Know Thyself to Buy Excellent Property Overseas

Michael K. Cobb

[ECB Building]

Know thyself for buying excellent property overseas and stay humble throughout the process.

In human nature, there’s a natural tendency to avoid risk. There’s an inherent fear of the unknown. It is what keeps us alive in the extreme positive sense and keeps us locked down at the other. But there are great reasons to face our fear and do something anyway, both for the long term and the short term.

New research shows that people who continuously try new things and expose themselves to adventure and the unknown have healthier brain tissue and stave off dementia. That’s a great long-term benefit. Short term, sorting out something new, even trying a new food, can be exciting and fun in the moment.

However, because we are wired to be cautious, moving ahead into the unknown, despite our fear of it, requires conscious thought. So ultimately, we must make a decision and take action. Remember. No great adventure starts until you face the fear of the unknown and say, “Yes.”

Know Thyself to Buy Excellent Property Overseas: Adventure

Buying a property and/or moving overseas is an adventure. Trust me. I’ve done both. And it’s not always pleasant. But it has always been worth it. I don’t write any of this from theory. Rather, I have lived and worked in Latin America since 1996.

My wife and I lived as expatriates (expats) for 14 years, raising two beautiful daughters in Managua, Nicaragua, where they spoke English at home, Spanish with their friends and German in the German School they attended. I have presented at and attended hundreds upon hundreds of conferences around the world and spoken with thousands upon thousands of adventurous, curious individuals who have expressed some level of interest in overseas living.

Through our company, we have provided incredible opportunities for those who are truly serious to pursue their dreams, put their feet on the ground and achieve what many others can only look at with envy. You may be considering a property or move overseas, too. If so, fantastic.

Know Thyself to Buy Excellent Property Overseas: Get Ready

But where to start? Are you ready? And what does “ready” really mean? There are just so many factors that impact our state of readiness.

Do you remember Glenda the Good Witch in the Wizard of Oz? She gave Dorothy some very good advice when she said, “Start at the very beginning.” And that’s what we’ll do here. Begin with the basics.

Spoiler Alert: We are not going to start by looking at countries, beaches, palm trees, vineyards and beautiful properties. Excellence in property buying starts by looking inside. Our best property purchase due diligence means understanding the “what and why” of our motivations. In fact, the people I’ve seen the happiest with their home overseas are those who really knew themselves.

Know Thyself to Buy Excellent Property Overseas: Get Prepared

Be sure and request the quick Are You Ready to Live Overseas” quiz that measures your state of mind for a move overseas. Should you choose, you can go online and dig deeper with the “Needs Likes, and Preferences Online Survey.” It explores motivations, concerns, must-haves, soft wants and hidden factors likely important to you, but ones you may not have thought to consider.

Take your time and do a lot of research. You’ll learn techniques and hacks discovered and used by savvy expats for decades. Uncover greenhorn mistakes that frustrate so many folks and send some budding expats back home discouraged and disappointed. And finally, seek out expats who have successfully navigated the challenges and built a wonderful, significant and meaningful life overseas. You’ll hopefully see that you can do so, too. And then you will.

You are reading this article. You want to move overseas. You need to know how to best push into the unknown and make wise decisions. You can. And it starts with knowing yourself.

Know Thyself to Buy Excellent Property Overseas: Adventure: Do the Work

It is work. Fun work. Important work. Inexpensive work. It is possible to be th

oughtful versus impulsive, conscious not assumptive, and humble rather than humiliated.

Do the research up front and you will save thousands of dollars, or even hundreds of thousands of dollars. Invest the time and you’ll reap the reward. Because, once we have a better understanding of our motivations, the next order of business is to change how we think. Yes, it’s still an inside job at this point. And it gets a little harder.

There are two main concepts we need to keep in mind when we buy property overseas:

  1. We don’t know what we don’t know
  2. We must forget what we think we know

These may sound contradictory, but they hold together well, and actually make a lot more sense in many cases after you buy a property. However, that’s too late. So, we are going to take a good run at it now before you get started.

Know Thyself to Buy Excellent Property Overseas: Adventure: Be Careful

Everyone buying property outside of North America needs to remember the famous words Dorothy said to Toto after being dropped into Oz, “I don’t think we are in Kansas anymore.” When going overseas, especially to places that feel familiar, we must be very, very careful. In fact, the more familiar the setting seems, the more careful we need to be. Because in the land of “buyer beware,” we need to stay sharp.

But how do we do that?

Take a look at a favorite saying of mine. It is the foundation of my foreign property buying philosophy. “I don’t know what I don’t know.” You may want to make it yours, too. Really.

Please stop and reread that last paragraph.

You might be saying to yourself, “Okay. But how can we know what we don’t know?” It’s a great question. Obviously, we can’t. But we can slow down and be open to new possibilities. We can watch and listen for new realities that vary slightly to greatly from our experience back home.

I like to picture a radar screen to visualize this principle. A small screen is easy to manage. In the world of “North American normal” we can get away with that. We are not so worried about something coming at us out of the blue and catching us off guard. We have a pretty good understanding of what’s going on around us most of the time.

