What We Global Property Buyers Can Learn From
March 10, 2014, Panama City, Panama: The key to success buying real estate overseas is a good attorney and cool-headed due diligence.
Dear Live and Invest Overseas Reader,
Many people think buying property in another country is a risk-filled quagmire that is too complicated to overcome. Certainly buying property in a location you’re not familiar with requires due diligence and research, but that’s true whether you’re living in Chicago and want to buy a lake house in Wisconsin or living in Chicago and want to buy a beach house in Honduras. The same “foreign” effects can come into play.
A good example of all that can go wrong going wrong when buying real estate in a foreign place is the 1948 movie “Mr. Blandings Builds His Dream House,” which follows a New York City ad executive who’s fed up with apartment living and so searches for, buys, and then renovates a farmhouse in Connecticut.
One critical mistake Mr. Blandings makes early on is not consulting with his attorney, who also happens to be his best friend, regarding the purchase terms and contract. The price that Mr. Blandings agrees to pay for his land is multiples of even the “top-gouge price for city slickers,” as his attorney-friend explains to him too late.
In addition, Mr. Blandings’ attorney notices a note on the back of the title that explains that the amount of land indicated for sale may have been “optimistic”…and that the parcel likely will survey out to include 30% fewer acres than advertised, “more or less.”
The bulk of the movie follows the renovations to the house…well, the aborted renovations. Mr. Blandings and his wife quickly decide the old farmhouse has to be torn down and a new house built. The movie is a must-see for anyone thinking about renovating…the original “money pit” story.