Country Article / Postcards

WHERE YOU CAN'T BUY

Date: 06/30/2003

Dear International Living Reader,

A citizen is one who acknowledges allegiance to a state. In return, the state promises protection...and, typically, a passport. You agree to do things like pay taxes and serve in the military if called. Usually, it's all an accident of birth.

A resident is one who has the legal right to reside in a country. Residency has nothing to do with citizenship.

Neither does it have anything to do with owning real estate. Certain countries restrict foreign ownership of property, but not according to residency status. It is non-citizens who sometimes cannot own real estate...or who can own only with restriction...not non-residents.

Of the countries we recommend regularly for property investment, many place limitations on foreign (that is, non-citizen) owners. However, these restrictions can be minor...and sometimes overcome.

In Thailand, non-citizens can own only condos...in Malta, non-citizens can own anywhere but cannot buy below a certain minimum threshold (of, at current exchange rates, about $73,000 for an apartment; $122,000 for a house).

In the Bay Islands of Honduras, foreigners can't buy more than three-quarters of an acre without special permission; in New Zealand, non-New Zealanders can't own more than 12 acres...or more than a half-acre on the coast...again unless they first obtain state approval.

These kinds of restrictions apply in Ireland, as well. We had to ask for permission to buy our house in County Waterford, which sits on 6 1/2 acres. We are, by the way, residents of Ireland...but, more to the point, not citizens.

In those countries that require non-citizens to apply for special permission to buy certain acreages or on the coast (many others do in addition to the ones I've mentioned here), often the permission is granted as a matter of course. Here in Ireland, for example, the application process is a formality.

In Mexico, foreigners can't own on the coasts--at least not outright. And in this country it is not a simple matter of applying for a bureaucratic ok.

The only way non-citizens can own coastal or border property in Mexico is through a Mexican corporation or a fideicomiso (a trust). (Dan Prescher and Suzan Haskins, our team in Mexico, have reported in detail on this subject in a special report they've just published titled "Your Piece of Paradise--A Guide to Buying Real Estate in Mexico." For details, click here.)

Notably, Nicaragua, Argentina, and France place no restrictions on foreign ownership of land. Non-nationals can buy as citizens.

Kathleen Peddicord
Publisher, International Living