Retire abroad for pennies on the dollar. As a retiree with a home abroad, you can take advantage of the sometimes much lower cost of living overseas—in some cases, living for as little as US$1,000 per month—while experiencing the adventure and excitement of a new life in a new country. Enjoy a rich cultural experience. Any real estate purchase abroad makes you part of a new culture. It broadens your world view, opens the door to exploration and travel, and encircles you with new friends from new places. Gain access to unlimited investment opportunities. As we just saw in the Great Recession, some countries enjoyed steady growth and strong property markets while the United States and Europe were (and in some cases continue to be) in crisis. Those with an “overseas footprint” have been able to profit through tough times. Achieve true investment diversity. If you have a “diverse” portfolio that's fully invested in the U.S. markets, then your eggs are, in fact, still in one basket.In 2008 and 2009, my investments in U.S. markets lost money. No surprise there. But my property investments in Uruguay and Brazil posted double-digit gains each of those years.As much as I hate to admit it, this was not because I'm particularly savvy or insightful. It was because I was diversified outside the United States. Benefit from currency diversity. Like having all your money in U.S. markets, having 100% of your investments in U.S. dollars also puts all your eggs in one basket. Some real estate markets overseas are priced in U.S. dollars, but those that aren't give you a currency diversity that can work for you as exchange rates move. Of course, it can also work against you.The value of a beach house I owned in Brazil increased 78% in less than a year in dollar terms. Part of that was an increase in the property's value. However, during the eight months I owned the house, the value of the Brazilian real gained almost 39% on the U.S. dollar. Again, this was not the result of having a crystal ball. It was diversity at work.Earn an income abroad. Another advantage of owning real estate in another country is that you can earn an income stream—often a non-dollar income—that's independent of the U.S. economy. My properties in Medellin, Colombia, rent for a total of around US$3,800 per month. Since the income is in pesos, this represents a good, non-U.S., non-dollar income stream. Owning abroad can also be a source of tax-deductible travel, as you travel to manage your investment properties. Enjoy the security of a hard asset. In the current investment climate, hard assets are the most sensible investment class and the best choice for storing value. As real estate investors are fond of saying, the value of your property can't go to zero...unlike your stock in Pan Am, Enron, or EToys.com. Profit from the world's agriculture boom. Some of the most solid investments over the past few years have been agricultural investments. Simply put, the world's population is exploding... while the available farmland is shrinking at an alarming rate. The three most recent agro-deals I've looked at are estimating annualized returns between 10% and 19%, on investments of as little as US$15,000. Store your wealth privately. Real estate overseas is one of but two remaining asset types that an American need not report to the IRS every year... meaning this is an opportunity for you to store and grow wealth privately. Take advantage of international asset protection. This can be one of the biggest benefits to having a property overseas. Having assets offshore makes them hard to get to. A deliveryman who trips on your sidewalk can probably get his hands on your bank accounts and possibly your IRA. But he won't get your condo on the beach in Belize. In fact, his lawyers probably won't even know that you own a condo in Belize, as there's no reporting requirement to the U.S. government. Open the door to overseas residency. Owning an overseas property gives you a “foot in the door” to the country where the property is located. It's another place where you can hang your hat. And in many countries, owning real estate qualifies you for a residency visa, even a pathway to citizenship, along with access to the country's banking and financial systems.In Colombia, I qualified instantly for permanent residency as a property owner... shaving five years off the time required for permanent residency and citizenship.What all this means in a practical sense is that you've got a second home, in a second country, set up and waiting for you should you ever need to take advantage of it. Like me, many people today are combining a number of these agendas. That is, your vacation home, income property, and international investment can also be your future retirement home, earning a good income now while giving you an international presence and increasing in value until your retirement. In addition, there is one big intangible upside to owning a piece of real estate abroad. It's the feeling you get when you become a citizen of the world, a person with an international presence. As you travel among the continents, you realize that you “belong” in more than one place. And the ability to belong in more than one country and culture may be the biggest benefit of all. Lee HarrisonEditor's Note: Lee Harrison will be co-hosting our Global Property Summitthis year. Lee will join Lief Simon on stage over three days in Panama City to discuss and consider your best options for taking advantage of this current golden age of foreign property investing.You can read more about the program Lief and Lee have put together for this, the only real estate-focused event on our 2015 calendar, here.
