Steady Appreciation And Double-Digit Net Yields– Why This Is One Of Our Favorite Property Markets Worldwide
American Rich Holman made his full-time move to Medellin, Colombia, six years ago.
“Being a gringo in Medellin is sort of cool,” he reported to the group assembled for our Live and Invest in Colombia Conference in Medellin last week. “The locals here, the paisas, as they’re known, they like us. They’re friendly, accommodating, protective, considerate, warm, and engaging.
“Their city is their biggest source of pride. If you want to bring a big smile to the face of any paisa, just tell him how much you appreciate and enjoy his city and culture.
“Outside El Poblado (Medellin’s central zone), gringos are still a bit of a novelty, so we stand out. But in a friendly way.
“My best advice for any gringo interested in spending time in Medellin is to respect the culture and to be polite. Preface any conversation with a local, even in business, with ‘como estas?,’ ‘que tal,?’ ‘que mas?,’ or the like. You’ll come across as arrogant and unfriendly if you don’t.
“For me, one of the best things about living in Medellin is the weather. You have one season: springtime. We’re at 4,300 feet and near the equator, so temperatures are consistently 72 to 80 degrees Fahrenheit with low humidity. Your main dressing decision is whether to wear a short-sleeved or a long-sleeved shirt.
“At this altitude, bugs are almost nonexistent, hence no screens on windows or porches. The city is amazingly clean, even in the poor areas, no dirty bathrooms, no rotting garbage or litter in the streets, no animal feces…
“Five of the top-rated 35 hospitals in all South America are in Medellin. Plus, the cost of health care here is about one-third the cost in the States.
“Transportation is affordable and efficient. Plenty of taxis (the average fare is US$3 to US$5) and lots of buses (fares around 70 cents). The aboveground Metro, which traverses north to south and east to west, is spotless, completely sans graffiti. The cost of a ride is about US$1.20.
“Medellin has a great educational system, with more than 32 colleges and universities, almost as many as in Boston. There is a tremendous sense of community. In almost all 60 of Medellin’s barrios (neighborhoods), on any given evening or weekend, you’ll find friends and families sitting at small outdoor bars and restaurants and on their front porches enjoying themselves, always laughing and smiling.
“If you like to party, you will have trouble keeping up with the paisas. Their energy for entertainment is inexhaustible.
“I think at least some of their energy comes from their city. This place has a vibrancy about it, a great positive energy. It just feels good to be here.
“This is an emerging economy. That translates to tremendous opportunities for entrepreneurs willing to put up with some negatives and some challenges. Speaking as one who has been running a business here for a few years, I can tell you that it isn’t an easy thing. However, I believe I’m investing now to position myself for the wave of growth I see coming.
“There are reasons why the world’s largest computer manufacturer, the world’s richest man, and the United States’ largest private real estate investor all have this year announced business operations in Medellin and Colombia.
“I’m in the real estate business,” Rich continued for the crowd in the meeting rooms of the Estelar Hotel in Medellin last week. “Right now, real estate in Medellin, on a cost-per-square-meter basis, is the least expensive of any cosmopolitan city in the world. That alone is enough to get my attention. Layer on top of that critical current reality all the many other advantages and benefits of this city, and it’s not hard to understand why I’ve chosen to restart my life here.
“Colombia continues to suffer a stigma thanks to its past problems. There’s still a lot of ignorance in the international community. Which explains why foreigners still represent less than 1% of residential real estate buyers in Medellin.
“This is changing, though. And the rate of change is accelerating. Which is part of the reason property prices in this city continue to rise steadily; values are up 5% to 7% over the past 12 months, a solid and healthy rate of growth for the property owner. And rental cash flow can net you double-digit yields, if you buy right.”
Continue Reading: El Retiro For Small-Town Living In The Hills Outside Medellin, Colombia