Avoiding Common Mistakes When Purchasing Property in Latin America
It’s so extremely important to remember that purchasing property or a home in Latin America is nothing like purchasing in North America or Europe. If you can remember that one fact, your buying experience will be affordable, exciting and stress-free.
That being said, it’s easy to get caught up in the thrill of moving to a warm, tropical paradise, so Where International is here to help remind you of the important points you need to remember when buying in Latin America.
Purchase Title Insurance – If you were buying a home or property in your home country, you’d purchase title insurance, so why even consider not doing it in Latin America? It’s a definite must. Surprisingly some attorneys aren’t even aware it’s available, and not surprisingly, most sellers do not know it’s available. You do though, so get it!
Budget Appropriately – There are so many other budgetary aspects to evaluate besides the actual home or property cost. Taxes, closing costs, attorney fees and currency exchanges are just a few. Depending on whether you’re purchasing a home, vacant land or a condo, there will be other charges to consider as well – condo fees and property maintenance being just a couple. Run your numbers more then once, and if you’re right on the cusp of your budget, try to build in a buffer for possible changes or additions.
Don’t Pay More Then You Should – Always do some of your own research when it comes to purchasing a home or property – do not take a seller’s or real estate agent’s word that you’re getting good value. It’s tricky without MLS or real estate regulations, but by immersing yourself in the area, getting to know people and building friends and trust, you should be able to get a pretty good handle on true property values in the area.
Know Your Profile – Retirement home? Vacation Home? Investment? Why are you buying a property or home in Latin America? It’s essential you know (and remember!) what purpose you’re purchasing for. Perhaps you find a gorgeous home near the beach surrounded by luxury resorts, at a real steal! However, if you’re purchasing for investment purposes, will the resorts be too much competition? You may have a tough time finding renters if everyone chooses to stay at a hotel. Or maybe you find a stunning home built into the side of a mountain. Fabulous views and everything you imagined your retirement home to be, except it has 3 sets of staircases and another set to get to the pool and patio area. Will you be up for that while living out your retirement dreams? Remember why you’re buying first, then look for something that fits your profile.
Hire a Local Attorney – Unless you are a Spanish-speaking attorney, never attempt to go through the motions of purchasing a home or property in Latin America without a local attorney. Clauses, terms and procedures are much different from North America’s and once you’ve signed on the dotted line, you can’t go back.
Ensure You Have Free Reign – If you’re purchasing for investment, confirm that you’ll be able to rent it out, as some countries have laws about short-term rentals. Are you allowed to run a business out of your home? What if you wish to sell a lot before a home is built? It’s in your best interest to confirm that you can do what you wish with your property after you’ve purchased it.
Interview Your Developer – Chat with others who have used your developer. Ask about other developments they’ve built and go check them out. Do they have a good track record? Ask for references. If you’re purchasing a vacant lot, all of these questions should be easily answered and readily available from a reputable developer.
Check It Out – Don’t ever rely solely on an advertisement or someone’s word. You must visit the location yourself – either a vacant lot or home. Since there are no advertising regulations in Latin America, a brochure or poster could show a completely different picture from what you are actually getting. It’s not out of the question to see artist’s renderings of homes and condos with beautiful ocean views, but when you go to see them there’s no ocean in sight. It’s also a good idea to ask about future developments that may impede your views.
Following this condensed list of tips for purchasing in Latin America will help ensure your buying process is hassle-free. It may seem like there’s a lot of preliminary homework, but in the end it’s in your best interest. After all, this is your own piece of paradise!