Articles Related to Uruguay

Argentina

Argentina thrives on crisis, and it can seem that this country is always entering or exiting a financial meltdown, making it hard to know when to get in or out. 

The most recent crisis here has been building for some time. Argentine contacts on the ground tell me that 2015 will begin the window of buying opportunity. As one puts it, "Argentina is right now walking into a new investment phase."

Another says: "The time to be putting money into Argentina will begin May 2015..."

I timed Argentina's last major crisis, in 2001, and helped investors who took my advice to as much as double their money in two years (myself included). I'm looking forward to the next buying opportunity in this country, and you should be, too.

Growth Markets

Panama City

I've been recommending Panama City for rental investment for 10 years. In that time, I've earned cash flow of 15% per year net and more myself and have helped many, many other investors do the same.

Post-2008, pundits who claimed they knew proclaimed that this market, like so many other markets around the world at the time, would collapse. I ignored them and continued recommending Panama City for rental property investment.

Though the market softened, no collapse came, and I, as well as those who took my advice, continued earning excellent annual yields.

What do I think of Panama City for rental investment today? I'm more bullish on this proven market than ever and am looking to invest further myself. This market offers some of the most stable rental yields available anywhere in the world thanks to its unique flexibility. You can rent short-term or long-term...to business men, retirees, or tourists...to expats or locals. 

The key is buying in the right part of town depending on which market you want to target. At the Global Property Summit in March, I will show you what and where to buy to generate the greatest possible yields while at the same time positioning yourself for what I predict is going to be excellent capital appreciation over the coming 5 to 10 years.

Medellin

Medellin, Colombia, has been one of my favorite rental investment markets for the past six years and here, again, I'm more bullish on this market's prospects looking ahead to 2015 than ever. 

In addition, I have identified an emerging neighborhood of this city that is poised to offer better-than-ever returns. This area is a focus of the local city planners, who are investing in important infrastructure improvements, and, as a result, is drawing increased attention from foreign investors, travelers, and property buyers. What began as the initiative of a few local entrepreneurs is expanding into one of the world's best rental investment opportunities today.

Meantime, the U.S. dollar is at a five-year high against the Colombia peso. The time to act in this market is right now. My Colombia contacts have the details for where and how at my March 2015 Global Property Summit.

Istanbul

An exploding local demand is fueling a housing boom in this beautiful and historic megacity. Half the population of Turkey is younger than 30 years old, and the country sees 350,000 weddings a year. All these new couples want places of their own to live, and, thanks to the strong and expanding economy, more of these young couples than ever can afford places of their own.

Still, right now, the starting market price in Istanbul is US$1,000 a square meter, making this city a global bargain. You can get into a rental with as little as US$50,000, and less than US$25,000 down buys you pre-construction yields of up to 15% per year.

My Istanbul contacts will be in Panama with me for the 2015 Global Property Summit to share all the details.

Profits From Agriculture

Productive land is the ultimate hard asset, with the potential for long-term even legacy yield. At my 2015 Global Property Summit, we'll look at:

Timber In Panama

Historically, timber has enjoyed the best risk-to-reward ratio of any investment sector, producing an annualized ROI of 12% to 15% per year every year since they started keeping records of investment risk versus return. It's the long-held secret of the world's wealthiest people.

I like Panama for timber. The country has some of the world's best zones for many kinds of timber, including teak. And, as this is the hub of the Americas, easy access to markets both north and south ensures outlets for your harvests. 

At my March 2015 Global Property Summit, I'll introduce you to the best current opportunities to position yourself for long-term growth from timber in Panama, including a chance to earn up to 11.62% from a hardwoods investment that also qualifies you for residency in Panama, one of the world's leading offshore and retirement havens. The best part of this opportunity is the buy-in cost, which is just US$15,200.

Agriculture In Panama

Panama also offers the opportunity right now to cash in on the globally exploding demand for one agricultural product in particular. I'm working with local contacts to prepare a special presentation on this opportunity specifically as it's one of the best agricultural investments I've identified in six years of searching.

Agriculture In Paraguay

Paraguay is the world's 10th-largest exporter of wheat, eighth-largest beef exporter, seventh-largest exporter of corn, sixth-largest producer of soy, fifth-largest exporter of chia and soy flour, and fourth-largest exporter of yucca flour and soy oil. 

This country has the third-largest barge fleet in the world (after the United States and China) and is the third-biggest exporter worldwide of yerba mate. It's the second-biggest stevia producer and exporter in the world and the world's #1 exporter of organic sugar.

GDP and GDP per capita are both expanding, and inflation is historically a one-digit number and has not surpassed 5% in recent years. 

