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Expected returns in Ecuador, and how Ecuadorians double them

A lot of people don’t know this about me… but I actually have an Ecuadorian mentor.

He’s born and raised Ecuadorian, from Guayaquil, self-made, about 50, and currently owns a hotel in Salinas, a rent a car company in Guayaquil, and a few other smaller hotels in Guayaquil.

I actually partnered with him when I part-owned a hostal in Guayaquil, my first significant investment in Ecuador. I wouldn’t have had the guts to do something like that on my own when I first got here, he showed me the biz.

Anyway, we still keep in touch, and one day we were talking and I asked him what he considered to be a good investment?

He responded, “20%…” OK I thought, that’s good.

But he wasn’t finished… “a month”.

“Wow, really? That’s how rich Ecuadorians think?” …was all that went through my head.

But after being here a while (3 years +) I can honestly say its true, for a lot of investments in Ecuador, that’s about the return you should expect.

Remember, like most places in Latin America, Ecuador should be considered a higher risk investment, and the returns should substantiate that.

So, how do Ecuadorians double their returns?


Yea, I learned this here in Ecuador. Rent the property and put the business, or rent the business, redo it and really put it to work and you will often see 100% returns on your now much smaller investment and get your money out within 2 or 3 months!

Sometimes it makes sense, but you don’t necesarily have to own ‘the trains’!

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Posted in Ecuador for Investors, Ecuador Q&A, Investor News/Analysis

Getting electricity to your lot in Ecuador

And on goes my building project on the coast of Ecuador.

Next up, electricity, not necessarily a sure thing in Ecuador.

But in this case, the electricity was about 100 meters away from my lot, maybe a bit less, so it wasnt a huge deal hooking it up to my property.

Total cost $2450 for everything, one guy did it all, installed two posts, one transformer for max 2 houses, and also did the certification with the electric company and got the meter installed.

In a few days he was done.

If I build more houses in the near future i can trade him the transformer i got for a more powerful one and he will discount the full price of the one i have.

As for installing the electrical outlets and breakers in the home itself, normally, I now electricians in Ecuador charge $12 per point, or per outlet installed. We found one recommended local that will do it for a total of $700 the whole house.

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Posted in Ecuador for Investors, Ecuador Q&A, Investor News/Analysis

Making sense of the new Ecuador Inheritance Law

This week (June 2015) the Ecuador president is sending a new bill to the Ecuador Assembly to seriously hike the inheritance taxes the rich will have to pay.Important news for us property investors.

As it lays now, folks in Ecuador with inheritances under $66,000USD dont pay any tax.  For inheritances valued $100,000, they pay a 5% tax.  For $200,000 10%, $300,000 15% and up until the max for inheritances over $796000 you´d pay 35%.

The new law does two things… for one, it creates two separate tables, and distinguishes between indirect heirs who are not direct (spouses, children) and direct heirs.

The second thing the new proposed law will do is really stick it to the wealthy while not effecting much the lower class.  Heirs that inherit money or property valued under $35,000 will pay no tax.  And, in the same example above, heirs who inherit $100,000 will pay a 7.5% tax, $200,000 a 17.5% tax.  But at $300,000 you really start to see the difference, now you´d pay 32.5% tax compared to 15% tax from before.

At fortunes over $566,000 youd pay 47.5% tax if you are a direct heir, 52.5% tax if you re an indirect heir compared to now when you pay 25%.

For indirect heirs who inherit over $849,000 you´d have to pay a whopping 77% tax! I think this will effect the country in two ways…

1. More people will buy property directly in the names of their kids to avoid this tax.

2. High-end properties over $300,000 will sell VERY SLOWLY if they sell at all.  Prices will drop for the high-end as they´ll have to offer serious discounts while most of the Ecuador rich will look to move their ´big´ money abroad.

But I think what you really have to worry about is what´s in the silver lining here.  If this tax gets approved this could open the door to more tax hikes… particularly for the rich.

ANd it continues to create a dangerous mentality of  “its OK to take from the rich cause they probably got their money anyway from robbing and stealing from the poor”. I´ve already heard tax reforms for a new capital gains tax may be in the mix.

But, I´ve always been one Ecuador “analyst” that recommends you only put maximum 10% of your portfolio in Ecuador, with a particular focus on less expensive Ecuador property (usually under $150k) cause I think that´s where the opportunity is in this market.

To see links of the current inheritance tax table click here, for the proposed one click here.

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5 Ecuador beaches suffering from receding sand line- buyer beware

Although the Ecuador coast still has some extraordinarily good buys, and many beaches not at all effected by erosion, here are five places on the coast I would avoid buying front-line beachfront property due to the noticeably receding sand line.  
In other words, the beach there is disappearing fast and who knows, your investment could go with it.  
1. Engabao- The largely unknown step-sibling of playas, while only a few minutes drive from Playas the beach and scenery change dramatically in Engabao, while in Playas the beach is large and expansive, in Engabao the beach faces a direct direction and gets pounded hard by the surf, while surfers like the area, erosion is evident, this beach is disappearing.  

2. Chanduy- Chanduy faces the same direction and is on the same beach head as Engabao, just maybe a 45 minute drive west.  Chanduy is a unique fishing town with zero tourists that´s literally at risk of falling off into the sea unless the town invests quickly in some anti-erosion boulders or something.  

3. Las Tunas- A small ´very local´ town on the central coast near Ayampe, Las Tunas gets pounded by big surf, and erosion is evident, this is one place I may buy oceanview property but not beachfront.  

4. Jama/ El Matal- Famous among expats in Ecuador due to the several expat communities in the area, El Matal´s recent problems with tidal surges and disappearing beach are well publicizied.  

5. Mompiche- An otherwise beautiful little town with a fun vibe, good food and good surf, most non-surfers simply don´t stick around long cause most days theres simply "no beach left" or anywhere to walk.  Erosion is evident.  

But I am pleased to say that most of the rest of the Ecuador coastline does not seem to have this problem as the beaches are pretty much in the same spot they were 5-6 years ago when I first visited Ecuador.  

And in the towns above, although I dont recommend buying right on the beach, an oceanview property or a near-the-beach property could still be a great buy.  

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And we’re off! Foundation prep. Ecuador coast house build part 1.

So this week we broke ground on the 3 bedroom, 2 bath oceanview house here south of Manta, Ecuador.

The first step was to level the ground and dig the holes for the foundation and septic system all in one shot.

As you can see in the pics (click display images in your email reader) in came the heavy manchinery, which I rented for $25 an hour with specialized driver included.

The total came to 36 hours or $900.

Next step, get water to the lot, easier said then done, maybe, stay tuned!


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Posted in Ecuador for Investors, Investor News/Analysis

Is there really NO car depreciation in Ecuador?


Today I sold my car in Ecuador.A 2013 model Chevy N300 mini-van for $13,000 USD.

I bought it one year ago from a used car dealership here in Quito for $13,000 USD.

So, I used the car for a year, put 26,000km on the car (16,100 miles), scratched it up a bit and still didn´t lose a cent on it.

