have to disclose the person of ultimate ownership. So all the structures in the world won't help you cuz at the end of the day, you have to disclose who the beneficial owner is. I think corporations do offer some additional protection from the perspective of estate taxes if they exist in a particular jurisdiction. Obviously corporations don't die, so by creating a will and providing a succession details in the will, it enables the successors to deal with the property. The other thing of course is that you probably don't have to probate anything in the local jurisdiction, because the corporation just continues. The asset protection discussion was actually quite interesting. You may or may not know that there was a guy named Kevin Trudeau who had some issues with the Federal trade commission. He was running infomercials and to make a long story short, the Federal trade commission going to judgment against him for 37 million dollars. He was driving a Bentley, living in a mansion, and was spending $100,000 on his credit card a month. He was called to examination in aid by the attorneys for the Federal trade commission. He said that his car was corporate transportation, the house was corporate housing, and he said he was broke. The judge didn't believe him, and gave him 10 years in jail. There's a lot of YouTube's on him as well. I think asset protection is more or less dead. If you have to disclose the assets, the judge tells you sell the property and transfer the money or go to jail. I think maintaining the properties though in my view is probably the biggest challenge. I remember speaking to a realtor in Panama. And she was very honest and she told me point blank, you cannot own a property in Panama and leave it unattended. It will just mold and rot. That's probably because of the humidity. So I asked her what people do? She told me that they hire a maid or I guess you would call it a house sitter. I think you're right about the idea of buying condominiums where there is a management company in the building that has a key to your property that can go in if there is fires floods etc. Also having a building with security is really important I think. I agree with you that an apartment is what you need, and if it's in a gated community even better! Having a trusted property manager is also important. I read a story in Cyprus mail we're a property manager who rented out a bunch of apartments that were essentially holiday apartments to asylum seekers. They completely trashed the places! The property manager was arrested and was thrown in jail, but I don't know what remedies the property owners had? I would probably think about looking into insurance about ensuring whether or not this type of risk can be covered. Over and above that, I think it's necessary to have a property manager in each of these places like you said, and have someone coming in and clean. I remember leaving my main property for only a couple of months. When I came back it was a disaster! I cleaned for almost 3 days. Whenever you live in a country that is hot or humid, you're all you're going to have problems. In Florida I know they run the air conditioners all summer. Cost of electricity has gone up to notches unknown in Europe. Some places are around 45 cents a kilowatt hour. Running AC could run up a big Bill. Obviously if you have staff that are visiting these properties or using them, that could be a big plus. I also do agree with you that putting them on Airbnb could be more hassle than it's worth. I inquired in a few high tax European countries about doing that. I think I said that I wanted to buy a property put it on Airbnb and use it the times that I would be in the country. The lawyer told me you better have all your paperwork in order. When they find out you're living in a tax efficient jurisdiction even with a double taxation treaty with the country, they'll be checking the days test for sure! Let us not forget what happened to Shakira in Spain. She thought she could be clever, it backfired on her. Anyway it was an excellent video, and I learned a bit, but there are still quite a few things that can go wrong. Many of the comments that you made would enable someone to circumvent a lot of issues. Well done!
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Another topic that you didn't discuss, is what do you do with cars? If you buy a car and leave it unattended for 6 or 7 months or more, it will be destroyed. Everything will wear out on it, the seals the rubber gaskets, you name it you'll have problems with it. So what do you do rent a car? I went to Cyprus for a little while and rented a car there. It was almost $100 a day for a Mazda 2. Why so high? During the pandemic, the car rental agencies couldn't rent out cars cuz there were no tourists. So they basically sold all their fleets as used cars. Then, the pandemic subsided, and tourists started coming. But then because of supply chain issues, it was nearly impossible to buy new cars, and the value of used cars had appreciated by 30% almost. So because of the extreme short supply, the prices went through the roof! I guess you could take taxis and Uber wherever you go, but it's really not the same as being able to jump in a car and drive around especially if you're not looking for a specific place to go, but rather want to go outside seeing and trying to understand the local market. I guess you could hire a driver and a guide if you wanted to. It would probably enable you to see more, see the things that you want to see, and perhaps even save some time. But it's really not the same thing, I like driving!
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