10 Tips for Renovating Property in a Foreign Country

Kathleen Peddicord
February 28, 2012

Do you harbor a dream of acquiring a labor of love in some romantic corner of the globe? Perhaps you could find a charming, old, and historic home in need of a face lift. I sympathize.

I'm drawn to old houses in the way that some women are attracted to new shoes. I'm a romantic. Instead of what's in front of me, I see what the property in front of me has the potential to become. This can be a dangerous habit when it comes to buying real estate in a foreign country.

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Take our former home in Ireland, for example. It was a 200-year-old stone farmhouse that had been vacant for more than four years. The previous owner had been an elderly woman who'd lived in the house alone for decades while it fell slowly to ruin around her. After her death, the rate of deterioration accelerated.

When I walked in for the first time, though, I didn't see the mold growing on the walls or the rot eating away at the wooden door frames. I saw classic Georgian symmetry complemented by high ceilings, ornate moldings, a grand central staircase, and original wood plank floors. There were also built-in shutters on all the oversized windows that opened, in every direction, to views of rolling green fields embroidered with low stone walls and centuries-old hedgerows. To me, this was the best of Irish country life, and just what we'd come to Ireland to find. Sure, the place needed a little work, but what a great project to restore this stately structure to its original Georgian splendor.

Irish banks don't require a formal inspection of any piece of property they lend you money to buy. Still, we thought we ought to have one. We asked our estate agent to recommend an inspector, whose eventual report puzzled us. Rather than detailing required upgrades to the electrical wiring or gaps among the slate tiles on the roof, the report suggested that the "décor could be modernized." We didn't disagree, but we were surprised the inspector found little else to comment on. As with so many things during those early days in Ireland, we shook our heads in shared confusion and moved on. We bought the place.

Friends recommended a general contractor to help with the modernizing we wanted to carry out. We met a contractor at the house one cold, drizzly morning and began showing him around. "We'd like to build in cabinets here and bookcases at the top of the stairs," I explained, "We want to replace the tub in the master bathroom and the shower in the guest room and then paint and paper throughout." He nodded, but kept silent as we walked from room to room. Finally, he declared: "I'd say you need a damp guy."

A few days later, on another cold, drizzly morning, we stood outside the heavy front door to the old stone house waiting for the damp guy, who approached with a screwdriver in his hand. He tipped his woolen cap to me, then headed toward the living room, where he began poking his screwdriver into each piece of wood he passed. The window casings, the shutters, the skirting boards at the bases of the walls, the frames of the doors to the patio, the Irishman poked and poked, his look growing graver after each thrust. "Rising damp," he declared solemnly. "All throughout."

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We didn't know what rising damp was, but we were pretty sure from the look on his face that its presence wasn't good news. Rising damp, it turns out, is a common phenomenon throughout the Emerald Isle, where damp from the constantly wet soil seeps into the foundation of a house and then rises up the walls until gravity gets the better of it. Left untreated, damp will rise, we learned, about six feet before the force of gravity halts its progress. In our house, it'd been left untreated for a very long time, meaning we had to blast away the interior plaster back to the stone from the base of every wall to a height of six feet. The exposed stone would be injected with a chemical to treat the mold, sealed, and then the wall would be repaired using plaster treated to withstand further damp.

For days and days workers blasted with jackhammers until every plaster wall had been made dust. At first, I'd visit every second day or so to check on the work. After a while, I couldn't face the mess and resorted to phone calls. And just when I thought the time had arrived finally to begin rebuilding, I learned that the next step in treating a bad case of rising damp was to tear out all the wood. Every panel, from the floorboards and baseboards to the window casings and shutters, had to be ripped out, treated, and replaced. If the rot was too bad, a new piece had to be made to fit.

