So It Goes In Paradise…

Feb. 12, 2012, Panama City, Panama: Day-to-day expat life in Panama City, Panama, can be a study in frustration, aggravation, and the unexpected.

Also This Week: Top Pacific Coast Retirement Options Compared…The World’s Most Romantic Oceanside Retirement…Like The Best Of Southern California (At Prices Even The Not Rich Or Famous Can Afford)…Seaside Jewel, Snowbird’s Delight…

Dear Overseas Opportunity Letter Reader,

"Sr. Lief?! Alberto is in trouble..."

It was Elodia, our office manager, calling upstairs to Lief in a meeting in my office. Lief excused himself and went down to find out what the trouble could be now.

It was just after lunch, but already it'd been an eventful day.

Gary, Lief's project manager for Los Islotes, had left the office early to drive out to the west coast of the Azuero Peninsula, where Los Islotes sits, to meet with an inspector from ANAM, Panama's environmental agency. The inspector was coming out for a regularly scheduled site visit. The guy, though, called Gary, just after Gary had pulled away from the office, to say that the trip was off. Would have to be rescheduled. Because of the Indians.

Members of Panama's Ngobe-Bugle indigenous tribe, protesting mining and hydro-electric dams on their land, have been registering their opposition to these projects by blockading roads around the country. No way to get from Panama City to Azuero the morning Gary and the inspector intended to make that trip. No way, in fact, to get many places in the country that day...or for some days to follow. Gary and the inspector would have to make their site visit another time.

Gary turned around and came back to the office. Which ultimately proved a good thing, as he was around later, to help with the Alberto thing. But I'm getting a little ahead of my story.

Alberto had been busy all morning. He and Marion had two urgent agenda items that day.

First, we had some furniture that needed to be put into storage. This wasn't so much urgent as scheduled. We had movers showing up. Someone needed to show them what to move where.

The second agenda, though, did qualify as critical. Thanks to a paperwork snafu, Lief, Kaitlin, and Jackson's residency visas were about to expire. (For some reason, my application was made separately and was all in order...while the rest of my family was at risk of becoming illegal aliens. Why? Who knows. We've learned not to ask those kinds of questions...)

Marion was meeting the movers to manage the transport of the furniture to the rented storage unit. Marion orchestrating the move, Alberto would be free to run around the city getting together the documentation that we needed to be able to file the visa extensions. The deadline for this was 24 hours away. If we didn't get the right papers filed with the right authorities inside that window, Lief, Kaitlin, and Jackson might have to begin their visa processes all over again. From the start. Dios mio.

So Alberto dropped Marion off with the movers and then set off on his paper chase. When he'd finished collecting the paperwork, he was to collect Marion from the storage depot and then go with her to make the required filings on our behalf. The clock was ticking.

Meantime, back in the office, Lief and I were trying to get a little work done. Until Elodia called upstairs to us in a panic.

"What's the trouble?" I asked Lief when he came back up to my office after speaking with Elodia.

"Alberto hit a guy. I mean, he hit a guy's van. With his car. Well, our car. The guy cut Alberto off, trying to pass him, and Alberto smashed into him. They're waiting for the police to show up."

In Panama, it's illegal for anyone in a vehicle to leave the scene of an accident involving that vehicle until after the police have arrived on the scene and taken statements. Not any policeman will do. It must be one of the special traffic policemen authorized for this duty. In the end, that day, Alberto waited four hours for the right policeman to show up (three other types of cops stopped by sooner, but their visits didn't count).

Gary volunteered to go help Alberto. He took his digital camera and said he'd be back with photos.

Marion called. The movers had finished. Where was Alberto? He was with our bashed-up Prado. Marion should hail a cab.

By the time this message was relayed, it was too late for Marion to make it over to the scene of Alberto's accident, get the required documents from him, and then go back across town to the Department of Immigration. They'd be closed for the day. That would have to wait for the next morning. When we'd be within 12 hours of the pending deadline.

The Prado out of commission, Lief and I would be hailing a cab, too, I guess, to get home that night...

No, no...not so fast. We'd use our friend's car, parked, at the time, on the street in front of our office.