Know Thyself to Buy Excellent Property Overseas: Develop Radar

But overseas, a much larger radar screen serves us well. It makes sense to greatly expand our screen of awareness so that anomalies are picked up way out there, not close in. When we pay attention and give ourselves the time and space to examine this new data and process it, we may then understand the significance of it and act accordingly to our benefit.

The second piece of this going overseas puzzle deals with our assumptions and forgetting what we think we know. Have you seen the word “assume” defined as making an ass out of you and me? Ass – u – me. When we go overseas, we bring our assumptions with us because they are part and parcel of who we are. Some are good. But some will be liabilities in this new, foreign environment. Because we don’t know what we don’t know, how can we know what are the right assumptions to believe?

At home, when I flip the light switch up, I can safely assume there’s electricity and that the lights will go on. I assume that when I go to the grocery store, I will find the products that I want and need. When I turn on the water in my shower, I assume I’ll enjoy a nice hot shower. But do these assumptions work overseas? Maybe. Maybe not.

Know Thyself to Buy Excellent Property Overseas: Don’t Assume

Assumptions make life easier. We don’t have to think or process the information above. We just “know” that we are “good” with these items. Assumptions are like filters. They let us filter out unwanted noise and reserve brain power for those things we need to process.

In the back of the brain, right at the top of the spinal cord, resides a special part called the Thalamus. This is one of the oldest parts of the brain and it its chief filtering mechanism. The Thalamus hears and senses everything. Literally everything at thousands of sensations per second, yet our conscious mind gets only about 1% of that information. That is because this is all the information the conscious “I” can handle and process.

A good example of the Thalamus at work is when you have a small baby in the house. While we can sleep through a raging thunderstorm, a tiny squeak from a newborn will rouse a parent instantly. This is the filter hard at work, sorting out the information we need from that we do not. Storm? No problem. Baby crying? Need to wake up and check. This mechanism lets us live our lives reasonably. If we had to pay attention to every noise, movement, sensation around us, we’d be overwhelmed. So, we filter.

Know Thyself to Buy Excellent Property Overseas: Achilles Heel

But this filtering mechanism can be an Achilles Heel unless we understand that we are indeed filtering. We must try and turn off our filter as best we can. But it’s not easy to turn the filters off, always living on your toes, ready to see something that doesn’t make sense. In fact, staying alert can be hard work. But it is necessary to do if we want to make wise property ownership decisions overseas.

Another part of filtering is confirmation bias. This is looking only for the facts that bolster what we already believe. But it’s dangerous. Especially when we really want that new property, and everything seems just perfect. Confirmation bias let’s in all the reasons we want to move ahead and limits or restricts facts that push against the decision.

When you recognize confirmation bias, turn it off. Acknowledge all facts. Respect what your logic says. Push your radar screen out further. Give yourself time and space from that awesome emotional experience of palm trees, margaritas and friendly sales guys. Process the hard data and do your homework. Look for evidence that contradicts what you want to believe. Note it. Write it down. Circle back to it. These are data points on the radar screen, and you absolutely want to pay serious attention to them.

Know Thyself to Buy Excellent Property Overseas: Buyer Beware

The bottom line is that there are numerous wonderful properties out there and some of them are right for you. But overseas, you are in a different country, with different rules. This is the land of buyer beware. There are few if any governmental agencies looking out for you. This is a dangerous assumption many people bring with them.

Many people simply assume that the laws overseas are similar to laws back home and are there to protect us as consumers, especially when the English-speaking sales people assure you that it’s “just like you are used to.” The laws may or may not be the same. If similar, they may or may not be enforced. Examining the facts is critical here and knowing that we must look out for ourselves is the result.

Consumer protection is just one of the assumptions people bring. There are many more things that people take for granted or assume. For instance, the construction standards in North America, may not be standard in Latin America. Acceptable bandwidth, water pressure, zoning restrictions and a whole host of quality-of-life factors cannot be assumed.

Know Thyself to Buy Excellent Property Overseas: Stay Humble

One huge character asset we can possess, or acquire, when going overseas is humility. This attribute is the one that really helps us to be open to the fact that we don’t know what we don’t know and lets us forget what we think we know. Humility is the synthesis of these two concepts.

What we need outside our home turf is a willingness to listen more, hear what doesn’t make sense, acknowledge it and try to fit that weird data into our analysis. When we are humble, we can allow others with more experience to guide us through unknown territory. Ultimately, our choice is really finding humility or paying tuition, a.k.a. humiliation.

The 15 Critical “Must Ask” Questions delve into many examples of questions to ask when buying property overseas. But we can’t cover all the possibilities. The goal of this process is to make us better thinkers and actors in the foreign lands.

When Buying Real Estate Overseas, excellent and comprehensive due diligence is mandatory. Learning how to ask the right questions is key.

Know Thyself to Buy Excellent Property Overseas: Three Simple Concepts

Three simple concepts lock in the 30 questions and give us an easy way to remember what’s important in the evaluation of property. As you’ll see later, they are broken into three main areas:

  1. Buy what you see
  2. Own community
  3. Know the developer.

For now, just know that a change in how we think is needed. Humility will be our best asset. Assumption and hubris our worst enemy. Request the Consumer Resource Guide and Must Ask Questions when buying property overseas.

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