For most people, real estate is one of the best investments one can make in a lifetime. It is a tangible asset you can use for personal or commercial use. You have the option to generate income from the property and enjoy tax breaks and deductions.
Real estate often appreciates in value. It is also one asset that very hard to reproduce. Most people use properties to build their equity, grow their wealth, and even diversify your portfolio.
Buying a property can be an exciting experience whether this is your first time making such a purchase or not. But if you think all it takes is enough cash and a bit of property hunting, then think again. Since it involves the purchase of a considerable asset, legal hiccups can come marching your way.
Buyers like you can face many legal challenges even after completing the purchase. The following are just a few examples of legal issues you need to watch out for when buying properties.
Working with Incompetent Parties
When it comes to selling properties, sellers have the option to sell with or without an agent. In most property sales, buyers often use different parties to simplify the process. This often includes a property lawyer and a real estate agent. But know that sometimes, they prefer to sell their property without an agent involved to save on professional fees.
In Australia, research shows that only less than 1% of properties are sold without agents. This means that in most property sales, you will need to meet, negotiate, and work with both lawyers and agents when buying real estate. But take note that not all agents are the same.
There are good agents and bad agents. If you are a property buyer, finding the following telltale signs show you found yourself a bad agent.
- He pressures you in buying a house that is out of your budget
- He fails to return your calls, texts or emails
- He has no patience in answering your inquiries
- He keeps on showing you properties that don’t meet your criteria
- He does not ask you important questions
- He lacks experience, leadership skills, and confidence
- He is dishonest, unprofessional or unethical
Another professional you need to work closely when buying properties is a competent lawyer. It does not matter how many times you buy properties. Reliable property settlement lawyers will make sure the conveyancing process will be less confusing for you. They will ensure the legal transfer of the property under your name. They will take care of all the legal stuff for you so you can have a flawless transaction that matches your best interest.
Property Acquisition by Temporary Residents
Are you a temporary resident who plans on buying a property in a foreign land? Know that there are rules and regulations you need to know about before acting on your intention to buy. Property ownership laws will depend on the state or country you wish to buy a land at. This can be a tricky task since foreigners often have a limited buying power on foreign land.
For instance, if you are a foreigner who wants to buy a property in Australia, you need the approval of the Foreign Investment Review Board (FIRB) before you can legally buy a residential property. The approval usually takes approximately 40 days. You can buy new dwellings easily but established dwellings are a different story. If you don’t become a permanent resident or citizen, you will need to sell the property once you leave.
It becomes a different story if you are a non-resident buying a property in the U.S. The housing market is very foreigner-friendly. You can buy a property just like how their citizens make real estate purchases. It is like buying a property in your own country but in American soil. Of course, there are issues you might face like tax laws and financing challenges.
If you are a foreigner and you wish to buy a property elsewhere, make sure you talk to a local lawyer. They can guide you through the buying process and make sure you understand the legal implications that come with the purchase. They can even help you save more by making better deals with the property seller and avoid legal issues in the future.
Purchasing a property comes with many legal risks. You will do lots of negotiating, real estate hunting, and legal document signing. If you want a smooth and legal transaction, be sure to work with competent professionals. Work with a licensed real estate agent who understands your needs and a competent attorney who can take care of the legal issues. Avoid making any mistakes so you can freely enjoy your new investment without worries.