#1037 – The Expat Files: Legalization, Culture, and Real Estate in Latin America

Automatically transcribed from the original recording; names and wording may contain errors.

[00:00] South of the border down Mexico way That's where I fell in love when the stars above came up to play and now that I wonder Hello there all you expat wannabes. I'm Johnny Mueller and you're listening to the expat files living in Latin America The show that tells you just what it's like to live work play and or retire down here in Latin America It's a mix of the good the bad the ugly and the great and it's all right here. So let's get started Hey now everyone down here in Latin America are mostly everyone between the age of maybe 15 and 40 They're talking about out Mexico just passed their laws to legalize marijuana and everybody wants to know the detail because you know It really is a huge deal and every Latin American country will soon follow suit and the narcos man

[00:50] They're scrambling for position and the musical chairs have begun and actually since they don't want their cash flow Situation to deteriorate they're moving into other avenues They've moved into the gas and oil thieving business the tequila business and I'm not talking about production I'm talking about the Extortion and protection racket end of it and they're getting heavier and heavier into the kidnapping thing yet Another reason why gringles and expats in Mexico have a hell of a lot to worry about They are more and more at risk because the bad guys have moved in to the gringo tourist areas like Tulum Porto Vallarta Cancun Playa del Carmen Casa Mel, etc. Etc. Whereas even five years ago It was hands off the tourists unless of course, they wandered too far off the gringo tourist trail That hands-off policy doesn't really exist anymore, but I digress back to the point

[01:40] So everyone's asking what are the details on this Mexican legalization of marijuana thing? Well today I've got the exclusive dope on all that ha ha if you've been paying attention You know, it was supposed to go into effect on January 1st in the new year 2021 It didn't though because they couldn't get the proper Supreme Court justice signatures They're on vacation in my jammy or something. Hey, I'm not kidding My jammy is the Latin American capital of the United States, you know But now regarding legalization of pot in Mexico They say all the ducks are lined up and it's supposed to kick in in about a month now You got a note for governments anywhere There's a heavy commercial money-making angle to legalizing weed with a number of big weed companies approaching the government for licenses To start growing and producing and packaging this stuff starting with a Colombian

[02:28] Canadian corporation called key Ron life sciences along with a big Canadian weed company called Canopy growth And of course, there's the Amsterdam connection a company called the green organic Dutchman company As well as a number of medical marijuana companies from California whose primary product is CBD oil So don't think for a second the benevolent Oh difference tumors in the Mexican government are Legalizing it to throttle down narco activity No, it's because Mexico is completely broke even though they've got some of the biggest oil and natural gas reserves in the world You know though that they continuously claim is running at a loss But only because government maggots have been dipping into it all along the real or the main reason is and I've heard this through Is it all these companies that are going to come in and take advantage of the pot selling and growing situation there like the five or six

[03:19] Just mentioned we'll be greasing a lot of palms and lining the pockets of the usual malignant suspects But in this case anyway The secondary effects are quite positive in that people will be able to use their drug of choice and the narcos will Get a substantial hit in the pocketbook So then what's not to like about legalization? And finally we have the details the cannabis bill creates a mexican institute of regulation and control of the drug Which will issue five types of licenses one for cultivation one for transformation of the product That would be cbd oil and such There'll be a license you have to have if you're going to sell this stuff retail and wholesale A license for research and a license for exportation So along the way the government gets their skim in multiple ways

[04:06] Not to mention the kickbacks big companies are going to have to pay to get in that market In other words if you don't come up with a skim or a kickback You'll be put into the never-ending loop of manana time if you know what I mean Furthermore according to mexico's cannabis bill only people 18 years and older and with permits may grow carry or consume marijuana and its derivatives So it does look like you just won't be able to go into a corner store and buy it unless you've got a permit to buy Which they're saying you'll be able to pick up at the local police station or municipality office for something like 10 bucks Renewable like a car license every year. So that's another way for the government to steal from you However, you know, we're talking about latin america where the cops are fat lazy underpaid and under motivated where laws are so sporadically enforced That you can get away with almost anything as long as you're not a gringo because you know in mexico

[04:56] Especially gringos are targets of the cops you long-time listeners Have heard me tell many boots on the ground stories to that effect Hey, i've got personal experience getting extorted by mexican cops most often and almost exclusively When i've been driving in mexico because you know, the cops down there are always on the lookout for An american or gringo license plates from texas california, nevada, wherever, you know A lot of people drive their cars into mexico for a vacation Just be aware your u.s plates stick out like a sore thumb and you'll be a target for the cops Oh and look out if you're driving a reticar too because They've all got a certain look a certain plate and certain stickers on them and a lot of the big rental companies will buy hundreds of cars at a time The exact same colors and models in the fleet and bad guys and mexican cops. What's the difference, huh?

