Buy property in Portugal at the Best Price
The process of buying property in Portugal and especially that of being able to buy at the best price can be an emotional, time-consuming venture; Therefore feeling that in the end you got the best price on your purchase can make all the difference. Like most major decisions, the amount of work and research you undertake before you start shopping can have a dramatic effect on how well you do in the end.
What do you really need?
Everyone can picture their ideal home but if you have not thoroughly prepared yourself prior to viewing properties? The chances are that you will find what you think is your ideal home and will more than likely end up paying too much. It is essential to treat the buying process in a slightly detached manner. Those who fall in love with their homes in Portugal usually pay too much and that is why we recommended you to develop a list of needs and one of wants.
When you are looking to buy the best priced property in Portugal, make sure that all your needs are fulfilled. Things like adequate space, a good neighbourhood, perhaps a garage and then have fun with items on your wants list. Treating the process in a regimented manner will help you to make a rational, informed decision.
Visit your lending institution prior to shopping for your new home. Be sure to get a mortgage commitment in writing as being pre-approved gives you a solid price range, and lets your realtor and potential sellers know that you are serious and not just browsing.
Get the right people behind you
Buying property in Portugal at the right price is a complicated process, with many people involved and having the right people on your side can make a big difference. An experienced, dedicated, and knowledgeable realtor can put a team of advocates, including lenders, lawyers, home inspectors and movers, on your side immediately.
The more you share with your real estate agent in Portugal, the better he or she will be able to represent you. Let your representative at Living Portugal Property know exactly what you’re looking for, in terms of needs/wants, price range, and location. This will eliminate unnecessary trips to unsuitable houses and that your dynamic and detailed focus can help ensure that you wind up in the right home.
Location, location, location
It’s still true, the desirability and resale value of your house depend on location more than any other factor. People want a desirable community. That includes character, quality schools, access to work, major transportation arteries, recreational facilities, etc. On your viewing trips, take a careful look and ask some of the following questions:
How does this house compare to others in the neighbourhood?
Are yards fenced?
Are there many children playing in the streets?
Are the front and back gardens and the exteriors of the homes properly maintained?
The least expensive houses in Portugal to buy, in a better area tend to appreciate faster than the most expensive houses in a less desirable area. Additional factors that affect the property value of a home include traffic, sounds, smells and planning laws. Be objective, make sure you are completely satisfied with the neighbourhood. If you choose a neighbourhood with problems, you likely won’t get as much as you hoped with it comes time to sell.
Use your realtor’s knowledge
Your realtor is trained in all aspects of real estate, including understanding supply and demand, economics, and the neighbourhoods of the city in which they practice. A professional realtor can do much of the work for you, by reviewing your needs, reviewing available properties, and making an informed match.
A comprehensive knowledge of the available houses in your neighbourhood in Portugal is one of your realtor’s strongest assets. With the aid of computerized systems, a realtor is notified within hours when a house for sale becomes available.
Pay attention to red flags
When evaluating a house in Portugal be sure you know the difference between acceptable and unacceptable problems. Cosmetic items like peeling paint, worn carpeting, or unattractive wallpaper can be easily remedied, and can be used as negotiation items, as there will be costs involved in updating the home.
Major problems however are clearly red flags. Look for items such as major foundation cracks, water damage, outdated electrical systems, and inadequate plumbing. These items could be too expensive to remedy to make the house a worthwhile investment.
Hire a home inspector
A home inspection is an inexpensive way to gain peace of mind, and guard your pocket book. A proper inspection will cover all areas of the house including foundation, electrical, heating, plumbing, floors, walls, ceilings, attic, roof, siding and trim, porches, patios, decks, garage and drainage. A professional inspector can give you an objective view of the property, with a written report, indicating the present condition and items that will need repair.
Be cautious with fixer-uppers
Sometimes, a fixer-upper can be purchased below market value, and once sufficient repairs are made, can be sold at a significant profit. However, not all fixer-uppers will bring in the profits you might expect. Consumers often overestimate their level of dedication to doing extensive renovation work, and underestimate the costs associated with such work.
A wall that needs to be replaced can often lead to the discovery of faulty plumbing, electrical, or other major undertakings. Your realtor and home inspector are your best allies when it comes to cost-benefit analyses.
Consider your future needs
A move can be a major undertaking, so take a good look at your current lifestyle and consider the future. Will you need extra space for a home office, a child, or perhaps a child moving back home? It may be easier and less expensive if you purchase property in Portugal that can meet these needs now, rather than moving up to a larger home a few years down the road.
When you’re ready to buy, act. Good properties sell. This is especially true given the current state of most real estate markets.
However, when you work with a realtor, you have access to the latest technology. As part of the MLS and Agent Handshake networks, a realtor has access to properties within hours of when they are listed. Technology works to your advantage. Many realtors now have personalized websites which allow you to sign on as a client, and receive notification of new listings via email. You save time and effort, and you can view only those homes that come closest to meeting your needs.
In any real estate transaction, be very clear about who is working for whom, and what the relationship represents. Unless otherwise stated, an agent represents the seller in transactions for the sale of a home. This agent, as part of his or her fiduciary duty, must ensure that the seller’s (and not your) position is represented throughout the entire process. Get a buyer’s agent on your side, or ensure that someone is acting in your best interests.
Pay for a written CMA
A Comparative Market Analysis (CMA) is an analysis of comparable homes in a given neighbourhood. It shows you the sale prices of comparable houses in the neighbourhood, along with asking prices of other homes in the area currently on the market. A realtor can request this report for any home and neighbourhood. Ask for this report in writing. With this valuable document, you’ll have solid, reliable information about how fairly a house is priced compared to its real market value.
Know the seller
Understanding a seller’s reasons for moving could work to your advantage during negotiations.
For instance, a seller who has been transferred to another city may be more motivated to sell than someone who is still shopping for a new home in Portugal. A vacant house or a house that has been on the market for several months and has been reduced in price, could also provide the opportunity for lucrative negotiations.
Keep it impersonal
Conversely, information could be used to your detriment. Information about your mortgage, size of down payment, move-in deadline, or circumstances for buying could be used to the seller’s benefit in negotiations. While you want your realtor to know these details, maintain your poker face and keep your cards hidden with the sellers and their agents.
Measure twice, sign once
While you definitely want to move quickly once you’ve made the decision to purchase, you don’t want to cave in to pressure for a quick close. Someone who is trying to pressure you into buying a house is likely doing so for a reason. Make sure the reasons for you to buy a home are your reasons, not theirs.
Exercise your negotiating skills
Even if you prefer not to haggle, it’s worth it, especially when it’s your new home and one of your biggest investments. Most people expect to haggle over the price as there is always room for negotiation. Let your realtor who should be a professional negotiator help you achieve the best price.
Avoid bidding wars
In some cases, the seller’s realtor may use scare tactics to rush the sale or increase the price. Falling for this trap could cost you money. If there is another buyer, or some other reason this pressure is being applied, whoever wins also loses because they tend to overpay. Let reason be your guide, not passion.
Get it in writing
Legally, sellers must disclose all known material defects of a property in Portugal. Ask for this in writing. Also be sure to consider the ramifications of these defects. Will they be costly down the road? Are they “serious” defects?
Be aware of hidden costs
While realtors often tempt first-time buyers with rent/mortgage comparisons, there is more to a home than simply the mortgage. You will be responsible for other items including mortgage insurance, appraisal fees, legal fees, inspection fees, transfer taxes, title insurance, inspections, property tax, increased bills, etc.
Your realtor can give you a good idea of the costs associated with buying a house in Portugal that are beyond its final negotiated price.