Sponsored Partner Content by ECI Development.
Everyone buying property outside of North America should remember the famous words of Dorothy to Toto in Oz, “I don’t think we are in Kansas anymore.” When going global, it’s not the same as back home. We must be very careful as we explore this new landscape. But how can we do that?
Consider this: We don’t know what we don’t know.
Humility is the one attribute that really helps when we go overseas. It’s a different country, with different rules. Many parts of the world are “buyer beware” so we have to look out for ourselves.
But if “we don’t know what we don’t know,” how can we? Three simple principles will provide excellent due diligence overseas.
Buy What You See
Know the Developer
A series of 15 questions highlight these principles. They should be an important part of the property selection process. There are no “right” or “wrong” answers. But having answers to questions about creature comforts, ongoing costs, and the developer are smart to know upfront.
Here you’ll see one question from each principle to highlight its importance. Click here and receive the Consumer Resource Guide, all 15 questions, and additional global property resources.
Beautiful views of the Pacific in Latin America for a fraction of the cost compared to California.
Buy What You See - Is the house or condominium plumbed with hot water?
Not a silly question. Inspect under the sinks to see if there is both hot and cold service. A splitter is often used from the cold service to provide water to both faucets. When building, triple check the plans for a hot and cold service to all bathrooms. Architects may design “local” and unless you catch this upfront, change orders become prohibitively expensive.
Own Community - What about the Home Owner’s Association? Are the fees high enough to cover maintenance of existing and planned infrastructure?
Yes, high enough. Worry about low fees because they are usually a sales tool. Nobody likes to pay monthly fees. However, fees set too low equate to unexpected surprise assessments and/or a dramatic rise in HOA fees when the true costs of maintenance are carried by property owners.
Know the Developer - Is the development company financially solid and do they have a record of success?
Buying a property in a foreign country is like getting married. Know who you are marrying. You are counting on the people and company involved to fulfill commitments now and for the next 20 years. Ask to see a copy of a business plan. Do they even have a business plan? Ask to see financials. You are the buyer and you have every right to ask to see financials, especially if they’ve promised something like future amenities. There are no bonding agencies holding their feet to fire to complete anything. If they’ve promised an ROI on rental return, ask to see cancelled checks to owners. They’ll be proud to show you.
Remember to request your complimentary Consumer Resource Guide here.