[05:42] They can spot a reticara mile away speaking of cars and who gets pulled over most There are tons of rusted out wrecks and shit boxes all over latin america that would get ticketed or impounded in five minutes If they ever hit the road up in the states In fact i'd say a quarter to fifty percent of all the cars in latin america wouldn't pass inspection up in cleveland But you know mexican cops don't want to pull over a guy in a wreck. They rarely do Even if they're breaking all kinds of traffic laws Even if it's got a bad hand stenciled number on a piece of cardboard passing for a license plate Hey, i've seen that dozens of times Obviously fake license plates done up with magic marker numbers yet The cops rarely pull them over because they know the guy driving hasn't enough dough to make it worth their while to extort That's why they're always on the lookout for gringos and expats

[06:31] Why because the rumor is we've got deep pockets excellent credit and credit cards that aren't topped out And if you don't have any funny money on you They sometimes can and will take you to an atm machine though when that happens It's usually at night as bold as mexican cops can be they know in the day There are a lot of people with cameras and cell phones and that's another reason why I don't recommend driving too much at all At night, but you knew that already, right? Oh, and here's an interesting email a really good question coming from anthony He's writing this deep from within the unflushed toilet known as washington dc By the way toilets in latin america are called ino doros ino doros And since i'm digressing quite a bit already I have to tell you here in latin america when you go to the hardware store There are three kinds of inodoros toilets small medium and large

[07:19] And you know when you're shopping for houses or just going to rent a place you can tell Right away if the place is up to code or up to first world standards by walking in the first bathroom You see and looking at the toilet Or the sink they also come in small medium and large and the small ones are the cheapest of course Because you see a latin contract or a builder who's really cut in quarters will put in the tiny toilets Which are perfectly fine for your average latino because they're smaller than we are and latinos are absolutely trained to put their toilet paper in the trash can Disgusting I know especially when they visit your house because that's what they're gonna do Put the used toilet paper in the trash can in your house disgusting. I know but that's the way it is Why because they figured out a long time ago when they put the toilet paper in the toilet it clogs up the undersized plumbing tubes

[08:05] That most all of them use and that's why if you use a restroom in any international airport even first world ones like in europe Even in my jammy if you want to call that first world You'll see the waste baskets jammed with used toilet paper. That means latinos have arrived But you knew that already right and about those pint-sized toilets and sinks Hey, that's just the way it is because most latinos have a mix of indigenous blood and the indigenous people are Averaging around five foot one or five foot two for the guys and the women well the majority of them are four foot something I'm talking about the pure indigenous people now, but since most latinos or latinos They like to call themselves have a slight mix of indigenous blood that kind of pulls down the median height for the general population So as a rule they weigh a lot less than north americans too. For example, my maintenance guy chepe who I had for years and years

[08:54] It's about five foot three hundred twenty pounds without an ounce of fat on him because he's you know One of those outdoor workers equipped with a big ass machete I'm telling you those indigenous guys that work out in the fields and such there's a name for them They're the guys that chop the brush and do gardening and maintenance and stuff And the word choppy adore means a chopper and what do you chop with a machete your own machete? Oh, when every machete wielder has a fila or a file used to sharpen that machete You get it at the hardware store for about a buck I don't know if you know the statistics, but in latin america There are more cell phones than people and more machetes than people too I'm telling you every indigenous guy has one or two or ten and man are they sharp They're lethal weapons, but you almost never hear about anybody getting hacked up with one

[09:42] Unless of course, it's a crime of passion There's lots of those so occasionally you'll hear of a guy hacking up someone who's having a fair with his wife or girlfriend or He'll hack up his girlfriend too But that kind of stuff almost never occurs in the city almost always out in the boonies So although there may be a million three foot long extremely sharp machetes within a two or three mile radius of you You don't ever have to worry that someone's going to come after you with one. It's basically unheard of Though I have to tell you every indigenous guy and gal, you know The girls know how to use those things to have their share of scars along the arms and legs There's a big learning curve to getting good at using a machete You know that 10 000 hours thing and all that though it is true if you're in the big city There are lots of metropolitan areas where you won't see a single machete because you know Most areas in a city are pretty modern