No big repairs were needed, just oil changes, new tires.

Is this normal in Ecuador?  Why?  

Actually, yes!  Cars are so expensive here due to the import restrictions AND cars retain their value quite well.If you shop around a bit it´s common to buy a used car at market price, use it for a year or two and then resell it for at or just below what you paid for it.

In my own experience, I´ve seen for most car types and models in Ecuador, cars depreciate about $1,000 per year of use.

It never ceases to amaze me when in Ecuador people will drive a new car off the lot and then try to resell it a short time later for $500 less than they paid for it!

In places like the US you´d lose 30% of the cars value instantly or more!

Not in Ecuador.

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Posted in Ecuador for Investors, Investor News/Analysis

How to get a building permit in Ecuador in 3 days

Building permits can be tough in Ecuador, but they can also be ridiculously easy.

Depends a bit on the project and the municipal where it´s located.

In my experience, the municipal in Playas Villamil is really a pain.  Quito not so much.  While the municipals in Santa Elena (Salinas area), and Jipijapa (for area of coast south of Manta) are pretty easy.

My experience this week at the municipal of Jipijapa getting a permit to build my 170m2 (1829ft2) house on a 330m2 (3552ft2) lot was pretty straightforward.

The hardest part was the week or two wait for the municipal to send an inspector to define the construction limits or as they say here “linea de fabrica”.  It helped my architect knew somone in the municipal who owed him a favor (I guess).

Once that happened I had to go to the municipal with a signed official copy of the architectural plan which after heavy negotiating cost me $500 for a plan guaranteed the municipal would approve.  If not, he´d redo it.

Plus, I had to take several copies of the property deed (escritura), certificate of registry (certificado del registro de la propiedad), electrical plan also made by the architect, and a copy of the 2015 property tax payment (predios) which for my property cost well under $100.

Altogether the permit cost $135 and took 3 days.

The requirements are basically the same all over Ecuador but every municipal will have their particularities.

So now on the blueprints, permit, the 2015 tax payment and a few other minor things i´ve now spent a total of $900.

And now I´m also ready to build!

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Posted in Ecuador for Investors, Investor News/Analysis

The property flipping dilemma on the beach in Ecuador

OK, so I have flipped property on the Ecuador coast with success.

But it’s obvious to me now after doing it that that’s not where the real money is.

You see, truth-be-told, a lot of the cheap, Ecuadorian-made homes, especially on the coast, simply don’t meet North American standards, and chances are you’d spend more to fix it up then the whole place is even worth.

So, what’s the opportunity?

Build your own house.

And that’s exactly what I’m going to do starting later this week.

Can’t say I don’t practice what I preach.

Below is the plan for my new project… in Puerto Cayo, just south of Manta on the coast with a beautiful oceanview and a short walk to the beach.

Might be a little hard to see, its just a quick pic from my cell phone of the blueprints the architect gave me.  The nice oceanview is to the bottom right of the plan.

 But here’s my thinking based off my experience selling property on the coast of Ecuador.  

3 bedroom, 2 full bath.  That’s as small as I want to go, even though most people who move here or retire here are moving down as a couple or a solo person, I’ve seen they still prefer at least 3 bedrooms because they like having at least one guest room for their kids/friends visits and one room they can use as an office or storage den.  While 4 or 5 bedrooms is often a little much.

2 non-master bedrooms separated by bathroom.  This is nice cause the people in one bedroom won’t have to walk through or outside the room of the other to get to the bathroom.

Spacious kitchen with island.  Important for extra space and entertaining.

Plenty of closet space with walk-in closet in master bedroom.  From my experience, especially women really focus on closet space, important!

Laundry room with door to exterior so folks can take advantage of the nice weather and walk outside to hang clothes on a line like the locals if they wish.  Plus, you got to have your machines inside and out of the elements to prevent from rapid erosion in that ocean air.

A dining area and patio with a BBQ area and sliding glass doors that take full advantage of the nice oceanview.  Especially us North Americans, like a good BBQ on the beach.

2 sinks and a bath tub plus shower in the master bathroom which will also be extra spacious.

Raised floor of house by about 1 meter so that even if there is a 2 meter fence around the property the house will still have a nice oceanview over the fence.  Plus this should help keep moisture and insects out.

Spanish-tiled roof with porcelen tile floor.  The roof because thats the style most expect when down here  and its good for insulation and the flooring because with the humidity of the coast that’s really the best option (easy to clean, carpet forget about it!).

1-story only making it good for older folks who don’t do stairs.  Plus, this will lower construction costs a lot because I won’t have to invest in a lot of rebar as needed when making a floor-roof (losa in Spanish).

An outdoor shower for getting the sand off before entering the house.  This also has to be easily unaccessibled if the house is going to be vacant for a long time, don’t want this to turn into the community shower.

170m2 (1829ft2) of construction on a 337m2 (3627ft2) lot.  Nice spacious house with a small but cozy yard for a garden or the pets.

Minimal use of wood and metals with a focus on materials like aluminium and other materials that won’t erode like crazy in the salty ocean air.

So that’s the basic concept and thinking behind the plan, if you have any suggestions just click on reply to this email.  I’ll keep you informed every step of the way from the ground breaking to the sale!


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Posted in Ecuador for Investors, Investor News/Analysis

Why I just bought in Cayo, Ecuador? The next big thing?

This week I closed on my newest Ecuador property.

Four 330m2(3552ft2) lots, together, with an oceanview a short walk from the beach in Puerto Cayo.  The lots are flat and have road access, water, internet and electricity nearby (which matters!).

The plan…

…build a townhouse on each and resell.  I’ll send updates on how it goes.

But for now, why’d I choose Puerto Cayo?

Just like I liked Manglaralto (a small town near Montanita) when I bought a property there 2 years ago, and then watched it explode with development, foreign investment and a subsequent surge in prices… I like Puerto Cayo entering 2015.

It’s got one of the most spectacular oceanviews of nearby cliffs and offshore islands of the whole coast of Ecuador.  And rare for Ecuador, the ocean on a clear day can have a turquoise color due to the multi-color rocks beneath.

The beach has surfing, an activity that attracts foreign interest and gives people something to do.  It´s something Manglaralto doesn’t have, but nearby Montanita does.

I like the proximity to the city of Manta (population about 200,000) which is about an hour away, with decent shopping, big box stores and the nearest airport.

I like that its in the Manabi province on the central part of the coast, compared to Santa Elena, the province on the southernmost part of the coast, where the locals have a serious litter problem.

I love the seafood options people have in the oceanfront cabanas near town, and that the town is relatively safe, I know folks who live there that sometimes leave their doors unlocked.

I like the fact it is a sleepy town instead of a party town like Montanita or Crucita.

I also like that there are already a good amount of foreigners and foreign investment in the area, but that you can still find cheap land if you know how to look, like I explain in my full guide.

Foreigners attract more foreigners.

In short, I think the place could explode in the short term.

What do I NOT like about Puerto Cayo?

Most would still consider Puerto Cayo a bit remote.

It is.

