Buying a Home in Colombia

Colombia, with its vibrant culture, beautiful landscapes, and affordable cost of living, has become an attractive destination for expats from around the world. Whether you're planning to retire, start a business, or simply want a change of scenery, buying a home in Colombia can be a great investment. However, the process can be complex, especially for foreigners. This guide will provide you with key information on how to navigate the Colombian real estate market and successfully purchase your dream home.

How Do I Find Houses for Sale in Colombia?

There are several ways to find houses for sale in Colombia. Online property portals such as Finca Raiz and Metro Cuadrado are popular and provide listings across the country. Local newspapers also have real estate sections. However, many properties are sold through word of mouth, so networking can be beneficial. Hiring a local real estate agent can also be helpful as they have knowledge of the local market and can assist in negotiations.

Are There Restrictions on Foreigners Owning Property in Colombia?

Foreigners have the same rights as Colombian citizens when it comes to buying property in Colombia. There are no restrictions on the type or amount of property you can own. However, there are certain areas, such as border zones, where foreign ownership is restricted for security reasons. It's important to consult with a local attorney to ensure you're not inadvertently violating any laws.

Does Colombia Have an MLS Type System?

Colombia does not have a Multiple Listing Service (MLS) like in the United States. This means that real estate agents do not share information about properties for sale. Each agent has their own exclusive listings, so it may be necessary to work with multiple agents to see a wide range of properties.

Do Brokers Have Licenses and How Do I Know if They are Licensed?

Real estate brokers in Colombia are required to be licensed. However, enforcement can be lax and unlicensed brokers do operate. To verify a broker's license, you can check with the Colombian Association of Real Estate Agents (Lonja de Propiedad Raiz). It's advisable to work with a reputable, licensed broker to avoid potential issues.

What Documents are Required When Buying a Home?

When buying a home in Colombia, you will need a passport, a Colombian tax ID number (NIT), and proof of income. You will also need a Certificate of Tradition and Freedom for the property, which shows the property's history and confirms it's free of liens or encumbrances. The purchase agreement, or Promesa de Compraventa, is another key document. It outlines the terms of the sale and is legally binding once signed.

Do I Need a Lawyer When Buying a Home in Colombia?

While not mandatory, it's highly recommended to hire a lawyer when buying property in Colombia. A lawyer can conduct due diligence, ensure the property is free of liens, help navigate the legal process, and protect your interests. Legal fees vary but typically range from 1% to 1.5% of the purchase price.

Do People Typically Buy a Property with All Cash or Take Out a Mortgage?

Both options are common in Colombia. However, getting a mortgage as a foreigner can be challenging. Colombian banks typically require a significant down payment and proof of income. Interest rates can also be higher than in other countries. Many foreigners choose to buy property outright to avoid these issues.

Are There Inspections That Take Place, and If So What is That Process Like?

Home inspections are not as common in Colombia as in some other countries, but they are becoming more popular. An inspection can identify potential issues with the property and save you money in the long run. If you choose to have an inspection, it's typically arranged by the buyer and conducted before the purchase agreement is signed.

What Are Some of the Pitfalls to Avoid When Buying Property in Colombia?

One common pitfall is not conducting thorough due diligence. This includes verifying the property's title, ensuring it's free of liens, and checking for any zoning or building restrictions. Another pitfall is not fully understanding the terms of the purchase agreement. It's crucial to have a lawyer review the agreement before signing. Finally, be aware of the potential for real estate scams. Always work with reputable, licensed professionals and never hand over money without proper documentation.

Expats Talk about Real Estate in Colombia

"Stay in the area for a while before making a desision and try and get some inside information ..someone from your own country who has lived in this place a while," said one expat living in Guatape.