• Make sure all legal aspects of the development have been taken care of. In particular ask the developer for a copy of their master title insurance policy. If they don’t have one it should raise a flag. Also ask them for any relevant environmental and municipal permits.
• If you’re buying off plan or pre-construction, your risks are higher especially if the real estate development is not very advanced on its master plan. It’s vital that you review other projects that the developer has carried out. Be cautious if they’re not able to point to any other projects that they have built. Of course it’s possible for a developer to be successful at building their first project in Central America, but it’s a sign to be more cautious.  Always ensure a phased payment plan – against tangible milestones – and try and keep the initial down-payment (which is usually done to kick off the construction) as low as possible.  If you are asked for a 50% down-payment for example, that could be sign that the developer is cash-strapped.
• If you’re buying in a multi-unit building, find out how many units have already been sold and at what point the developer will start building. Ideally you would want to buy in a project that has been financed from the start of construction, but often these are hard to find. Bear in mind that if the developer is relying on sales to fund the construction, long delays are possible if the market softens.
• As you’re preparing the contract make sure you seek the advice and an independent attorney. Many developers will recommend their own, but this is not a prudent way forward. Remember that in Costa Rica, Panama your contracts will be in Spanish. So unless you are a fluent in Spanish (and legal Spanish at that) hire a fully bi-lingual attorney.

Slow down… You may well have found a great investment opportunity, but we’d also like to set out some lessons that we’ve learned from our own experience of living and investing in several Central American countries (including Nicaragua, Costa Rica and Panama).

• Have you really done your homework? Remember as there is no MLS in many overseas real estate markets each agent has different listings. And even if they have the same listings, the price can vary considerably.
• Are you hoping that the area will improve after you buy? Perhaps your agent has told you that the road will be paved or that a new hotel is planned for the area? Now I don’t want to ruin the party, but these things may never happen or may be delayed for many years. Are you still happy with the property if these improvements never occur?
• Have you checked the title? What we mean is have you hired a competent attorney and asked him or her to conduct a full title check at the public registry. Have you also confirmed that the property plat map is identical to what is recorded at the catastral office and reflected in the title deed? And while we are talking about legal matters; are you planning on taking out title insurance? The answer to this question should be yes!
• Have you followed the 6 month rule. Now this is a tough one. To be completely sure that the property and the country are right for you our best advice is to live there for 6 months before you buy. Stay during the rains, see what it is like when that vacation feeling has worn away or when off season takes hold.  If you are still feeling good about the place, then it may well be right for you.
• Are you aware that getting financing from local banks can be difficult? And that even if you do manage to get a mortgage the rates are unlikely to be as low as you are used to back home?
• If you plan on building on the property or improving existing facilities are you sure you can get all the right permissions and approvals?  If you are buying near the ocean, near a protected area or near a border with another country then focus real attention on this matter, as laws have been becoming tighter.
• What’s water and electricity service like at the property?  Can you get broadband internet?  Is there cell phone coverage?  All good questions to ask before you sign on that dotted line.

We’ll be adding to these lessons in the future, so keep ‘em bookmarked.

Royal Victoria

This is one of the most luxurious hotels in Varenna. It is located right beside the lake and the place looks exquisite especially since it was newly restored in 2000. Air-conditioned rooms, a swimming pool, the courteous staff and the big and plush lounges are just some of the reason why you should want to spend your Varenna days there.

Hotel Milano

Situated at the centre of the town, Milano is a small and beautiful hotel. There are only eight bedrooms and some of these rooms open directly on to Lake Como while others come with a frontal view of the lake and the adjoining garden. Private balconies attached with every room is a special attraction and so is the La Vista restaurant, offering sumptuous Italian dishes.

Varenna Hotel Du Lac

The sprawling flower-covered terrace overlooking the lake is the main allure of this little romantic villa. The terrace comes with a small but beautiful terrace garden and the tourists can just sit there and enjoy to the full the stunning beauty of Lake Como (a major Italian lake).

Villa Cipressi

Located at a quieter part of Varenna, this is the biggest and the most elegant staying option you can find in Varenna. There are 32 bedrooms and 3 suites and the hotel features exclusive antique furniture and wall work that is going to fascinate every visitor. A step garden borders the villa and there are four large halls inside the house.

Other good Varenna hotels include Beretta, Eremo Gaudio, Del Sole and Olivedo.

1) Listing your international property

Listing information is generally a combination of text, photos and occasionally video.  That’s all well and good but how can sellers create a listing that really seduces the buyer?  In the end, much of it comes down to effective copy-writing.  This is of course also the case in the US or elsewhere – but in Central America expect to put in some of the copy-writing effort yourself:

• Start with a headline that draws the buyer in.
• Explain the “why.” By that we mean why you bought the property in the first place.  It can also be useful to explain why you are selling it, if the reason is a positive one.
• Advertise the features of the property, don’t just catalog them. (This is critical when it comes to photos.  Don’t just photography every room for completeness but carefully prepare five or six seductive photos to showcase the property)
• List the benefits of the property.  Explain precisely what will the property deliver for the buyer.  Sell the lifestyle that comes with the property.  After all buyers are not just interested in four walls and a roof they are buying the lifestyle that comes with owning them.

2) Exposure

As these is no MLS for property in Central America, getting good exposure is not as simple as getting the property onto a central database.  Don’t leave the marketing up to the real estate agents.  Remember, they’re acting more as buyers agents than listing agents.  And if you are selling in a real estate development, don’t assume the developer is going to put your property ahead of theirs.

• List the property with every real estate agent who is active int he region, promising a full commission to whoever sells the property.
• Provide the details to informal agents and property runners.  This may include your taxi driver and the hotel receptionist.  In practice you don’t have to be a  formal ‘real estate agent’ to sell property in Central America.
• List the property with international listing sites that rank highly for relevant search terms.  it’s all about increasing the marketing exposure for your property.

Now of course there are other tactics such as getting the price right, negotiating the contract terms and so on.  We’ll get to these in later posts.  But don’t lose sight of the fact that your first step is to get your listing and exposure strategies in place.

Q: Why does the real estate market not have many exclusive listings.  Most listings are open listings (or pocket listings).

Q: How can buyers find out what is for sale most quickly.  As there is no central source of information do they have to go on property viewings with all active real estate agents?

Q: How about informal real estate agents, are they are viable source for current real estate listings?

Q: What is the best way of determining price movements and trends in a particular market in the absence of officially published statistics.  How beset to protect oneself from hype?

Q: How can a seller encourage real estate agents to market their property more effectively (eg include the property on a mailing, advertise in the office, include it on property tours).  In particular how can this be done in the absence of an exclusive listing?

Q: Is it worth giving the real estate agents an exclusive listing in a non-MLS environment that is relatively unregulated?

Q: What is an open listing and do the sellers really want to sell?

Q: As a seller how often should I contact the real estate agent?

Q: What is the level of collaboration between rival real estate agents and rival agencies?  How often are commissions shared?

Q: What are the main avenues for lead generation?

Q: How important is the internet as a lead generator for real estate in Central America?

Q: As a seller of property in a real estate development, how can I compete with developer-direct listings?

Q: How can I sell a property when I don’t reside in country?

Q: What aspects of marketing would it benefit me to help the real state agent with? Images? Marketing copy? Ease of access?

Q: Why do real state agents act more like buyers agents than listing agents?

Q: How should I price my property when comparative statistics are so hard to find?

Q: Does offering financing really help?