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Medellin, led by the local utility, EPM, uses thousands of temporary workers over a period of months to decorate downtown with millions of lights in preparation for the grand lighting on Dec. 1. The event is called El Alumbrado, literally "the lighting."The celebration is a tremendous source of pride among the people of Medellin and enjoys broad public participation and support. Everybody gets out and enjoys the festivities. El Alumbrado started in 1955, sponsored by EPM and the local municipality. It was a modest celebration in the early years but has steadily progressed to become the extravaganza it is today, drawing visitors from around the world.El Alumbrado's traditional kickoff date was Dec. 7, a Colombian holiday called Día de las Velitas (Day of the Little Candles), held on the eve of the Immaculate Conception. But, since 2011, the "lighting" has gradually crept back to Dec. 1 to accommodate the large tourism influx into the city for the occasion. This year it crept back to Nov. 29 and will run until Jan. 12, drawing more than 4 million visitors. For this season, they've installed almost 500 miles of light strings with more than 30 million bulbs at a cost of around US$10 million. The effect is amazing. Have a look at these few random shots of Medellin's Christmas lights.The Alumbrado actually takes place in five major areas around the city, with a number of smaller, local displays here and there. My favorite of these areas is the walk along the river, which has the most impressive display, along with a carnival atmosphere including food stands and a handful of restaurants set up for the occasion. The display here runs between the bridges Puente Guayaquil and Puente San Juan for just over a mile.I'd say there's no better time to visit Medellin than right now. It's downright Christmassy, despite the invitingly warm weather. With the abundance of events and festive atmosphere, I can't think of a better place to celebrate the season. Lee Harrison
My favorite part of Salinas is Chipipe, close to the naval base. It draws a quieter crowd and, because it's at the end of the beach areas, sees less traffic than elsewhere in Salinas. The beaches are wider and nicer than anywhere else in town, and just a couple of blocks in from the beach is a pleasant downtown area with fine old homes and lower property prices.
Salinas is famous for sport fishing and holds a number of world records for sailfish, tuna, and black marlin. The year's best weather starts in November, with sunny skies and pleasant temperatures. February through April, this weather gives way to sunny mornings with showers in the afternoons, still quite pleasant. April through November, it's often cool, dry, and overcast. If you burn easily, you might like it; if you crave sunshine, you won't.But Salinas benefits from the school schedule in Cuenca. The kids are out of school in Cuenca in June and July, and that's when a lot of families go on vacation. So there's a demand for vacation rentals during the time of year with the least-pleasant weather.This is good news for North American investors, who can escape their winter to enjoy Salinas' best weather and also enjoy local rental demand during the off season.Bottom line, what makes Salinas such an appealing property-purchase location is the low cost. Here are examples of properties currently on the market:
I recommend Salinas as your best coastal choice in Ecuador if you're interested in a place where you could live part time and rent your place out when you're not there. You'd enjoy great weather during the North American winter and rental traffic during North America's summer.
And, again, you can position yourself here right now for as little as US$40,000.Lee HarrisonEditor's Note: Lee Harrison, our Overseas Property Alert editor, will be revealing all of his current top global property investing recommendations at our 2015 Global Property Summit.Registration for this once-a-year event will open within the next 24 hours.Go here now (this is your last chance) to get your name on the pre-registration list to enjoy VIP attendee status and perks.