The friend, on an extended stay out of the country, left his car with us for safe-keeping. We'd been wondering where we'd store it. Didn't want to leave it on the street indefinitely. Not that we'd worry so much about it being stolen. But a car parked on the side of the road in this town is fair game. You never know who might swerve, slide, or smash into it. Panama's capital is increasingly a great big bumper-car arena. Too many vehicles. Too much construction. Nowhere any shoulder.

Where could we park our friend's car so it'd be under cover and safe from the free-for-all that Panama City's calles have become?

Now, an answer to that question had presented itself. The Prado would be away for repairs, probably for some time...leaving an open spot in our covered driveway.

Problem solved.

Kathleen Peddicord

P.S. We made the filing deadline with the Department of Immigration...with three hours to spare. Lief, Kaitlin, and Jackson remain legal aliens.

P.S. What else this week?

  • As I've been reminding you over the past month or so, an important part of our editorial agenda this year is making comparisons, drawing out the advantages and the downsides of the world's top retirement havens for 2012.

Today, in that spirit, let's consider Pacific coastal options...

If this is the retirement lifestyle you're in the market for, your search will lead you to choices in Costa Rica, Nicaragua, Panama, Ecuador, and Mexico...

  • "Early in the morning," writes Mexico Correspondent Lauren Stanley, "joggers and dog-walkers are the only ones on the malecón, the seaside boardwalk separating the white-sand beach from the cobblestoned street with its row of shops. Often there is a slight haze in the air, softening the Pacific's blue and blurring the sharp edges of the high-rises seen in the distance, across the bay.

"At this hour here in the Romantic Zone, the only sounds are the waves as they curl onshore and the occasional whoosh of a passing vehicle. The row of whimsical bronze sculptures along the malecón--among them a boy riding a seahorse, a couple in love, and (my favorite) pillow-headed figures climbing a ladder to the sky--are their only company. This is not an early-rising city, and the shops and restaurants are still closed. Their enticing displays--gem-studded jewelry, gaily colored ceramics, chic beachwear, and more--will be available later, as the city wakes up.

"On the quiet side streets, that climb steeply toward the hills, people leave homes and apartment buildings to do their daily shopping just as they would anyplace...just as though they weren't lucky enough to live in one of the most romantic cities in the world.

"For that curving white-sand beach nearby fringes one of the world's largest and most beautiful bays--the Bay of Banderas. And the city that hugs its shores is the legendary resort of Puerto Vallarta, Mexico..."

  • Leaving the Puerto Vallarta airport our most recent visit to this part of the world, we knew right away that we were back in North America. Alongside the highway, we saw Wal-Mart, Home Depot, a mega-grocery store, Domino's Pizza...

"Can we go to Wal-Mart?!" asked young Jackson enthusiastically from the back seat.

Jack's experience of places like Wal-Mart to this point in his life has been limited to our annual Christmas visits to Baltimore, where my family lives. To him, Wal-Mart is a special treat, along with Toys "R" Us and Best Buy. The truth is, places like these are a special treat for me, too.

We've been living for more than 14 years in parts of the world that don't have big-footprint shopping. I feel a little ashamed to admit it, but I miss it.

Because places like Wal-Mart make life easier. It's easy to shop in a Wal-Mart (because there's so much choice, all under one roof), and it's easy to buy there (because the prices are so low).

Many things about being an expat aren't easy. We embrace the challenges, savor our way of life, and encourage our kids to do the same. But, now and then, I admit it: I enjoy an hour or two in a Wal-Mart as much as the next mom.

In this Puerto Vallarta region of Mexico, though, the expat life can be easier than it is elsewhere, and not only because there are three Wal-Marts here...

  • "Puerto Vallarta," writes Mexico Correspondent Lauren Stanley, "is located on Mexico's central Pacific coast, in the state of Jalisco. It's about a five-hour drive west of Guadalajara, Mexico's second-largest city and the Jalisco state capital.

"The city lies between the blue sea and velvet-green mountains that tumble down almost to the shore, and this setting is one of the first things you notice. As you walk along Vallarta's seafront, look down the cobbled side streets that debouche into the malecón.

"You'll see that these streets rise steeply to hills...sometimes within just a few blocks of the shore. These hills are dotted with homes and condominium buildings that offer sweeping views of the bay.

