Why El Presidente Ortega Hasn’t Changed Our Minds About Nicaragua
Real estate prices in Nicaragua rose steaily through the end of 2006. With Sandinista Danny (Ortega) scheduled to re-take office at the beginning of 2007, though, and the U.S. real estate market beginning to tumble, investors began to pull back, taking a wait-and-see attitude.
Meantime, the tourists kept coming to this bueautiful and diverse land, but, with so much uncertainty on both sides of the investment equation, most were content to enjoy the scenery…without staking a claim to a piece of it for themselves.
A little more than a year later, and the bad press initially surrounding the re-election of El Presidente Ortega is turning. Ortega is playing nice with the U.S. He is working to clean up title on 3,800 properites held by Nicaraguans. And he continues to support foreign investors’ land rights. While most U.S. speculators are holding their sidelines approach to the Nicaragua market, the tourists are beginning to buy in again. Sales aren’t as brisk as before Ortega’s re-election, but they are trending up, especially near the tourist hubs of Granada and San Juan del Sur.
As unlikely as it may seem, surfers, especially in the wake of Ortega’s re-election, have become a real estate market force. They don’t seem to care who holds office…as long as the surf is up…and the surf off Nicaragua’s south Pacific shores is considered five-star. Surfers have continued to come, to ride, and to buy, ongoing political events notwithstanding.
We have to admit…we don’t surf. However, we’ve been infaturated with Nicaragua for 15 years, a country working hard to set itself firmly on the path of peace, prosperity, and open markets. We’re invested here ourselves and would have no reservations investing further today.
Nicaragua at a Glance
|Population||5.7 million (July 2007)|
|Gross Domestic Product (GDP)||$18.17 billion (2007)|
|GDP Per Capita||$3,200 (2007)|
|Inflation Rate||9.8% (2007)|
|Currency||Gold Cordoba (NIO)|
|Exchange Rate Versus U.S. Dollar||18.457 gold cordobas = 1 U.S. dollar (March 2008)|
|Population of Capital City||1.7 million|
|Time Zone||GMT minus 6|
|Seasons||Tropical; rainy season lasts from June to December|
|International Dialing Code||505|
|Electricity||120V / 60 Hz; Plug Type: A (US style)|
|Name and Party Affiliation
of Current Leader
|Daniel Ortega, Sandista National Liberation Front|
|Income Tax Rate for Residents||10% to 25%; 15% for all income earned within Nicaragua|
|Property Tax||0% to 1%|
|Capital Gains Tax||Taxed at income tax rate|
|Inheritance Tax||Taxed at income tax rate|
|Rental Income Tax||Taxed as income tax rate|
|Transfer Tax||1%, paid by seller|
|Restrictions on Foreign
Ownership of Property
|Local Chamber of Commerce||www.caconic.org.ni
Tel: Tel: (5052) 68-35-05
|American Chamber of Commerce||www.amchamnic.org.ni
Apartado Postal 202
Tel: (5052) 67-30-99
|Primary Exports||Coffee, beef, shrimp, lobster, tobacco, sugar, gold, peanuts|
|Residency and Visa Requirements||Tourist Visa: automatic 90 days upon entry
Residency: permanent residence and investor’s residence visas, including pensionado and rentista
Citizenship: three years of uninterrupted, legal residence
|Special Benefits for Foreign Residents or Retirees||No income tax on external income; tax-free import of household goods and vehicle|
|Preferred Contact||Mike Cobb