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Don’t limit your real estate investment opportunities to just one market

Written by CEO Martin Fodor: The term “risk diversification” is often mentioned when it comes to investing. This also applies to real estate, which is still considered a stable way to increase the value of money, whether it’s generating profit from rent or relying on the appreciation of the property over time. It remains true that Slovakia has a relatively stable real estate market, which naturally experiences cycles where prosperity alternates with crises. 

However, new opportunities emerge after these crises, along with a different perspective on how to diversify investments. The principle is simple—while one market may stagnate, another may paradoxically grow. However, estimating the development is not always easy.
It requires a certain level of knowledge about individual markets, not only from the perspective of demand for real estate but also by observing possible political developments, economic potential, and, as they say, the devil is often in the details. For this reason, local legislation, taxes, and property management cannot be ignored.
    

Where Is It Worth Investing?

The question, therefore, is: what indicators can help investors choose the right location? Many countries might not seem attractive to us at the moment because they remind us of Slovakia 15–20 years ago. And this is where the trick lies. Slovakia advanced primarily due to reforms and significant strategic investments. Let’s take Albania as an example, which has long been leveraging its potential in energy, tourism, and real estate to attract major foreign investors.
Albania is focusing on building infrastructure as well as trade relations with the EU. Currently, a luxury resort worth €1.4 billion is planned on the coast of the uninhabited island of Sazan, creating 1,000 jobs. This project is set to be carried out by Jared Kushner, son-in-law of Donald Trump. What should investors considering purchasing real estate abroad take away from this?
For example, in Albania, such a significant investment predicts substantial regional development, meaning that in a few years it could become a sought-after destination with rising real estate prices. At present, however, it is still accessible for most Western investors, and in my opinion, those who invest in real estate on the Albanian coast now won’t regret it in a few years, as they will likely see their money grow in value. Of course, they must carefully consider the specific location before making a purchase.

Similarly, we can talk about Bulgaria, which for many Slovaks and Czechs remains synonymous with nostalgia and retro. However, the resorts being built there are significantly advancing, and I’ve personally witnessed this while purchasing investment properties for our clients. For instance, in the cadastral register of Sunny Beach, there is a lot of activity. Apartments there are occupied for 150 to 200 days a year, and the construction of new development projects continues. From our experience, the annual yield here ranges between 8–15%, which is a very decent result. The country still has growth potential. Would you have said that 15 years ago?

If I had to decide today where to buy an investment apartment abroad, I would answer without hesitation: Dubai. My response is quick primarily because we have already purchased properties there for our clients, and I am convinced that Dubai is currently a safe bet for investors. Properties are being purchased there on a large scale, and developers are constantly introducing new projects that elevate accommodation services to an entirely different level. I dare to say that this is where trends are concentrated. Furthermore, Dubai has a significant advantage when it comes to economic growth and political stability, as governments don’t change frequently, not to mention the high level of safety and investment returns.

The fact is, Dubai is one of the most visited tourist destinations in the world, meaning there is an enormous demand for accommodation, whether it’s from the middle class seeking affordable options or those preferring luxury. What surprised me personally was the speed of the entire transaction. While in Slovakia, weeks are spent dealing with cadastral registry issues, in Dubai, the chances of encountering such situations are minimal.
 

Sometimes You Don’t Need to Look Far

A market similar to ours but slightly more interesting is undoubtedly the Czech Republic. Apart from the fact that our culturally closest neighbors have a better-developed tourism sector, there is also high demand for rentals, for example, in Prague or Brno. However, one must also account for higher purchase prices, as apartment prices in Prague are among the highest in Central Europe. The initial costs might quickly bring down your expectations for returns. However, if your main goal is simply to diversify finances across multiple countries and market clarity is your priority, then the Czech Republic is not a bad choice. Similarly, Germany can also be attractive for investors, but many are discouraged by the growing regulations, a complicated process, and high prices.

If you are interested in investing in real estate in other countries, you need to think about your goals long-term. Are you willing to spend energy dealing with complications related to legislation and taxes? Is your financial situation resilient enough to withstand potential market stagnation, especially in summer destinations that tend to be empty during the rest of the year? Such investment is undoubtedly a responsible step but must be well thought out. Don’t decide “with your heart” alone just because you like a location, although that is also an important factor in decision-making. In such a case, I recommend visiting the place multiple times, getting a feel for the environment, and establishing initial local contacts to help you navigate better. If you want to achieve stable returns and real appreciation of your investment, good preparation is key.