Buying A House In Colombia

However, there are two important notes for foreigners to be aware of when buying real estate in Colombia. In Colombia, there is no title insurance and there is no escrow (except for new construction properties). So, it is very important to hire an experienced lawyer who understands real estate law in Colombia to do a title search and other background checks.

As a foreigner, you can indeed buy property in Colombia. The Colombian government recognises the importance of foreign investment and has made the process easy for foreign individuals to buy property in Colombia. The process is the same for foreigners as it is for locals, the only requirements are that they be in possession of a valid passport and the sufficient funds for the purchase. In fact, buying a property in Colombia can even lead to a residency permit; depending on the size of your investment you can apply for a one-year or five-year visa.

Expat Exchange members, some of whom have purchased multiple properties in Colombia, offer tremendous insight into the property buying process in Colombia and the involvement of Colombian lawyers, real estate agencies and Banco Republica. Expats in Colombia and others considering investing in real estate in Colombia should read these tips for buying property in Colombia.

One member in Colombia offered a very helpful checklist for buying a property in Colombia. He advised the following: First, find the property you want to buy and make a sales contract. Second, wire the money to your BanColombia account, when it gets here, show the bank your sales contract and they will convert it into pesos and deposit into your account. The bank will assist you in filling out a formula 4, keep a copy and send it to Banco Republica. One business day before the closing, go get a new certificate of title, certificado de tradition, just to make sure nothing new has come up. On closing day, show up with a bank check for just a little less than the estimated closing amount and some cash to make up the difference. Go right away, the same day or the next day and pay the tax and register your property. Trust no one and especially not the sellers or any family members that have advice.

One person asked, If buying property in Colombia remotely (while living in US), is there a way a buyer can verify that the property was properly registered? would this require flying down to Colombia to verify?

In the property buying process outlined in Tip 1, the member said to show up with a bank check for little less than the estimated closing amount and some cash to make up the difference. Other members asked why you should do this. He answered, Because the closing amont is just an estimate. There are always offsets or additional fees or somthing else that comes up. Also utility bills cannot be paid up to closing so that has to be negotiate or prorated. I will, depending on the seller or amount or situation, show up with a check for 5 million short and 10 million in my pocket. Additionally, if the seller does not come with some good references or is not known by me, I will ask to inspect the property early in the morning of the closing day before we meet at the notary. I have more than once closed on a property and the seller has not completely moved out or has removed items that were to stay. Also the paz y salvo (certifies that no property taxes or administrative fees are due) need to be up to date, as much as possable. After the closing, there are no go backs. We come from an environment where we want to do the right, fair thing. They do not.

There is a lot of discussion on our Colombia forum about so-called 'gringo agencies' and their motivations. One member commented, Although the 'gringo agencies' are easy to criticize the reality is that buying for anyone new to the country isn't easy. Finding a good realtor isn't easy and they don't tend to do much other than show you places that they know of. My experience, even with the best of them, is that you don't get a balanced view. In Medellin, with all of the development going on it's important to have someone that tells you that one of the reasons this apartment is on sale is the the road below (for example Carrera 30) is being widened and that's going to significantly change your living experience.

If you are considering buying a pre-construction property in Colombia, learn from this member's experience, I bought an apartment off-plan about a year before I moved here. They estimated 1 year until completion, and in the contract it allowed the developer until a certain date to complete. When I arrived in Colombia, they still hadn't started to build, so I gave them a little time to start construction. However, despite constant promises to start next week, tomorrow, next month, it never got under way. So I had the right to cancel in my contract, which I did. The money I also got them to agree should be put in a fiduciaria, to protect me (I paid in full), and so when I cancelled I got all my money back plus a nominal interest, and bought my present apartment. To this day, 3 years later, they still haven't started construction of the original one.

Another member recommended having your Colombian spouse help in the process. Obviously, if you're not married to a Colombian, you'll have to enlist the help of a Colombian friend! He said, When we were looking at properties, I'd have my Colombian wife go first. She would short list them, then I would go take a look. As soon as they saw me, the price would jump... my wife would remind them the original asking price. It's very difficult to find the correct price since they don't have a county assessor like in the states, where you can just go to the website and find out how much someone paid for their property... or even call the county assessor. Best option to find what a good price is to look at many different places, take into consideration location, etc... When I say many... I mean 30-40... seriously. You need to get a Peso/Sq Meter cost. Try to talk to the neighbors too. My wife did this just to find out who our new neighbors might be, and they would normally always say 'they're asking too much for that place'... even if a higher price on their neighbor's house would mean a higher price for their house.

One expat in Colombia offered a very helpful checklist for buying a property in Colombia. He advised the following:First, find the property you want to buy and make a sales contract. Second, wire the money to your BanColombia account, when it gets here, show the bank your sales contract and they will convert it into pesos and deposit into your account. The bank will assist you in filling out a formula 4, keep a copy and send it to Banco Republica. One business day before the closing, go get a new certificate of title, certificado de tradition, just to make sure nothing new has come up. On closing day, show up with a bank check for just a little less than the estimated closing amount and some cash to make up the difference. Go right away, the same day or the next day and pay the tax and register your property. Trust no one and especially not the sellers or any family members that have advice.

One person asked, "If buying property in Colombia remotely (while living in US), is there a way a buyer can verify that the property was properly registered? would this require flying down to Colombia to verify?"

In the property buying process outlined in Tip 1, the member said to show up with a bank check for little less than the estimated closing amount and some cash to make up the difference. Other members asked why you should do this. He answered, "Because the closing amont is just an estimate. There are always offsets or additional fees or somthing else that comes up. Also utility bills cannot be paid up to closing so that has to be negotiate or prorated. I will, depending on the seller or amount or situation, show up with a check for 5 million short and 10 million in my pocket. Additionally, if the seller does not come with some good references or is not known by me, I will ask to inspect the property early in the morning of the closing day before we meet at the notary. I have more than once closed on a property and the seller has not completely moved out or has removed items that were to stay. Also the paz y salvo (certifies that no property taxes or administrative fees are due) need to be up to date, as much as possable. After the closing, there are no go backs. We come from an environment where we want to do the right, fair thing. They do not. "

There is a lot of discussion on our Colombia forum about so-called 'gringo agencies' and their motivations. One expat commented, "Although the 'gringo agencies' are easy to criticize the reality is that buying for anyone new to the country isn't easy. Finding a good realtor isn't easy and they don't tend to do much other than show you places that they know of. My experience, even with the best of them, is that you don't get a balanced view. In Medellin, with all of the development going on it's important to have someone that tells you that one of the reasons this apartment is on sale is the the road below (for example Carrera 30) is being widened and that's going to significantly change your living experience."

If you are considering buying a pre-construction property in Colombia, learn from this member's experience, "I bought an apartment off-plan about a year before I moved here. They estimated 1 year until completion, and in the contract it allowed the developer until a certain date to complete. When I arrived in Colombia, they still hadn't started to build, so I gave them a little time to start construction. However, despite constant promises to start next week, tomorrow, next month, it never got under way. So I had the right to cancel in my contract, which I did. The money I also got them to agree should be put in a fiduciaria, to protect me (I paid in full), and so when I cancelled I got all my money back plus a nominal interest, and bought my present apartment. To this day, 3 years later, they still haven't started construction of the original one." 781b155fdc