Category: Ecuador for Investors

I hear it all the time.

“I don’t like the heat and humidity of the coast of Ecuador but frankly, Cuenca is too damn cold.”

I know, I understand.

I usually respond just like I did in my last email… “A lot of people try to push Cuenca as “eternal spring” but actually it’s more like eternal ‘late fall’ “.

Now, I’ve lived in places with true eternal spring-like weather.

Example, Hawaii and Medellin, Colombia.

You know, places that have constant year-round weather where you can walk outside with a t-shirt and shorts and not even think about the temperature cause you are neither hot nor cold.

The problem with Medellin? It rains too much.

The problem with Hawaii? Not much, but if you press me I’d say it’s too expensive and many locals really don’t like “outsiders” or people not from Hawaii even though the ones that work in tourism well try to hide it.

In fact, Ecuador does have places with eternal spring-like weather.

Places just high enough to avoid the muggyness, mosquitos and humidity of the coast while not being as high as Cuenca or Quito.

One such place is one you’ve never heard mentioned before.

Zaruma.

Zaruma is a cozy town of about 20,000 folks built into a cliffside with a wooden-spanish-colonial style old town surrounded by lush slopes of coffee plantations in southern Ecuador about 3 hours from Machala, 4 hours from Loja and 6 hours from Guayaquil.

The town was founded hundreds of years ago by ambitious miners in search of gold.

Further downstream the mines still run rich, but up in Zaruma the mining has stopped.

All that’s left is a stunning, little, undiscovered place to live.

The town is perched at an elevation of 1200 meters (3937 feet(about half the elevation of Cuenca)) and the year round temperature hovers around 22 degrees C (72 F) and drops just a bit cooler than that at night so you can sleep comfortably with a blanket over you (no AC or heat needed!).

The nearest airport is Santa Rosa, about 1 1/2 to 2 hours by car away.

Most the locals shop in the fresh produce market right in the middle of town and get their bare necessities from the little street stores that dot the town.

The town has a free, public hospital that is known for having good service.

The locals are friendly and quick to strike up a conversation with one of the few foreigners in town.

Within Ecuador, Zaruma has a great rep for it’s amazing coffee, particularly beautiful people and sweets.

Rents for a 2 bedroom house/apartment just outside the old town start around $150-300/month and plate lunches start around $2.

A local specialty is the TIGRILLO, a breakfast dish made of mashed plantanes, cheese and eggs.

A cool thing many visitors do is take a guided tour of the town gold mine, now extinct, it was an actual mine for hundreds of years and the tour is done by an actual miner and is very informative (and free!).

I’d stay in the Cerro de Oro Hotel in the town center, nice, clean rooms for only $10 per person. Ask for a room on the top floor for some spectacular mountain views but watch your head on the way up the stairs. Any taxi in town knows where it is and can take you for $1.

Buy your coffee at the local distributor, an 80+ year old man with a great sense of humor, Don Marcelo Valverde, he has his shop in the town center, just ask around for the “tienda de Don Marcelo” and folks can point you the way.

The only negatives of the town I see at this point for expats wanting to take residence are the distance to a major city and the fairly steep town roads.

Foreigners? Not many, yet.

There you have it, one mountain town in Ecuador with a steady, warm-yet-comfortable climate year-round.

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Here are a few pics from a recent trip I made to Zaruma Ecuador.

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Opps.

I let the cat out the bag on this one.

Don’t get me wrong.

I like Cuenca. It’s a nice place that’s attracting a lot of expats.

But…the world’s top retirement destination?

Child, please.

Are you outta your freakin’ mind?

It’s not even the top destination for retirees in Ecuador.

It was obviously chosen by people who’ve visited maybe a couple spots in Ecuador and who are interested in primarily selling seminars.

Let’s examine Cuenca further:

Climate: Forget eternal spring, I’d call Cuenca weather more like “eternal late fall”. It’s chilly, especially at night with lows in the mid 40s F, yet its just warm enough so that most dwellings don’t have heat, making many places indoors downright …cold! And it rains a lot too, and it’s more humid than the high elevation (8400 ft above sea level) would predict.

Cost of living/ Real estate: Yes, food is cheap like all over Ecuador with multi-course lunches starting around $2, taxi rides start at $1-3, bus rides $.25, 2 bedroom condo rentals start around $250/month, BUT due to several factors real estate in Cuenca is notably more expensive than most other places in Ecuador.

Food: Whenever “guinea pig” is a local staple, you know you’re in trouble. Hands down the variety of seafood and even the BBQ meats on the coast of Ecuador beat the local eats in Cuenca… any day of the week!

Local people: The local “Cuencanos” are friendly to foreigners, no doubt about it, but with so many foreigners around, most locals are de-sensitized and are really quite neutral to the sight of a foreigner. Being a foreigner alone won’t win you any brownie points like it does in other areas of Ecuador and the world where foreigners are a rare sight. But at least foreigners aren’t frowned upon. Ecuadorians as a whole are friendly, laid back people.