Week after week, we watched as the charming Georgian country house we'd bought was reduced to rubble inside. Around the same time, I discovered that I was pregnant, and our sense of urgency about the planned move into bigger country quarters increased. What we thought would be three or four weeks of carpentry, painting, and wallpapering turned into what we've come to refer to as our first "total gut job", a project that took nearly two years to complete. I insisted we move in before our son, Jack, was born, which meant we spent our first month in the house holed up in the master bedroom, the one dust-free room, without a real kitchen and with only one working bathroom.

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That's what it means to undertake a renovation in a foreign country. We so enjoyed the experience that we undertook another one when we moved to Paris several years later. Although there's no rising damp in Paris, in the 300-year-old building where our apartment was located, there were other problems. We intended to add a bathroom and paint, but ended up redoing the plumbing, the heating, and the wiring throughout the entire apartment. A project expected to take two months took eight and cost two-and-a-half times as much as we'd budgeted. In all, over the past 14 years or so, I've been involved in nine renovation projects in seven countries. It always takes longer and costs more than you think it will. I now count on twice as long and two times the cost. That way, sometimes I'm pleasantly surprised by the actual outcome.

As I write this, I'm approaching the finish line with another renovation project in Medellin, Colombia. I decided here again to buy old and charming and redo. The costs of both labor and materials are so low in this city that I believed I'd be able to carry out a high-end renovation of an interesting apartment in an older building for much less than it would cost to build or buy something comparable today. These are the circumstances under which a renovation can really make sense. If you share my interest in restoring and renovating old and charming into new and special, here are 10 important things to remember:

1. Be sure you have the time, money, and enthusiasm to complete the project. Frankly, purchasing a condo or house is a much easier option. Renovating in a foreign country is a lot of work. If you aren't completely certain you have the stamina and the funds to see a project through to completion, don't take it on.

2. Understand that any home-renovation project is going to exceed your budget for both time and cost. Count on it.

3. If you can't be on-site full time, you need a plan to protect your investment when you are absent. You need security. You can go high-tech and install a security system, or you can go low-tech and provide quarters for a live-in caretaker.

4. Investigate the track record and the reputation of any contractor you consider. Your contract is only as good as the person with whom you enter into it. A contractor eager for work, anywhere in the world, will likely underestimate the cost. Once the project is under way, you really have no choice but to continue paying the bills, even when they exceed your expectations. Enforcement of contractual price can be difficult after the project has begun.

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5. Be sure the construction supervisor can communicate with the workers in their language. Even though English is the primary language in Belize, for example, many of the construction workers are Spanish speakers from Central America or Mexico. In Paris, our crew was Romanian and spoke only Romanian.

6. Develop a formal set of plans and stick with them. The workers need direct and constant supervision. If uncertainty sets in about how to do things, nothing gets done right.

7. In many developing markets, laborers' wages are typically paid in cash weekly. Many construction workers are temporary residents who follow the work and do not establish bank accounts. You need a good cost-tracking system to monitor cash flow.

8. Not only the crew, but your contractor needs to be monitored throughout the entire process.

9. Even if you're present on-site most of the time, and you're monitoring and managing the crew and the contractor directly, count on misunderstandings and difficulties. Many contractors take on small side jobs while they're working a big job (such as the construction of your home). It is easy for them to mix up funds and materials. Review all invoices carefully to assure your materials aren't sent to another project site, for example. You've also got to monitor construction payments and expenses carefully. Take my advice: Pay materials suppliers directly, as the materials are needed. Don't pay your contractor, for example, and then have him pay the supplier. The more direct control you have down the line, the better.

10. Use local materials and appliances whenever feasible. Replacement parts are more readily available for locally purchased products, and local tradesmen are more familiar with installation, operation, and repair of local products. Plus, local products are designed to stand up to the local climate.

Kathleen Peddicord is the founder of the Live and Invest Overseas publishing group. With more than 25 years experience covering this beat, Kathleen reports daily on current opportunities for living, retiring, and investing overseas in her free e-letter. Her book, How To Retire Overseas--Everything You Need To Know To Live Well Abroad For Less, was recently released by Penguin Books.