Due Diligence Part II – Get to know your property & neighborhood
In my first installment on due diligence I explained how important it is to know your agent before you arrive in Bali.
In today’s installment I talk about what happens once you have arrive in Bali and are ready to view those beautiful properties that you have shortlisted during the last few months with your agent. You are particularly excited to see that villa on top of your list, because you have already figured out, how it will be to live in it and you virtually know all the coffee shops and restaurants in its vicinity.
Here is a surprise. Don’t get too excited cause most buyers don’t buy what’s on top of their first inspection list. Why? After having inspected some 20 odd properties, your original brief will certainly change dramatically. And that’s a good sign – it means you have done your homework and learned something you didn’t know before.
But how to decide which property is right for you? Here are some hints.
Return to the top 3 properties on your list a few more times during different hours of the day. Go in the morning, have a look in the afternoon and see how it presents at night. Be sensitive to how traffic behaves during different hours of the day. Pay attention to noise – is there a school nearby, a busy factory, a construction site, a discotheque hidden in the ricefields? Talk to people that live in the neighborhood and find out as much as you can. Does the local community welcome Uber or other commercial taxis or are you bound to use some local transport providers at above normal tariffs? Do you have kids that will go to school in Bali? If so, chose the school before you fall in love with a property and carefully research how long it takes to commute. Try it out during the hours your kids will have to go to school and come home. Then look at the quality of the building you intend to buy. Any cracks in the walls? Any marks on the ceiling indicating a leaking roof? I personally like to inspect the electrical panels. A tidy panel tells you a lot about the overall condition of the villa. How old is the property? If its more than 10 years old and has never seen a major renovation, chances are that there is a lot of work that will hit you in the next few years. Bursting waterpipes, electrical cables that are eaten by unfriendly animals and stop working, leaking ponds and swimming pools, leaking roofs…. Factor that in. If you are unsure about the building quality, get a local engineer to do an inspection and prepare a report.
In my next installment on due diligence, I will talk about some very important legal matters. Stay tuned.