Orange County, in particular it’s beach communities, such as Laguna Beach, Corona Del Mar and Newport Beach, have a large British Ex-Pat population. It’s not hard to understand why so many British people decide to relocate to Southern California; with its stunning beaches, year-round Mediterranean climate, palm trees and abundant opportunities, many British Ex-Pats refer to it as “Paradise”.
Real Estate Agents in Orange County and Los Angeles
If you’re thinking of relocating from the UK to Southern California, or, if you’ve already decided to relocate to Los Angeles or Orange County from England, its important to learn the differences in the way people buy and rent homes in California. This guide has been written to detail some of the basic differences, however, there are so many nuances and variables that it is vital you work with someone who understands the property buying and renting process in both the UK and Southern California.
American real estate agents rarely have experience or knowledge of the property buying process in the UK, and therefore are unaware that people relocating from the UK to Southern California are coming from a very different system. These agents generally aren’t aware that some of the major aspects of buying a home in California as a British ex-pat are entirely different to those in the UK; they don’t know what they don’t know.
Here in the OC, there are several Realtors marketing themselves as “British Real Estate Agents in Los Angeles” or “British Real Estate Agents in Orange County”, however, in the majority of cases, they have never bought or sold a property in the UK and are in fact referring to the fact that their parents are of British origin.
If you are relocating to Southern California from the UK, you may not be aware yet of how vastly different the property purchase process is here; buying (or renting) a property in Los Angeles or Orange County involves an almost entirely different process to the one you’re used to in the UK and you’ll need to work with an agent who understands not just the local property market, but also the differences between buying a home in the UK and buying a home in California in order to properly walk you through the process and make you aware of the differences that an American real estate agent won’t even think to point out.
We are a team of Realtors in Southern California, with both British and American agents. Whether you’re relocating, or, searching for a buy-to-let investment property in California, we can help you!
The difference between buying a home in California and England.
Let’s take a step by step look at the differences…
In the UK, homes are listed by an Estate Agent and this is almost always a company rather than a person. Many people at the estate agency work on the property listing together as a team. Each person at the estate agency is an employee of that estate agency.
In Southern California (and the US generally), Estate Agencies are known as brokerages and each Estate Agency almost always has self-employed agents, each of whom work completely independently of each other, and are often in competition with each other. Think of them as self-employed independent salespeople rather than salaried employees on the same team.
Each of these agents is running their own business and the quality of service offered as well as level of knowledge will vary drastically between agents. Typically, 10% of these agents get 90% of the business, and the remaining 90% of agents share the remaining 10% of business. You will want to work with one of the top 10% as these are the people running successful real estate businesses and to do so requires skill, experience and knowledge.
These self-employed salespeople are known as ‘Realtors’ and this is the term generally used to describe a real estate agent here in the US. Technically only a member of the National Association of Realtors is allowed to refer to themselves as a Realtor, but you’ll find that the term Realtor is so commonly used that is has now become a noun, rather than used to describe a member of this group.
When you buy or sell a home here in Southern California, you’ll have to sign a contract with a brokerage (estate agency) however the contract will be with ONE agent at the brokerage, and you won’t be working with any other estate agent there. If you have questions about a property, you won’t be able to just call the office and ask anyone, you’d have to reach out to the agent you are working with.
Unlike the UK, buyers here in Southern California are represented by an agent. Your agent will be representing your best interests at every step of the property purchase process, in a way similar to that of a solicitor representing you in a legal case in the UK. Just as, for example, you wouldn’t want to use the same solicitor as the other side in a divorce, here in California agents represent their clients best interests and don’t disclose information that could weaken their negotiating position such as having to find a new place to live by a specific date needed for relocation.
In the UK, real estate agents are salaried employees who earn a bonus commission. In California, real estate agents do not receive a salary and instead work on commission only. The seller of a home pays a commission to the agent listing the property and that commission is then split with the buyer’s agent. The buyer does not pay anything to their agent and it usually should not cost you any money to work with an agent. Regardless of the source of the commission, the buyer’s agent has a fiduciary duty to their client only.
