The 5 Key Reasons Why 98% of International Real Estate Investors Fail (And How to Avoid It)

Cristina Schuttmann
Jul 3
3 min read

Over 15+ years advising international investors in the Spanish real estate market, our team at Biznexus Consulting has identified a clear and consistent pattern:

98% of foreign investors make the same avoidable mistakes, costing them thousands of euros annually in tax and legal losses.

The good news: these mistakes are 100% preventable with the right guidance.

MISTAKE #1: Investing Without an Optimized Tax Structure

Real case: A Mexican investor bought an apartment in Madrid under her personal name. Result: she paid 47% in capital gains tax.

Biznexus Solution: With the proper structure — using international holdings and double taxation treaties — taxes can be significantly optimized. In certain cases, strategic corporate structures allow for even greater annual savings.

Key lesson: The first 30 days of tax planning determine whether your investment will be profitable or disastrous.

MISTAKE #2: Misunderstanding Non-Resident Taxation

Investors from LATAM and the U.S. often apply their local tax rules to Spain.Major mistake.

Critical points to consider:

Non-resident income tax (very different from resident rules)
Wealth tax (applicable based on asset size)
Local capital gains tax (varies between municipalities)

Without proper planning, investors may overpay by thousands each year.

MISTAKE #3: Choosing a Location Without In-Depth Market Analysis

Real case: An Argentinian investor bought in a “prime” Barcelona area without studying local data.

Outcome: Actual ROI was 3.2% vs the projected 8.5%.

Our Biznexus analysis method includes:

District-level demographic growth (last 5 years)
Infrastructure projects (metro, tram, urban renewal)
Rental demand by tenant profile
Gentrification and appreciation trends

Result: Our clients average 12% ROI because we invest where the data confirms the potential.

MISTAKE #4: Poor Financing Structure

Myth: “Spanish banks don’t finance foreigners".

Reality: They finance up to 70% with the right conditions.

With our exclusive banking agreements, we offer:

Up to 70% financing for non-residents
Competitive interest rates
Recognized international guarantees
Accelerated processes (45 days vs 90-day standard)

MISTAKE #5: No Exit Strategy from Day One

Investing without planning how or when to exit is a dangerous game.

Our Biznexus exit strategy includes:

Real estate cycle analysis (knowing when to sell)
Capital gains tax optimization
Strategic property upgrades to increase value
Access to a global network of qualified buyers

Why Do Our Clients See Different Results?

1. Comprehensive Due Diligence

We go beyond the property and assess:

Urban planning status (permits, liens)
Long-term appreciation potential (5–10 years)
Legal risk analysis for foreign investors
Full tax optimization from purchase to sale

2. Specialization in LATAM & U.S. Investors

We understand your unique challenges:

Currency controls & international transfers
FATCA compliance & local regulations
Double taxation treaties (country-specific)
Golden Visa & tax residency strategies

3. Proven Track Record

€47M managed for international clients
0% portfolio losses
12.3% average ROI vs 7.8% market average
Significant annual tax savings per client

Real Testimonials

“As a Latin American entrepreneur, Biznexus helped me structure my real estate portfolio in Madrid. The tax savings are significant and my net ROI is 11.8%.”— Carlos M., Developer

“Investing in Europe from Miami seemed complicated. Biznexus handled my Portuguese Golden Visa, and now I have EU residency with a 12.5% return.”— Ana R., Investor