Tip #3: Know the Difference Between Fee-Simple and Leasehold Properties
Guam, like Hawaiʻi, has a few leasehold properties on the market. Leasehold properties often catch the eye of buyers who are new to Guam because they’re usually cheaper than fee-simple properties.
Your ownership rights will differ significantly between these property types, so it’s important to understand the difference:
1. Purchasing a fee-simple property is just like a traditional sale. You close on the home, and you own it indefinitely. You’re free to sell it, rent it out, or pass it on to someone else when you pass away.
2. A leasehold property resembles a very long-term lease. Common leasehold terms can be anywhere from 20 to 50 years. In that time, the leaseholder pays property taxes and enjoys use of the property, but will have to vacate (or extend) once the leasehold term is up.
You’ll most commonly see condos in Tumon offered as leaseholds. Before you commit to a leasehold, make sure you understand all the implications. Your real estate agent can assist with figuring out which type of property is right for you.
Tip #4: Realize that Title Issues Aren’t Out of the Question
When completing all the due diligence before closing a sale, the property will be subject to a title search. This will ensure that the seller has a clear title to the property—and the full right to sell it. The title search can also turn up financial obligations, like liens or back taxes.
Your real estate agent will likely recommend title insurance, which protects against any errors that happen in this process. For example, what if a distant relative of the seller suddenly appears after the sale and argues that they have a claim to the property?
All this is to say: Take the title search seriously, and consider title insurance to protect yourself against potential problems down the road.
Tip #5: Be Aware that the “Seller’s Disclosure” Law Has Not Yet Passed in Guam
For the last few years, the Guam Real Estate Commission has been working on passing a seller disclosure law. The proposed legislation, Bill 383-35, would require a seller of residential real property to disclose any known material facts about their property prior to the sale.
For example, if the seller knows there’s a problem with the plumbing, under current Guam law, they are under no legal obligation to tell you about it prior to the sale.
That’s why it’s important to hire a certified home inspector. Although not every problem will be unearthed in a home inspection, an inspector can often spot things like potential roof issues, faulty wiring, foundation problems, structural issues, etc.
What’s the best way to find a home inspector? Your real estate agent may have a recommendation.
You might also consider using someone certified by the International Association of Certified Home Inspectors (InterNACHI). These inspectors commit to a code of ethics, as well as ongoing continuing education. You can review Guam’s InterNACHI-certified home inspectors on the InterNACHI website.
Now that you’ve got a solid foundation for Guam’s real estate market, all that’s left is to take the first step and secure your financing. With that in place—and an agent to represent you—the real fun begins: finding your new home on Guam.
If you’re relocating to Guam, we’d be happy to help you get your belongings to your new home. Simply reach out to one of our Guam-based experts for a complimentary quote. We’d love to be among the first to welcome you to the island!