It still lacks a lot of things like things to do, shopping, etc.

Also, there’s not many taxis in this town for some reason, and the distances can be far to walk.

Basic services can be iffy.  Not all lots have easy access to the city water system and the Internet, meaning you should inquire first!

In this area, beachfront land prices have already jumped in the last couple years due to foreign investment, the cheapest I found in my search was around $60-80 per meter.  3-4 years ago the prices started around $20-30 per meter in this area for beachfront.

But you can still find inexpensive oceanview lots a short walk from the beach for around the price I found mine at.  Thats the opportunity.  Foreigners love a view and Puerto Cayo has it, and at a good value for now.  But the place is poised for some serious possible appreciation in the short-term (1-3 years).

So get in while you can.


Enjoy the best oceanview of the whole Ecuador coastline right from your porch of the islands off Puerto Cayo!

The house is a short 3 minute walk from the beach and a short walk to the center of a sleepy, safe fishing village with AMAZING seafood!

Rise in the morning and slide open your sliding glass doors and bask in the 180 degree oceanview from your porch.

Also, enjoy the safety and comfort of a small gated subdivide without all the politics of a large one.

Entertain your loved ones during a BBQ from your deck as you whale watch and entertain your closest friends and family.  This beach house, built to North American standards is the place for you, all for under $1000 per square meter which is much less than the new construction residences in nearby Manta!

Year built: New! 2015
View: 180 degree oceanview
Lot size: 337.5 m2 (33750ft2)
Roof: Spanish-colonial style clay tiles
Availability: 1 finished house available only, 3 pre-construction

Construction size: one story 190m2 (1900ft2)
Distance to beach: 500 meters
Bedrooms: 3
Bath: 2
Patio/deck: covered (27m2 or 270ft2)
Garage: covered, one car.

Property type: Stand alone home in small (4-5 units) gated community.
Landscaping: Desert landscaping
Master bath: His and hers sink, bath-tub. (9m2 or 99ft2)
Bedrooms: Finished wide closets with extra large windows with screens.  (22m2 or 240ft2)
Water pressure: House comes with installed pump and pressure tank, plug and play.

City water: yes!
Sewage: Septic
City electric: yes!
Internet/Telephone ready.

Open kitchen with island, air extractor, and granite countertops.

Porcelen flooring
Spanish tile roofs
Screens for windows

Very desirable area for rentals… great possible return on investment! Duplexes in nearby vacinity are going for over $250,000 with no oceanview.

Finished! Move-in ready. Only 1 finished house available, could go quick!

For the finished house asking $159,000. For $145,000 get the same house on adjacent lot if you buy pre-construction!

For more details or a showing call 0988899774(Ecuador) or write us below and we will respond within 1 business day:

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Posted in Ecuador for Investors, Investor News/Analysis

Black-listed real estate agents in Ecuador – Background checks

Come on, man

Were you actually expecting a list of names here?

I’m not about to start mud-slinging.

But I will show you how to let the facts speak for themselves and how you can do a FREE background check on anyone you like in Ecuador.

Especially helpful before you do a bigger business deal with someone from or in Ecuador.

Within seconds you can freely see their entire criminal record (if they have one), specifically what they have been convicted of and even some legal matters they were involved in yet not necessarily convicted (as Ecuador isnt necessarily an ‘innocent-until-proven-guilty’ country).  You can even see things like if they’ve gotten seriously behind on child support payments or if they’ve been involved in any kind of fraud in the past.

In fact, it’s commonplace for businesses in Ecuador to check someone out in this manner before hiring them.

All you need to do the background check is their “cedula” number (thats the official, mandatory ID card in Ecuador).

Then go to the site

Once on the site under “datos del solicitante” you’ll need to put your information.

Then under “datos de la persona a consultar” you’ll need to input the full names and cedula number of the person youd like to check out and click CONSULTAR.  Thats it, on the next screen their criminal history will appear or a message will state they have no criminal history!

Now, no one can hide from you.

Especially helpful in real estate purchases where before the deal goes through the seller and buyer have to exhange copies of their IDs to write up the new deed (escritura).

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Posted in Ecuador for Investors, Investor News/Analysis

Macadamia farming in Ecuador – really?

China, India, Egypt, Jordan, Dubai… I can say one thing after living or visiting those places… what a barren wasteland!  At least the parts I saw.  

But Ecuador is different.  

Truly gifted.  

The green here in the Andes is a special color green, really.  So much water.  The dark black top soil runs so deep.  

All you have to do is find the right altitude and it will have a steady year round climate to grow whatever you like.  

So it shouldn’t surprise that a few innovative farmers have done just that, now profiting from Macadamia.  

Precisely, 3 with significant plantations in Ecuador.  And this week I was hanging out with one of the big three on his lot near the town of Los Bancos in Ecuador in the coastal lowlands  but still a ways from the ocean.  

He began… 

You need to find a place that has plenty of water, yet a lengthy dry season for the harvest time, which in this area is from March to July.  

Preferibly between 300-500 meters above sea level.  The Macadamia trees like 25-30 degrees C.

The Mac farmer continued, “you need at least 3000 trees to have a legit, profitable operation.”  

The trees are planted 9 meters apart so you can get about 150 trees on one hectare.  So 20 hectares is all you need to get in 3000 trees.  

Initial investment

Land in this area of Ecuador is alreayd a bit pricey compaatively to other farm areas of Ecuador because it is already great for Cacao (Chocolate bean) and Palm oil and the locals know it.  The going rate for good, yet vacant, farm land around here is $5,000 per hectare.  So for a minimum of 20 hectares that’s $100k.  

You’ll also need about $50k to prepare raw land ready for planting and to build yourself a small plantation home.  

Then comes the trees.  You can buy the seedlings from someone in Ecuador already growing Macadamia for $8 per tree.  For 3000 that would be $24,000.  

You’ll also need a tractor for Macadamia farming.  He says you can find a used one in good condition in Ecuador for around $15k.  

Production and profits
On the high end you can expect 18 kilos of brute, whole nut with shell and all per year per tree… and 15% of that is the inner nut ready for consumption.  Thats about 3 kilos from a top producing tree.  On the low end a tree in this part of Ecuador produces 12 kilos of brute nut shell which provides about 2 kilos of nut ready to eat per year.  

The local wholesale price for Macadamia in Ecuador now is $22 per kilo.  

So thats a per tree annual revenue of $66 (on the high end) which for 3000 trees equates to $198,000 per year.  On the low end that figure would be $132,000.  

Variable costs

The farmer I spoke with says he has 5 full time employees for his 50 hectare plantation.  Each worker makes around $400 a month.  

No electricity is needed on the farm and there is no irrigation system, the trees are fine with the natural rainfall.  He himself drives from Quito every weekend to manage the farm himself.  On the way back to Quito he fills the back of his pick up truck with the weeks output of Mac Nuts.  (He has a processing plant and oven in Quito he says cost him around $200k.)  But he said the plant is not necessary, most growers just sell wholesale, he said he’d buy your nuts at the wholesale price if you produced them.  

