Whether you are investing in Latin American real estate or considering a second home, there are plenty of opportunities to find attractive, safe, economical homes. Of course, buying real estate in any foreign country comes with certain inherent risks.
When buying real estate in Latin America, consider the economic stability of the area in which you hope to purchase property. Not only will this impact the price of the home or land, but also it will contribute to the resale value and the cost of living should you decide to move there. Economic instability is rampant throughout Latin America, and you don't want to place yourself in a negative financial position.
Avoid "Ejido" Property
In Mexico and other parts of Latin America, buying real estate can be confusing when you aren't familiar with the language or culture. "Ejido" land, for example, is a popular type of property sold to foreigners, but it isn't necessarily in your best interest. Ejido means that the land is not privately owned, and is usually purchased by multiple people as a form of co-op. Although citizens can convert ejido property to private property, the same rights do not exist for foreigners.
In some parts of Latin America, buying real estate with proper connections for electricity, water and sewer can be difficult, and the lack of same might not be spelled out prior to purchase. Before you sign real estate documents, ask specifically about these connections and whether they are in sound working order. Retrofitting property with utility connections can be prohibitively expensive in Latin America.
The city ordinances in Latin America are often as rigorous as they are complicated. In Mexico, Brazil, Uruguay and Chile, for example, some types of property are zoned only for partial construction. This means that a portion of the land must remain undeveloped. There might also be height restrictions on buildings placed on the land. Learn about these ordinances before buying real estate in Latin America.
Real Estate Agents
When buying real estate in Latin America, it is important to secure adequate representation. Since the laws might differ significantly between the country in Latin America where you intend to buy and your home country, it is often best to have representation in both places. You can hire a real estate agent from home, then network with an agent abroad.
If this doesn't appeal to you, consider hiring a real estate agent in Latin America, then working with your attorney at home. He or she can review all documents before you sign and investigate legal ramifications of your real estate decisions.
It is impossible to make informed decisions about buying real estate in Latin American unless you actually visit Latin America. Even if you only tour the homes you've investigated online, you'll be better prepared than if you were to make a decision based on recommendations and pictures alone.
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