If you’re on the fence about investing in property in Guam, perhaps this is the best time to seriously consider it. Real estate market experts expect a continuous upward trend in the property industry in Guam in the coming years.
Even if a property seems perfect, there are still many things to look into before closing the deal. There are many things you’ll need to know that a seller might tell you immediately. While real estate agents are legally bound to disclose only the truth, you must make sure that you ask the right questions.
INQUIRE MORE ABOUT THE OFFERING PRICE
Property buyers in Guam often compare prices of similar properties in the neighborhood before deciding on an offer, and the asking price may have very little to do with the actual value of the property or a buyer’s offer price.
- Don’t hesitate to ask what amount the seller originally paid for the property.
It will be helpful to know if the market value has gone up or down from the time the seller purchased the property. If it’s a property from a foreclosure, it may affect your financing schedule, because you bear the risk of not being able to secure financing for about 90 days. However, don’t dwell too much on this, just use the information as a guide for your specific purpose.
- Do ask how much equity does the seller have.
As a general rule, the higher the seller’s equity, the better it is for you. If the seller owes more than the asking price, the seller will most likely bring cash to closing and you’ll be buying at a short sale. This means that the seller’s lender is willing to accept a discounted payoff to settle an existing mortgage. Remember that if the seller has to release funds out of his own pocket to close escrow, you won’t be able to negotiate further for the seller to pay for closing costs or even offer to cover for any repairs.
- Do know how many similar properties are sold in the same area.
Your real estate agent will be able to easily secure a list of recently sold properties for you. This information is the best indicator of value because the bank’s appraisal officer will base much on these comparable sales to compute its value.
- Do know many other offers have been issued for the property.
Some properties receive many offers, and if this is the case for the property that you’re interested in, your offer will need to be very strong to stay in the running. Don’t be turned off if a property has multiple offers. There have been many occasions where the last offer submitted ends up the winning offer.
- Do find out how long the property has been on the market.
If the property has been out on the market for over 90 days, you might have a better chance at negotiating a good discount on the selling price. However, this will all depend on the area in Guam where you’re interested in. Some could be in the market for 360 days or more.
KNOW THE CURRENT PROPERTY CONDITIONS
Before deciding on an offer price, take into serious consideration the existing condition of the property. Knowing ahead of time regarding pertinent structural issues of delayed maintenance will give you a bit of leverage during negotiations.
- The Foundation. Raised foundations usually have access under the structure to reach the plumbing and electrical. It is usually homes with basements that would have this type of foundation. Slab foundations, however, are more common in newer structures. It might be in your best interest to ask what was in the area before it became what it is today. For instance, if the builders built a new subdivision over a wetland area, you can more or less expect to have issues with drainage and dampness.
- The Roofing. The newer roofs usually have a lifespan of about 15 to 50 years, but this is all dependent on the kind of roofing materials used. Any diligent buyer should seriously pay attention to the maintenance of the roof because the lender might require repairs before you close the deal and the costs of which will fall on your account. Perhaps you can negotiate that the seller be willing to take on the expense or offer a corresponding discount from the selling price.
- Systems and Appliances That Have Been Replaced. It’s in your best interest if the older plumbing and electrical systems have been replaced or updated. Remember as well that most older appliances can no longer be repaired because the spare parts have become obsolete. Best to remain practical by making sure the appliances work.
CONSIDER PROPERTY LOCATION
When it comes to real estate, it’s really and ultimately all about location. Properties found in popular areas are worth much more than similar properties in less desirable districts.
- Know what your neighbors are like. You might want to get to know your future neighbors by talking to them and get a feel of what they’re like. This way you can more or less have an idea if this is a culture you are comfortable living with.
- Look for schools in the area. If you are a family with small children, this is typically a major concern.
- Other types of property nearby. Remember that if you’re looking at a residential area, apartment buildings, commercial and industrial structures lower the value of residential property around them. You might want to take this into consideration because this fact will be rather helpful when it is time for you to resell.
- Pay attention to possible irritants. The traffic from nearby stores and restaurants may be a source of annoyance, or the noise from the freeways in the distance might make it difficult to have restful evenings.
Looking into a property in an area that is highly in demand, may not provide you with enough time to ask all the questions you want. It is always best to work closely with your trusted real estate professional. He or she will be able to provide you with all the necessary information you need to know as well as the latest trends in each type of market.