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Ecuador inflation
Jan
30
2012
There are growing Ecuador inflation concerns.
Ecuador flights may be down as Ecuador I would like to know how Ecuador’s inflation is affecting the expat community since it closed so much higher than in other South American countries.
Are the ticket prices costing so much more now?
Does anyone have a better idea of what is going to be like in 2012? We are planning to retire in Ecuador but all these bad news is making us think really seriously about it. Thank you very much.
Answer #2
I think what you might be hearing is that inflation is going up and so are the incomes, but one is outpacing the other. Now for the native culture in a country where the minimum wage is only $292 per month I think you can see where that would be a problem. My wife and I live here year round and have not found anything that has risen to the point that we say…we can’t buy that anymore. I do understand that trying to live on a fixed income might be scary when you here about inflation but….so far that press has been more bark and there is not much bite that we have seen. Ecuador has some quirks for sure, but we have found it to be truly a lot less costly to live here than back in the states could every hope to be.
larryp
Answer #3
And a better quality of life.
I just flew in from Seattle non-stop to Miami, and then MIA – GYE non-stop. $ 568.00 return. Shop the Internet, daily. Prices for the same flights will fluctuate as much as $ 250.00, same cariier, from one day to the next.
Megalodon
Answer #4
Mr. Nice, as far as better deal in Florida real estate goes, I would say that you need to consider all the costs involved in the transaction including the holding costs. For example, I have homes in Florida and lived there many years and for all the counties, cities and states the biggest problem with the real estate fiasco is the diminishing values which have a profound effect on the tax base since all these counties rely on real estate tax base for a large percentage of their revenue. Not the case in Ecuador. Not counting foreclosures and bankruptcies all the cities and counties in Florida are having issues with tax base. With that, and even though the values have plummeted in most areas, values for real estate taxes have not diminished to the same point. When you have values in purchase that are so much lower than the value placed on them for taxes you have an issue. The tax value basis has not come down the same rate because there is no way to generate that lost revenue and without the revenue, budgets can not be met for basic services for the most part. So, even though the real estate prices have come way down and they are now a good value play, the tax base has not or only slightly, which will make holding Florida real estate much more expensive than holding Ecuador real estate. I am just saying that quality/price is not the only factor in determining “value”. This statement does not even touch on the surface of “cost of living” differences either which I try to consider when thinking of value for real estate and what value it has to me and my family. Just another thought process.
larryp
Answer #5
How about some facts. Y/Y inflation rates from the Bacno Central del Ecuador:
Diciembre-31-2011 5.41 %
Noviembre-30-2011 5.53 %
Octubre-31-2011 5.50 %
Septiembre-30-2011 5.39 %
Agosto-31-2011 4.84 %
Julio-31-2011 4.44 %
Junio-30-2011 4.28 %
Mayo-31-2011 4.23 %
Abril-30-2011 3.88 %
Marzo-31-2011 3.57 %
Febrero-28-2011 3.39 %
Enero-31-2011 3.17 %
Diciembre-31-2010 3.33 %
Noviembre-30-2010 3.39 %
Octubre-31-2010 3.46 %
Septiembre-30-2010 3.44 %
Agosto-31-2010 3.82 %
Julio-31-2010 3.40 %
Junio-30-2010 3.30 %
Mayo-31-2010 3.24 %
Abril-30-2010 3.21 %
Marzo-31-2010 3.35 %
Febrero-28-2010 4.31 %
Enero-31-2010 4.44 %
Answer #6
Basically in 2 full years inflation has gone up just under 1% by this chart. From January 2010 is was down through June, 2011 then started to rise and it looks like it might be trending downward once again. As I stated previously, we live here full time and have not found anything egregious in pricing to make us not buy what it is we wanted. If I compare the basic cost of living here with what it was costing me to live in the USA, it is vastly different and much less costly. There are certain things that cost more here than in the USA but we just either order online or wait until we go back and bring it here. Not a problem. I do understand the concerns about inflation for those that are on a fixed income though but this chart might illustrate a good point of view. Just a different perspective.
larryp
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Answer #1
So, I am technically not an expat since my main residence remains Canada, but I am in Ecuador 2 – 4 times a year for several weeks a trip since my boss accepts my broad definition of “home office”. I used to fly round trip to Ecuador for just under US$400 from New York in the low season 5 years ago. Those fares are gone. I now regularly pay $700 – $800 which is a substantial increase to what it used to be.
In Ecuador prices have definitely gone up, but basic necessities are still decisively cheaper than in North America, since the price base was low anyway. The “canasta basica” (basic items basket) is valued at slightly over $550 a month I believe. I am just amazed that by now comparing the Florida real estate market and Ecuador real estate market you sometimes get the better deal in Florida in terms of quality/price. Some things have always been more expensive, such as cars and electronics that sometimes cost even 100% more than in the States (those things are in turn cheap in Panama for example). Depending on your lifestyle and what you are willing to give up you can spend a lot or relatively little.