Paraguay qualifies right now as a "blue ocean" market, an investment arena awash with opportunity, especially agricultural investment opportunity. My correspondents from the scene will have the details for March 2015 Global Property Summit attendees.

Farmland In Uruguay

Uruguay is a breadbasket country that is also the world's most turn-key market for productive farmland, the world's oldest asset class and one that is going to continue to become more attractive over the coming decade as the world's population continues to expand. We're looking at more than 9 billion people on this planet by the middle of this century, a sobering reality that is translating to a global race for farmland, with some countries (including Brazil, for example) imposing restrictions on foreign ownership of productive land.

Not so in Uruguay, which welcomes foreign investors. Nearly 95% of the land in this country is farmable. At the March 2015 Global Property Summit, my Uruguay investment pros will introduce you to current opportunities to position yourself to profit from an ultimate hard-asset investment in this market, including agricultural, cattle, sheep, forestry, and vineyard buys.

Isn't global property investing a jet-set strategy?

No.

I've identified six opportunities with buy-ins of US$50,000 or less to showcase at my 2015 Global Property Summit, including one double-digit yield opportunity for less than US$20,000 and another for US$25,000 that could earn you up to 22% per year.

Lief Simon

P.S. The first 25 who register are invited to accompany me on a private property-viewing tour in Panama City

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Good luck finding this level of sophistication and infrastructure anywhere else in Ecuador outside Quito (which we also would not recommend as a place to live).

Why Not Boquete?

Boquete has long been heralded by many (starting, in fact, with us, more than 15 years ago) as one of the world's top retirement havens. However, we decided not to include this Panamanian mountain town in our 2014 Index for two reasons.

First, the cost of living in Boquete continues to rise.

Second, you have other better choices elsewhere now, which we wanted to feature instead. We limit our Index to 21 destinations. This is an arbitrary restriction that forces some hard choices. The truth is, as more places worldwide become more appealing for the would-be retiree, other places, including some well-known, like Boquete, become less so. Boquete is still a great turn-key choice for overseas retirement, but we'd say it no longer belongs on a short list of the world's top 21 choices.

One big draw of Boquete is its large and growing expat community. If the idea of retiring to a place where many others like you have already paved the way and stand ready to welcome you to their ranks, you have other more affordable choices, including Cuenca and Chiang Mai, for example, both of which offer super-cheap, high-quality lifestyles (and both of which are included in our Index this year).

Puerto Vallarta and Barcelona are two other expat-friendly options featured in our 2014 survey. The cost of living is higher in Puerto Vallarta and Barcelona than in Cuenca and Chiang Mai...and higher than in Boquete. However, the cost of living isn't unreasonable for the quality of life available for purchase. The quaint mountain town of Boquete just can't compete for lifestyle with chic, cosmopolitan Barcelona or Pacific oceanside Vallarta.

Why Not Uruguay?

Uruguay has gotten expensive, too expensive for the lifestyle on offer, and it's likely to become more expensive still.

Uruguayans are used to the devaluation of their peso. They refer to appreciation as atraso cambiario, "the exchange rate is running late." Because of this phenomenon, prices for many big-ticket items in Uruguay (including real estate, cars, and even high local salaries) are quoted in U.S. dollars.

Why Not Brazil?

High crime rates keep much of Brazil off our radar and out of our survey. That said, south from Ceara to Natal, you can enjoy super-cheap coastal buys in safety.

Further, the bureaucracy, red tape, and corruption at all levels involved with getting anything done in this country are significant downsides to life here. The country doesn't make establishing residency easy and offers no retiree benefits program.

Also, Brazilians speak Portuguese, which, for most of us, is not as easy to muddle through as Spanish, French, or Italian.

Why Not Ajijic, Chapala, San Miguel de Allende, Or Merida?

Mexico offers many well-publicized options for the foreign retiree. Why did we choose Puerto Vallarta over the rest of the choices for our 2014 Retire Overseas Index? Because if offers the best option anywhere for the retiree looking for developed Pacific coastal living on a budget.

Nicaragua, Panama, Costa Rica, and Ecuador all also offer Pacific coast options, but none is anywhere near as fully appointed as Puerto Vallarta, which offers marinas, country clubs, golf courses, shopping, and fine dining. Yet, you could retire here on a budget of as little as US$1,910 per month, which is more than an average budget for other countries with Pacific coastlines in our Index but a very reasonable amount given the lifestyle on offer.

Why Not New Zealand?

