Bermudians have always had a compulsion to acquire real estate, with so many of us spending our entire lives purchasing, renovating, upgrading and paying off our most cherished asset. And why not? Everyone wants to have a place to call their own, to stamp their identity, and to feel secure even in worst of weather (except in the case of a couple of really nasty hurricanes).

Bermudians are also probably the most world travelled of any country's citizens. Perhaps because most of our ancestors ended up here on the way to somewhere else, the wanderlust created by isolation and compact living is never dormant in the Bermudian soul and it is common to hear travel tales of adventures to the four corners of the earth from anyone, young or old alike.

When many Bermudians choose to spend significant parts of their time abroad, it becomes a natural extension to buy a second home property for future investment. Imagine, a little play house to retreat to in Canada, the United States, France or the UK! Without serious planning, however, foreign real estate investments do not materialise into decent profits, let alone the break even point that the foreign purchaser had hoped for.

Additionally, the foreign owner is exposed to (excuse the repetition) a completely foreign tax structure that kick starts into place with the first transaction, your purchase. After the horrendous events of September 11 in the US, securities transactions from all origins have received heightened scrutiny and real estate investments are no exception.

Over the seven years of providing investment and financial advisory services here in Bermuda to hundreds of clients, I would easily estimate that one in four local Bermudian residents have very strong ties to the United States. Older clients, particularly those closer to retirement, very often also own real estate abroad. Those that currently don't, voice opinions that they plan to buy or wish that they owned that little vacation spot.

Real estate in Bermuda has always been a great investment ? there are after all only so many units available at any one time. Choice of sites did not enter the picture; the buyer was happy to purchase just about any home of a small inventory at just about any price. Domestic banks, too, were conservative in their lending habits and while home foreclosures happened, the rate of such sad events appears lower than that of other countries. Not so in the United States where the forces of supply and demand (or lack thereof) for housing drive real estate cycles that ebb and flow with the tide.

This is not the case in the US where there may be thousands of units available for sale at any one time; financing may be palatable and very aggressive, even for a foreign investor; builder/broker/mortgagors may extend very lenient credit terms; buyers tend to be more transient, and you may never know your neighbours. After weighing those thoughts, you need to focus on the purchase price, and above all, the price may be right. What's a couple of hundred thousand dollars compared to the average home price in Bermuda today?

In Las Vegas today, real estate has risen more than 35 percent over the prices of last year, with 2004's prices increasing by the same margin over the year before. Dry heat, booming economy, easy access with hundreds of planes a day bearing the more than 35-40 million visitors a year. Sounds great, you think? So do many others with more than 6,000 people moving to Las Vegas every week.

Everywhere as far as the eye can see, sand is being converted into substance, concrete forms faintly resembling the adobe structures of the real Native Americans.

Schools, instant communities, many of them gated, a Walgreens and Starbucks on every corner, and easy money to be had, if you are in real estate. How can you go wrong? Perhaps, you can't or won't. After all, Steve Wynn just sunk billions into a new 53-storey resort where a round of golf costs $400 per person.

Is this the place for you, or should it be a Florida golf (gulf) scene, slightly exposed to the weather elements, but "simply fabulous" just the same. Whatever the choice, the decision to relocate, however temporarily, is energising and, but that should not be the only reason to invest abroad.

There are many items that should be considered before buying a US property. In articles to follow, we will explore the benefits and detriments of a US real estate purchase, both single family dwellings and condominium structures. Just for starters, here are a few things to think about!

Property taxes, use taxes, federal, state, and city income tax, geographical location, federal estate and state inheritance tax, condominium fees, capital reserves, excess liability insurance, absentee owners versus live-there neighbours, bankruptcy and insolvency by other condo owners, home inspections, radon gas, environmental impact, title search, wills, estate planning, probate court, real estate structure, titling of ownership, financing, corporations, property management, number of days in the US, reporting requirements of attorneys, accountants, real estate and rental agents, US source rental income and the most important of all: Location, location, location.

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