Also, during harvest time the farmer hires seasonal workers by the day (around $15 per day is the going rate in Ecuador) and for occasional weed cleanings and things too.  

Benefits of Macadamia

The biggest benefit to growing Macadamia in Ecuador is that it is an uncommon product that most locals don’t even recognize, thus, repelling the common thieves.  Plus, the product can not be consumed until processed by expensive machinery which few have, further repelling the thieves that often snatch the Cocoa beans which can be bought and sold at any streetside wholesaler on any given corner in the Cocoa producing areas.  

Also, obviously, the value-added possibilities of this product are endless.  

You can process your own nuts, package them, add flavors and sell to the bakeries and grocery chains locally, or even export them.  Mac Nuts don’t go bad for over a year after processed according to the farmer.  

Plus, the farmer said local demand for Macadamia is growing significantly and he doesn’t export.

“The local demand has been plenty for me.” 

He continued, “With a farm this size, all you need is one bakery chain to buy your nuts on contract, and you won’t have to look for buyers anymore.” 

The drawbacks…

Of course, there are reasons why everyone is not growing Macadamia.  

Macadamia in Ecuador requires a VERY specific climate, not too humid, not too dry, like the one here near Los Bancos.  

Also, you won’t see any production for the first four years.  And the peak production I mentioned above won’t happen until around year eight.  But the trees live and continue to produce for 50-60 years if well maintained.  

But as a farmer with expenses and payroll there are ways to meet your daily costs for the first few years.  The trees are planted 9 meters apart and are small at first, so you can grow short-sycle crops in between until the Macadamia trees start producing.  

Where I’m at, the farmer grows Maracuya (Passion Fruit) which grows like weeds and can be sold quickly as well.  Also, most macadamia farmers have part of their farm growing Cacao (Chocolate) which is a shorter term crop which reaches peak production at 3 years of age.  

You’ll see ‘Buonamici’s Mac Nuts’ on a shelve near you soon.  :)

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Posted in Ecuador for Investors, Investor News/Analysis

Beachfront or oceanview in Ecuador?

Good question. 

Well, obviously if you can get your hands on a cheap beachfront property, you should go for it. 

By “cheap” for Ecuador standards, I mean anything less than $50 a square meter ($4.65 per sq. ft).  On the high end, I’ve seen folks ask (and get) as much as $200 per square meter for beachfront land.

But I think entering 2015 the real opportunity is in the oceanVIEW properties along the coast.  

You see, the Ecuador coast is lined with oceanfront mountains like the California coastline providing many properties with a spectacular view.  

And you can still find many of these oceanview properties CHEAP.  

By cheap, I mean for instance, a 400 m2 (4300 ft2) lot with a 180 degree oceanview in Ecuador you could probably find starting around $8,000-$15,000.

Maybe less.  

Us gringos love a view.  

Ecuadorians don’t care much, but that’s what kept the price down so long on these properties.  

In fact Ecuadorians build homes with bedrooms with no windows then when you comment on it they look at you like you’re the crazy one for saying something. 

Buy some oceanview cheap from locals, build something (or not), flip it to a foreigner is exactly the strategy Id suggest for someone just getting into Ecuador real estate.  

And its the strategy I’ve followed and plan to follow again entering the new year.  More on that in updates to come.  

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Posted in Ecuador for Investors, Investor News/Analysis

The golden fruit of Ecuador – Papaya


When you move to a new country and try to sell a product to the locals, there are two ways to do things.

The right way.

And the wrong way.

Especially when it comes to food.

The wrong way, at least if you dont have a multi-million dollar marketing budget, is imposing your “superior” foods on the local population.

For instance, pizza.

Maybe you can make a much better pizza than they have available locally according to your North American or European standards.

But maybe the pizza in Ecuador is the way it is for a reason.. with its more liquidity and almost sweet tomato sauce… cause thats how the locals like it.

Its hard to know as a new-comer.

So all you can do is observe.

And to sell the locals something they already eat like crazy.

Its simply much easier.

Enter Papaya.

But there are two types of Papaya that grow in Ecuador.  The Hawaiian breed and the Criolla breed.  The Hawaiian is smaller and for export primarily, cause the locals don’t eat it.  (Actually, some consider it pig food.)

The Criolla is the gigantic rugby-ball-looking Papaya that is for local consumption only, not export, and boy do the locals love it.

Its truly one of those products where if you grow it they will come.

Papaya Criolla likes a dryer climate, while it can and does grow in the Amazon region its better grown in the coastal region of Ecuador.  Specifically in the areas of Santo Domingo to Independencia or on down to Quevedo.

In these ideal areas, the Papaya can grow without any formal irrigation system in place, its fine with just the natural rainfall in this area.

The Papaya is also best grown on flat or almost flat land.

In these areas land apt for Papaya production usually can be found starting around $3-6000 USD per hectare.  According to my local Papaya expert, 30-40 hcts is the minimum for a worthwhile, highly-profitable Papaya farm.

For today, lets take a closer look at the Papaya Criolla (lets give the locals what they already want).

The Papaya tree has a lifespan of 2 years.  It begins to give fruit at the 8 month mark.

And harvests from there are weekly.

The Costs

The initial costs of planting the crop and preparing the soil average around $4-5k per hectare.

After that, costs are minimal with this crop as for a farm of 40 hectares, all you need is one live-on full-time employee (who makes about $500 a month).  And about 5 part-time employees that from the time the plant begins to give fruit at the 8 month mark, you will need to hire them about 2 days a week paying each $15 a day to harvest, weed and fertilize the crop as needed.

It may also be a good idea, especially starting up, to hire a technician or agro-engineer with experience in the crop, to help manage the technical aspects of the farm.  For a full-time agro-engineer you are looking at minimum $1000 a month, but you could also hire one on a part-time basis.

The Production

Each hectare fits about 1100 Papaya trees.  About 100 of those are masculine and dont bear fruit and are used for future breeding purposes only.

Each tree during its lifespan gives at least 20 fruits, some can give as many as 30 if the care has been good.

Thats 20,000 fruits per hectare per each 2 year cycle.

The Sale and The Profit

The fruit sells wholesale at about $1 per fruit.

The fruit is an easy-sell and is often sold to the retail sellers at open-markets or directly to top-end restaurants.

Thinking in ballpark figures for busy people like yourself, thats $20k per hectare in brute sales over the course of a 2 year period.  According to my expert, the grower can expect about 40% of that is usually the profit for the farm owner.  Thats $8k per hect, every two years… so for a 40 hectare producing Papaya farm, that would be about $320k over a two year period or $160k per year, however youd like to look at it.


So even if you bought the land at the more conservative $6000 per hct for a 40 hct farm… for a total of $240,000 youd be able to realistically make that money back within a bit over 1 and 1/2 years.  Not bad.

This is certainly a product Im considering for my upcoming agro-investment here in Ecuador.

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Posted in Ecuador for Investors, Investor News/Analysis

Is Chicken farming in Ecuador really that profitable?

Ecuador is closing its borders.

To many imported products that is.