We like New Zealand as a part-time retirement spot, but we didn't include it in our survey this year because it's just not a realistic full-time option for the typical retiree. The truth is, New Zealand (like Australia) isn't overly keen on the idea of foreign retirees and doesn't make it easy for the retiree to establish residency. In fact, in most cases, it's not possible.

Why Not Costa Rica?

About three decades ago, Costa Rica decided to make a business of the foreign retiree. The Costa Ricans invested in a formal and successful advertising campaign, targeting Americans primarily. Tens of thousands of would-be retirees from the States took up the invitation and relocated to this beautiful land of hills and rainforests.

The benefits Costa Rica offered retirees who became resident were terrific, including the original pensionado program against which others were measured for decades. In addition, way back when Costa Rica made a name for itself as a top retirement choice, the cost of everything from groceries and eating out to prime coastal property was super cheap. Fast forward a couple of decades, and, thanks to investors and speculators, Costa Rica wasn't so cheap anymore, neither its cost of living nor its beachfront real estate. And, while prices had risen dramatically, the infrastructure hadn't kept pace. Retirees were happy to overlook falling bridges and unpaved roads when prices were low. Harder to rationalize putting up with failing infrastructure in the face of appreciating costs.

Worse, after working so hard to woo American and European retirees, Costa Rica seemed to change its mind. The Costa Ricans didn't eliminate their famous pensionado program; they simply eliminated most of the tax breaks it had promised, as part of a deficit-reduction austerity package. And they didn't grandfather in existing pensionados. So those who'd chosen Costa Rica for the retiree benefits it offered were surprised and disappointed to find that those benefits existed no more. Now the Costa Rican government is considering a further pensionado program adjustment. They're talking about increasing, maybe substantially, the minimum monthly income requirement to qualify. And, again, if the change is made, existing pensioandos won't be grandfathered in. To renew your status, you'd have to qualify under the new requirements.

Kathleen Peddicord

P.S. Our 2014 Retire Overseas Index is featured, in full, in this month's issue of our Overseas Retirement Letter. If you're not yet an ORL subscriber, become one now to receive this bumper special annual edition, hot-off-the-virtual-presses.

Or you can purchase a copy of the Index on its own here.

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First, I think Montevideo is a good choice within Uruguay; the cost of living is lower than in Punta del Este, and I found lifestyle to be richer for a year-round resident. Don't get me wrong; I loved living at the beach. But Montevideo is alive and active every day of the year, while Punta del Este grinds to a halt in the wintertime.

Colombia's Medellin, however, provides a more upscale environment than Montevideo. In my neighborhood of El Poblado, the streets are better kept, the city is cleaner, and everything seems shiny and new. In fact, the lifestyle is higher-end than anywhere I've lived in the United States...which makes Medellin an amazing bargain considering the low cost of living and of property.

On the other hand, I find a cultural richness in Montevideo that I don't feel in Medellin's El Poblado. The Old World European traditions, the predominantly Italian influence, and the friendly people create an experience that I haven't been able to duplicate outside Uruguay. And Montevideo--in fact, Uruguay in general--offers the low-stress environment that comes with a truly non-confrontational culture...something I've found to be unique about Uruguay in the Americas.

Whether you prefer the Old World ambiance and tango culture of Montevideo or the upscale beauty of Medellin is a matter of personal choice. But here are a few other things to take into account, as well, if you're deliberating between these two top retirement options.

First, I believe that the cost of living for day-to-day items in these two cities is almost the same. Based on my own spending habits for food and entertainment, I can't see a difference in my routine expenses.

However, you'll spend more on electricity in Montevideo, as you will likely use heat for three months per year and air conditioning for perhaps two months. Montevideo has four seasons (but no ice or snow), while Medellin enjoys moderate temperatures all year (average high of 79°F).

All things considered, I'd say you'll spend less in Medellin than in Montevideo, especially if you live (in Medellin) outside the most expensive and sought-after El Poblado.

Both Montevideo and Medellin are cities where you could live without a car; although it's easier to get around Montevideo on foot than it is El Poblado, as Montevideo's terrain is fairly level and everything's closer at hand.

Both cities also have solid infrastructure, with drinkable tap water, good public transportation, and reliable high-speed internet service available at reasonable prices.

Montevideo and Medellin also both host a significant English-speaking expat community. But in neither case is the English-speaking community large enough to affect the local culture.

One important difference has to do with the cost of real estate, which is significantly higher in Montevideo than in Medellin. Based on my personal experience, a Medellin apartment that sells in El Poblado for US$1,500 per square meter would cost more than US$2,500 per meter in Montevideo, in a comparable neighborhood.

