Living, Retiring, And Investing In San Juan Del Sur And Granada...

Nicaragua Is Cheap, Yes, But
It's Also So Much More...

Sept. 15, 2014
Granada, Nicaragua

Dear Live and Invest Overseas Reader,

I traveled to Nicaragua this past weekend for the first time since 2006. That's the year, coincidentally, when Daniel Ortega was re-elected this country's president. He's since been elected for a second consecutive term in 2011 and sits as Nicaragua's president today.

It was lack of time that kept me from returning to Nicaragua these past eight years. Just too many other places I had to be. For many, though, Ortega has been the deterrent. He was, after all, the leader of the Sandinistas, the group that ousted the dictator Samoza back in 1979, and the same guy who, then, once in power, confiscated land and redistributed it to the poor. Investors had concerns.

Then came the global downturn that started in 2008. In its wake, both investors and tourists were even thinner on the ground in this country.

Seeing the volume of traffic in Granada this weekend, I think it's safe to say that the tourists have returned full force. A new (well, new to me) pedestrian street lined with restaurants extends now from Granada's main square toward Lake Nicaragua and was crowded with people every time I passed. Many new hotels have opened in this city in the last eight years. However, more important, the hotels I remember from 2006 are still there. They survived the downturn.

I don't think this little colonial city has seen as much activity as it is seeing right now at any other time during its almost 500-year history. Based on my conversations over the three days, it's not only tourists who are feeling comfortable enough to give Nicaragua another chance. It's investors, too.

Everyone I met with—expats, business owners, and those in the real estate industry—assured me that the market is returning. Sales are being made at greater rates than at any time since 2008. After almost eight years in office this time, Ortega hasn't made a move against anybody's property. As the book I'm reading on Nicaragua's history over the last 100 years puts it, today's Ortega is not 1970s Ortega. Ortega today is the capitalist version of a Sandinista, with an appreciation of the importance of personal property rights.


Being American Overseas

Do I Feel More Or Less American Living Overseas?

Sept. 14, 2014, Panama City, Panama: How does living overseas affect one’s “American-ness”

Dear Live and Invest Overseas Reader,

At our Retire Overseas Conference in Nashville last month, an attendee asked:

"Do you feel more or less American as an American overseas?"

I've been living outside the States for 17 years, and, to answer the question of the gentleman in the audience in Nashville a few weeks ago, I've never felt more like an American than I do today.

Living in the States (I lived in Baltimore, Maryland, for my first 35 years), we Americans take being American for granted. Every year since I left Baltimore, I've been more aware of my American-ness.

Thinking superficially, this is easy to understand. We lived in Ireland for seven years, long enough to acquire Irish passports even. But we're not Irish...not really.

We were in Paris for four years, and both our children think of that city as home. It's where our blended family bonded, where Jackson started school, and from where Kaitlin left our nest to start college. We still have the apartment where we four lived together. In storage there are plastic tubs containing old school report cards and gifts the kids made for me for Mother's Days. We love Paris and look forward to returning, but we're surely not French.


Lief Simon Details The Most And Least Successful Property...

Lief Simon's True Confessions—"My Biggest Losers"

Sept. 12, 2014, Panama City, Panama: Lief Simon has invested in real estate in more than 20 countries over more than 20 years, making nearly three-dozen purchases in total. Here are his biggest winners and losers.

Dear Live and Invest Overseas Reader,

A reader wrote in last week to tell me she was done with international real estate investing. She's invested in four opportunities I've written about over the last 10 years, and none of them has played out as expected. She wasn't upset, just matter of fact, writing to let me know that she's going to stick with U.S. real estate going forward, as that's something she feels she understands better.

Can't argue with that logic.

This very reasonable lady lost everything on one direct-developer investment she made. I invested in that deal, as well, so we were able to commiserate. The developer, as it turns out in hindsight, was in over his head. He didn't have enough experience or local knowledge to understand the complications he would encounter, and so these complications weren't factored into his business plan or projections. Bottom line, he wasn't properly capitalized and went belly up.

I've lost money on a few direct-developer investments. Others have played out well. I consider an investment of the kind I'm talking about, one where you're getting in on the ground floor right there with the developer, comparable to investing in a start-up company pre-IPO. You have the potential for big reward, but the risks are great, as well. (My pre-IPO investments have a higher loss rate than my direct-developer real estate investments, for whatever that's worth.)

