How to Buy Property in Florida - A Definitive Guide
How to Buy Property in Florida - A Definitive Guide
10 methods of buying property in Florida Writing articles,
advice columns and answering readers' queries for property
magazines and newspapers inevitably leads to a postbag of
antidotes and questions, as well as the odd phone call. These
are often from someone who having recently arrived back from
Florida, develop what the Americans term, 'buyers' remorse' but
can sometimes be a return to realism, after being worn down by
the particular sales method they have encountered or simply been
unprepared. In most cases they wanted to own a property in
Florida but felt let down by the limitations of advice provided
and the range of locations and properties they were shown -
sometimes they feel they paid too much or bought the wrong
property in the wrong area!
The article below examines the implications of different
Property buying methods in Florida
>From a for sale board or American property magazine or newspaper
Although this is often a routine method of buying property In
the UK, it is certainly not the best method to use in Florida,
why is this? Well, the home owner has selected the agent who is
selling the property. That agent has advised the buyer on the
recommended selling price of the property, they have access to
information on comparable properties recently sold. That Agent
can therefore not represent you in the most effective format to
protect your interests - as a Buyers agent. There are
significant legal implications emanating from these
representation issues which are not always made apparent to the
buyer.
Another problem; commission which is paid by the Seller in
Florida is normally split between the Buyers and Sellers Agents.
The fact that the Sellers agent is going to receive both
commission cheques can occasionally motivate them to persuade
you that the transaction should go through, even if you are
having doubts. - Whereas your own Agent working for you as a
Buyers agent has a fiduciary responsibility, specifically to
you.
One of the people, who wrote in to the expert's panel on one of
the magazines I advise on, illustrates the potential problems
that sometimes crop up. They saw a property they loved, went
straight round to the Selling agent; put an offer in with them
asking their advice. After moving in they discovered neighboring
properties were coming on the market at 20% less than they had
bought for, additionally their air conditioning, roof and pipes
all had hidden defects requiring costly replacement - where was
their representation? ironically a Buyers agent would not have
cost them one cent!
>From a For Sale by Owner board
Unless you already live in Florida and know the neighbourhood
the property is in, don't even go there -some property owners
are notorious in charging above the market price for the
property, you will have no one to point out the likely pitfalls
to you such as does that property have any alterations which
fail to qualify under building regulations, etc?
Straight from a Developer
An agent on a development site represents the developer; they
are not there to look after your specific interests. You do not
pay less for the house by not being represented by a Buyers
broker indeed the expectation by most developers is that you
will use one. By not using an agent you are vulnerable to one
sided contract terms, all to often you will be cajoled into
buying unnecessary extras which ratchet up the price and who
will tell you that the discounted property being offered has the
worst resale potential, due to its positioning - not obvious
from the site plan. Thus rather than saving money in many cases
you actually end up paying more!
>From Paper/Magazine adverts in the UK
The glossiness of a property advert is never a guarantee to the
quality and professionalism of that Companies service.
Unfortunately this fact is not always picked up. This seems to
be a particular factor with some Orlando developments, where
sizable marketing budgets can in certain cases reflect large
profits for the developer, rather than value for money or a
sound investment for you. A particularly enticing photo does not
guarantee a sound investment.
>From a Guide Book
This is certainly a step in the right direction-but again
caution. I am concerned with some of the guides I have been
asked to contribute to are clearly outdated, with the original
text written years ago and sometimes altered little on
reprinting, this can lead to expensive misleading information,
such as referring to being in a buyers market when it is very
much a sellers market. A major problem is that they are often
written a year before publication and some are not revised on at
least a yearly basis, a particular problem in identifying market
trends.
At an exhibition
My research seems to indicate this can be something of a
lottery. Exhibition organizers make their profits from the
number and size of stands they sell and visitor entrance fees;
many do not monitor the background of the exhibitors.
Florida based companies tend to be under represented as they
have to fly staff over as well as pay the exhibition fees, so
those particularly outside Orlando do not believe there is
enough specific interest to make attendance viable. I have also
found visiting various stands incognito that a glossy stand does
not necessarily correlate with honesty and accuracy. Some
exhibitors may have very sharply dressed sales people, but are
they licensed Florida real estate associates accountable to the
State of Florida? Do they have knowledge of all locations and
developments or focus on a few paying the highest commission
rates? Be aware of marketing orientated sales people, selling
off plan via a video link, stallholders who are only aware of a
few developments or locations or indeed who have never visited
Florida. At a Seminar
Again as part of the research for magazine articles I have
attended several of these: one was advertised extensively
including in the Financial Times. Looking back on a recent one I
attended, to say I was absolutely gob smacked would be an
understatement. It consisted of over two hours of psychological
babble and emotional twaddle intended to sell further courses -
those attending those further courses say they were great
motivational courses i.e. getting you to invest in property, but
in many cases again there is the backdrop of cherry picked
developments coincidentally paying the highest commission rates.
Do it yourself
I can understand why with the potential pitfalls some determined
people read up on the facts and feel they could do better - my
view is that's its like performing an operation yourself on your
own in growing toe nail, you can read the book and understand
the theory - buying a one off property in a foreign country
without the benefit of free professional advise makes being
fiercely independent seem pointless. Who is going to keep you
updated on trends, where will you find details of recent
transactions to ensure you are obtaining best value for money? I
seem to receive a fair stream of queries from this group who
have run into problems after buying, many which could have been
avoided with a good buyer's agent.
Finding an Estate Agent (Realtor) yourself
It is not generally recognized by British buyers that the vast
majority of Real Estate Companies in Florida ranging from the
internationally known Coldwell Banker, Century 21, ReMax etc as
well as smaller companies including franchise operations operate
with self employed licensed agents. There are tens of thousands
of licensed Florida agents selling property in Florida working
on a self employed basis under the remit of managing brokers.
These agents vary in terms of experience, expertise, knowledge,
familiarity of locations outside their area, as well as
awareness of the differences with real estate procedures in the
UK.
When you walk into a Real estate companies office, in many cases
you will be allocated the agent undertaking desk duty - how do
they stack up in terms of the criteria above, some have just
qualified, some have undertaken only a few transactions, many
only work part time!
Safety First approach
If you would like to be put in touch with experienced well
qualified real estate agents in Florida locations that you
specify, ask Andrew Bartlett for independent Florida Property
advice and I will advise you of appropriate licensed agents with
the necessary qualifications and knowledge and - who have
considerable experience of British clients. Many are Brits who
settled in America several years ago, work for market leading
companies in their respective areas and share my philosophy of
providing clients with as much information as possible without
the frankly irritating sales pressure that is so often a feature
of buying a property in Florida.