Also, real estate transaction costs are much higher in Montevideo than in Medellin. I paid around 8.2% of the purchase price on the two Uruguayan properties I bought but only 1% on each of two Medellin properties I've purchased.

Real estate trades in U.S. dollars throughout Uruguay, while it trades in Colombian pesos in Colombia. So Uruguay offers exchange-rate stability (with respect to real estate), while Colombia offers the risks and/or rewards of buying in a foreign currency.

In both countries, you have exchange-rate exposure for all other expenses (aside from property purchase). Both the Uruguayan peso and the Colombian peso have risen strongly against the U.S. dollar over the past few years; however, recently the dollar has been gaining ground on both. This is impossible to predict, so I just chalk it up in the “risk” column.

In both countries, I found residency fairly easy to obtain; although Colombian residency is the easiest I've seen in Latin America. I applied and walked out the door with my Colombian visa in just under one hour.

Finally, Montevideo is less convenient to the United States than Medellin. The flight to Montevideo takes over nine hours from Miami, while Medellin is just three hours away.

As we say again and again and again, it comes down to your priorities. If you're seeking to diversify your life outside your home country or looking for a safe haven, I would give Uruguay the edge over Colombia. It's an easier jurisdiction for the movement of money; it has a far more flexible and customer-focused banking system; and it's geographically and economically more removed from North America, which, in the context of "safe haven," is a plus.

On the other hand, if want to be able to visit family, friends, or business ventures in the States regularly, Uruguay's geographic situation would be a negative.

If you're interested in the purchase of real estate, for investment and/or for personal use, I would recommend Medellin over Montevideo. This is where Medellin is the clear winner, not only versus Montevideo but versus almost any other city you could name right now.

Not only are prices significantly lower in Medellin than in Montevideo, but we see in Medellin the potential for continued appreciation of values over the near, mid-, and long terms. And, in Medellin, you also have the potential to generate cash flow from rental income of better than 10% per year net. Medellin is one of the top real estate investment markets in the world today.

Lee Harrison

Editor's Note: The limited VIP attendee spots for our Live and Invest in Colombia Conference taking place in Medellin in May are filling quickly and will be sold out soon. If you'd like to join us to discover firsthand just how much Medellin has to offer, I urge you to get in touch to reserve your VIP place now.

You can read more about the program we've put together for this, our only Colombia event of this year, here.

Or you can register by phone by contacting our Conference Department toll-free from the United States at 1-888-546-5169.

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Phillip brings up a good question, one that I hear frequently about these two popular retirement destinations. Having lived in both cities, I think I can help compare the two.

First, Montevideo is a good choice within Uruguay; the cost of living is lower than in Punta del Este (the other most popular choice among expats and foreign retirees in this country), and I found lifestyle in Montevideo to be richer for a year-round resident.

Colombia's Medellín, however, provides a more upscale environment than Montevideo. In my neighborhood of El Poblado, the streets are better kept, the city is cleaner, and everything seems shiny and new. In fact, the lifestyle is higher end than anywhere I've lived in the United States with the exception of east-side midtown Manhattan...which makes Medellín an amazing bargain considering the low cost of living and of property in this city.

On the other hand, I find a cultural richness in Montevideo that I don't feel in Medellín's El Poblado. The Old World European traditions, the predominantly Italian influence, and the friendly people create an experience that I haven't been able to duplicate outside of Uruguay. And Montevideo--actually, Uruguay in general--offers the low-stress environment that comes with a truly non-confrontational culture, something I've found unique in the Americas.

Whether you prefer the Old World ambiance and tango culture of Montevideo or the upscale beauty of Medellín is a matter of personal choice. But here are a few other things to consider, as well.

First, I believe the day-to-day cost of living in the two cities is almost the same. Based on my own spending habits for food, entertainment, taxes, etc., I can't see a difference in my routine expenses Montevideo versus Medellín.

That said, you'll spend more for electricity in Montevideo than in Medellín, as you will likely use heat for three months per year and air conditioning for perhaps two months. Montevideo has four seasons (but no ice or snow), while Medellín enjoys moderate temperatures all year (average high of 78°F).

Both Montevideo and Medellín are cities where you could live without a car; although Montevideo is more convenient than El Poblado on foot, as Montevideo's terrain is fairly level and everything's closer at hand.

Both cities also have solid infrastructure, with drinkable tap water, good public transportation, and reliable, high-speed internet service at reasonable prices.

Montevideo and Medellín also both host a significant English-speaking expat community. But in neither case is the English-speaking community large enough to taint the local culture.

