As the purchase of real estate becomes ever more global, you as a real estate professional may encounter a situation where knowledge of international real estate will be quite useful. What if you receive a call from a couple that want to relocate and live abroad, but have never been outside of the United States? They give you specifics on home size, desired lot size, desired topography, proximity to urban area, etc., but no country. They want you to help them, but where do you start? Although this scenario may be exceptional, it has happened to me. How prepared are you to advise these Buyers? Of course in each representation you must first analyze the sophistication of your Buyers, if they have never lived abroad, here are some guidelines to follow.
- Make sure your buyers have the funds to buy abroad.
Whether your buyers are looking to move permanently and make their principle residence in another country or are just looking for a second home, it is a good idea to discuss with them the added expenses of making that overseas purchase, including moving expenses and trips back and forth. There will be extra fees for international attorneys and consultants. Help them get pre-approved through an international lending specialist.
- Do research on the country.
How much do your buyers know about the new country? There are several resources available these days to tap into for helpful general information about languages, cultures, populations, road systems, crime statistics, etc. An excellent place to start is the International page of the Houston Association of Realtors®’ website, www.har.com/international. The Internet is also a great source for basic facts. Caution the buyers that some information about properties is fraudulent and they could become a party to a scam. If the deal sounds too good to be true, something is wrong. Houston has more than 70 consular offices. Help them set up an appointment to visit the Consul General of the country and try to attend the meeting with them. Your familiarity with the consular office will help you on future representations. Have your buyers write a list of questions to take to the meeting, including ownership rights for non-citizens, immigration regulations, retirement tax incentives, health insurance, property transferability, duties on bringing belongings, pet quarantines, etc. Even if the Consul General cannot give detailed information, your buyers will have peace of mind that they have established a connection and probably will be given more information by way of websites or telephone numbers.
- Finding the property.
Once you have determined that your Buyers are qualified to make a purchase abroad where do you find the property? You may start with HAR.com and go to the International Area 82 of the Multiple Listing Service, which features international listings by country. You may want to locate a Realtor® with the NAR designation of Certified International Property Specialist(CIPS) in the other country, find one on the NAR site: www.realtor.org/international. Another source is to contact a member of FIABCI (The International Real Estate Federation), www.fiabci.com. One of these professionals may already know of a property that fits your buyers’ needs or can direct you to someone in that country with whom they already have a business relationship who can assist you.
- Relationship with the real estate professional in the other country.
After you have located a real estate professional in the other country, it is time to establish a working relationship and negotiate a referral fee agreement for your commission in writing. This must be done before you send the buyers. Ask the other Realtor® if she is familiar with the TRC (Transnational Referral Certificate) governed by ICREA (International Consortium of Real Estate Associations), www.worldproperties.com. When you feel secure with the other real estate professional, you can begin to inquire as to which potential properties are available to meet your buyers’ needs.
- Specific questions for the REALTOR® abroad.
After you have secured your working relationship with the foreign real estate professional, you should have a list of questions on hand, including but not limited to the following:
- Is a deed to the property available for your review?
- How far is the property from hospital care?
- What is adjacent to the property?
- What is the access to clean water?
- What main highways are nearby?
- Where is the airport in relationship to the property?
- What are common costs of utilities?
- Can a phone line be installed immediately?
- Is there a fire station nearby?
- Can the property be rented to a third party?
- Is there a property manager to look after things?
- Is there zoning in the neighborhood?
- Schools? Churches? International Banks?
You will probably not have all of your questions answered and cannot really verify that the answers that you do receive are accurate, but it shows your buyers that you are making all attempts to assist them.
- Understanding the contract and legalities.
When the sales contract is presented to you, it is your responsibility to be familiar with the common usage of real estate terms of that country. You must have the contract professionally translated. Advise your buyers to engage legal counsel with international business and tax expertise, both here and abroad, to advise them on all tax liabilities connected with their purchase. Find a title insurer that works in the country to provide the security of title for the property.
- Closing the deal and property conveyance.
Be fully apprised of the methods used to close and convey property. It may be very different that what your buyers are accustomed to here. Make sure your commission is protected and that you have set up a bank wire transfer from the foreign bank to yours. Find out how long it will take to have the property registered with the government property records.
- Making the move.
If the buyers are moving away to make their permanent residence abroad, you may be able to assist them in selling their home. It would be quite helpful if you had a list of reputable and experienced international relocation shippers that could give estimates and explain the procedures. Have knowledge of what household items and vehicles may be moved on a tax-exempt basis and some ideas of replacement costs. Sometimes it is less expensive to replace household items than to move them. Don’t forget to check out restrictions for moving the family pet.