Agents in California have to be trained, licensed and pass background checks; the real estate industry and the agents working within it are heavily regulated.
Southern California Property Search Websites
In the UK, when you begin to look for a new home, you’ll typically start your search online. If you see a home that interests you, you’ll send an inquiry via that website and it will go to someone in the office of the estate agent listing the home. That person will reach out to you to schedule a viewing.
Here in Southern California, if you send an inquiry via a property website, prepare to be inundated with calls and emails from random real estate agents. You’ll be added to email lists and spammed for months by aggressive salespeople. You’ll regret it almost immediately. Don’t do it.
Here in the US, because these agents are running their own businesses, they have to advertise for clients just like any other business, and property search websites in California sell ad space to these agents. Often, the ad is designed to make that agent look as if they are the official point of contact for the property; nine times out of ten, they are not and have zero connection to that home, knowing as much about it as you do.
Instead, ask your agent about the property. Your agent will be able to schedule a viewing (known as a showing here) for you and provide you with more information about the home. If you’d like to search homes for sale in Los Angeles or homes for sale in Orange County, you can do so on our website free of charge. We don’t require you to enter any of your personal information, and if you inquire about a property listed on our website, your inquiry will come only to us.
You should avoid Southern California property search websites that require you to enter your information in order to view property details; if you enter this information you’ll generally be added to an email list and spammed. Our website offers all of the information about every property currently publicly listed for sale, and we have access to many more properties being discreetly marketed.
How To Find Homes In Southern California As A British Ex-Pat
Homes for sale in Los Angeles and Orange County will usually (not always) have a ‘For Sale’ sign posted outside, just like homes in the UK. The main difference here is that in the UK the sign will have the Estate Agency’s information on it, whereas here the sign will have the contact information of the individual agent who is representing the home seller, even though the brokerage’s logo is shown.
If you see a home in Southern California that you’re interested in, don’t call the listing agent shown on the For Sale sign; that agent represents the best interests of the seller, not you, and any information you give them can be used to negotiate against you if you decide to buy that home. Instead, you should have your agent contact them on your behalf.
Property Viewings in Southern California
In the UK, you are able to call an estate agency about a property, they will call the owner and set up a viewing for you, and you just turn up at the property to be shown around it by the seller. That scenario never happens here in California.
Here in California, agents are involved at every step of the way. The agent representing you will contact the agent representing that property (not their brokerage) and will set up a showing (viewing). Your agent must then accompany you to the showing and be present with you the entire time you are at the property; you will not be allowed into the property without your agent present. In almost every case, the owner will not be present, and your agent must unlock the property using a secure lockbox. At the higher end of the market, the listing agent will also be present at the viewing and will conduct a tour and answer questions you may have regarding the property. Sellers never show you around their home, or attend the showing, unless it’s a property being listed as ‘For Sale By Owner’.
Mortgages For British Ex-Pats in California
Before you are able to view any property in Orange County or Los Angeles, you will be required to obtain a mortgage pre-approval or to be able to demonstrate proof of funds if you are a cash buyer. While there aren’t many mortgage options for British people relocating to California or the US generally, some do exist and we are able to connect our clients with mortgage brokers who may be able to arrange mortgages for British people relocating to California.
If you are relocating from the UK to Los Angeles or Orange County and require a mortgage, we recommend contacting us as soon as possible to get started on arranging your mortgage as this will usually take a little longer than obtaining a mortgage in the UK.
If your UK bank has a US affiliate, it is worth checking whether they are able to provide you with a US mortgage (and bank account) based upon your UK credit score.
The Difference Between Buying A Home In California and England
When you make an offer to buy (or rent) a property in England, it isn’t legally binding and you could make offers on dozens of homes if you wanted to without consequence should you change your mind. In fact, right up until contracts are exchanged on the day of the sale becoming final, you could change your mind and only lose the fees you’ve paid. Of course, the person you are buying the home from could also change their mind, or accept a higher offer at the last minute.
