Living in Luxury | The Most Expensive Mistakes in Real Estate are Often the Ones You Never See Coming—until it’s too late.

Nicole Franceschini

In a market as unique as Puerto Rico, having a knowledgeable advocate isn't a luxury—it's a necessity. Time and Again, I hear from buyers and sellers dealing with situations that could have been avoided had they had the right guidance. For most, a real estate transaction is the biggest financial move you'll make in your lifetime, trying to go it alone seems almost unthinkable. Yet, people do it, and it often costs them far more than they bargained for.

Every year, I get calls from people looking for help after the fact. They’re stuck in a situation that’s already spiraling, often facing limited, expensive options to fix it.  The reality is simple, you don’t know what you don’t know. Unless this is your full-time job, there are simply too many moving parts to keep track of. As I always tell new brokers that I am mentoring, opening a door is the easiest part of this job. What you really need me for happens long after the tour—it’s understanding the hidden pitfalls and knowing exactly how to navigate them. It’s knowing what needs to be in a contract, and when it needs to be there. 

Some years ago I had a client, a seller, that decided to sell on his own to save on the commission. After the closing, he reached out to me to explain that his deal had included the solar panels and batteries of his property, but he didn’t own them outright and had made no provision in his agreement for the buyer to assume the lease. An $80k dollar mistake that could not be undone. Or consider the buyer that purchased a property without understanding the property insurance ramifications due to its oceanfront location or flood zone location. Or the seller blindsided by the withholding requirements for Non-Residents. Or the buyer who did not realize that this particular municipality charges 1% of the purchase price to the buyer (unless negotiated), hint it's not just Dorado. 

Then there are the technical pitfalls. I’ve seen agents and brokers add a “subject to appraisal” contingency with zero explanation. To the untrained eye, it sounds standard, but without proper wording, it leaves the door open for the seller to renegotiate if the appraisal comes in high. If the seller has a back up offer, the buyer is faced with two not so great options, increase the price or lose the deal to the other buyer waiting in the wings. 

Between eminent domain, structural issues, title defects, and complex tax implications, the risks are real, not to mention, the liabilities of cash transactions or trading LLCs. 

Here is Why You Need a Knowledgeable Advocate to Buy Real Estate in Puerto Rico

Puerto Rico is unlike any other market in the United States—or anywhere else in the world, for that matter. It operates under a distinct legal framework, carries the complexities of its commonwealth status, and blends U.S. federal law with local statutes that can surprise even seasoned mainland investors. Add in the layers of Act 60 tax incentives, Municipal Taxes, CRIM property tax records that don’t always match reality, and a title system rooted in Spanish civil law tradition, and you have a market that demands more than a quick Google search and good intentions. The reality is that our data collection while improving is still staggeringly behind that of the US mainland. 

The Illusion of Simplicity

On the surface, Puerto Rico can feel familiar to American buyers. The currency is the dollar. The language of contracts can be in English. Many agents are bilingual and accessible. The banks are FDIC insured. It’s easy to assume the process mirrors what you’d experience in Miami or New York. Property records here can be fragmented across multiple registries. Easements and access rights don’t always appear in a standard title search. Flood zone designations—critically important on an island—often require local expertise to interpret correctly. And the emotional pull of beachfront views or lush mountain properties can make it tempting to move fast and ask questions later.

What “Knowledgeable” Actually Means Here

Not every licensed agent or broker is an advocate, and not every advocate has the depth of knowledge this market requires. An advocate is looking out for you in a multitude of ways, not just showing you real estate, but helping you navigate your new island life. Your advocate will review agreements, neighborhoods, comparable sales, schools, tax records, etc…What you’re looking for is someone who understands the legal landscape. Puerto Rico’s Property Registry operates differently from the deed recording systems most U.S. buyers are accustomed to. An experienced advocate knows how to read a Nota Simple, flag title defects, and work with local attorneys before a problem becomes your problem. Actually, the smart advocate when working with a seller pulls the Title and CRIM certificates the day they take the listing. You don’t need these issues just before closing which is exactly when they come up if you leave it to the bank or the very busy notary attorney. There are countless factors to consider: divorce, prenuptial and post nuptial agreements, trusts, LLcs, death certificates, and more. 

Knows the Neighborhoods Beyond the Brochure.

There’s a significant difference between a property that photographs beautifully and one that will hold—or grow—its value. Flood history, HOA enforcement culture, proximity to infrastructure projects, traffic patterns, municipal taxes for certain districts not others: these details live in local knowledge, not listing descriptions. The seasoned broker has been around, talks to people, meets with other top professionals at both professional events and private meetings. I personally meet with the top independent real estate brokers on the island every other month and attend other professional networking events for this very purpose. To trade on our knowledge, experience, and know how. 

Knows How to Prepare the Agreement but has it Overseen by their Team Attorney. 

I often joke with clients that I’m not a lawyer but I pretend to be one when needed. In all seriousness, I don’t play attorney, or tax attorney, or structural engineer. I have people on my team for these purposes. They are called experts in their field. That crack in the wall, not going to make a judgment call on that one, call the engineer. Most questions I have an answer to and if I don’t know, I go straight to the expert in their field. Knowing when to include certain contractual elements is essential, not every agreement is the same. It can depend on certain contingencies in place, the lifestyle of the new tenant or buyer, location due diligence requisites, inheritance issues, and more. etc.. 

Knows the Right People and has Relationships that Move Things Forward.

Puerto Rico’s professional community is tight-knit. A connected advocate can get you access to inventory before it hits the market, facilitate introductions to reputable contractors, attorneys, and notaries. In the luxury sector, clients want exclusivity and want the listing that hasn’t yet been marketed. When you are connected to the right community of brokers, buyers, and sellers this happens. Even the appraisers call for feedback and our knowledge because we live it day to day.  

Knows the Stakes Are High

Puerto Rico’s real estate market has seen significant appreciation in recent years, driven by tax incentive migration, remote work flexibility, and growing international interest in island living coupled with scarcity of inventory. That appreciation has also compressed the margin for error. Overpaying because you misread a comparable or because your broker did not know about unregistered transactions of traded LLCs or Cash purchases can cost you hundreds of thousands. Missing an easement that limits your development rights or the limitations that can be devastating if you're trying to build oceanfront homes. Are there ways to deal with these things, yes, and your broker will set up the correct due diligence and put you in contact with the correct team to guide you.  These situations aren’t hypotheticals—they’re recurring patterns for buyers who came to the table underprepared. And it affects the sellers too, what happens when you have a buyer working with a deadline and all of a sudden a title issue arises? They can and sometimes will walk away. Having an advocate who knows who to call at a critical moment can help get you to the closing table.

Help You Find Your Footing in an Unfamiliar Market

If you’re considering real estate in Puerto Rico—whether as a primary residence, a second home, or an investment property—the first and most important decision you’ll make isn’t which neighborhood or what price point. It’s who is in your corner. The cost of a wrong decision here isn’t just financial. It’s the time, the stress, and the opportunity cost of capital tied up in a complicated situation when it could be working for you.

In a market this layered, this vibrant, and this full of possibility, the question isn’t whether you need an advocate. It’s whether you’ve found the right one. And to those not using one, I’ll still be here to take your call.