A friend  has a house in France, in the Dordogne. He spends most of the summer there. He regales me with the charm of his village, the wonders of French bread and the mysteries of un-pasteurized cheese. His stories awaken my dream of owning an old hacienda in San Miguel or a villa in Conchas Chinas, the Beverly Hills of Puerto Vallarta.

    If you are prone to similar thoughts, let me suggest some pleasant homework. Read Peter Mayles’ “A Year in Province ” or Tony Cohan’s “On Mexican Time .” Both are charming but cautionary tales. If you’re still working here and hoping to have a good time in a far away place, some of the time, an adventurous purchase probably isn’t the way to go. Unless you’ve got as much time as money, a turnkey deal will work better.

    My practical but pleasurable alternative: View the purchase of a home abroad as a portfolio decision. It can be a hedge against inflation. It can be a hedge against a falling dollar. It may be a good investment. It probably won’t be the worst. Whatever, it is part of a diversified portfolio of assets.

    The basic realities are in your favor. Homes in resort areas are relatively inexpensive to run. Taxes are low because there is a lot of assessed value relative to demand for services. Utilities are low because you aren’t in occupancy much of the time. Ditto the cost of interior maintenance. As a consequence, resort homes--- wherever they are located--- tend to cost less to operate than workplace homes. Homes in foreign countries, which often rely much less on real estate taxes, can cost even less to operate.

    Think well under 3 percent of market value.  So a $500,000 condo may cost less than $15,000 a year to operate. You won’t have to use it much to get that back in vacation value compared to the cost of a deluxe hotel suite in the same area.

    The remainder is portfolio investment. It will grow tax-deferred and possibly tax-free.

    While the supply of luxury properties around the world is soaring, resort locations will continue to bring premium prices as the world’s wealth grows even faster.

    Most people can’t buy second homes as portfolio investments. The brute fact is that most Americans have the bulk of their net worth tied up in their primary home.  They would benefit from less real estate, not more.

    The very affluent, however, aren’t most people. A recent study by VIP Forum, a Washington DC based wealth management research group, found that a net worth of $10 million was the basic price of admission to the top 1 percent of households.  They’ve also found that households with net worth of at least $20 million have been growing faster than the rest of us. At those levels, owning a home overseas is simple diversification.

    Where to buy?

    My vote goes for the full service communities in Mexico and Costa Rica, usually with a primo branded hotel as part of the package. The scope of these developments provides assurance of quality, long term maintenance, access to services, and an abundance of amenities.  Of course, the amenities may not include un-pasteurized cheese.