Saturday, October 31, 2009
Dear Reader,
In the past weeks in her "Twelve Things you Need to Know to Do...and Then Do" series, Margaret strongly recommended that you:
1. Engage your own independent legal advice,
2. Buy the right title insurance,
3. Check which items to look out for in your sale contract,
4. Check your title deed carefully,
5. And check permits and approvals.
This week she gives you two tips. You should always make sure that you can get to your property... and that you get the infrastructure you need. Over to Margaret...
Tip # 6: Check Access How do you get to your property? If it is via a right-of-way through someone else's property, that needs to be stated in the deed. Similarly, does anyone else have right of way through your property? Your attorney can check both of these scenarios.
Tip #7: Check Infrastructure Essentials These are the basics that you can't live without, and you should ask the seller as many questions about them as you need to ask to feel comfortable before proceeding with the sale.
Water:
- Is there a source of potable water on the property?
- What's the water pressure?
- What's the purity?
- If there isn't a mains supply, who will drill a well? If it is you, how deep will you have to drill--and how much will that cost?
- How is waste treatment being handled?--and does it comply with local regulations?
- Will there be a municipal system, a system put in place by the developer, or will you need to put in a septic tank?
- If a septic tank, check local regulations to see how much you will have to spend (some environmentally-sensitive areas require a very high-tech, and very expensive, tank).
Electricity:
- Is it in place...if not, what timeframe are you looking at?
- Will it be overground or underground?
Roads:
- Are roads and pavements already in place?
- If not, when will they be...and what standard will they be? Remember, developers often leave roads until last, as road surfaces can be damaged by heavy construction equipment.
If high-speed internet is an absolute necessity for your job or your business, check that it is available in your area (preferably with a service provider). Ask what the speed is in MB (megabytes). High speed or broadband internet in some countries I have visited is as slow as dial-up back in parts of the UK.
You can try to cover yourself by ensuring that your contract has firm timelines, standards and commitments for the infrastructure essentials. Some sellers and developers will allow you to escrow a portion of the purchase price until they are completed."
Don't think that your due diligence process is just boring paperwork. I always recommend that you visit before you buy. This is a central part of your due diligence. It's also fun. This is where Pathfinder Chill Weekends come in.
A Chill Weekend is nothing more than an opportunity to enjoy a short vacation in exchange for allowing a developer the opportunity to showcase a property or development he is promoting. No strings, no high-pressure sales tactics, no hard sell, just a chance to investigate some real estate opportunities (and check out the beach, of course!).
Best of all: the developers pick up some of the tab.
This December, our friends on Ambergris Caye, Belize will host a Chill Weekend.
December 4th-6th, 2009: Fashionable resorts and million-dollar oceanfront houses haven't changed the fact that Ambergris is a beautiful tropical island where anyone can stroll on white-sand beaches or dive into clear azure waters. It's still a gorgeous, charming, completely captivating island--just like it was decades ago.
You'll find quaint restaurants, cyber cafés, and friendly mom-and-pop shops of nearly every variety...and packed-sand streets where golf carts are the principal means of transportation.
The Grand Baymen chill weekend gives you the chance to check out what could be the most affordable luxury property in all of Ambergris Caye, with condos from $99,999. The trip costs $299 per person, and covers your accommodation, airport transfers, and meals. Book your Weekend in Paradise here.
Ronan McMahon
You might also be interested in:
Make Sure This is in Your Contract
Do You Know Exactly What You’re Buying?
Posted Under:
emerging market, due diligence
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