Capital investment in Colombia?????

tigredelnorte says on Jun 25, 2005, 09:33:

Economics 101 Person A arrives in Country B with money. Person A invests money in Country B. Wealth is transfered from person A's country of origin to country B. For example Person A has a house built. Local workers are required to build this house. Local business sell materials to build this house. Local business needs to hire more people to take care of new clients. Are you starting to get the picture? Local workers, new clients = reduced unemployment. Local business = cash flow in country goes up. Is Colombia a communist country?

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Michael_B says on Jun 25, 2005, 11:38:

Thanks Boomer Boomer, we can appreciate your concern for the people of Colombia as I believe that most of us here feel the same way to some extent. But next time is it possable to do so without the name calling, it feeds the trolls like we used to have here also my 12 year old daughter likes to read PBH also. Thanks

I have just turned 50 years old and mi esposa is a Caliena, we are coming back down to Cali for vacation in August. One of the things we wish to accomplish this trip it to either find a home to buy or a home site in South Cali that we can begin to build within the next 2-3 years. I am not looking to make money on this, I would like to have the house paid for when I retire at 62. I wish to retire in Colombia. One of the things that my wife recently found out is that if we pay to their state run retirement system $ 150.00 a month she will be able to draw approx 2.5 million CP per month at retirement age, which for women in Colombia is 55.
My question is, does anyone think that this is a bad risk at this time or should I invest my money here(in USA) and buy later? Thoughts ?

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Mr. Hollywood says on Jun 25, 2005, 11:57:

You're not thinking very clearly, boomer A couple quick observations, Boomer:

1. Most of the money driving real estate inflation in Colombia is the money of Colombians who fled the country for safety reasons finally coming home. Are you going to begrudge Colombians the right to return to their country and buy houses?

2. The very small bit of real estate investment being done by Euros and Americans is at the very top end of the market. The 50% of poor Colombians don't really care of an oceanfront condo in Cartagena costs 100 million pesos or 800 million pesos. It's like worrying about real estate prices on Park Avenue or in Beverly Hills somehow impacting the poor people in the US. And my heart doesn't really burst with sadness that suddenly rich Colombians have to compete with outsiders for these luxury properties. They stand to benefit way more from the country being perceived as safe and stable, if it ever comes to that.

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DonkeyDust says on Jun 25, 2005, 12:16:

colombia may be poor because not many want to invest here. Boomer:
I live in Vancouver BC. It is very desirable place for people with money and not to live.

For people with money because it is a great place for so many reasons.
For people with NOT MUCH money because of the same reasons as the people with money but also because the people with money fuel the economy buy buying houses and businesses.

Of course peopple rich or poor want to make money. Who would want to loose money? Investers help fire our economy, create jobs and the general wealth that we have TODAY. This seems obvious to me.

If they were making thier money work for them in Colombia to the same extent...well you can fill in the blanks.

I am seeing nice 3 or 4 bedroom houses in good areas of major cities for $100,00 on the internet.
;gringoinbogota thinks price will go down 5 times?
;not be good for Colombia because then estranjeros will be picking the bones of the Colombians misfortune at the worst possible time for them.
; if the Colombians had a strong economy thier houses would have more value not less.

I agree, why be rude or foul? If I am thought to be wrong on some of my coments here I would certainly look worse if I was foul to other posters.

I was thinking about importing (with a friend) some 15 year old cars and motorcycles from Japan (he already has) to Canada. Are we bad bad to make this business? there is a 15 year rule that makes cars expensive to keep inJapan after 15 years so they are cheaper. I dont feel like I am exploiting anybody no matter the profit margin.

If you don't know where your going you might not get there. You don't own your possessions, Your possessions own you.

Latitudes attitudes & platitudes.

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Gator says on Jun 25, 2005, 12:16:

Where was this rant.... when Japanese investors were buying everything thing the USA had to offer????????? I guess he does not know the word he used, "invest, means to commit money in order to earn a financial return.

"Credidi pretio parvo emere et magno vendere tibi in animo fuisse!" .