I don’t necessarily agree with it, but it is what it is.

Like it or not, with policies like this there are always a few “winners” and often a lot of “losers” (like the end consumer who now has to pay more for inferior products).

But why not take advantage of the opportunity and start producing one of the products that has now become more restricted to import?

Like Chickens.

Already, one of Ecuadors most popular short-cycle “cash crops” among locals.

It’s great because every 6-7 weeks you “cash out” recouping everything you’ve invested and the take-home-profit.

And its one of those produce it and someone will buy it things.

Everyone eats chicken in Ecuador.

This week I had the chance to sit down with a veteran chicken farm manager at his place during my research.

Here’s the skinny… 

Start up costs, Investment

One of the great things about chicken farming is the small amount of land comparatively you need to get started.  Plus, the land itself can be in the boonies and CHEAP because thats ideal for a chicken farm.  You want to distance yourself from any sizable populations or neighbors cause they may not be fond of the smell.

You’ll need a lot with at least space for one farm house big enough for a sizable population of chickens.  Most chicken farm houses are 20 meters by 120 meters to be precise.  Thats 2400 m squared of land.  Not much.

The lot has to be flat and have a water source.

But many chicken farmers have more than one farm house, for instance 7, with a batch of chickens each, so they can be harvesting a new batch each week providing a steady income so this business pays for itself.

Each farm house this size holds 20,000 chickens.

You can chicken farm about anywhere in Ecuador, but it is ideal in the warmer regions of Ecuador like the coastal lowlands.

In warmer weather the growth cycle shortens to 40-42 days, while in colder highland areas the cycle can be more around 50 days.


This business is also nice because its not labor-intensive.

You’ll have to pay one farm house keeper per farm house.  They usually make the basic wage in Ecuador ($340/ month PLUS incentives totaling around $800/month).

Every 6 weeks you’ll have to pay about 10 guys $10 a day each for three days to round up the chickens for sale.  Total $300.

The food can run around $7000 per cycle (6 cycle).

Basic services like water and electricity aren’t much in Ecuador but could also cost a few hundred dollars.

The chickens themselves are bought young and little at $.40-.50 cents each.

In total, budget $70,000 USD to raise 20,000 chickens my expert explains.

Income and Production

After 6 weeks the chickens are sold (alive) for $.80 cents per pound. Each chicken weighs around 5.5 pounds.  Total= $4.40 per chicken roughly.

$4.40 x 20,000 chickens = $88,000.


Talking in ballpark figures per farm house which holds 20,000 chickens over a lot of 2,400m2 the profit would be roughly $88,000-$70,000 TOTAL $18,000 every 6-7 weeks.

Then depending on personal preference anywhere from 5-15 days will be needed for farm house cleaning and disinfecting between cycles.


Of course, diseases are the biggest risk, thats why if you have multiple farm houses you want to spread them out and be sure to have only one farm worker exclusively per farm house.  He could carry a disease on his clothes from one house to the other.

But now a days the chickens come vaccinated and this is not a huge problem at all in Ecuador.

Selling the crop is not a problem, just make it and finding a buyer is relatively trivial.  What does vary a bit is the market price like most commodities.

Want more?

Like but what about the technical aspects of the actual chicken-growing, how to get started, buy the best chickens, find the best workers and more?

For that and more subscribe to my weekly Ecuador Insiders Newsletter below, you can unsubscribe at any time:

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Posted in Ecuador for Investors, Investor News/Analysis

A sneak peek into the rose business in Ecuador

Roses are big money here in the Andes.  

Both Ecuador and neighboring Colombia are deep in the business while flowers are chief exports.  

This week I had the chance to sit down with a 14-year vet rose farmer at his place during my research for my soon-to-be-released Insiders Guide to Agro-businesses in Ecuador.  

I’m also planning a little agro-investment of my own.  

Ecuador roses are considered higher quality than the ones grown in most countries because they were grown at a higher altitude giving them a natural longer-lasting shelf life.  

Grabbing his cup of tea, my friend began, “to start its much more profitable to buy comparable land and build your own farm from scratch.”

As most producing flower farms, if you can find one for sale, often go for a half million or more.  

Start up costs, Investment

But thats the kicker, if you know where (and how) to look, my friend states, you can find land ideal for flower growing for around $15-20k per hectare.  

And you’d need at least 3 hectares for the farm to be really profitable.  

Once you acquire the land, my friend continues, you’d need to invest about $60-70k per hectare to prepare the soil and build the greenhouses.

$15k x 3 = $45k PLUS $60k x 3 = $180k TOTAL $225k on the low end.

Income and Production

You’d then be able to fit 80,000 plants per hectare.  

And each plant gives one rose per every 3 months.  

The roses sell to importers in the USA for around $.25 cents per rose FOB wholesale.  Europe pays more, often offering around .35-.38 cents per rose.  

My friend continues, “but you have to time your production right to hit the predictable demand surges (and price upticks) around western holidays like Valentines Day.” 


My friend explains that organic fertilizers and other irrigation costs total about $1000 per hectare per month.  

Plus you need about 8 pickers per hectare making the basic Ecuador wage ($340/month each) and you’ll need one sales manager ($1200/month), one production/farm manager like him for ($1500/month), one secretary (minimum wage $340/month) and one export coordinator ($5-600/month)who is in charge of filing all the paperwork needing during exporting and getting the permits.


3 hectare farm= 240,000 plants= 240,000 roses every three months = 80,000 roses monthly sold at the lower USA importer price of $.25 a rose = $20,000 net income.  

Land and general production variable costs 3 hectares ($1000 per hectare per month) total=$3000 PLUS labor costs $1500+$1200+$600+$8500= $14,800

But with time as your retain the best pickers you can greatly reduce the number of pickers you need and reduce the labor cost even more if you manage your own sales.  

Total (conservative) estimated monthly profit projection of 3 hectare flower farm = $5200.  


There aren’t many risks to flower growing in Ecuador, that’s why its such a big industry.  

If there is a frost, it would only kill the flowers, not the plant, but this obviously isnt common in Ecuador where here on the equator you can bank on the climate being the same and predictable all year round.  

But unlike other crops in Ecuador where all you have to do is produce it and drop it off at the processor at the corner, and they’re guaranteed to take it, with roses you actually have to get out there and sell and hire a full-time sales manager or you could be left with unsold flowers on your hands.  

What about the technical aspect of the actual flower-growing part (which you know nothing about)?  

That’s what you hire a farm manager to do.  

So where’s best to find land ideal for flower farming and the best farm managers?  

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Posted in Ecuador for Investors, Investor News/Analysis

The ONLY type of hotel I’d put in Cuenca

I get it all the time.

People know I’m in the hotel biz…

…and they tell me they have a property and are thinking about putting a hotel in Cuenca.

But truth is, I would NOT put a hotel in Cuenca, except for one type.

You see, Cuenca is already loaded with good hotels, and they’re cheap!

An acceptable option at $10-15 per person per night can be found quite quickly.

The type of hotel I’d put in Cuenca is an apart-hotel.

