Buying Foreign Property 5 Effective Ways to Make Your Offer Stand Out

20230526052151_647041ef56a71.webp

In a seller's market, like the US, buyers must be prepared to do some ground work and move fast whenever they spot homes that offer what they are looking for. In a competitive market, a buyer with cash doesn't necessarily win these days. 2015 Realtytrac stats say that about a third of property buyers in the US are cash buyers. Cash might still have an advantage over mortgage but below are some more tips to create a winning offer.

Only a few sellers can reject an offer of cash but chances are you're not the only one bringing cash to the table. Hence you need other strategies when making a home offer:

1. Move fast.

Moving fast could help you win when making a home offer in a competitive market. If you’re dealing with a seller who doesn't have much time (who does?) and wants to sell fast, all you need to do is put your best foot forward and follow other steps in these article to seal the deal.

You can also offer to close quickly. A standard closing period is about 30 days. If you can close in three weeks instead, this could convince the seller to accept your offer even over one that offers more money.

2. Get a professional.

A proactive and knowledgeable agent will know what works in that community and will be able to create a winning offer fast.  A good agent will be the strongest weapon in your arsenal when in a competitive market. A knowledgeable agent will guide you through winning strategies in that competitive market that may seem crazy when you try them in a slower market.

3. Be human.

Display personality with your offer. One way to do this is by writing a letter to the seller that tells him the reason why you want to buy. Indicate a subtle feature you like about the house (which other buyers didn't notice). Other sellers will appear impersonal.

4. An earnest deposit

A substantial first deposit makes a major difference. A reasonable first deposit will be about 3% of the value of the house. A seller often takes this offer seriously and can feel positive you are focused on the stand by position this offer.

This may give you a winning edge. Submitting a pre-approval notice with the first deposit puts your offer before others by telling the owner you are serious.

 

 

 

5. Money talks.

Of course, the more money you can offer upfront, the better your chances. If you can afford a 30% or 40% down payment (or more), sellers will be tempted to accept your offer. And, in the long run, it will save you money on a mortgage, shortening the length of your loan and the interest you pay. You can also waive some contingencies, depending on what your agent approves.

These tips can put your offer on top of the pile. However, in a competitive market, beating the competition depends on your creativity. 

Previous Post

How to Successfully Buy Overseas Preconstruction Homes

Next Post

3 Steps to Determine the Fair Market Value of Foreign Real Estate

Related Posts

20230526051906_6470414ab26ab.webp

Top 5 Considerations for New Investors Seeking To Buy Overseas Property

  • 12, August 2023

Over the years, real estate has been pushed as a better investment to stock. With so many differences as wide as the fact that real estate is a solid, physical good while stock isn't, it's hard to see the similarities between both types of investments. An investment in real estate is similar to stocks, in the sense that, there are both negatives and positives, there is an amount of risk involved and there are no guarantees. However, comparing real estate and stocks over many decades, real estate has performed better in generating consistent wealth and long term appreciation for millions of people. But as mentioned earlier, there are no guarantees. Here are five important factors new investors should consider when buying a home abroad.

Factors To Consider When Buying A Home Abroad

1. Availability of good real estate agents. Hiring a good real estate agent is the single most important thing you'll do as a foreign property buyer. Hence you need to verify that these agents can deliver excellent service. This service will usually include post-purchase assistance. Your real estate agent should be able to help with service connections, home improvements and other requirements after the sale. A good real estate agent will also provide practical help and support. So ask questions and verify what your agent can help you with to ensure smooth purchase process.

2. Insurance. Few things done right will save you the hassles when buying property abroad. One of those things is getting coverage. This is particularly true of vacation home owners who might have to leave the property in someone else's care and investors dealing with tenants. Building insurance is a must for foreign property owners in some countries e.g. South Africa. But don't stop there! Get insurance for the contents of your home. While seeking insurance cover, check around. If you can find an insurance company with base in your home country, then go for it. If not, then settle for local insurers.

3. Property improvement. It's a given that you might not like some of the props and arrangement of your new overseas property. So, many new investors go along with renovation ideas and plans. However, home improvements can eat up your savings. Hence, before buying any overseas property, get a reputable appraiser. Don't expect to meet the property in tip-top shape. But if you'll be spending too much on repairs and renovations, then it's a bad deal.

4. Security. How secure is your new property? If there have been record of burglaries in the house, then having a big padlock might not cut it, you might need to move on. You need to determine how secure the area is. Your real estate agent might not disclose this information, so personal research is necessary.

5. Climate. You don't want to buy in an area prone to floods. Regions of extreme hotness or coldness are also out of the question. Look beyond how cheap the property is and get a house in an area you'd be able to 'survive' in.

 

These are just some basic factors you already know you should consider. But it's easy to take them for granted.

By Bebuzee Admin Read More
20230526050920_64703f00c316b.webp

6 reasons to use a real estate agent when buying a home anywhere

  • 07, October 2023

Buying overseas real estate often comes with increased responsibilities. Hence you need an efficient local real estate agent

 

While you might be a real estate guru in your home country, buying real estate in a foreign country can get messy without a knowledgeable local real estate agents

 

Here are just three ways things could go wrong when buying overseas property:

 

Over-the-top valuations: A foreign buyer probably doesn't have the stats on comps and recent sales that would help him make the best decisions on pricing. Locals might see this as a chance to price the property above market value. Without an agent on your side and banking on exchange rate advantages, sellers might feel justified to charge you more.

 

Taxes and paperwork omissions: In countries like Spain where there could be local rules and taxes regarding foreign home ownership, it's easy to ignore a few details. Not having the necessary licenses and permissions can be very costly.