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miamimike says on Jun 25, 2005, 12:31:

Michael_B, that COl. state pension sounds like an awful good deal. Depends on how many years she has to pay in. How long will she paying in to be vested(guarenteed monthly lifelong checks)??
If you take that $150 monnthly pay-in, its $1800 yearly and figuring that monthly payout its $1087 rounded off.$13,032 yearly and at age 55 yet. That wouldn't happen here in the US unless she gets disabled and the formula for benefits is different. Paying in $1800 for $13,032 of yearly benefits is a deal any way you cut it! These payouts were computed using $2300cp=1 usd. And of course this will change by the time she could collect. Sure those monthly pay in amounts(150usd) are correct?

My Avatar-- Sarah Palin Says " "You know the difference between a pit bull and a hockey mom?? Lipstick!" Now on a Short Verbal Tether by the Honorable John McCain

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Rubiazo says on Jun 25, 2005, 12:58:

One could definitely say the same thing about the USA. I wonder what % of the USA's wealth is actually in foreign hands. Michael Moore claims 6% of it is in the hands of the Saudis alone, but he also talks a lot of unsubstantiated shit too. But I wouldn't be surprised if 20% or more of this country were actually controlled by foreign interests.

Any time somebody with money comes to buy property in Colombia, they should be THANKING them. That's free money for the whole country, as it was the product of labor and investment ELSEWHERE. Turning the money into pesos strengthens every other peso in the hand of every Colombian from one end of the country to the other, which allows them to divert resources from propping the peso up into other things.

This is kind of like bitching about gringos coming down to Colombia and banging whores. They are the best thing that ever happened to the economy. It's the same thing, nobody in Colombia had to make that money, it just arrives and stays there. And you can guarantee that when a prostitute gets his/her hands on some cash, that cash is going RIGHT BACK into the economy pronto!! Not to mention, they typically overpay by 3-4x and STILL think they are getting a great deal. They are as likely or more to use/insist on condoms than local clients, and FAR less likely to hurt the prostitutes simply because they are in a strange place and more than a little scared. Everybody's happy.

Next thing, somebody's gonna complain about people paying for Colombian girls on the sex webcam sites and how Colombians can no longer afford to have webcam sex with their own girls anymore!!!

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Gomezman5 says on Jun 25, 2005, 13:05:

I think make a good point, ex I think Boomer makes a good point, except his message get somewhat lost because of the way he presents it. Inserting the foul language detracts from his message as well.

But, I have asked these questions before...especially of Gringos. What makes their goofy minds think, that just because they have a great vacation 2 or three times, wherein they stay at nice hotels and get waited on hand and foot, that it translates to buying a home in paradise to invest and live in from time to time. I don't call these people very
intelligent.

I will say this, I can't tell you how many Colombians come to this country, get residency, work a life time to collect a pension, with the ultimate goal of returnin to Colombia upoon their retrirement. Some of them do, and most that do, come right back to the US within a year. It's just more complicated than it seems. I could go on forever as to why the dreams just don't pan out. In my case it would be a virtual impossibility. I my pension gives me medical coverage and drug coverage for life. Do you think they will pay for everyting I need in Colombia? They will pay for nothing. So only a fool would work all those years for those beneifts, and then throw it out the window upon be able to take advantage of those benefits. One medicine I take costs $185. a month. My insurapce co-pay is $16. In Colombia, the medicine would cost me between $85 and $95 a month. So people just can't move. That is just one example

And Michael_B, I think you should forget this idea of buying property there for investment purposes. If your wife is still able to participate in the pension program, and you evaluate the benefits of doing so closely (I know nothing about it) then do so. But, this is the US, it's easier to monitor your investments here, than in another country. Who is going to watch the house while you are gone? It just makes no sense....none whatsoever. Go to Colombia, stay with family, stay in the best hotels which by American standards are dirt cheap. You will be able to go there, stay at the hotel, enter a nice clean fresh smelling room, where the employees will all be willing to wait on you hand and foot, so that you can enjoy your stay. That's a no brainer. Besides, the real estate market in the US for the last 10 years has been as good as any real estate market in the world. Why the hell would you want to go over seas and think you can do better there?

