Buying property overseas is like buying a boat - expert

Cape Town – South African investors seeking property overseas simply to get a passport often end up getting burnt, says a global property expert.

“One of the biggest mistakes people make is that they go and buy a property, wanting a passport,” said Wealth Migrate founder and CEO Scott Picken. “It’s a bit like buying a boat; it’s not a good investment.”

Wealth Migrate provides emerging market investors access to below-market real estates in first world markets – predominantly in the UK, US and Australia - using crowdfunding technology.

A graduate of the UCT Graduate School of Business’s property development programme, Picken said: “Just like the internet has done in many other industries, it has cut out the middle man and reduced the costs, it has increased efficiency and, most importantly, it has increased accessibility.

“We’ve brought technology to the property space,” he said. “[We] allowed people access through Wealth Migrate … to the best quality opportunities and the best quality partners around the world.”

Picken said that a decade ago, people could only invest in properties in their “back yard”, but now it is possible to invest all over the world.

Wealth Migrate has offices in South Africa, Singapore, Hong Kong, Brisbane, Atlanta and London and focus on property in Australia, the UK and the US.

“Our whole business model is built on partnerships,” he said. “It’s a networking of partners that are all over the place and we are collaborating with those partners.”

WATCH: Fin24 studio interview with Scott Picken

Book with Clem Sunter

Picken recently published a book, Property Going Global, in association with scenario planning expert Clem Sunter. He said the book is seen as the authority on international real estate investing and provides guidance on how to create wealth safely via a tried-and-tested system.

“What frustrated me was that the statistics came out in 2010, [which showed that] over 80% of South Africans that invest overseas lose money,” he said. “And that’s really quite annoying when you consider most of them are trying to get wealth preservation.

“Clem Sunter has got his world-class systems on scenario planning. Most people go along and just hear them, but they don’t do anything about it. I created a four-dimensional model to help people systematically and scientifically make the right decisions as to where they should invest.

“With Property Going Global, we’ve taken them through the different markets, we’ve shown them the mistakes that South Africans make and we’ve given them pointers.”