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Personal
Experience in Real Estate Sales - Part II
By Harriet Murray
August, 2004 |
- Current
Survey: If you are
going to buy a single-family
home, a condominium with
adjacent land, a parcel
of land or a building lot,
you should find a competent,
honest engineer to do
a topographical survey. Historically,
in many sections of the country,
when land was originally
surveyed, it was done
from the air by plane. The
legal description of the
boundaries and size was not
as accurate as a specific
survey on the actual land
being considered for purchase.
These original legal descriptions
can be transferred from deed
to deed until an updated
survey establishes the
current boundaries. I believe
that it is very important
for you to know what you
are buying. It is common
practice here that a survey
is an expense of the buyer.
You may choose the surveyor.
- Listing Price: The listing
price of a property
is an important indicator
of what should become a realistic
sales price. If a
seller has no real information
on actual sales prices,
he is not informed about
the objective value of his
property. If a listed price
is chosen that has no relationship
to sale prices that
are comparable to his property,
how can the seller make
a good decision about what
to ask for his property?
How can a buyer know
what he should expect to
pay for a property if the
listed price has no valid
reason for the price being
asked?
Beginning in 2003,
the local real estate community
of agencies who are members
of AMPI began reporting
actual sales prices of exclusive
listings when they were
sold . Not all agencies report
sales prices. The sales
information gives the members
a valuable tool to not only
help determine market values,
but also to also know when
a market is changing up or
down. This information helps
sellers price their properties
more realistically and helps
buyers determine a range
of price, which they can
expect to pay.
Comparables need
to be understood by the agent
and his client. Properties
have to have some similarities
in order to be comparable.
Adjustments upwards or
downwards can be made for
negatives or pluses to a
property value. Also of importance
is the length of time a property
takes to sell and when
the sale occurred. You
should ask the agent you
are interviewing (to be your
listing agent or your buyer
representative), what information
they have on comparables
for the type property you
have or want to buy.
- Buyer
Beware and Seller Beware
: Most problems could be
avoided or reduced to a large
extend, if certain steps
were taken in the beginning
of the process of selling
or buying a property. We,
as foreigners, have to realize
that the laws and culture
in Mexico can be different
from our previous experiences.
The first thing a buyer or
seller should do is: THINK.
Then THINK AGAIN. THEN, THINK
HARDER. We should be critical
of ourselves and take the
time to understand the reality
of where we are and
what we are doing.
If
something sounds too
good to be true, it probably
is too good to be true. Don't
accept answers at face
value. Double and triple
check your information. Ask
more than one source. Know
the difference between cost
and price. You are not going
to "steal" anything
in a foreign country or
different culture than your
own. I don't think that happens
many times in our original
culture, we just think
it does.
If you are a buyer,
take the time to learn as
much as you can about the
area where you want to buy
and the properties for sale.
Find the best people
you can to help you accomplish
your goal.
If you are a seller,
find out whether you are
exempt from or have to pay
capital gains upon sale.
Plan this in advance of listing
your property. Research the
market conditions and
determine a realistic price
range to market your property.
Do repairs: clean up legal
or physical problems first.
Find the best agency
and agent to represent your
interests.
If I had a magic
wand and could change a basic
human trait, which I have
observed over the years causes
communication problems; it
would be to make all of us
better listeners. If we are
not good listeners, we miss
what is being said, why it
is being said, and what it
means.
- Amount
Of Inventory For
Sale Within The Bay : The
comment sometimes made by
a buyer is that there appears
to be a huge amount of property
for sale. The inference
is that there is a problem
with the real estate market
or there is a negative about
buying in Mexico.
I believe there are two
factors, which affect
the supply of properties
for sale within a market.
In a resort or retirement
area, there are more
frequent moves or changes
in ownership because
of the nature of the
demographics. People
change their minds about
what kind of property
they want to own and
there are changes in
their personal situations.
These owners of resort
property do not typically
have a job or family
obligations, which require
them to stay in a certain
location. When there
is a lot of movement
in and out of community,
there are more properties
for sale. In communities
that have little additions
or loses to their population,
there is traditionally
less property for sale.
The other factor, which can
affect the supply of
properties on the market,
is the pricing. Properties
that are priced too high
for the demand or properties
that have undesirable features
are not attractive to buyers.
Properties that are
priced incorrectly can
stay on the market a long
time. The actual amount
of saleable inventory is
less than what is indicated
by the "for sale" signs
you see.
- The
Roles Of Different
Parties To A Sales Transaction
. There seems to be a
common misunderstanding of
the roles of different professionals
within a transfer of
real property in Mexico.
The notary is empowered to
transfer the property by
following specific guidelines.
The notary, while being a
specialized attorney, is
not the attorney representing
the buyer or the seller.
If you want an advocate or
legal advice from your perspective,
you need to find and hire
a good attorney. You can't
use the notary, if he is
representing the transaction
itself.
The bank, in the case
where a fidecomiso is required,
is the holder of the
real estate and transfers
certain rights to the primary
beneficiary. The bank gives
the primary beneficiary,
which is you, the right to
buy, sell, transfer, build,
remodel, and gift the property.
The bank does not have the
real estate as an asset on
its books.
The sales agent and
the listing agent have different
functions. The exclusive
listing agency has taken
the responsibility of
marketing your property and
has committed to make the
member agencies within their
organization (AMPI) aware
the property is for sale.
The listing agency commits
to advertise the property
to these agencies, and through
other means, make the community
aware your property is being
offered for sale. The participating
listing agency also agrees
to make known to their
member agencies they will
receive a commission if their
buyer purchases the property.
The
buyer agent and selling agency
have the responsibility to
assist you to purchase a property
for the best price and terms.
The listing agent and agency
should sell your property for
the best price and terms.
If
you need the advice of an engineer,
accountant, designer, architect,
attorney, you should seek
the best available to advise
you. You should expect to
pay them a fair and reasonable
amount of money for
their expertise. No real
estate agent should attempt
to keep you from using professional
advice from other professionals.
An
older real estate agent
from Oklahoma taught me
many years ago a truism: "Everything
has a price. Determine
what you want, what the price
will be, and if you are
willing to pay it."
This article is based upon
legal opinions, current
practices and my personal
experiences in the Puerto
Vallarta-Bahia de Banderas
areas. I recommend that each
potential buyer or seller
conduct his own due diligence
and review.
Harriet
Cochran Murray
For
additional information on
properties, for sale or lease
within the bay please visit Harriet
Murray website, call
or e-mail me at:harriet@casasandvillas.com
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