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miamimike says on Jun 25, 2005, 13:30:

Rubiazo, actually MMoore was shy a few points on % of US Assets foreign owned. And this info I am posting does NOT include all the US Paper debt owned by the Japanese and Chinese. Much of this came about after the the Book (Foreign investment in the US by Mack Ott--source)was printed in the 90s.The amount of US Bonds, Treasury Bills owned by Japan(largest us debt holder) and China(2nd largest us debt holder) is Staggering.Much of this debt acquiered after 2000 due to increasing us debt financed by china and japan. Interesting to see % of foreign ownership as of 2005...

"At the end of 1990, about 16 percent of foreign assets in the United States were owned by foreign governments, while 84 percent were privately owned. (Similarly, 14 percent of foreign assets owned by the United States were official, and 86 percent were private.) "

My Avatar-- Sarah Palin Says " "You know the difference between a pit bull and a hockey mom?? Lipstick!" Now on a Short Verbal Tether by the Honorable John McCain

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caslug says on Jun 25, 2005, 13:38:

concur w/ GMAN.. It very easy for a 1st worlder to have a GREAT time in COL ON VACATION, we go, we see, we play, we have fun, we RETURN. We don't really have to worry about the day-to-day struggles that comes with LIVING there. Like, crime&security situation, lack of business opportunity to make decent 1st WORLD wages, HUGE bueracracy getting things done, etc., Yeah if you got goobs of money or have an expat package life is good, because you're using MONEY to grease lots of problems away. This is NOT unique to COL, in any 3rd world country, if you got money you lived like KINGS! Much more than in the US. An well do family in the US (making $200/yr) is living good, but that equilalvent in COL(or any 3rd world) is living like KINGS. Like Donald Trump!

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caslug says on Jun 25, 2005, 13:41:

US foreign debt.. alot of it is held by foreigners, china&japan has gobs of it. Just look at the trade and fiscal deficit. who do you think is buying lots of US Gov't Bond? Heck China had so much US dollars that they went on a spending spree in latin america. They bought a cooper/tin mine or two in Cuba for $200-300 million USD, then sign a development deal w/ argentina to build bridge or dam i think.

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boomer says on Jun 25, 2005, 13:47:

I Apologize............somewhat?. I Apologize for the temporary fit of anger and my poor choice of discriptive words, but it makes me angry every time I read a post from someone wanting to turn a quick buck in Colombia! It's simple logic that every dollar that goes in your pocket, comes from someone else's pocket. In Colombia, that pocket is the Colombian people!

Investing in Colombia is wonderful, If it benefits the Colombian people as a whole! I was complaining about the Capital ventures for the purpose of removing what little the average Colombian has in their pocket. Taking advantage of these people by creating a sellers market in real estate is like dangeling candy in front of a child. Most of these people have little money and when the price of homes becomes inflated, they start to see dollars and not their future. Why own, when you can rent, Right??? If you want to invest your money in building new homes, that benifit the labor market, then I say more power to Ya!! If you want to invest your money in starting a business that employs people and makes a profit for yourself, then I say Great!!! But bragging about making a 300% capital gain on removing Colombian's from their homes, then I say that sucks!!

Got it?

orgullo_de_colombia

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Dan says on Jun 25, 2005, 14:25:

my personal opinions I'm not looking at buying property entirely for making a profit of any type. Mainly, I'm looking at someday living in Colombia with my Wife and Step-Daughter. I COULD buy now, and then rent it out to someone who could otherwise not afford to BUY a house. Perhaps to someone who only makes enough for rent, and I'm sure there are plenty in this situation. Hey, to me, that says that someone has a place to live. Another thing that I was looking at was buying other properties to rent out to others, for the same reason that I just mentioned. Now, lets just say I did this, I can have an Inmobiliaria handle the additional properties for a small fee. Now, I got a couple things going on that can HELP Colombia. One, A person has a place to live. Two, I'm supplying some work to someone else.

