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How to buy Colombian property and Colombian pesos.

I have spent some time looking at property for sale in Colombia and I have developed two hang-ups about it.

Firstly, I notice that the owners seem to have great difficulties selling their properties. It seems to take them forever. I really want to avoid owning any asset which is very illiquid like that. Maybe I should be more aggressive about making really low offers, to make it easier to sell on at a profit?

Secondly, I worry about the cost of transferring funds to pay for any purchase. I would like to be more in control, rather than sending a whole bunch of euros or dollars (presumably, as I live in UK) having no idea how many pesos I'll get on the day, nor how much I'll lose in the hands of local banks for conversion and other charges. I would prefer to play the market and choose a good day to buy pesos and then hold them while I make the purchase. This would be relatively easy if I had a bank account, but I can't open one as a tourist.

Are there any ways of investing in pesos? I can't even find anyone who trades them. Any suggestions? I am talking holding pesos outside Colombia here. I have read that a lot of the rise in the peso stemmed from professionals investing in pesos for the interest rates. That means there's a way to invest in them. Maybe they buy bonds?

This is really the local side of a general investment dilemma: when you sell property, you get cash. You want to choose which currency to hold your cash in while you wait to buy more property. So you're a dealer in two things: property and currencies.

I am becoming more interested in investing in US property, as the prices are down plus ( and it's a big plus) so much information is available. I can sit at my screen in UK and browse properties all over the USA with prices, photos, maps, articles, blogs etc. How opposite to Colombia!

However in my searching I have seen some delightful properties in Colombia and would like to solve the problems and get a place for my hols.

By tabla on Jul 20, 2008, 03:46 in Friendly Talkzone.

jonny305 says on Jul 20, 2008, 12:45:

go to miami
really good deals now!!
i bought at bad time 2005

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tomtom33 says on Jul 20, 2008, 13:00:

Doing anything in Colombia is a mind fuck. When you further complicate things by talking currency fluctuations, peso trading, and which day to convert to get the best rate, you approach the impossible. And you haven't even touched upon things like registration of foreign funds and the outright thievery practiced by Colombian banks.

Save yourself a lot of grief and do not invest in Colombia.

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gargajito says on Jul 20, 2008, 15:19:

The property market is booming in some parts of Colombia now, but that doesn't mean it's not going to crash in the future. A friend of mine bought a brand new flat in Bogotá 3 years ago for less than $200 million pesos, and his neighbour recently sold for nearly $500 million. So, for an investment, you may have missed the best opportunity to enter the market.
Transferring funds isn't easy, the peso/dollar/pound exchange rate is subject to large fluctuations, if you don't live in Colombia or you don't have family here then you won't have anyone to help you through the buying process. You need to think about whether you want to buy second hand, or new, or from the plans (before the property has been built). If buying new/from plans it may make the financial transaction a bit easier as the construction company may have a bank account that you can transfer your money to.
But really my advice would be that it would be a very risky investment, with lots of pitfalls, so unless you're thinking of buying something as a home to live in, don't do it.
Also, in response to the "good deals in Miami" I'd steer clear of those too, many people believe the market in the US has a long way further to fall yet.

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Buongone says on Jul 20, 2008, 20:19:

For trading pesos, check out: XE.com. I believe they can help.

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jonny305 says on Jul 20, 2008, 20:46:

true long way to fall but i saw an apartemt that cost in 05 165.000
selling for 80 thousand
beautiful area in miramar parkway
but you right if one wants to live in Colombia buy your property there
but i think for europenas the us is dirt cheap also to buy

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aztec says on Jul 21, 2008, 07:03:

tabla, euros make the US market a better bet for you! There are areas hurting where you can steal an apartment or house.

Any one in the world can buy in the States without any special laws directed at them solely because they are aliens! Just keep all your transactions transparent. You have the same protection as any citizen. Of course you are also subject to the fluctuations of a fickle market.

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billyb says on Jul 21, 2008, 07:11:

With the appreciation in the euro versus the dollar and the depreciation of properties in so florida the last couple of years, somebody with euros could buy 3 to 4 times the property they could have just a few years ago. That is why RE people are saying that over a quarter of the upper middle to high end props are going to europeans there.

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tabla says on Jul 21, 2008, 08:29:

These comments are really helpful. There are several threads emerging here:

1) Where to buy in USA. I toured USA once by bus, and particularly liked the stretch after leaving Colorado, passing through Albuquerque NM and crossing N Arizona (taking a stop at the amazing Grand Canyon) and into S California. They said the day I was in LA was the clearest for 17 years, with some rare hills visible and all the smog rolled back like a wall over the ocean. Then hitched a lift up Route 1 in a new open red Mustang! Even hitched once in a small aircraft. Then it was colder in SF and I was out of my fav area. That was in August btw. Re Florida: is it still possible to buy good hurricane insurance? How much does that cost?

2) Buying in Colombia. What I want to do is set up a lifestyle, ie say an apartment in Bogota and Medellin, and a finca in some beautiful countryside. I think I'd be better renting the apartments but will have to buy the finca. In fact, it might turn out cheaper to use hotels in the cities, for the amount of time I need to spend there. My main need there is to get the names of some good hotels. I stayed at the Nutibara in Medellin which was an acceptable standard though a bit run-down but a bit pricey at 140k COP. Can I get something good for about half that? It's hard to explain what I like, maybe something with a bit of panache and not the usual boredom. For example I found a nice place in Cali with huge Jacuzzi in the room. We had fun there! No lights, but jacuzzi! Dirt cheap, too.

3) I do have pals in Colombia who can help me find good people to work with.

4) In terms of a finca I would actually prefer to buy some land and build. This is because I have special requirements. Physically the most suitable area for this would be that whole plateau east of Medellin, where Rio Negro is. Just happens to be a very expensive area. Means the land is expensive, but building might just be lucrative.

Basically what I like is to be about 1600m up and near the equator. Doesn't have to be Colombia, I guess.

Summary -- interested in USA for investment, to make profits to feed my international lifestyle! Therefore doesn't really matter where I buy in USA. Interested in the Andes for spending quality time.

Final comment: pity about the bug bites I get looking at fincas. No idea what it is that bites me. Tried the teamina -- no good.

3) Trading pesos. I checked xe.com and firstly they will send your money anywhere for you, but don't hold it for you. Secondly, they only deal in 15 of the world's major currencies. Surprisingly that still includes dollars and pounds, but nothing south of the Mexican peso. Unfortunately my funds are in sterling, not euros, but still makes sense to buy in the USA. COP have got rather expensive since I started looking at Colombian property.

Interested to hear your further comments on these points.

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turnmeon says on Nov 22, 2008, 18:44:

i will not buy property in the USA right now, the market keep droping, and it seems imposible to sell later on

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