The difference is the rooms will often be mini-apartments with at least two different ambiances, a living/cooking area and the bedroom.

Unlike normal hotels the rooms have a kitchen or place to cook as most people would get tired of eating in the street for weeks on end.

And they are meant for longer stays.

Usually a few weeks, maybe a few months at a time with of course special weekly and monthly rates.

And they often serve as a “half-way” home for folks who recently arrive in Cuenca and begin the search for their permanent home.

An apart-hotel is a great option for people because agreeing to rent something long-term before they arrive and see it is a big mistake.

Best to look around once here.

And at least initially its nice to take advantage of a few of the services of a hotel like an attentive, knowledgable front desk staff, laundry service and WIFI Internet from day one yet still be able to cook for yourself and enjoy the privacy of your own place as you get your feet wet in a new country.

You could even sell off the individual suites to private owners and continue to manage them and rent them out in a property-manager-type role.

The really neat thing is you could promote it as both a hotel and a condo rental.

There are already a few of these type hotels that exist in Cuenca, but I’ve seen the demand in the area to justify another well-located good one.

More so by far than anywhere else in Ecuador, a lot of expats are moving to Cuenca.

That’s the hospitality niche I’d attack in Cuenca.

Any takers?

You can count me in.

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Sold! Montanita beach house: from $15 to $45k

“There it is.” I said as I signed the sales deed this week.

I sold my 4 bedroom, 3 bath beach house near Montanita for $45k.

The same one I bought entering 2012 for $15k.

Once I bought the property I put about $2k into it to clean it out and lightly furnish it with the basics being a stove and a few plates, a mini-fridge and a few beds.

The idea was to rent it as a budget short term rental and keep it as my own weekend getaway when I lived in hot, humid, muggy Guayaquil.

After 3 months or so of owning the property someone who had rented the property offered me $40k to buy it.

I mistakingly turned it down.

Meanwhile, I quickly discovered there was a huge demand in that area of the coast for inexpensive rentals in the $300-450 a month range.

In 2012 I kept it rented about 90% of time.

So much so in late 2012 I decided to build two one-bedroom one-bath beach bungalows on the same property, all with a nice oceanview and a 30 minute walk from the center of Montanita.  A pre-fabricated wooden one for a total with furnishings of around $4500, and a brick/bamboo bungalow for around $6500.  They both rented well, the brick/bamboo one more so, for around $230 a month each.

Both were done building in about a month.

Then in early 2013 I decided to put the property for sale for $60k because a friend of mine in the area said the area was hot and that I could get $80k.

I did start to notice the influx of foreigners in my tiny little town next to Montanita (Manglaralto) and the building going on all around me.

Plus, the towns streets had just been paved.

I chose not to work with any realtors, just post it online myself.

And after a few months I didn’t get any bites, so I decided to take the property off the market as I didn’t really want to sell it at the time anyway.

But after moving to Quito, as my business grew in 2013, I had less and less time to manage the rental from a distance.

The property deteriorated and became harder to rent.

Often 6-8 months would pass between visits from myself.

Then in December of 2013, i decided to repost the property online for sale, this time for $45k.

And within two days I had several interested folks, one foreigner that lived in aother part of Ecuador called so worried I would sell it he gave me a deposit of $250 just to hold it til the weekend so he could make it over to see the place.

I believe the increased interest this time around had to do with both the lesser price and the time of year, right at the beginning of high season on the coast when most other folks take their properties offline.

But when he actually saw the place he wasn’t impressed.

You see, it is an Ecuadorian-made very simple dwelling, needs work, and certainly not up to most Americans standards.

He passed.

But I continued to get a lot of interest and several people a week wrote and visited the property with my caretaker.

In the meantime, I got a few low-ball offers but finally in the third month I had the property for sale (March 2014) I got a call from a real estate agent in Montanita saying he had an interested buyer.

He worked as a buyers agent and was charging the buyer 5% commission but not charging me.

The person from the US visited the property several times over the next few days and made the offer for my full asking price.  I took it, he deposited $1500 as an earnest deposit.

I then went to the coast after he had already left back to the States to sign the deed to close the sale.  His agent took care of the rest and paid the necessary taxes.

The buyer then wired the rest to my account.

The closing took about two weeks.

Done deal.

Besides what i made renting the property, I made roughly $15-16k off the sale.

Not bad, but I could have made more if I wouldn’t have made the following mistakes…

1. Understand properties in Ecuador (a cash economy), especially higher priced ones, usually (but not always) take a long time to sell.

2. I should not have added the bungalows to the property as they didnt do much for the property value.

3. Don’t get emotionally attached to a property, it should always be for sale from the moment you acquire it for the right price.

4. I should have used local real estate agents from the beginning as it pays to have a salesmen showing the house instead of my older caretaker.

5. Don’t try to do too much with a basic coastal-Ecuadorian (boxy) construction, it is what it is, the only way to make it really nice is to level it and start new.

Other interesting things I learned from owning this property…

– A lot of people like sleeping near a tourist hot spot like Montanita but not right in it.

– As mentioned previously, there is A LOT of demand from foreigners for cheaper rentals on the coast as the properties available go from really cheap and generally unacceptable for foreigners to expensive places over $800 a month.

– There is a MUCH higher demand for rentals on the coast of Ecuador in the North American winter months from late December to early April compared to the rent of the year.

– You can charge a lot more than usual during long weekends and holidays in Ecuador if you market to Ecuadorians.

– Ecuadorians look for rentals with caretakers for security, TVs and Air Conditioning while foreign renters prefer privacy (no onsite caretaker) and NEED WIFI Internet while a TV and AC are not so important.

– It would have paid to have a caretaker that speaks English to help the tenants settle in.

– If possible, it pays to market to foreigners already living somewhere in Ecuador, as most foreigners still in their home countries are generally tire kickers.

– The best way to market your property to Ecuadorians is still the areas Sundaypaper.

So, what’s next?

Another property purchase i’m sure, but probably on the coast of Ecuador as I still think the best deals for flipping are there.

Stay tuned!

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Posted in Ecuador for Investors, Investor News/Analysis

Who pays what in an Ecuador real estate transaction


This week I was involved in an Ecuador real estate transaction.

More on that in my next email.

But it reminded me of something very important to know before you buy property in Ecuador.

To know who typically pays what in a standard Ecuador real property transaction as it may differ from your home country.

Often a foreign buyer will get stuck with paying the whole damn thang because they just didn´t know otherwise.

Typically in Ecuador, unless previously negotiated, the buyer pays all the fees associated with drawing up the new deed and getting it notarized, then registered in the property registrar (escritura y registro en el registro de la propiedad).

The buyer will also pay the tax to the municipal called ALCABALAS.

The seller is expected to pay all past due annual property taxes (PREDIOS) and get the property current.

The seller is also expected to pay the capital gains tax called PLUSVALIA which is calculated based on the official assessed value from when the seller bought the property to when he sells it (not based on actual purchase price).

The seller is also expected to provide proof all the energy and water bills are current.

This is how most local Ecuadorians do it.

