Puerto Rico Real Estate, But Why?
I've had quite a few people ask me about the process of moving to Puerto Rico, so I figured I'd throw out a little bit of info on the process. This is in no way intended to be a guide for relocating to Puerto Rico or for buying property, but it can be a starting point if you're interested in becoming my neighbor :) I'll give you a few of the details, and then I'll get into my personal why... I'm more than happy to give you as many details as you'd like, or answer any questions you might have, so please feel free to ask any questions you'd like in the comments below, or shoot me an email, email@example.com.
The first major points I learned about PR Real Estate
- Nothing Happens Fast - You'll hear the phrase Island Time a lot
- Real Estate law in Puerto Rico is from Spain, not the U.S.A.
- Addresses are hit and miss
- Ask for GPS coordinates when you inquire about properties.
- Apple Maps is better at directions on the island than Google Maps
- You need a lawyer, period (and a good one!)
- Lawyers do everything here from real estate to transferring car registration. Only lawyers can be notaries, and only lawyers can draft powers of attorney.
- Lawyer's fees can vary dramatically. For instance, I was originally quoted approx. $3,100 in attorney fees for the the transaction. Thankfully I found another lawyer that does not fleece the unknowing and completed the transaction for less by orders of magnitude.
- My recommended attorney is Idalia N. Leon Landrau who is located in Caguas, but serves the island. Idalia is fluent in English and Spanish and literally saved the deal by drafting contracts into the evening and being available as an invaluable resource for information about everything related to the process. You can reach Idalia at her office at 787.743.6768 or shoot her an email here. Please tell her you were referred by Building Beyond Me.
- Your attorney is the one that files the deed and completes the transaction.
- If you are buying with another party (even a husband or wife) it may be worth getting a Power of Attorney in case one or both of you aren't able to be present for the deed signing or tax filing. A power of attorney will cost you more than the cost of a sales contract because it's much more detailed. The law seems much more concerned with relationships of people than it does with property ownership.
- There is an MLS, but nobody uses it
- This renders all of the major U.S. Real Estate websites useless. Don't expect to find any accurate information on realtor.com, zillow.com or any of the other portals or major brokerage sites.
- The main site for real estate listings (and everything else) is Puerto Rico's version of Craigslist, www.classificadosonline.com, but I'll tell you, it's a complete A.D.D. nightmare and you can't expect the listings to be up to date. As an example, my house closed months ago, but is still listed for sale on classificados.
- There is no buyer's agency - You'll deal with A LOT of Listing Agents
- If you are lucky enough to find an agent that will operate as your buyer's agent, they have to negotiate commission splits on every potential deal. It's a lot of work with very little payoff, so I can see why most agents steer clear of it.
- Listing agents will try to sell you their listings and their listings only.
- Listing agents can take advantage of buyers and sellers. Even though the seller traditionally pays the sales commission, don't expect that the listing agent hasn't padded the price to their advantage. For example, I feel that the listing agent on my house fleeced her seller, ultimately charging a 13.6% commission, stating time and again that the price was very firm and the owners weren't entertaining anything less than full price.
- It is really hard to put down earnest money if you're not physically on the island and working with a lawyer and the listing agent.
- Don't expect to hear back from Real Estate Agents if you are buying in a relatively rural area and in a low price range. You may not be worth their time.
- Timeframes and Deadlines are arbitrary
- Having held a real estate license since I was 19, and spending the majority of my professional career in real estate, I have been conditioned to setting dates in transactions and if for any reason a date can't be met, the contract needs an amend/extend. Not such a big deal here. I went out of contract for weeks, stressed like crazy, freaked out, and was finally told it wasn't a big deal. Things take a long time for discovery (addresses, tax records, deeds, ownership), and it's not worth re-writing a contract if something takes longer than expected. If you're an anxious type like me, set a REALLY long date on your purchase contract.
- Insurance is confusing until you get an agent that just handles it!
- Properties that are considered high risk may cause insurance agents to not return your calls.
- You can ask for policies and be told they are being written, or waiting on an inspection, or any other random thing.
- My recommendation? Call Marsha Gonzales, an independent insurance broker. She gets your information and gets it done, even with a hurricane looming on the horizon. Marsha can be reached at 787.447.9273 or you can shoot her an email here. Although she is not fluent in English, she works hard to communicate quickly and accurately using translators, and I did not find language to be a barrier in working with Marsha. I highly recommend her for her diligence and her efficiency. We completed the entire transaction digitally, and I couldn't be more grateful. Oh, by the way, Marsha was recommended by Idalia, my attorney. See what I mean about having a good attorney?
- It's totally worth it!
- This island is amazing. Real Estate is cheap. The people are friendly. It took me from February 26th, when I identified the property I wanted to purchase until August 29 to get moved in and settled (just in time to evacuate for Hurricane Irma as a side-note hahaha)
Why Did I Choose Puerto Rico?
I needed a new start in life, and I felt that a drastic location change would help to bring me back to life. If you've followed my posts for any period of time, you'll know I spent the last three years in a completely agoraphobic, super anxiety-ridden, basic inability to leave the safety of my dog and my bed in my brother's basement. You might read The Minefield on the way to Diagnosis and Treatment of Bipolar Disorder if you want a little context on that.
So, Puerto Rico. There were a few reasons why it made sense for me. I needed an American medical system for Medicare to continue psychiatric treatment as well as physical treatment (maybe another country would have been better, but you can't immediately take advantage of their universal healthcare). There is no currency exchange because Puerto Rico uses the American Dollar. My cell phone plan is considered American domestic, so there was no change there. You don't need a passport to come here, and it's one of the easiest islands to move your pets to.
I had amassed a very finite amount of money, about enough to pay for a year of rent in Denver, and I knew it would be gone fast and I'd be stuck with nothing. I didn't want to remain dependent on my brother and sister-in-law, though I can't thank them enough for keeping me off the streets. I didn't want to be beholden to Section 8 rules and standards that could change at any time.
Basically, I felt the best thing I could do was to buy a house so that whether or not I was able to work consistently, I wouldn't be homeless. This mental illness is a bitch! Some days I think I've got the world in my hands and can be a functioning member of society, and then I spend three days in bed, trying to convince myself not to kill myself. This is not conducive to making a steady living, and unfortunately all too common with Bipolar Disorder.
I spent countless sessions discussing my intentions with my therapist, psychiatrist, and rheumatologist. I was rather surprised that all of them were in favor of my move, though all expressed concerns. "Will it be more difficult to get mental health support?" "Don't forget that you're allergic to the sun, so stay out of it!" I got a 90 day supply of medications and made the move. I have yet to find doctors. I'm using the excuse that I haven't settled in yet, but the reality is that I hate seeing doctors, particularly new ones so I've been procrastinating. Don't follow my lead on this. I need to see a psychiatrist to adjust my medication or do a supervised discontinuation of medication which would be my preference, but a scary prospect.
With the amount of change that has occurred in my life in the recent past, it's not a big surprise that I can't seem to get a handle on my mood swings. I haven't reached danger points yet, but I'm getting close. The demons are with me every day, and some days they're winning.
I know one thing for sure. I'm better off being depressed and looking at the ocean than being depressed and looking at suburbia in Colorado. Nothing against Colorado, but it really only worked for me when I was working and living at a higher standard of living than I can now afford.
This is an experiment. It may turn out to be for the best or it may be a big learning experience. Either way, I'm grateful to be here.