With the comment about removing people from their homes, I don't think that's it at all. There are dozens of properties on the market right now. I don't see anything wrong in this situation. Hell, people do that in the US too, not just Colombia. Look at Los Angeles, people who bought houses between 3-6 yrs ago are selling for double what they bought them for. Colombia, I don't think is growing that fast, but still there's people doing that.

Like someone said earlier, there are a lot of Colombians returning to Colombia and putting a lot of money back into the economy too. I think that's great. I personally look forward to helping out Colombia when I live there with my family.

God Bless America!

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tomtom33 says on Jun 25, 2005, 16:24:

Boomer The average Colombian is not going to be buying the types of homes/apartments that are increasing greatly in value. No one is making a 300% capital gain by removing anyone from their homes. And I have seen plenty of "these people" fleecing gringos on property deals.

Your grasp of economics is tenuous at best.

I bought my apartment in Cartagena because I want to spend the rest of my gringo life there. After two years, it is going very well.

Gman-my prescription drugs cost about US$800 per month, a little less than my health insurance premium. Cadillac health insurance in Colombia costs around US$175 per month. I can live much better in Cartagena than I could in the US. And Cartagena is the most expensive city in the country.

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Gomezman5 says on Jun 25, 2005, 16:46:

Boomer.....my health insurance is FREE ---well it comes as part of a benefit package that I have with my employer. In fact, along with a pension that will give me %65 of my pay at 54 years old, makes my benefits package among the best. It I stay until I am 60, I will get %70 of my pay. Two years later, at 62, I will get soc. sec..

Now, you can say what you want, Medical care in Colombia is adequate...it certainly is not what I am used to. And the word adequate applies if you live in Medellin which supposedly is even better than the health care in Bogota. The best technology and is right here in the US. No socialized medicine of Europe or Canada....you die waiting for for diagnostic exams let alone surgery.

Don't get me wrong, Cartagena is fine and and quite beautiful, but there are trade offs in life, and giving up my top quality health care is not one part of my life I will choose to compromise on.

On feel sorry for people in this country that have to pay huge amounts of money out of pocket for drugs and health care in this country. But since I get it all ....and for life while employed and as part of my retirement package, for me to move to Colombia would be the essensce of stupidity.

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tomtom33 says on Jun 25, 2005, 18:28:

Gman In your situation it might be stupid to move to Colombia. I have no one to pay for my health insurance but me. And of course you are right about the quality of health care. For something complex, I certainly intend to go to MDE.

One thing to consider, that free health insurance may not always be free. Ask the GM workers how long their free health insurance will last. Then there is(was) Enron.

There is also a rash of pension underfunding that may cause some big problems for the US pension guarantee fund.

But the US is eminently more stable than Colombia. Except for my apartment, my money is in the US stock market.

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utopiacowboy says on Jun 25, 2005, 23:09:

"One of the things that my wife recently found out is that if we pay to their state run retirement system $ 150.00 a month she will be able to draw approx 2.5 million CP per month at retirement age, which for women in Colombia is 55." It's not 55. My wife's asleep now or else I'd ask her but I believe it's 57 or 58. We continue to pay into her Colombian retirement monthly.

Disclaimer: any comment I make is inane and is not to be taken seriously, and is so patently ridiculous that no one should take it seriously, even as an insult.

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juanalejo says on Jun 26, 2005, 09:37:

Pension 55 for women or 60 for men. As of 2014 it will go to 57 and 62. UC, the reason your wife may still pay if she already reached 55 is if she has not reached the minimum number of working weeks to be able to retire, she will need to continue until she does reach if she wants a pension.

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viewpoint says on Jun 26, 2005, 09:38:

Much as I hate to say it BOOMERS "first" post (less the bad lanuage) is far more right than wrong. He has stated exactly what goes though my head when I see some of these posts. Any foreign person coming to Colombia that's not totally fluent in espanol thinking that he's smarter than the Colombians in real estate investments will soon be separated from his money with his or her head handed to them.

