How to find the right property to buy abroad: agent, portal or research?

What is the best way to find a property to buy abroad?

Separate the two jobs. Job one is deciding which property is worth buying. Job two is buying it: viewings, negotiation, title checks and the paperwork to completion. Pay for job one yourself, so the advice is not tied to any sale. Then use an agent and a lawyer for job two. Most buyers merge the two jobs and let the person paid on the sale choose what they buy.

None of these is dishonest. They are different jobs, paid by different people. The mistake is asking one of them to do all five.

Should I use a real estate agent to find a property abroad?

Yes, for what agents do well: access, viewings, negotiation and running the transaction. No, as your only source of advice on which property to buy. In most markets the agent is paid by the seller when a sale completes. That is a legitimate job, done well by good agents. It is just not research for the buyer.

Who pays the commission, how much, and when, differs by country. I keep a side-by-side of real estate agent fees in twenty-one countries. Before you rely on an agent's shortlist, ask four questions:

1. Who pays you, and how much?
2. Are you paid if I do not buy?
3. Will you show me listings from other agencies?
4. What is the last property you advised a client not to buy, and why?

The answers tell you which job the agent is doing. A good agent answers them without hesitating.

What does a buyer's agent do, and who pays them?

A buyer's agent searches and negotiates on the buyer's side. Whether they are really on your side depends on who pays them. In some countries the role is licensed and paid by the buyer under a written agreement. In many others the label is used by agents paid from the seller's commission. Ask who pays the fee, in writing, before you sign anything.

The label settles nothing. The written fee agreement settles everything. If the fee comes out of the seller's commission, the agent is paid when a sale completes, so the incentive is a sale. If you pay a fixed fee yourself, the pay does not depend on which property you buy, or whether you buy. I wrote out the three arrangements, with a worked example, in buyer's agent vs listing agent.

Can I just search the listing portals myself?

Yes, and you should look. The portals show most of what is for sale. They do not show which of it is worth buying. The same property often appears several times from different agents at different prices. Asking prices are not sale prices. Quoted rents are rarely checked against real lets.

Doing it properly yourself means:

• pulling every listing in your city and budget, not the first two pages;
• removing the duplicates;
• checking each rent against what similar units actually let for;
• adding every cost of owning: purchase fees, taxes, service charges, maintenance;
• checking how easily it could be resold, and to whom.

That is weeks of work in a city you do not live in. It is also the job I do: Brinkman Data's research has analysed 33,030 distinct listings so far, counted after duplicates are removed.

What is independent property research?

Independent property research is analysis of the market paid for by the buyer, with no commission from any sale. Brinkman Data is one such service. It analyses every listing for sale in your city and budget, checks rents against real lets, works through fees, holding costs and resale, and sends you the five worth buying with a spreadsheet of every listing. It costs $499, is delivered in five days, and is paid only by the buyer.

What a Brinkman Data report contains:

• the five properties worth buying, one page each, every figure linked to its source listing;
• the full spreadsheet of every listing in your city and budget;
• the costs of owning each one, the realistic rent, and the resale picture.

What it does not do: arrange viewings, negotiate, or replace your lawyer. That is job two. I bought two condos with my own money using this method and published both, line by line, in the second-unit case study and the first-unit case study. You can read a real report, page by page.

How do I build a shortlist of properties worth buying?

Start from every listing, not the ones someone sends you. Remove the duplicates. Price each property on what it costs to own and on the rent it can actually achieve. Check how easily it could be resold. Then rank. Five strong candidates beat fifty viewings.

1. Every listing. Your city, your budget, every portal and agency.
2. One record per property. The same unit listed five times is one unit.
3. Real rent. Check against actual lets of similar units, not the listing's claim.
4. Full cost. Purchase fees, taxes, service charges, maintenance, vacancy.
5. Resale. Who buys it from you, and how many similar units compete.
6. Rank and cut. Keep the five that survive every step.

The full method is published at the methodology page.

How much does it cost to get help finding a property abroad?

It depends on the model. Listing portals are free. A seller-paid agent costs you nothing directly; the commission is part of the price. A buyer-paid buyer's agent charges a fee or a percentage, which varies by country. A property lawyer charges a fixed or hourly fee. Independent research at Brinkman Data is $499 for every listing in your city analysed and the five worth buying.

Set the cost against the purchase. A wrong choice can cost more in fees, vacancy or a slow resale than every adviser in the table combined.

Which option should I use?

If you already know the exact property: hire a lawyer. If you know the city but not the property: get independent research first, then use an agent to view and negotiate, and a lawyer to check. If you have not chosen the city yet: compare cities first, then the same steps.

• Know the property: lawyer.
• Know the city, not the property: research, then agent, then lawyer.
• Still choosing the city: compare cities, then research, agent, lawyer.
• Lots of time and local knowledge: the portals yourself, then a lawyer.

Does this work in any country?

Yes. The comparison holds anywhere property is sold through agents and listing portals. Brinkman Data reports cover any city in any country where property is for sale. The deepest published research is on Thailand and Southeast Asia, where I own two condos bought with my own money.

Header photo: Mike is Michi, CC BY-SA 4.0, via Wikimedia Commons. All credits: image credits.