Are you buying real estate? Is property being purchased for sake of investment; as a roof over your head; a nest for the family; or for purposes of conducting commercial activities such as an office, factory or retail trade? All or any of these purposes of buying real estate would need attention to the following check-list of points:
- In major parts of the world, real estate is now notched right after gold and precious metals as the most preferred forms of investment. This is because land is becoming increasingly scarce and the potential buyers are only increasing in number leading to a clash of supply versus demand. Thereby creating a potential for making quick money for the over-night operators, scammers through faulty, risky and fraudulent deals. Watch out for anyone trying to inordinately rush through a deal without proper verification and or inadequate documentation.
- Real estate may be bought from any one of the following sources -- directly from a government agency; from a property builder or developer; as a second sale from an existing property owner; from a broker who represents the real owner. Sometimes, mortgage companies, banks and financial institutions auction or sell property confiscated for default and non-repayment of loans.
- Irrespective of the nature of the seller, as a potential buyer it will be your sole responsibility to ascertain ownership of the property, whether the property is mortgaged or encumbered in any manner. Are there more than one set of claimants to its ownership? Of course, it is easy to trace ownership in cases where a mortgage or financial institution is involved since they would have conducted a due diligence search on the property prior to advancing any loans. Nevertheless, proper checks must be conducted at the relevant office for land records, inquiries made in the neighborhood, with local brokerage and construction agents for details on a property. Obtain certified copies of all agreements, documents and records relating to ownership of the property from the seller and review it from its first instance of ownership. It is highly advisable to have the title documents reviewed by an attorney and that you obtain a certification as regards ownership of the property. Note that the certification must trace ownership from the very first instance.
- Next, check to see if the property has been constructed in observance with all building codes and laws. Get an architect to inspect and certify it; check for plumbing, electrical and other facilities within the premises. A bonus advantage would be if the property has been insured and if there have not been any claims for insurance. The property must be in conformity with local zoning regulations including the intended use of it.
- Check that all property taxes, utility bills and outgoings in regard to the property have been paid to date and that there are no outstanding or penalties payable.
- Take appropriate measurements of the entire real estate and ensure that it corresponds to the measurements mentioned in the documents evidencing ownership of the property.
- If the real estate is located within an apartment complex, a gated community or in any case if it is part of a private group of residents welfare association it is very essential to check terms and conditions of the association to ensure there are no provisions therein that you may not be able to comply with.
Finally, buying real estate brings with it inherent risks for appreciation of the property. Know how to never mix investment with usage of real estate for reasons of personal dwelling. In making a home, choose safety of inhabitants, proximity to amenities and general satisfaction of your family as a single point deciding factor.