The best and worst countries for Americans to buy real estate

Postpandemic chaos in the U.S. real estate market has taken hold, and Americans are being forced to search for better real estate markets, even second- and third-tier ones. However, there is another alternative - investing in real estate abroad. While there will be regulatory hurdles to overcome here and a complex tax situation, it's an option worth considering if the price is right. Some foreign countries can offer much higher rental yields than the U.S., with an average of 2.91% (though this varies by market).

Read on for the best foreign countries Americans should consider for real estate investment, as well as those that are not the best choice.

The best countries to invest in:

• Moldova: rental yield - 6.64%, the cost of renting a one-bedroom apartment - $432. Moldova lies between Ukraine and Romania in Eastern Europe. It has one of the highest rental yields, with very low rents.
• Egypt: rental yield is 5.38% and the cost of renting a one-bedroom apartment is $768. Housing values in Egypt have increased 28.25%, but prices have declined in the last two quarters of 2021.
• Jordan: rental yield is 6.11% and the cost of renting a one-bedroom apartment is $310. Jordan offers yields of over 6%, while rental costs remain low.
• Ghana: rental yields of 17.31% and the cost of renting a one-bedroom apartment is $1,160. Even with the rise in rental prices over the past 18 months, Ghana has maintained high rental yields. In addition, its economy is showing growth and GDP is expected to increase in 2022 and 2023.
• Montenegro: rental yield - 5.8%, the cost of renting a one-bedroom apartment - $324. Montenegro is across the Adriatic Sea from Italy and north of Albania. Although rental values have declined, yields remain strong and home prices have increased by more than 36% in 2021.
• Costa Rica: rental yields are 3.63% and a one-bedroom apartment rents for $850. Costa Rica attracts attention for its care for the environment, but it is also a great place to invest.

Worst countries to invest in:

• Israel: the rental yield is 3.30% and the cost of renting a one-bedroom apartment is $2,442. Israel has a lower average yield than the US. Housing prices are increasing, but not as fast.
• Argentina: rental yield - 5.71%, the cost of renting a one-bedroom apartment - $289. A nice country where renting is affordable, but it is not the best place to buy investment real estate.
• India: rental yield is 4.44% and the cost of renting a one-bedroom apartment is $303. Rents in India are very low, but this has a negative impact on profitability. Housing prices are not growing fast either.
• Austria: rental yield - 3.18%, the cost of renting a one-bedroom apartment - $854. Austria is famous for its beautiful architecture and rich history, but is not too attractive for real estate investors. Yields are low, although home prices are up more than 10% in 2021.
• China: rental yield is 1.58% and the rental price of a one-bedroom apartment is $548. China is one of the worst places to buy rental housing for U.S. investors. Yields here are low and rental costs are high. Housing prices, however, are rising rapidly.
• Turkey: rental yield - 4.71%, the cost of renting a one-bedroom apartment - $241. Turkey is also not the best choice for buying investment real estate. Yields are below average and home prices are down slightly.