Anything more than a residential home as a full time residence will more than likely be a poor investment unless you have some Colombian intelligence guiding the way. How many Colombian REITs do you see in Colombia ? I haven't found one in Medellin but I would be interested in anyone weighing in with their input. Behind every project being built is a promotor (building contractor) that for the most part sells out the project (residential or commerical) before or during contruction as condominiums carrying NO inventory. In fact, most builders are not even risking their working capital as the new owners through their monthly payments are providing the cash flow to pay for the project expense (building costs).

If investing in real estate (apartments as an example) was so profitable why are there no major multi-housing (single ownership) projects in Medellin (the market I know) ? The bottom line is that the costs of borrowed money in Colombia are greater than the income revenues derived from ownership of the underlined real estate assets. Cash on cash you might make 6% average. Pick the wrong PESO currency entry point with your foreign currency and you could see a 30% loss in short order of your foreign currency measured investment (been there myself and done that).

You are playing another mans game with lots of variables out of your control and most of us aren't equipped to do it. I have had forty years of business experience and everyday something new in Colombia surprises me. Lending money for others to purchase real estate makes more money in Colombia than borrowing it to invest in real estate or investing cash expecting more than a savings account return on your investment.

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utopiacowboy says on Jun 26, 2005, 10:57:

Gracias, Juanalejo. That explains it. My wife will not be 55 before 2014 so for her, it's 57. She has a lot of years to pay before she can collect!

Disclaimer: any comment I make is inane and is not to be taken seriously, and is so patently ridiculous that no one should take it seriously, even as an insult.

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Hunter says on Jun 26, 2005, 11:27:

Boomer If you read the thread where I posted the 300% gain, it was connected with somebody saying don't invest money in Colombia real estate, you can't make any money on it, so I was pointing out that you can, it was nothing to do with boasting.

As others have said, foreign money coming in helps out the economy, so if foreigners want to but property or other things I am all for it, any foreigners buying will nearly always be the tip of the iceberg, most of the buyers or sellers will be Colombians, so the majority of any money being made will be made by the Colombians.

In my companies case there was no forced sellers and all the sellers were Colombians, also you are presuming a lot that we foreigners are fleecing the Colombians, as has been pointed out by several people its normally the Colombians ripping off the foreigners, which I have seen several times.

Most important of all, any money that my company makes is re-invested in Colombia, seeing as it is a non-profit making organization, at the moment there are approx 200 Colombians employed indirectly with the investments that the company has made from the profits that the company has made in Colombia and the UK, but I suppose Colombia doesn't need any foreign capital investment with your way of thinking, it only has 40% unemployment, they can look after themselves.

Hunter

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Hunter says on Jun 26, 2005, 11:40:

Retirement It is far better to leave your first world Country behind in most cases and move to a developing one, presuming that you are not to ill to do it.

Your dollar, pound, euro whatever will go much further, you can purchase health cover at the desired destination if you choose carefully, certainly nearly all drugs are far cheapar, in many of these Countries the health services provided are far better than your Country of origin at the top end which the foreigners can generally afford.

Thats why hundreds of thousands probably millions of people do it each year, some retun to their home Countries, because of homesickness, but such is life.

Many Countries appreciate the foreign retired person and the money that the person brings to their economy and the jobs that it creates, creating retirement visas especially for them.

The foreigners will push up the cost of living in the areas that they live, but the main beneficarys are always the locals, although some foreigners do as well, so what.

I think some people are way to negative or have little crasp of basic economics on this board.

Hunter

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Gomezman5 says on Jun 26, 2005, 12:56:

I agree with VIewpoint's point of view Viewpoint has made many posts about his knowledge of real estate investment in both Colombia and Panama. I have to believe he has some specialized knowledge in this area

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Rubiazo says on Jun 26, 2005, 14:58:

People are mixing the planes here Viewpoint talked about people bringing money into Colombia often getting screwed over in the real estate market. The original post was about Colombia getting screwed over by people buying into the real estate market. THAT notion is absurd and, like others have pointed out, due to a complete misunderstanding of basic economic principles.