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"Rule #4: Acknowledge your bad Spanish. "I've found that this gets you a lot of points. Unless your Spanish is legitimately fluent, begin any conversation with, 'Excuse me, my Spanish is not very good, but...' First, this makes the Spanish-speaker more attentive to what you're saying, but it does something else, too. It lets the person on the other end of the conversation know that you're not a cocky American who's going to barge in and belligerently demand what he wants. It signals instead that you're asking for help. That really puts someone in a different state of mind. "Rule #5: Pedestrians do not have the right of way, ever. "Lots of people get run over. One trick when crossing a street with a stop sign is to cross behind the lead car. Locals don't ever cross in front because that car is watching the traffic. When there is an opening to go, they will go whether there is someone in front of the car or not. The pedestrians are just expected to scatter. It takes some getting used to, but you can't expect crosswalks to be honored or for pedestrians ever to have the right of way. "Rule #6: You've got to drive aggressively. "If you're a yield-to-the-right-of-way person, you're going to be sitting at the first intersection you come up to until doomsday. Ecuadoreans are very aggressive behind the wheel. They don't let people in and they don't show courtesy, neither to pedestrians nor to other drivers. If you can't drive like them, you're better off not driving. I found it fun, so much more fun than driving in the States, when I got used to it. "Rule #7: Forget your ideas about personal space. "We tend to treasure a little space around us and don't touch or rub up against each other in public. Once in this country I was taking the bus and sitting next to a 12-year-old girl on her way home from school. As we were riding along, she fell asleep on my shoulder. When we got to her stop, she woke up and got off. That's a kind of closeness we're not prepared for. "Rule #8: Don't get in a taxi without agreeing the fare in advance. "I just read that Cuenca now has metered taxi. Guess what? Cuenca had metered taxis in 2002 when I was living in that city. They became law, but the taxistas refused to use them. They still do. They get away with it because customers don't complain. The taxista just puts a rag over the meter so you can't see it. So you want to get an idea of what the fare should be before getting in. "About a year ago, I arrived at the Cuenca airport and asked a driver, 'How much to downtown?' He said, 'Six dollars.' I said, 'I don't think so. I live here!' He said, 'Two dollars.' "Rule #9: Don't wait to be seated and other restaurant etiquette. "In the United States we wait to be seated, but here you seat yourself. Also, in our culture, a waiter is designated to certain tables, and you only ask your waiter for more water, etc. That doesn't happen here. All the waiters are happy to help. If you need something, don't worry about who took your order, just grab the next guy you see. "Also, you need to ask for the check. I can't tell you how many times I've seen folks angrily waiting for their checks while the restaurant has wanted to close 20 minutes ago. All the waiters stand shoulder-to-shoulder by the kitchen wishing the people would just ask for the check so they can go home. It's a standoff that happens all the time. It would be rude for a waiter to bring the check before you ask for it. By asking for it, they know you're done. You can say, 'La cuenta, por favor.' "Restaurant bills here include a 10% tip. If you want to leave something extra, that is fine but not expected. If I know the restaurant owner doesn't distribute tips to the wait staff, I leave cash on the table. "Rule #10: Bring patience with you. "Know that nothing will be as efficient as where you're from. Be patient. You're gonna' love it here if you learn to appreciate the differences." Kathleen Peddicord P.S. Lee Harrison was master of ceremonies for last week's event in Ecuador. His presentation on Ecuador etiquette was recorded, along with every other presentation. These audio recordings are being edited now to create our all-new Live and Invest in Ecuador Home Conference Kit, which will be available for fulfillment two weeks from today. Meantime, you can purchase your copy pre-release and save more than 50%. Do that here now.
"Dear Team Live and Invest Overseas, I thought this might interest you... "According to my Weather Pro App (widely used by Irish farmers) we can see that our trip to Dubrovnik next week will be somewhat of a disappointment weather-wise compared with Portugal. I never expected that. Just goes to show your weather reports in your recent Retire Overseas Index report were spot on." --Bea D., Ireland
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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.
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