 

Lopsided Communication: Sure your developer wants to come to terms quickly, which you find appealing as you don't want to hang around too long. However, you don't want to sign any form or contract without understanding what it entails. It's always important to get expert advice before signing on the dotted line.

 

You should have two people on your side when buying foreign real estate, a lawyer, to help with legal complications, taxes and paperwork and a real estate agent to guide you through the home buying process. You might want to ignore an agent's services as a way to save on agent charges. But here are six reasons why hiring a real estate agent for foreign property purchases is vital:

 

1. Full access to the market: Buyers in North America who work with agents have a full access to the Multiple Listing Service (A service that offers access to information regarding market value, comps and properties on the market). While some countries do not have a property listing service, a good agent will likely have a slew of properties and connections with other agents. This ensures he can secure a property that fits your criteria.

 

2. Detect overpriced properties: Where there is no MLS to set pricing, sellers and their agent often pad the asking price on their properties. Especially when the buyer has no agent on their side. Even in countries with MLS, ignorance can be a justification for an agent to charge you up to 40% above asking price. You can take advantage of an agent's market knowledge in this case. An agent has comps and data coupled with market experience and should be able to tell you instantly when a property is overpriced. However, do not neglect to do your own research about properties that catch your fancy. This will help you keep unethical agents in check.

 

3. Help with securing mortgage: One of the risky aspects of buying property abroad is getting financing. When considering going for a mortgage, your real estate agent can give you the low-down on mortgages for foreigners. He or she might also be able to connect you with bankers. An agent can also facilitate your loan by helping you with the necessary paperwork. This is one major reason why the services of a real estate agent are invaluable when you're buying a house overseas.

 

4. Negotiating and drawing up an offer: Negotiating tactics you have mastered in the US might fail to work when negotiating with sellers in Japan. The reason is that there are culture and language differences which can be difficult to fathom. So instead of trying confrontation or hard sell tactics, it is usually best to hire a professional agent who understands your situation and can persuasively represent this to a seller.

 

5. Help with finding good deals: You're probably trying to scoop up a good deal on a property. However, it's unlikely you'll find great deals by driving around a neighborhood. Agents have connections with other agents and access to a lot of properties. Hence it's much easier to find great deals by working with them.

 

6. Recommend trusted professionals: A trusted real estate agent would probably have a number of reputable service professionals in his network from inspectors, lawyers, handymen, mortgage lenders etc... This would be highly beneficial since you have little experience in the neighborhood and might be susceptible to pseudo professionals.

 

Caveat: When choosing agents to work with, work with vetted professionals. Don't just go with the agent down the street as that might turn out costly. This is why we periodically recommend agents in select communities who are vetted and have significant market experience to make your foreign property dream come true.

By Bebuzee Admin Read More
20230526052910_647043a6600d1.webp

How Much Should I expect To Pay in Stamp Duty Fees When Buying Foreign Property?

  • 20, May 2023

When you hear stamp duty, don't run for cover! Stamp duty fees are only applicable in the Commonwealth of Nations countries, Singapore, Australia and a few states in the US. It is a tax that arises from the transfer of property, usually, you pay when you sell. In this case, there will be a transfer of documents. Stamp duty legally requires that these documents are stamped, this shows the amount of tax paid. This means you’re actually paying for government stamp. Where enforced, stamp duty is placed on transfer of lands, homes, buildings, copyrights, patents and securities.

Facts About Stamp Duty fees

Stamp duty can be one small additional cost to your home, especially if you're dealing with a second home or investment property. Here are some things you should know about stamp duty:

* In the UK, the government levies stamp duty tax on all share transactions, currently at 0.5%. This generates £4bn for the treasury.

* In the European Union, Germany, Sweden, Luxembourg and the Netherlands have no stamp duty.

* France charges stamp duty only for transactions above £5,000. In the US, stamp duty is more or less insignificant, only 0.003 percent is charged.

* When you deal with really big money, it becomes a problem. Stamp duty is the reason why influential fund manager, Fidelity, moved half of its £6bn UK special situation fund offshore in 2016.

* Stamp duty came into being 200 years ago in the UK and some people believe that it was the sparking flame for American Independence Movement. When it was introduced to the American colonies in 1765, it was met by protests.

* Stamp duty is only paid on brick and mortar of the house. It shouldn't feature fixtures and fittings, white goods or items of furniture as they are exempt. You pay stamp duty on land and property purchases.

* You also pay the stamp duty when you buy shares valued at more than £ 1,000, although it is a different system, and the rates are different as well.

* You do not pay it on properties in Scotland. Instead you have a Land and Buildings transaction tax on properties costing more than £ 145,000.

* In the UK, just because your property is below £ 125,000 does not mean you can ignore Stamp Duty. You still have to submit a Stamp Duty land tax return.

 

* Even though your lawyer usually takes care of it, it is your responsibility to make sure that the return and payment are shipped on time. If it is late, you will pay a fine of £ 100, plus any interest.

* If you are transferring a portion of your home to an ex-partner after divorce or separation, or if you are giving the deeds of your house to someone - as a gift or in your will - you do not have to pay stamp duty.

How Much Stamp Duty Should I Expect To Pay?

In the UK, there are several price bands for Stamp Duty. The tax is calculated by the part of the purchase price of property that falls within each band. For example, if you buy a house for £ 275,000, the tax on the stamp duty (SDLT) you owe is calculated as follows:

0% on the first £ 125,000 = £ 0

2% on next £ 125,000 = £ 2,500

5% in the final £ 25,000 = £ 1,250

Total SDLT = £ 3,750

In this case you pay £ 3,750. This will not be the case in other countries. So, it is important that you contact a lawyer in your destination country who’d give information on how stamp duty is calculated.

By Bebuzee Admin Read More