Of course lots of gringos who buy property in Colombia are going to over pay, especially if they don't know the language. That's all part of the game too. Caveat emptor never has applied more than when buying real estate, no matter what protections there are in place. As far as I'm concerned, if there weren't 'a sucker born every minute' there'd be no way for the rest of us non-suckers to make any money!!

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Rubiazo says on Jun 26, 2005, 15:07:

Just another case in point Here are two hypothetical situations:

1) Mr Opportunist buys property in Colombia with the idea of flipping it in a few years. Things go as planned and the value of his property skyrockets. He sells it for twice what he paid for it. Assuming he filled out forms 4 and 11, he can now get the original amount back tax free, but the profits he made will be dinged at a rate of 47% if he tries to take the money out of the country. Correct me if I'm wrong on any of this.

2) Mr Opportunist does the same thing in the US. Because properties are super expensive here he has to use mostly OPM (other ppl's money.) Fortunately he has a decent credit rating so he gets a mortgage at 6%, no probs. Once he sells that property for twice what he pays for it he may well be liable for capital gains tax but there are lots of ways around this. Since there are no capital controls in the US he can take that money anywhere he likes, maybe even Colombia.

As far as I'm concerned, people in Miami, LA and San Diego should be the ones angry about real estate prices being driven up, much more so than anybody anywhere in Colombia.

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Gomezman5 says on Jun 26, 2005, 15:55:

Rubiazo... As a person who own a few investment condo's (2)here in Chicago, I can tell you, it is hard enough to keep track and protect the interests you have in real property that you have only miles from your home. But to by property in a foreign country where you don't know the customs and how things work, that makes it only that much more difficult. Addtionally, condos are the easiest piece of property to maintain. All you do is pay the assessment and the building, the management company or if self managed the building manager hired by the board maintains everything. Also condos are much more secure because there are always people there. In the 18 years that I have lived in my condo, I have served on the board 7 of those years and there has never been a break in to one of the units.

A house is a totally different story. It is a sitting target. Nobody is there to watch over it. No security. If there is a problem you don't have a clue who to call. And if you do find someone, you don't know if the person who you hire to do the service is rebutable, and therefore if they do a poor job at whatever you are paying them to do, what is your redress? Are you going to sue them from the states???

Like I said earlier, any Gringo who buys investment property in Colombia is just spinning his wheels. Why would any gringo want to do that when some of the best real proerty investments have been, and continue to be right here in the USA.....(his own back yard)

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Rubiazo says on Jun 26, 2005, 16:13:

What I don't like about condos They can raise the maintanence on you whenever they want, however much they want. You're right about houses being a security risk, however. Buying a private house in another country you are not gonna live in is probably not a shit-hot idea, unless you have a REALLY good reliable property manager (good luck.)

I would get a 2-4 family house and live in one of the units at least part-time. I also know quite a bit about construction from owning my own house here in the Bronx so I'd know right away if someone were trying to screw me.

Getting good tenants in any situation is an art in itself!

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Gomezman5 says on Jun 26, 2005, 17:27:

Rubiazo....raising assessments?? yes and no What you seem to be forgeting is that condo boards rasie assessments out of necessity. There are no free rides in this world. You should also keep in mind that while condo boards have the power to raise assessments, they also have to pay those increases. Board members are not exempt from paying assessments. At the same time, condo members ussually do not lose site of the fact that if assessments are raised without reason, or spending occurs in a reckless manner, ultimately they are held accountable to the unit owners. And under the laws of every state in the US where condos are abundant, a certain percentage of the board comes up for election every year. I can tell you, that in the several years that I served on my condo board, a board with over 700 units, I myself, as well as most other board members I served with, remained cognizant of the hardship of assessment increases.