Now you know so you don´t get stuck footing the whole bill as the buyer, cause they will lay it to you if they see you don´t know!

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An Insiders take of the restaurant biz in Ecuador

Something about Ecuador ignites the entrepreneur in all of us.

As my Ecuadorian mentor once told me, “people in Ecuador are more entrepreneurial than in a country like the US because they have to be, there are less decent employment options so you got to employ yourself. ”

I´d agree.

And this week, I´m going to interview my good friend Amir, who moved to Ecuador last year from Canada, and has since started a pizzeria in the Quito (Cumbaya) area.

I met him when he was a new arrival “right off the boat”, if you will.

Enter Amir… 

Amir, tell us about your restaurant?

Sure, the name is MegaPizza and we serve top-notch Italian-Canadian cuisine like pizza, putin, salads, subs, wings and more at reasonable Ecuadorian-style prices.  Specifically, we’ve got the best subs and pizza in all of Ecuador (Note from Domenick: I’d agree.).  The restaurant is right between the main park of Cumbaya and the San Francisco University in one of the top restaurant districts of Quito.

So Amir, why’d you choose Ecuador for living and your business?

Well, its warmer than Montreal, residency is pretty easy, taxes and rent are low comparatively and so are most of the costs of living.  In Canada it was too pricey to start my own place.  A restaurant like mine would rent for $4000 or more per month, utility bills would be several hundred dollars a month and employee costs would be several thousand a month.  In Ecuador, rent, utilities and employee costs are dirt cheap and you don’t have to worry so much about peripheal costs like insurance while at the same time I’m still charging about the same as i would in Canada for my product.

Why’d you choose Cumbaya for your pizzeria?

I like the warmer climate when compared to nearby Quito (30 minutes away) and it is an affluent neighborhood and lots of residences ideal for delivery.

What were your biggest challenges when starting and running the business?  

The biggest challenge was finding a good place to rent for the business.  It took several months of checking the Internet ads in Spanish, the newspaper and driving around scouting out areas.  A lot of decent places that were available were offered not by the land owner but by the restaurant owner who wished to sell you their business, furniture and lease, often for upwards of $60k or more.  When I already knew the business and knew what I wanted to do i was not interested in buying someone elses know-how and used equipment and furniture.

Finally, we found a large empty locale and inquired with the caretaker and found out it was available, it had no sign, thats how you can often find the best deals in Ecuador.

Also, obviously communication was an issue cause I don’t speak Spanish well.  I took a one-on-one class in Quito for about two months when I first arrived for $6 an hour and that has helped a lot.

What are the lease terms like for your restaurant in Ecuador?

Well, my lease is for one year only with a security deposit equal to one months rent.  The rent is $1500 a month.  The locale has about 6 parking spaces and 90m2 of dining area plus an outdoor patio with capacity for about 50 people (about 15 tables).

Where’d you find your kitchen equipment and furniture needed for the restaurant at the best value?  

Honestly, searching on the Internet in Spanish helped a lot. I knew what I needed cause I worked for many years as an employee of top restaurants in Montreal.  I found one distributor online in Ecuador where I bought most of my kitchen equipment PROMAINEC.  For instance, we bought all new stuff… a 2 door industrial fridge was $2200, the pizza oven $1700, the dough maker $1200, and the stove-grill-hotplate all in one from the LOZADA store in Quito was $1200.

The wooden tables and chairs were ordered custom maid by a local carpenter, they came to $36 for each table and $40 for each chair with a seat cushion built in.  Those were the best prices we could find, it was much better than buying ready made tables and chairs from a place like Megamaxi or Mi Comisariato.

What was the total investment to get your restaurant up and running from scratch?  

Including the security deposit for the lease, about $20,000 USD.

Where the permits difficult to attain?  What permits are needed for us newbies to the business in Ecuador?  

Actually, this part was very easy in Ecuador.  It all starts with the SRI (the IRS tax agency in Ecuador).  You need to get a RUC or tax ID number (free).  Once you have that you need to go to the IEPI or Institute that copyrights Intellectual property in Ecuador to register your company name and logo ($115).  Then you have to go the Municipal and apply for your LUAE or license to operate.  After application they will send inspectors to pass your business, first the firemen (bomberos) and then the health department (salud) and Secretary of Tourism.  After passing the inspections you can pay your annual Municipal patent (patente municipal) (varies by business type and location, around $100-250 annually).  A special license to sell liquor does not seem to be necessary in Ecuador from what we have gathered (we’re still confirming this one).

Where do you source your ingredients and food?  Whats cheaper and whats more expensive compared to Canada?

This part was more tricky in Ecuador than in Canada where one phone call can get you everything you need within a few hours.  The big things like flour and cheese we buy in bulk from distributors we found online.  We had to test the quality of several before we found ones we like.  The prices of things like pizza boxes varied greatly so shop around before you commit.  We often would take the phone numbers of the distributors off the labels of the products in the supermarket chains.  We’d stop the trucks delivering supplies and drinks to stores in the street.  The little things like jalapenos can only be found in the top-end supermarkets like Supermaxi, so we buy those there.

Chicken and fresh produce vegetables are much cheaper in Ecuador than in Canada.

Some things are more expensive in Ecuador, like pepperoni which is $5/kg in Canada while $13/kg in Ecuador.  Some things are cheaper like cheese which is $22/kg in Canada while $7/kg in Ecuador.

What are some interesting things you’ve learned about selling food to Ecuadorians?

Ecuadorians don’t drink much coffee compared to North Americans.  They love hot sauce.  And they’re surprised by all the different pasta options we offer like tomato, pesto and alfredo sauces, but in a pizza shop they usually ignore our fringe offerings and go right for the pizza.

How did you find your staff?  

Well, my friend and I started the business, we are the cooks for now, and my friends brother moved to Ecuador as well to help out.  We hired one waitress to attend the clients and answer the phones (since we dont speak much Spanish).  We pay her $400 a month plus tips which is a bit over the minimum wage in Ecuador for a full-time 40 hour a week employee.  We found her quickly by placing a classfied ad in the Quito Sunday newspaper.

What are your profit margins like for the food you sell?  

Well, if you don’t count the fixed costs like rent and so forth , just taking into the account what we pay for the food itself and what we sell it for the profit is about 70%.  That number can get higher if we sell more and are able to buy in bigger bulk.

How much do you sell on a good day?

Our goal based on our price level, roughly $8 a meal, and restaurant capacity is to sell $40 per table for a total of $1000 of sales per day.  That is a good day for us.

Any other tips for a new restaurant owner wannabe in Ecuador?  

Sure, the cost of living and rent in Ecuador is cheap compared to a place like Canada so take your time to find a good location, it could take several months of searching, don’t kid yourself with an average location, you win before you begin.

How can we learn more about your restaurant or give it a shot ourselves?

Check our our Facebook page MegaPizza Cumbaya to see pics of our food, we are right on the corner of Orellana y Chimborazo in Cumbaya or call 02-603-9983 for more on how to arrive, obviously, we speak English, open 7 days a week.  And on Monday nights we have EXPAT NIGHT from 6-10PM where if you show a foreign passport you get a free beer or beverage of your choice with any meal purchase.

