The Biggest Mistakes Real Estate Buyers Make
The process of buying real estate overseas can be complicated, time-consuming, and stressful. But it should not be like this. Read our guide below on the biggest mistakes buyers make and how you can avoid them.
Mistake #1: Location is everything
Almost everything can be fixed, but the location, the location, the location cannot be fixed. Buy location, NOT price. When investing in real estate overseas remember to do your due diligence and pay special attention to the small details that can turn your dream home into the home of your worst nightmare. Before buying try to get information from different local sources in order to be sure that the location you chose is really the right one for you.
Besides common factors such as traffic connection, security, neighborhood, distance to the nearest hospital, and infrastructures such as supermarkets, shops, and restaurants, it is important to verify the connection to basic public services. That is water, telephone, internet, electricity, and garbage collection. Which are the available providers and how reliable are their services? Are there any (regular) interruptions or connectivity problems with one of the basic services in the sector? Does the availability of one of these services vary according to the season (rainy season/dry season)?
Speaking of seasons, although Panama is a tropical country without seasons, there are sub-climates in different areas of the country. Depending on the location and time of the year there are regions that are more humid than others, in certain areas, there is a constant strong wind during the dry season, others where heavy rain falls during certain months of the year, while there are zones suffer from drought during the dry season.
Mistake #2: Not thinking about selling the house someday
Buyers often forget that they will most likely sell their home at some point. Personal circumstances can change, and eventually, you have to sell. The purchase of a home should be structured well from the beginning to avoid headaches and bad surprises in the future: What will be the taxes to pay when you sell your home? Which legal figure is the most convenient to acquire a property? If something happens to me, what is the quickest and least expensive way to transfer the house to my heirs?
Mistake #3: Falling blindly in love with a house
Just as in love relationships there are properties that are "problematic". Some details are cosmetic and can be solved in one way or another, but there are real estate options that can be called an "uncontrollable risk". Whether it's a lawsuit, a conflict of interest, or some kind of encumbrance. Unless you like to play Russian roulette, don't get distracted by the "flashy" details of a house.
Mistake #4: Trying to buy without a lawyer
Last but not least, one of the biggest mistakes we can observe in our legal practice is when buyers try to buy without an attorney. There are too many factors that cannot be calculated and making a mistake is somehow inevitable. Lack of experience combined with the desire to save “some pennies" can have serious consequences. The laws and the legal basis in Panama are not the same as in other countries. You should not sign contracts or legal documents that were not reviewed by a trustworthy lawyer. If you have doubts about a transaction, seek advice from an experienced lawyer who will not only protect your interests during the purchase transaction but also your wallet by avoiding problems in the future.
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