Fianlly, may I add 2 other points. First,Boards CANNOT, as you contend, raise assessments whenever they want. Most revenue raising measures are controlled by either statute or by the condo associations on delcarations/and/or bylaws in terms of notice to the ownership which clearly gives the ownership at lease one full meeting where debate can be heard, and ownership can voice their objections, before the revenue raising measures can be enacted. Also, second,condo boards are generally much more responsible at maintaining the common elements (building property) than individual property owners are. Condos have reserve funds, private owners often don't have a dime in the bank to pay for the new roof or to replace the Air condtioning when it goes "on the friz." Condo associations, have repair and replacement studies to inform them about what expenses they will need in the near and not so near term so that expenses can be planned and paid for when needed.

Rubiazo, I think I have given you some very compelling reasons that not only tell you that condo associations are not so reckless, but to the contrary, are actually better at planning for expenses that are on the horizon then private parties do.

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tomtom33 says on Jun 26, 2005, 18:14:

Condos in Colombia It doesn't work that way here Gman. We have no reserve funds. In fact we have debt. Somehow we can fall behind on paying the government for some kind of worker's benefits. And I was stunned to find out that the association has no insurance of any kind on the building or for liability.

Hunter-is your experience similar?

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Gomezman5 says on Jun 26, 2005, 19:55:

tomtom It sounds like they need a little good old fashioned expertise from an American lawyer who 1.practices condo law and 2. a person who has hands on experience serving on a board (That is myself in both cases.)

This is just another example of why I say that when an American moves to Colombia thinking that life is going to be a bed of roses, they get a rude awakening....ussually fairly quickly, about just how frustrating life can be in Colombia. Colombians, in turn, upon arriving here, almost always get frustrated by the myriad of rules and regulations that exist, that are really designed to protect people.

Tomtom...there is no excuse for a condo mgmt/association for not having property insurance or liability insurance. See, it is highly unlikely something like that could happen in this country because the building always have to provide a cerificate of insurance whenever work on the building is done, or whenever it applies for a building permit. So if we did not have insurance, we could not provide a certificate of insurance......

Oh well

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Hunter says on Jun 26, 2005, 23:48:

tomtom Some of the condo blocks have debts in Ctg and most have little or no reserve funds, the debts are to water bills for one example I can think of.

The only reason that they have the debt problems is because of some Colombians who don't pay their bills, the apt that is behind on payments gets charged 2% a month interest rate fee, but because Ctg is very laid back, they don't push to recover the money, until the person owes a lot.

I have been told by the administrators of the buildings, that they like foreigners buying in Ctg, because they nearly always pay their bills on time, hence much less work for them.

In Medellin they will take you to court if you are not paying, its as bit more efficient there.

Actually running a portfolio of properties in Colombia is far far easy than in London for example, because labour is cheap any minor problems can be solved by throwing a small amount of money at it.

Also to my surprise, because the rental laws are better (if you are prepared to use them), Colombians are better payers than renters in the UK.

Hunter

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Gomezman5 says on Jun 27, 2005, 00:01:

Hunter....that is true In Colombia, if you don't pay your rent, you are staying in your apartment on borrowed time. It's not like the US where all the states and major cities have enacted various statutes and ordinances designed to protect the non paying tenant from a summary eviction. A dead beat tenant in Chicago, can stop paying rent in November, and if he is samrt and know the system, can find a way to delay the entire proccess and thus avoid being thrown out until March or even April. It is rediculouus.

In my condo, if you are late in your assessment, there is an automatic $75 late fee.....late by the way is the 10th of the month in that it is due on the 1st but we have a 10 day grace fee. If you are more than 2 months late, the condo ass. files a lien on your unit and appropriate proceedings (forcible detainer/eviction) is commenced. You don't play games in not paying your assessment.

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miamimike says on Jun 27, 2005, 00:58:

Rubiazo, Miami is now Officially the "Largest US Bubble" in real estate and depending on when you bought it can be something very good.

"As far as I'm concerned, people in Miami, LA and San Diego should be the ones angry about real estate prices being driven up, much more so than anybody anywhere in Colombia".