In California, offers to purchase a property are legally binding on both the buyer and seller, so do not sign such an offer unless you are able to complete the purchase. Gazumping and Gazundering do not exist here.
You will also have to put down a substantial amount of money as a deposit on the property with your offer, and you won’t be able to make an offer unless you are in a position to pay such a deposit upon the offer being accepted.
There are of course several ways to back out of a purchase as a buyer if your agent has written them into the contract, for example if the property doesn’t appraise for the amount offered, or if your financing falls through, however you may lose the deposit money you put down at the time of making the offer. The seller can rarely back out of a contract and in fact the buyer can sometimes force them to sell even if they change their mind.
In England, when you want to make an offer on a property, you do so by making the offer to the estate agents office representing the home, who then liaise with the seller, often facilitating a negotiation between you and the seller until a final sale price is agreed upon by both parties. In California, your agent will present an offer on your behalf to the agent representing the seller. The seller’s agent will then present the offer to their client, the home seller. The sellers agent and your agent will act as middlemen, facilitating the negotiation and at no point will you ever have direct contact with the seller or their agent during this negotiation.
Every offer you sign, and all of the terms stated within the offer contract are legally binding on you until you rescind it or until the seller rejects the offer. The contract will be produced by your agent, not a lawyer, and in most cases, no lawyers will be involved at any point in the property purchase. The agents working for the buyer and seller in fact handle the legal work involved in the transaction and are trained and licensed to do so.
Once an offer is accepted, your agent will then arrange for inspections on the property, title searches, a valuation if required, and handle the escrow process. Should any issues arise, your agent will be the one handling them on your behalf.
When you buy a home in California, the agents handle the majority of the transaction, making it a far easier process for you as a buyer. While you may feel somewhat overwhelmed at the thought of buying a property in another country, when you work with us as your agent, you won’t be doing it alone and will have someone walking you through the entire process step by step, at no cost to you.
How To Rent a Home In Los Angeles or Orange County
If you’re not quite ready to buy a home yet, or, if you’d prefer to rent first to get an idea of the area before committing to living there for a long time, renting a home may be the best option for you.
If you’re searching for homes to let in Southern California, or Property Letting Agents in California, you may not find many options; this is because Americans don’t use the term “let” or “letting” and instead just say “rent” or “rental”.
Properties here are described in terms of square feet and Brits who aren’t used to seeing this often struggle to work out whether a potential home is large enough for their needs. When you work with us, we help you navigate this and many other nuances.
As an ex-pat, without a US credit history or credit score, renting a home will be more challenging for you than if an American were to rent the same property. Almost all landlords here will want to do a credit check on all people intending to live in the property, and they will usually want to see bank statements, references from past landlords, tax returns, pay stubs, etc. There are several creative ways we can get around these requirements for our clients in most cases, however it can sometimes be harder to rent than to obtain an ex-pat mortgage.
British Ex-Pats in Orange County and Los Angeles
While an agent’s role is to help you buy or sell a property, we are also able to help our British ex-pat clients settle into their new life by providing information about the local area that is specific to their needs, including; where the British grocery stores are, local British pubs, delivery services to order items from the UK, local groups, as well as general information about the area.
Relocating to another country can be an intimidating and often lonely experience, especially if you don’t know anyone here yet. It can help to have another fellow Brit to talk to, and to introduce you to the locals. There are many local social media closed groups that we can also add you to, from neighborhood watch groups for your new neighborhood, to parent groups and networking groups.
While we aren’t able to advise our clients on items other than real estate, we are able to make introductions to professionals who can provide such advice. We can also share our first hand experiences of moving from the UK to the US, and all that this involves, from shipping companies losing our belongings, to launching, buying and selling businesses here, to enrolling our children in California schools, to learning to drive here and getting a California driver’s license, to US immigration processes and interviews, etc.
If you’re not ready to buy or rent a home in Southern California yet and are just considering making the move, feel free to reach out to us; we’re friendly, and will be happy to offer information free of charge.