Forget The Sandinistas: Time (Again) To Act In Nicaragua
“Forget about the Sandinistas. They’re obsolete.”
— Violeta Chamorro, September 1989, when asked about her chances for defeating the Sandinistas in Nicaragua’s first presidential election after the Contra War.
To the surprise of El Presidente Daniel Ortega and all Nicaragua, Mrs. Chamorro won that election in February 1990. The Sandinista Ortega stepped down graciously, and Doña Violeta began the work of rebuilding her country.
I visited Nicaragua for the first time three years later. Managua, thanks to the earthquake of 1972, the revolution, and the civil war, was a near-disaster zone. No reason to stick around (this is only slightly less true today).
Gringos like me migrated instead to the south Pacific coast, where speculators had already begun snatching up stretches of this country’s primo beachfront, and to the inland colonial city of Granada.
In Granada, there was a single hotel, the Alhambra, with a long, breezy porch overlooking the city’s central square. A rocking chair out front of the Alhambra has always been my favorite perch in this city…but, back in the early and mid-1990s, the hotel itself was nothing to write home about. Rusted fixtures in the bathrooms… cockroaches under the beds (the Alhambra has since been beautifully renovated, and today I heartily recommend it)…
Back then, Granada and Nicaragua both were short on amenities but long on heart. This country was pulling itself up by its bootstraps. In the towns and walking along the dirt roads, you saw men and boys in olive green military garb, sometimes carrying weapons. They seemed intimidating, until you stopped to speak with them. They talked openly of their desire for peace.
These Nicaraguans were tired of fighting, tired of watching their once-prosperous little country dissolve into economic chaos.
In the decade that followed, the transformation was remarkable. The gringos kept coming…and even began settling in. The speculating along the Nicaraguan Pacific Riviera went into overdrive. Sleepy Granada became a tourist hub, so crowded I’d often have to wait my turn for a rocking chair on the porch of the Alhambra.
Doña Violeta had been right. The Sandinistas had become obsolete, just like the political model they’d sought to follow.
That is not to say, though, that the Sandinistas–the party or the people–disappeared.
Indeed, the most famous Sandinista of all, Daniel Ortega, sits again, right now, in the seat of the country’s presidency.
Through 2006, when Ortega was re-elected, Nicaragua seemed on the fast track to a big, bright future. Then, with Señor Danny scheduled to re-take office at the beginning of 2007 and the U.S. real estate market beginning to tumble, investors panicked and pulled back from this country.
A year-and-a-half later, what’s the story? Ortega has played nice with the U.S. He has worked to clean up title on 3,800 properties held by Nicaraguans (questionable history of ownership of land in this country has been a key investor issue). And he continues to support foreign investors’ rights.
In other words, Danny’s done nothing to raise any alarms.
Nevertheless, investors, especially U.S. investors, remain cautious.
Like the investors, the tourists, too, took Nica off their radar screens in late 2006, following the election. But, unlike the investors, the tourists are returning. January through May is peak season in this country. January through May 2007 saw about 80,000 visitors from the U.S. and Canada, 320,000 tourists overall; January through May of this year saw 90,000 travelers from the U.S. and Canada (an increase of 13%) and better than 340,000 overall (6.7% growth…and more than the total number of tourists in 2006, prior to Ortega’s re-election).
I don’t have formal data on foreign investment in this country during the past two years (if you do, I’d appreciate hearing from you), but I can tell you anecdotally that the shine has been off this country’s real estate market since the 2006 election results were announced.
For the past year-and-a-half, Nicaraguan developers I know have been reporting that sales are “slow”… “stagnant”…”down”…. They’ve launched low-cost-of-entry offers ($30,000 lots in full-amenity developments, for example, something that, two years ago, like communism in this country, seemed to have gone the way of the Dodo)… They’re promoting developer financing… They’re uncharacteristically open to offers…
Ortega can’t run for re-election again in 2011. Meantime, he seems to be behaving as well as could be expected…better even…
And, meantime, it’s more of a buyer’s market in this country than at any time in the past decade. That alone is good reason to be nosing around Nicaragua right now.
But there are better reasons.
Politics have too long distracted people from recognizing what this country has to offer. Take Doña Violeta’s advice and forget about Ortega and the Sandinistas. Two decades ago, they tried to make a new Nicaragua. Fortunately for you and me, the old Nicaragua, the largest but least-visited nation in Central America, lives on.
This Nicaragua is a beautiful country with loads of sunshine and two long coasts, one of white sand, one with wildly crashing surf. It is a land of lakes and volcanoes, of cloud forests and tropical jungles, of cattle ranches and Spanish-colonial cities, of rare orchids and white-faced capuchin monkeys.
It is also a very affordable place to call home.
Several weeks ago, I introduced you to Jay Snyder. About five years ago, he and his wife discovered just how beautiful and just how inexpensive Nicaragua can be.
As Jay tells it, “I planned a visit and enrolled in a Spanish-language immersion program. I lived with a local Nica family in Granada and went to Spanish classes each day for a week. Then I took off to see the rest of the country–remote villages, coastal towns, planned developments… With only three days remaining on the trip, I felt a strong desire to return to Granada. So I did. And, back in the city, I took the plunge. I began speaking with real estate agents.
“Walking around Granada with the agents, I realized all my senses were satisfied. I liked what I saw, what I smelled, what I heard, what I tasted, what I felt…
“I place a lot of value on the sixth sense, too–on intuition. And I liked what my gut told me about Granada. The place felt right, and I felt at home.
“The truth is, retirees in the States right now face a serious dilemma. It’s impossible, really, for them to live on Social Security. And the cost of quality retirement living options has exploded. The current meltdown in U.S. housing costs doesn’t change this fact. Most retirees can’t afford a retirement home.
“Nicaragua seems to offer exactly what people like me are looking for–an affordable, quality lifestyle bundled with the chance to start over…”
Granada is this country’s number-one tourist draw. Nobody visits Nicaragua without visiting Granada. I’m a big fan of this postcard-charming colonial town, just inland from Lake Nicaragua and at the foot of the sleeping volcano called Mombacho. I’m not sure, though, that I’d recommend it today as the best place in the country to settle.
No question in my mind, if you’re ready to move from your sideline position and make an investment in Nicaragua, Granada is the place to do it right now. It will always see more tourist traffic than anywhere else in this country. More hotel room nights, more renters, more restaurant diners, more souvenir shoppers…
But because Granada is a tourist town, there’s no avoiding the tourists and their trappings, which are noticeably more present every time I pass through.
On the other hand, if you’re looking for a more “real” Nica living experience, go north…to Leon, where the living is not only more Nica…it’s also more affordable. In Leon, you’re distant from the tourists and the established expat communities…and distant, too, from the inflated economies that follow them.
In Leon, life goes on as it has in this country for centuries. Beyond the fields of sugarcane and corn that surround the city, and only a 20-minute drive away, is the coast, meaning you could enjoy the best of colonial city living with weekends at the beach.
And you could live well and comfortably here, in the second-oldest colonial city in the Americas, on as little as $954 a month if you invest in one of the city’s grand old colonial haciendas yourself…or as little as $1,300 a month if you rent. Correspondent Christian MacDonald has taken out his sharp pencil again and drafted a complete and detailed budget for your new life in Leon.
And note: Nicaragua uses the Córdoba, which, unlike most any other currency you could name these days, has been falling faster than the U.S. dollar. While the U.S. expat’s buying power has been steadily reduced worldwide, in Nicaragua, it continues to expand.