» reply--Really I'm not angry, if I sell today probably 4-5 time gain for what I payed for it(my condo) in '95. Not good for a buyer. On that Bubble-it will Break here someday. Has before 2-3 times in Miami history.Will drop again. Who knows when? It was on the financial news thursday that the discrepancy between real estate selling prices and the Average Wage is the greatest in the US. We were the Poorest Big City in the US last year-many minimum wage jobs here and less if some one is illegal and there are 1000s of illegals here in the miami area. Not Good here if you are a buyer, great if you are a seller!


Gomezman--We don't have a Reserve fund here in my Condo Bldg. No rentals permitted either..Its stupid -we should have a reserve but don't. And its not a Florida State Law to have one either. Wish it was!

My Avatar-- Sarah Palin Says " "You know the difference between a pit bull and a hockey mom?? Lipstick!" Now on a Short Verbal Tether by the Honorable John McCain

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Rubiazo says on Jun 27, 2005, 02:49:

Miami- It can either be really good or really bad. The problem with such a speculative market is that at this point there are a lot of people flipping properties. Anybody who wants to buy NOW in Miami for the long term has to be extremely careful. If the market crashes you could end up with the bank calling your loan in certain circumstances.

A lot of properties are like that in Miami- no rentals permitted. Which really sucks because buying property should not FORCE you to live there. Although even here, I have to maintain a residence in my own place for 2 years after the refinance :P A LOT of people in Miami do it anyways under the table though. I really don't know anybody who obeys all of the US 'rules and regulations', anywhere in the country. If we did, things would just fall apart here IMO.

Here in NYC if I get a deadbeat tenant I can count on being out of pocket at LEAST $10k and taking anywhere from 6 months to even a year or so to get them out. You have to be extremely careful who you let in to rent here. In Canada things are even worse for landlords. But the DR takes the cake. It is actually on the books there that legally in order to evict a deadbeat tenant you have to pay their moving expenses!!!

Another concern of mine about Colombia real estate is if you get a contractor to do some work, is it gonna take a year to get four weeks worth of work (here) done? Here a one week job always turns into a two week job anyways because of complications buying the materials, unforseen difficulties etc. I usually do all my own buying for jobs now and negotiate with contractors to bring the price down since they dont have to shop for and haul their own materials.

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spigrimace says on Jun 28, 2005, 18:29:

How not to get fleeced in Real Estate in Colombia I love how the eyes get sooo wide open whenever I have inquired about real estate in Medellin.

I´m trying to buy the building my bar and restaurant are in. The 2nd floor needs extensive work to the point I would think one of the walls has a crack so bad, it would be condemned. It will need to be knocked down, supported and rebuilt. The whole roof needs to be replaced and a lot of littler things to bring it into good shape.

The owner told me he wants $380,000,000 pesos (The lot is 450 meters square). To an American it sounds cheap at around $160,000 for a nice size commercial lot and building. But let´s not get taken. Use avalulos (appraisers). They asked $300,000 for the work. So I got 2 estimates one said $270,000,000 - $280,000,000 and the other said $280,000,000 to 290,000,000. So let´s go with $280,000,000 as the common number. They both said you need to deduct the repairs so we had a few engineers come in. Some were free, some wanted $150,000 for their time. Some wanted to really dig deap and tap into the foundations, the beams and do stress tests on the concrete. That would have costed about 2 millones to do. Anyway I kept getting a $50,000,000 as the common number to fix the building in good shape. So my max bid would be $230,000,000. Big difference from $380,000,000 right? Okay I paid a millon for the work, but look at maybe I could have saved from being fleeced. So I sat and waited, yet my phone rings every week to know what´s going on with the deal. See the game unfolding? Take lots of time to figure out what the real deal is. Always ask for proof in every deal. Never take word at face value. I also got a copy of the escritorio and found out it´s an inherited place owned by 5 heirs. So obviously someone wants to sell and get their cut. Dig because you ARE being lied to buy the seller.

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