You can minimize your risk with a direct-developer investment by asking for land as collateral—though that's not always what it's cracked up to be. Right now I'm invested in three direct-developer deals where the development isn't moving forward but I have property as collateral. The truth is, though, should the developments be forever (as opposed to temporarily) stalled, the land I hold as collateral in each case isn't worth much. What would I do with these little islands of property unless or until the planned developments they were meant to be part of play out?


Where To Retire Overseas

How To Find The Right Place For
You To Retire Overseas

Sept. 11, 2014, Panama City, Panama: When deciding where to retire overseas, pay as much attention to your heart as to more quantifiable or scientific considerations.

Dear Live and Invest Overseas Reader,

One thing I've learned in my 17 years as an American abroad is that you can't spreadsheet a new life in paradise.

As you consider your options for where to reinvent your life overseas, you want to review detailed budgets for the countries that interest you, as we try to help you do regularly. You want to understand the local tax rates as they'd apply to you and the average temperatures by season. You want to research the local standards for medical care and the cost of health insurance. You want to look into air access to and from the places you intend to travel regularly...options for establishing legal residency...


This research is important. But, once you've carried it out, set all the data aside and let your heart take over.

A friend, Jeff, a Brit who has been spending much of his time in Nicaragua for years, passed through Panama City this week.

"People ask me all the time why I chose Nicaragua over Costa Rica," he said.

"There are quantifiable explanations," Jeff continued. "The cost of living in Nicaragua is lower than that in Costa Rica, for example. And Nicaragua has a program of special benefits, tax breaks, etc., for foreign retirees that's very competitive.

"But those aren't the reasons I recommend Nicaragua over its neighbor to the south to anyone who asks or why I chose to focus my time and attention in Nicaragua years ago, when I could as easily have based myself in Costa Rica. Nicaragua simply appealed to me more," Jeff explained, "for reasons that I have trouble explaining."

I knew what he meant. I visited Costa Rica for the first time coming up on 30 years ago. I've returned probably 25 times since. Its Pacific coast is beautiful, as is its mountainous interior. Great surfing, great bird-watching, great boating, great fishing...Costa Rica has all these things. When I first traveled to this country, it was also very affordable and boasted the world's premier foreign retiree program. Still, I didn't get it. I could list out the advantages and benefits of living in Costa Rica, but I couldn't make myself want to live there.

Then, a few years later, I traveled to Nicaragua. I knew within a few hours of wandering around colonial Granada that this was a place I wanted to return to. This was a place I could call home, for visiting it for the first time felt like coming home.


Own A Spanish-Colonial Home In Granada, Nicaragua

A Lot Of Charm For Just US$37,000

Sept. 10, 2014, Granada, Nicaragua: Granada, Nicaragua, is the premier Spanish-colonial city and perhaps the best place in the world to shop right now for a Spanish-colonial home of your own

Dear Live and Invest Overseas Reader,

A Spanish-colonial city can be a great choice for retirement, and Granada, Nicaragua, is perhaps the queen among all Spanish-colonial city options. At the heart of this city, radiating from the central square, is a great variety of classic and charming Spanish-colonial homes with high ceilings, painted tiles, and private center courtyards.

And the best part is that you can own one for as little as US$37,000.

Founded in 1524, Granada claims to be the first European city founded in mainland America, so it's a truly old colonial city rather than a semi-modern lookalike. It's named after the ancient city of Granada, Spain, and shares some of that city's Moorish architectural influence.

Granada sits at the north end of Lake Nicaragua, with beaches near town and a group of small private islands just offshore, and just south of Lake Apoyo, Nicaragua's largest volcanic crater lake.

The international airport at Managua is a little less than an hour to the north, and the Pacific Ocean lies a little more than an hour to the west. The weather is warm to hot all year, with average high temperatures running seasonally between 86°F and 93°F (30°C to 34°C). Rainfall is moderate at 47 inches, and most of it comes between May and October in the form of afternoon showers.

It's obvious as soon as you arrive: Granada is one of most finely restored and preserved colonial cities in the Americas. It sees a good number of international travelers and has a sizeable expat community. These two things combine to account for the city's wealth of upscale hotels, fine restaurants, and well-kept buildings.


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Kathleen Peddicord

Kathleen Peddicord is the founder of the Live and Invest Overseas publishing group. With more than 25 years experience covering this beat, Kathleen reports daily on current opportunities for living, retiring, and investing overseas in her free e-letter.

Her book, How To Retire Overseas—Everything You Need To Know To Live Well Abroad For Less, was recently released by Penguin Books.

Read more here.


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