Google is generally recognized today as the answer to every question, but there are exceptions to that Internet Age fundamental and one of them has to do with shopping for real estate overseas.As you launch your foreign property adventures, your first instinct may be to google a direction, to surf around online for country agents and property listings. I encourage you to resist that urge.
Well, that’s over-stating things. Go ahead and spend time online searching property-related key words for the destinations that interest you. You can acquire background this way, gain a starter understanding of the geography, the neighborhoods, and the property options on offer wherever you’re searching, and begin to identify price points. All of that can be helpful if you keep it in perspective. Whatever information you find online, to do with the state of a market, with sample property listings, or with current pricing, will be confused and confusing. Often it will be plain wrong, and, when you think through what’s going on, you’ll understand why. In fact, several things are going on that keep the internet from being your friend when it comes to finding a piece of property worth buying in another country.
The first has to do with language. Search online in English for information on real estate for sale anywhere in the world where the people speak anything but English as a first language, and what are you going to find? You’re going to find information and listings from those involved with the property market in that place who do communicate in English. Who might that include? In the case of Latin America, gringo agents. I don’t use the term pejoratively but as shorthand, as it is often used, to refer to anyone in this part of the world who hails, originally, from North America or Europe. You can throw Australians and New Zealanders in there, too. Considered collectively, South of the Rio Grande, these folks-Americans, Canadians, Germans, Dutch, British, French, Aussies, Kiwis, etc.-count as “gringos.” Don’t take offense; usually none is intended.
We gringos have made big marks on some of the property markets in this part of the world, especially in Central America. Over the past three decades, we have been identifying particularly appealing pieces of this region, especially along its coastlines, buying them cheap, chopping them up into smaller pieces, repackaging them, and then reselling them, primarily to fellow gringos. We have created markets where none existed, re-engineered off-the-map fishing villages into high-end holiday towns. Along the way, a lot of us gringos (and a lot of locals, too) have made a lot of money… and many other gringos, with lifestyle, rather than investment agendas, have acquired reinvented retirements and second homes in the sun.
As a result, today, in many places throughout Latin America, especially, again, in Central America, the gringo force is well-established and strong, especially in the context of local property markets. In places like Ambergris Caye, Belize, Roatan, Honduras, Boquete, Panama, and Playa del Carmen, Mexico, more real estate is sold by gringo agents than any other kind. The last time I counted, the very small island of Roatan, in the Bay Islands off the Caribbean coast of Honduras, was home to more than a dozen gringo agencies… but of which one was owned and operated by a local Honduran.
These agents may or may not be qualified, they may or may not have any previous experience selling real estate, they may or may not be trustworthy or reliable, but they all have one thing in common: They speak English as a first language. And this makes them feel safer to the rest of us who also speak English as a first language. We can understand them better than we can understand an agent stammering away at us in Spanglish, and so we assume, subconsciously, that they must understand us, too. And, critically, we also assume, subconsciously, if we let ourselves, that they have our best interests at heart. We’re all in this together, right? We English-speaking strangers in this strange land. Surely we’re all looking out for each other.
In some emerging markets where you might be considering investing in real estate, this couldn’t be further from the Wild West reality you’re going to face on the ground, including among, perhaps especially among the gringo real estate agents you’ll encounter. The trouble is that, because they’re able to communicate in English, these are the agents you’re going to find when you carry out any English-language property-related search online. Any English-language search is going to return information and listings published by agents who deal in English, and it’s these agents who are most experienced and most savvy at taking advantage of foreign, especially first-time foreign buyers.
Searching online in English, you’ll also connect with those locals who either speak enough English to post their listings online in that language or who have English-language support (friends, family, partners who read and write in English). These guys are probably a rung or two up the ladder from the typical gringo property agent in the developing markets of Central America where you might be shopping, but, working with them, you still are not going to be accessing all the information you need or even, necessarily, accurate information, and you’re not going to find your way to the best deals. For that, you have to expand your search to include local agents.
This requires local language skills. The best case is when you have them yourself, but, if you don’t, you have two options that can also be effective at making it possible to penetrate from the gringo to the local market. You can enlist help from a friend who speaks the local language, or you can engage someone specifically for that purpose, a translator. I have done both things successfully in markets around the world. If you’re not working with a friend you know and trust, the key is finding someone you can come to know and trust. Again, I’ve done this. Don’t advertise for an “English-Language Translator To Help A Foreigner With The Purchase Of Property.” Yikes…the characters that ad would attract.
You find a property scout/property search translator in a foreign country the way you find most things in a foreign country, from a maid to a plumber, a doctor, or an attorney- by word-of-mouth. When entering any new market, make one connection you trust and then build out from there.
Language is perhaps the biggest reason why google is not usually your friend when it comes to shopping for real estate in another country, but there are others, including the fact that once on google, always on google. Search online for property listings anywhere in the world, and what will you find? Current listings? Recent listings? Former listings? Old listings? Outdated listings? Sold listings?
Yes. And usually it’s impossible to tell them all apart. Maybe an online search will lead you to agent contacts that ultimately prove worthwhile, but the particular listings it yields likely will not. And not only because chances are good that those listings will no longer be current by the time you find them, but also because chances are good they’ll also be either misrepresented or posted with inflated price tags or both.
A woman reader of my daily e-letter contacted my Panama office staff a few years ago to say that she was interested in buying an apartment in Panama City. She’d been searching online for months and had finally found one she thought she wanted to move ahead with. Would we mind going to have a look at it for her, as she couldn’t get to Panama anytime soon herself. Sure, we told her.
My assistant called the agent and made an appointment to meet her at the apartment at lunchtime that afternoon. She printed out the listing from the agent’s website to take with her. She returned an hour later shaking her head.
“There’s no pool!” she exclaimed as she walked into my office.
“Excuse me?” I replied, not picking up on the reference.
“At the apartment I went to see for the reader who contacted us this morning. The listing online shows a beautiful pool and social area. After I’d toured the apartment, I asked to see the pool.
“‘Oh, there’s no pool with this building,’ the agent responded.
“‘But your listing online shows a pool,’ I said. And I showed her the print-out I’d made of the listing from the site.
“Do you know what she said? She told me, ‘Oh, that pool’s not in this building. It’s at the hotel down the street.’
“Told me that just like it were the most normal thing in the world.
“The apartment is horrible,” She continued. “Nothing like in the photos or the description online. But at least there is an apartment. There’s no pool. No pool at all!”