The real estate industry is booming in Guam. Market experts foresee a continuous upward trend in the years to come. So if you’re shopping for property in Guam to put your money in, this is perhaps the best time for you to invest.
No matter how perfect a piece of property seems, there are many questions you should ask before closing the deal. There is a lot you’ll need to know about a property that a seller might not tell you right away. However, real estate agents are legally bound to tell the truth, so you must make sure to ask the right questions.
Here’s what you need to inquire about so you can make sure the property is worth your hard-earned money.
ASK ABOUT 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.
- How much did the seller pay for this property? It helps to know if the market value has gone up or down since the seller purchased the property. If it’s a property flipped from a foreclosure, there is a risk that you might not be able to secure financing for 90 days. But don’t focus on previous sales, simply use this information as a guide for your specific purpose.
- How much does the seller owe? It would be more beneficial for you if the seller has a lot of equity. If the seller owes more than the asking price, the seller will likely need to bring cash to closing and you are buying at short sale. This means that the seller’s lender is amenable to accept a discounted payoff to settle an existing mortgage. If the seller has to release funds out of his own pocket to close escrow, you are not likely that your seller will pay for closing costs or offer to pay for any repairs.
- What is the going rate for similar property sold in the same area? This is perhaps the best indicator of value because the bank’s appraisal officer will rely much on these comparable sales to compute its value. Your real estate professional will be able to secure a list of recently sold properties for you.
- How many offers have been received for the property? Some properties generate numerous offers. If this is the case for the piece of land you’re interested in, your offer will need to be very strong to stay in the running. Don’t shy away from a property with multiple offers. There have been many instances where the last offer submitted ends up the winning offer.
- How long has the property been on the market? If the property has been on the market for over 90 days, you might be able to negotiate a sound discount on the selling price. However, this all depends on the area in Guam where you’re interested in as the days in the market could be 360 or more.
ASK ABOUT THE CONDITION OF THE PROPERTY
You might want to take into consideration the condition of the property before deciding on an offer price. Knowing in advance about structural issues of delayed maintenance gives you a bit of leverage on the negotiation table.
- What type of foundation does it have? Raised foundation has access under the structure to reach the plumbing and electrical. Homes with basements likewise have this type of foundation. Slab foundation, however are quite common in newer buildings. It might be wise to ask what existed in the area before it became what it is today. For instance, if the builders constructed a new subdivision over a wetland area, it is more likely to have issues with drainage and dampness.
- How old is the roofing? Depending on the materials, the newer roofs have a lifespan of about 15 to 50 years. You should pay attention about maintaining the roof because your lender might require repairs before you close the deal and the costs of which might fall on your shoulders, unless the seller is willing to take on the expense or through a commensurate discount on the selling price.
- When and what appliances or systems have been replaced? It is to your advantage if the older plumbing and electrical systems have been updated. Also, remember that some older appliances can no longer be repaired because the parts are obsolete. Best to remain practical by making sure the appliances actually work.
ASK ABOUT THE LOCATION OF THE PROPERTY
In real estate, it is really and ultimately about location. Properties in desirable areas are worth much more than similar properties in less desirable districts.
- What other types of property are located nearby? If you’re looking at a residential area, know that apartment buildings, commercial and industrial structures lower the value of residential property around them. Best to take this into consideration as this will prove most beneficial when it is time for you to resell.
- What is the demographic profile of the neighborhood?You might want to consider getting to know your would-be neighbors by talking to them and get a feel of what they’re like. You can gauge whether or not this is a culture you are comfortable living with.
- What are the schools? This is a major concern for families with small children.
- Are there irritants? The noise from the freeways in the distance might pose a nuisance in the evenings, or traffic from nearby stores and restaurants might be a source of annoyance. To some people, even barking dogs can be a grave inconvenience.
Bear in mind that real estate markets are always changing. It can be a buyer’s market today, a seller’s market tomorrow or a neutral market the day after and the cycle continues. If you’re looking into a property that is highly in demand, you might not have enough time to ask all the questions you want. Your real estate professional should be able to provide you with insights on the latest trends in each type of market.