Old town/ Spanish colonial architecture: The Cuenca old town is OK, but it can’t compete when compared to the old towns I’ve seen in Cartagena (CO), Guanajuanto (MX), Colonia (Uruguay), Santo Domingo (DR), or even Quito.

Health care: Its a bit more pricey than the healthcare service in nearby Loja, and the variety of services offered is better in Guayaquil or Quito.

For singles: For single guys, its hard to beat Guayaquil, it just is, trust me on that one. For single women (and gay men), I’ve heard Manta, Guayaquil and Machala have some of the countries best looking and most enjoyable men.

Crime: While notably more safe than the other two big cities in Ecuador (Quito and Guayaquil), it’s still not quite as safe as the smaller towns in Ecuador if this is really important to you. Remember Ecuador outlaws guns so gun violence is a rare sight anywhere.

Cultural events/nightlife: For cultural events like classic music concerts and plays, Loja beats Cuenca. But if I got the chance, I’d trade both for Le Reve Vegas show tickets. For pure raucous nightlife, Quito and Guayaquil beat Cuenca once again any day of the week.

Expat community: If you’d like to be around a lot of other expats, Cuenca has built the largest expat community in Ecuador (rumored to be between 3-5,000 permanent residents) but there are also significant expat communities in Salinas, Manta, Cotacachi and Quito. But none are yet to the levels of hot spots in Mexico like in San Miguel.

Business opportunity: For businesses focused on selling products or services to expats it’s hard to beat Cuenca due to the large flow currently coming to the area on a daily basis, heck, I might even put a business there soon, but overall, coastal Ecuadorians are known to be more “free-spenders” than their highland counterparts and boy does the coast still need about, well… everything.

Overall: Unless you’re looking for a larger, established expat scene, Cuenca can easily be beat in all the categories listed above by other spots in Ecuador.

It’s overrated.

In fact, in my next letter I’ll share one unknown, alternative destination in Ecuador that has most of the benefits Cuenca has but with a true warmer-yet-not-too-warm eternal-spring like climate. To get it sign up for my list below, you can unsubscribe at any time:

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Most expats in Ecuador don’t own cars.

It’s just a fact that with all the cheap/frequent public transport having a car is not a “necessity” just merely a “luxury”.

But several expats, maybe you too, shy away from buying a car cause they don’t really understand the process of both purchasing a vehicle and what’s needed to drive in Ecuador.

But it’s nothing to fear and actually not that complicated.

Related article: Lyft And Uber Accidents In Texas – Who Is Liable?

The process to buy a car in Ecuador: 

After agreeing to terms with the seller, you’re going to want to check their registration card (Matricula).  On it there will be the name of the owner and the VIN of the car.  Verify the vin by popping the hod of the car and physically checking and verify the owner by having him show you his Ecuadorian ID card (cedula) or passport.

Many in Ecuador buy and sell cars and thus are selling a car that is not in their name, all they have is an open contract from the previous owner that they are waiting to put the new buyer’s name on and a copy of the previous owners “cedula”.

I recommend only buying a car from the person that is the registered owner.

You can then run a check to see if the car has any unpaid leins against it or outstanding fines through the website of the DMV of Ecuador called the ANT, http://www.ant.gob.ec/index.php/consulta-de-multas AND through the website of the National Police http://www.policiaecuador.gob.ec/index.php?id=infracciones_de_transito .

All you need is the plate number of the car to do the search.

To double check you can also go to the office of the JEFATURA DE TRANSITO in your town and verify the car is really owned by the person appearing as the owner on the matricula they are showing.

With the plate number you can also check to see if the car is stolen online here.  http://www.policiaecuador.gob.ec/index.php?id=vehiculos_robados

If everything checks out and you’d like to continue with the purchase the next step is to write up the sales contract and get it notarized.  Notaries usually charge around $50 for this service.

Once you have the notarized bill of sale you can take it to the nearest SRI office (the Ecuadorian IRS) and pay the 1% transfer tax based on the value of the vehicle to put it in your name on both a national and police level.

The last step would be to go and register the car in your name in the DMV of Ecuador (ANT or COMISION DE TRANSITO).  But if the car still has a bit of time left on the current registration (you need to renew once a year) you can drive with your license (from any country), the notarized bill of sale and the registration (matricula) which is not yet in your name but still current just fine until the current registration expires, according to the Ecuadorian police.  Registration costs around $150 annually.

You will also need to make sure the car has the basic liability insurance paid required by law (the SOAT).  The SOAT insures all the medical costs people involved in a car accident may have.

What it does not cover are the cars involved.  For example, the cost of the SOAT for an $11,000 car in 2013 is $27 for one year of coverage.

Private companies like Generali also provide more comprehensive car insurance in Ecuador.  For example, to insure an $11,000 car full coverage runs about $450 annually.

So to recap, whenever you drive in Ecuador you will need to bring your license from any country, your matricula card of the car you are driving (registration), and have the SOAT card on hand.  And if the matricula is not in your name you’ll want to have the notarized bill of sale or the rental contract in the car as well.

Now, to learn the buying process of a house or property in Ecuador be sure to sign up below now:

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