"The hills are part of the Sierra Madre Occidental mountain range that runs from the state of Nayarit, north of Jalisco, to south of Puerto Vallarta. Thanks to this geography, the city is long and narrow, hugging the shore.

"Over the years it's gradually expanded both north and south to its current size--20 miles or more for the core city and outlying areas, and with a population of nearly 256,000 in the 2010 census.

"Puerto Vallarta is a snowbird's delight. The region has a hot, sunny climate. Winters are dry and sunny, with temperatures into the 80s Fahrenheit. Summer temperatures can reach into the 90s, and this time of year is more humid. This is also the rainy season (June to September). Fortunately, there are usually sea breezes, and evening temperatures generally drop to the 70s even when the day has been hot.

"Until the 1950s, Puerto Vallarta was a small fishing village along a spectacular bay on the Pacific, modestly popular among Mexicans as a beach resort. Then, in 1963, John Huston filmed The Night of the Iguana in Mismaloya, a seaside village just south of Puerto Vallarta. The film's star, Richard Burton, was involved with actress Elizabeth Taylor at the time. She followed him on location...and the paparazzi followed her.

"Suddenly Puerto Vallarta was all over the news--and on the map, as far as Americans were concerned--and it's remained there ever since..."

Also This Week...from Resident Global Real Estate Investing Expert Lief Simon:

Kathleen has been writing to you this week about Puerto Vallarta, making the point that this is one Pacific coast destination where it's not silly to make a comparison to the southern coast of California. In fact, the two regions are very similar. The big difference is the cost. Puerto Vallarta serves up the same Pacific Ocean surf, the same white sand, and, very important, a comparable level of infrastructure, amenities, and services as you find in towns along the coast of southern California, but at a steep, steep discount.

That's all speaking generally. What about real estate values, specifically?

Puerto Vallarta can be inexpensive compared with many coastal spots in the States and even compared with some other South of the Border coastal retirement options. At the same time, it's a proven rentals market.

In the Puerto Vallarta region, including Nuevo Vallarta, you can find real estate for sale for as little as US$60,000 (for a condo) or for as much as many millions of dollars (for villa compounds right on the coast). In other words, whatever your budget, even if it's relatively modest, you can find something. This is one reason we like this region as much as we do.

As in any coastal area, prices go up exponentially the closer you get to the water. Older is less expensive. Newer and in a gated community with amenities costs more.

If you're considering the market as a prospective investor, again, you have lots of choice. Pay as much attention to location as to price. If you're shopping for a rental investment, buying cheap doesn't guarantee a good yield.

Using the US$60,000 condo as an example, the price looks great and breaks down to about US$850 a square meter...low by most any standard (don't mention this to the guy from Tucson who keeps writing to me to try to persuade me that Tucson is the world's cheapest place to buy real estate right now). But the location isn't going to attract vacation renters in this market with thousands of available units. If you're buying for investment, you have to balance price with rental potential.

On the flip side, the price of a US$635,000 one-bedroom condo on the water in a marina community may compare well with parts of southern California, but don't expect a great yield on that either. Even if you could rent it out every day during the high season (mid-November through April), the rent isn't likely to be high enough to help you break the 5% net threshold (my minimum expectation for a reasonable rental yield). This is the kind of property you buy for yourself with the thought that you'll rent it out when you're not using it to help offset some of the carrying costs.

Between those two extremes lies lots of opportunity in the Puerto Vallarta area...from reasonably priced condos in town that appeal to those who want to walk to the shops and restaurants to higher-priced (but not over-priced) condos on the water in the newer resort areas for those looking to be near the beach.

With such variety in a market, you have to get your boots on the ground to find the buy and the area that works for you. Fortunately, the Vallarta area has an MLS system (as I remind you regularly, this is a rare thing outside the United States), which can help you get your bearings without having to drive around and around for days or weeks trying to focus your search.

The important bottom-line point is that the Vallarta region offers properties at price points to work for any budget. We'll show you firsthand when we convene in this town for our Live and Invest in Puerto Vallarta Conference taking place May 30-June 1.

I hope to meet you there.

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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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