The cost of real estate is higher in Montevideo than in Medellín. Based on my personal experience, a Medellín apartment that sells in El Poblado for US$1,500 per square meter would cost more than US$2,500 per meter in Montevideo, in a similar neighborhood. Also, real estate transaction costs are much higher in Montevideo than in Medellín: I paid around 8.2% of the purchase price when I bought in Uruguay, compared with but 1% in Medellín.

Real estate trades in U.S. dollars throughout Uruguay, while it trades in Colombian pesos in Colombia. So Uruguay offers exchange-rate stability (with respect to your property) if you're shopping with U.S. dollars in your pocket, while Colombia offers the risks and/or rewards of buying in a foreign currency.

In both countries, however, you have exchange-rate exposure for all other expenses (aside from property purchase).

Finally, Montevideo is less convenient to the United States than Medellín. The flight to Montevideo takes more than nine hours from Miami, while Medellín is around three hours away.

If you're looking to diversify your life outside your home country or if you're in search of a safe haven, I would give Uruguay the edge over Colombia. It's easier to move money to Uruguay than to Colombia, Uruguay has a far more flexible and customer-focused banking system, and it's geographically and economically more removed from North America. In the context of diversification and safe haven, that's an important plus.

In both countries, I've found residency easy to obtain.

All things considered (cost of living, cost of real estate, cost of purchasing property, etc.), you'll spend less in Medellín than in Montevideo, especially if you live (in Medellín) outside the most expensive and sought-after El Poblado neighborhood. And, again, Medellín is also more convenient to North America.

That said, I don't think I've ever enjoyed life as much as in Montevideo. In the end, for me, the choice between these two cities was more about lifestyle than economics.

Lee HarrisonContinue Reading:

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Aug. 1, 2011:

"Kathleen, we purchased property in Belize several years ago and have recently sold it for a large profit. We wanted to put the money into Atlantic Bank in Belize. This bank has U.S. dollar accounts. If we do this, will we have to file a FBAR? I do not even know what that is? The account will be in my name (I am a U.S. citizen).

"Will the U.S. want taxes from our property sale? I am guessing they would if we have the funds come to a U.S. bank.

"We also have an HSBC bank account in Panama, but now with the change in Panama laws allowing the U.S. government to see what funds we have, would it be advisable to have the funds transferred to the HSBC bank in Panama or not?

"Please provide your knowledge and information on the above issues. We are to receive the funds soon and would like to know where the best place to put them would be.

"Thanks very much for your assistance. I am sure glad we latched on to your e-mails because they have brought us to Panama, and we are now moving there when I retire next year."

--Barbara J., United States

As an American, you must report the sale of any piece of property anywhere in the world no matter where you have the funds from that sale sent. And, as a U.S. citizen, you are liable for tax in the States on any capital gains you yield. However, you can offset those U.S. capital gains taxes due by the amount of any taxes you pay in Belize on the profits from the sale. (This is true anywhere, not only in Belize.)

Please be careful putting the funds into a local bank account at Atlantic Bank. That bank may allow U.S. dollar accounts, but that does not mean you'll be able to get your U.S. dollars out of Belize when you decide you'd like to. This has been a problem for other people I know. To wire U.S. dollars out of Belize, if you don't have what's referred to as a "foreign" U.S. dollar account, you will have to get approval from the Central Bank of Belize, and that can be difficult to obtain.

While the Panama government did, indeed (and unfortunately), sign an exchange-of-information treaty with the United States last year, that fact does not mean they are actively reporting on your (or anyone else's) bank accounts in this country. It's not as though Panama banks are now sending daily reports to the U.S. IRS.

The treaty allows the U.S. government to request information on particular account holdings in Panama and for Panama then to be obliged to send that particular requested information. It's not a blanket directive but allows for a case-by-case exchange of, again, specific information.

Furthermore, note that, whether you hold the funds in a bank account in Belize, Panama, Uruguay, or anywhere else outside the States, as an American, you are meant to report that fact. That is, as an American, you are obligated to report on all non-U.S. bank accounts you hold if the aggregate balance at any point during the year is US$10,000.

You do this on the FBAR. Here is a link to that form for reference: http://www.irs.gov/pub/irs-pdf/f90221.pdf.

We will be addressing these filing and compliance issues and requirements in detail during our Offshore Summit taking place Sept. 14-16 in Panama City.

The Early Bird Discount for registration for this event expired yesterday. However, I've asked our conference team to honor it through the close of business today, as we had dozens of calls and e-mails over the weekend from readers wondering if they were too late.

Get in touch now, and co-Conference Directors Lauren and Sharon will give you the Early Bird savings. This is (really) the final day for this.

You can reach Lauren and Sharon by phone, toll-free from North America, at 1-888-627-8834. 

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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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