Buying Communal Land without Papers

The “spread” is getting bigger.

In other words, the difference between the lowest-priced and highest-priced properties in the same areas is getting larger, save for some very renowned building companies which are reputed to sell house and land packages at a reasonable price.

That’s the first thing I noticed this week as I began my newest property search on the coast of Ecuador. For instance, in the area I was looking near Olon on the southern coast, one land for sale, a 270 sq. meter lot with a three story wooden house, right on the beach, was for sale for $500,000. Yet in the same area, one block back, I found a nice 220 sq. meter vacant lot for $30,000, meeting my current budget.

Good location with an ocean view from the second story of a house if I were to build one. Great, quick resell value, especially if I constructed a house… creating instant equity…the problem… the property has been in the same owner’s family for decades, and the owner himself has never bothered to do the legal paperwork to get the official deed/title to the property. A common problem of the best deals in Ecuador.

You see, the smaller communities in Ecuador are run by “comunas” or local governments that control local matters including property sales and zoning.

So half my morning one day this week was spent sitting in a local “comuna” or local community administration office talking to the president of the “comuna”.

He explained to us the process of legalizing the property. First, the current owner has to register himself as part of the “comuna” which costs $20 annually and needs to be passed by the board which could take up to 15 days. Then, almost immediately… because the owner is well known in the community… he’ll get issued an official “Right of Possession from the Comuna”. Then, the sale can be made. And with that “Right of Possession” the new owner can go to the Municipal’s office in Salinas, the capital of the province, and apply for and get the office deed/title. Of course, the local “comuna” will ask for a few thousand dollars in transfer fees… a glorified kickback.

The whole process is NOT a sure thing, but in this case may be worth the risk, just be sure not to give any deposit money until the papers are in order, and use a local lawyer when in doubt!

Additionally, the current owner is a local fishermen who’s never used a computer and doesn’t seem too motivated to see the process through… so, I think I’m going to have to keep searching, and we’ll see what happens by next week.

The stakes are rising! Big money is to be made if you know how to look for property in Ecuador like a local, which I cover in depth in my buyer’s guide, see more here… https://63s.e69.myftpupload.com/SalesInsiderGuide.html

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Low Balling Offers Like a Local

This past week I began my property hunt here in Ecuador… with a $30k budget.

I did quickly notice prices have risen a bit since I last looked in 2009, but desirable properties under $50k can still be found. In fact, it only took me a couple days to find some very interesting buys (more on that in next weeks newsletter).

But this week, while property hunting with a friend of mine who has a much larger budget than me, I witnessed something astonishing.

We found a small hotel for sale on the coast. We sat down with the owner, a young Ecuadorian girl married to a Foreigner. During our conversation she mentioned the asking price was $500,000.

A few days later my friend (as I was sitting by his side) emailed his offer to her, $135,000. And to my surprise, the owner received the offer very warmly, responded quickly and was very close to accepting, I believe my friend will up a bit to $150 or $175k and it just may do the trick.

Which serves for a very important lesson this week! In Ecuador, asking prices are HIGHLY negotiable, and its not uncommon people offer from 25% of what is being asked. This kind of stuff never ceases to amaze me but this is how it really is down here in Latin America. Gotta love it!

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Local in Manta Gets 20 Years for Killing a Foreigner

A Local of Manta got sentenced to 20 Years in prison for killing a foreigner on November 3, 2009 as reported this week by the Universo.

I’ve personally felt nothing but warmly welcome in my time here in Ecuador but it is important not to get mixed up in the wrong crowd, wherever in the world you are.

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Cotacachi Property Management Companies

For a complete list of Cotacachi Property Management Companies please see our directory of real estate professionals here.

To suggest any new Cotacachi Realty Management Companies to be included in the directory please use our contact form and we’ll respond within one business day, thank you.

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Vilcabamba Property Management Companies

For a complete list of Vilcabamba Property Management Companies please see our directory of real estate professionals here.

To suggest any new Vilcabamba Property Management Companies to be included in the directory please use our contact form and we’ll respond within one business day, thank you.

To stay in-the-know on all the latest news any savvy investor NEEDS to know before they invest in Ecuador, sign up for my weekly Ecuador Insider’s newsletter below, free! You can unsubscribe at any time:

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