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Posted in Ecuador for Investors, Investor News/Analysis

The dirt on Cotacachi, Ecuador: March 2014 Market Report

This week I had the pleasure to interview Olga Plavidal, one of the most knowledgable people I know on the Cotacachi real estate market.

Cotacachi is a small mountainous community a few hours north of Quito, and 15 minutes from Otavalo, which has experienced quite an influx of North American expats in recent years due to many factors like its healthy lifestyle, low costs and mild, comfortably warm year-round climate.  For me, its one of those few places in the world, and even in Ecuador, where you really don´t need heat or AC in your home and you re still comfortable.  Rare.

So lets turn to the local expert on the ground to get the dirt on whats really going on in early 2014…

Enter Olga.

1.    Why did you choose Cotacachi?  

–       I came to Ecuador 3 years ago, stayed in Quito for a month and was making short trips to various destinations. When I came to Cotacachi for a day trip, my soul whispered me: ‘That’s it, darling, that’s your home…’ Some places looked like from the fairy tales to me!

I’ve been captured by the beauty and the cleanness of the town. Every morning the owners of the stores wash the pavement in front of her/his business with soap (!) They beautify their exteriors with flowers. People are very friendly and they greet you on the streets even if they don’t know you. Gorgeous views of 2 volcanoes of Cotacachi and Imbabura and the stable climate, like May time all year round. Even at the rainy season we have just occasional showers in the afternoon and over the night. Hardly ever until the afternoon.

2. What do some expats complain about in Cotacachi?  Or why some folks decide not to stay in the area?  

–       Some foods are not available that you’ve used to – but use your creative juices and find the alternatives, lots of them! Probably, not too many things to do, as they might think. However, we have lots of activities here now; new businesses are popping up and many volunteer activities as well. But it’s everybody’s choice if they just want to stroll from one restaurant to another and gossip on everything, or to get pro-active in many new opportunities that we have to offer now. Many business opportunities are still not here. You chose this country to live in. Get creative and go for your dream! Turn your hobby into a new venture and create the lifestyle that you desire!

3. What are current market prices like in the different areas of the town and for different types of property and the per meter price of vacant land in the area? 

–       Depends on the area. Closer to the center, the higher the price, of course. The typical Ecuadorean house, not the new one, can be around $250-300 per m2, while the new construction in the gated community can run up to $750 per m2. You pay for what you get – quality of construction and finishing materials, security of the gated community, etc.

The land is the same – the closer to the center – the higher the price. $40-50 per m2 closer to the center and smaller lots, and can be $15-17 per m2 just outside the town for the bigger acreage. Again, it all depends on the location, neighborhood, views, size, and many other aspects to consider.
4. How has the market performed over the last year?  over the last 3 yrs?  over the last 5 yrs? 

–       It’s steady growth of about 15% a year, the more people get to learn about Ecuador, the more they come here. The property prices have tripled here in the last 3-5 years. They will be still growing, but there’s still a great chance to get them cheaper than in the US or Canada. Also, please consider that you don’t have to pay cooling or heating humongous prices, property taxes for most of the properties are under $100 a year (!). Also, what you pay for food, services and some other things are incomparably cheaper that in the US and Canada. You have to weigh all this on your scale and don’t just look at the property prices, but rather the whole picture of your monthly spending here. You know it yourself that you can live here comfortably under $1,000 a month, even renting a modest property, or under $500 if you own it.

5. Do you see any notable tendencies in the local real estate market?  

–       I sure do. More people are looking now into income producing properties, businesses to support them in case there will be some political changes, affecting their lifestyles. They are looking mostly for B&B’s, restaurants, farms and agricultural land. However, there are still quite a few folks who’ve built their nest-egg, sold their property back at home and want a nice comfortable home to live here peacefully.

6. Where in the city is best for an expat to invest and where are some areas to avoid?

–       To avoid is definitely the areas out of the city, where the Indigenous communities are occupying. If you decide to live in one of those communities, you should be really adaptable to their lifestyle and culture. Otherwise, the whole city of Cotacachi is not so big, let me know your desires and I’ll do my best to assist you in finding the best place for you!

7. For someone looking to invest in a rental property, what would you advise them and what type if property should they buy and where to keep it rented?

–       Most of the folks are looking to rent in the center of Cotacachi, a few minutes walk to the center. It’s easier to rent it out. Inexpensive, maybe Ecuadorean style home with all the basic furniture. Many renters want it for a short period of time, up to a month or a bit more, so that accommodate them, as it’s cheaper then hotel and gives them more privacy.

8.  What are the prices of nearby farm land and what types of crops are most common in the region?

–       The most common crops here are corn and beans, avocado trees are abundant as well, lemons and oranges grow well here, tree tomatoes (it’s a local fruit), potatoes, tomatoes, cucumbers, lettuce, cabbage – so many things, this soil is so rich, I think that whatever you stick in it, will start popping up J

Prices can be very different, depending on the location and the size of the land. $1-10 per m2.

9.  What other opportunities do you see for investors in your area?  In other words, what would you do with $100-200k in your area right now?

–       I’d buy some good rental property that will bring some good ROI. Also, land for development or a good inexpensive land for agriculture. No matter what the future holds for us, people will always need the place to live and the food to eat.

10.  For renters, what are the average rental prices looking like?  What are the normal rental terms?  

–       Depends on where and what you rent. Gated communities can be $600-1,000 a month, all furnished and really nice. But you can find a small local Ecuadoreans apartments for $100 unfurnished, or a bit more furnished. All depends on your choice of lifestyle and budget. My friend rents now a 1 bedroom furnished apartment with a good size kitchen, full bathroom for $200 a month. Please, don’t ask me for rentals, I usually don’t do them.

11. What’s one thing most people don’t know about Cotacachi?

Gee, Dom! That’s a big one! Please don’t limit me on that one! Let me list some of them, at least:

–       You’ll pay for anywhere going in taxi in Cotacachi just $1, don’t even ask the driver ‘how much’, it’s just a buck, wherever you go. Can be $1.25 or even $1.50 if this is 5-10 minutes to the properties that are a bit out of town, Like Yana Pamba, El Batan, Jahua Pacha.

–       You can have a really nice lunch in a local restaurant, if you ask for ‘almuerza’, not going for ‘a la carte’, which is from the menu. Just from $1.75 in many little  local places, at the food court/bus terminal as well, to a fancy ‘La Tourista’ on Bolivar street for $3.50 – awesome! Just don’t forget the magic word ‘almuerza’, write it down now, or they will bring you ‘Menu del Dia’ and will charge you twice for a little bitty added to it.

–       Do you know that you can drink the water from the tap? Yes, it’s safe! It comes from the Cotacachi volcano and goes through the purifying facility here in Cota, and straight to our homes.

Thank you, Dom for interviewing me, hope that will help some nice folks to get some better ideas about living here.

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Posted in Ecuador for Investors, Investor News/Analysis

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