[10:29] But when you get out to the boonies and you're driving along and you see a group of guys walking down the street They'll all have a machete and they'll all have personalized little scabbards Made out of leather and nicely tooled all gussied up with rhinestones and embedded metal studs Kind of like a cowboy and his saddle. Anyway, where are we? Oh, yeah talking about bureaucrats, unfleshed toilets and landlords Anthony from dc writes. Hi johnny. I'd love to hear you talk about what tenant and landlord rights are in latin americ For example, what happens when a tenant cannot pay their rent? How is the outcome different for latinos and gringos? How does a landlord get a non-paying tenant out of their place? As i'm sure you know, it varies from state to state in the u.s Where sometimes landlords can get evictions easily and sometimes tenants can stay for months without paying a penny

[11:15] Very curious as to how this plays out in latin america all the best anthony from the unfleshed toilet known as washington dc All right, anthony. Thanks for that And I gotta tell you I get lots of inquiries from gringles and expats saying look johnny With the real estate bubbles popping all over the world right now Cash buyers will be able to pick up some really fantastic deals And you know a lot of gringos and expats with the plan b are looking to invest They've got some dough when they come down and at first they park it in the bank But they know in the end that's a losing proposition inflation and time will wipe that out They want to get some return on their money and a great way to do that is to buy rental properties, right? But what about the tenant situation especially in the age of covid it's where people just aren't paying their rents anymore Personally i'd hate to be a landlord right now. The future is not looking bright

[12:02] But since you will be able to pick up some fantastic deals on rental properties You got to weigh that fact against the problems You just might have or certainly are going to have when dealing with tenants And here's the scoop the key to it is the selection of your tenants and as you might have assumed Gringo and expat tenants are considered to be the best of tenants. Ask any landlord Only problem is if you're a landlord off the gringo tourist trail There'll be practically no other gringos to rent to of course if you're on the gringo tourist trail There'll be gringos everywhere. So then that's not a problem But still as a landlord how you qualify tenants, especially if your spanish sucks Well, one way to take a lot of the guesswork out of the equation is to connect with a rental agency They're all over the place Let them handle bringing in the tenants and qualifying them The thing is though they'll take the first month rent as their payment

[12:49] But in the end landlords and attorneys will tell you that's the best way to go Problem is down here in latin america because of all the lag time we talk about Credit bureaus or credit agencies are pretty much in their infancy So if you want to do a credit check on somebody he might be a terrible player But his delinquency won't show up on a credit report because only banks and credit card companies are hooked in to any kind of credit bureau system So the negative stuff will only show up on a credit report if he's delinquent on his credit card car payment or bank loan Now if he's going around town writing bad checks Let's say or he ran out on a mechanic or hospital bill. It most likely won't show up on his credit report So again, if you're a landlord unless you got a gringo or tour a pool of gringos interested in your place your best off Getting a property management agency to handle that

[13:35] Oh and note that'll also help you get the guy out if he's a bad payer Of course in the age of covid anything goes and a good payer could turn into a bad payer overnight So then how do you get him out? Well, you know here in latin america most countries have not done what they've done in europe in the us That is put a moratorium on rent during the covid it thing Which of course we know is a time bomb waiting to blow because those back rent payments are not going to be forgiven Someone's going to have to come up with the dough So then how to evict someone here in latin america? Well first you need a latin lawyer He files the case in court and even before the covid it stuff It took usually two or three months to get the first hearing So your deadbeat tenant gets two or three free months right off the bat and here in latin america normally The landlord gets a two-month deposit up front

[14:21] So you'll at least get that problem is a lot of times the court will have postponement after postponement So it would take probably on the average six months to get a guy out So then who actually kicks the deadbeat out? Well, once the judge hands down the decision the lawyer will take it down to the police station Closest to your rental unit and the cops will generally go out there that day or the next knock on the door and evict them So in the end after you've absconded with a deposit you'll probably end up losing four months rent on top of that You know when a tenant gets evicted. He usually gets his revenge by trash in the place I had that happen to me up in the states. So bottom line here in latin america It's easy to evict someone but it takes six months and it's hard to arrange all the necessary paperwork on the court dates You'll need a lawyer for that and that could cost you a hundred or two

[15:07] So avoid all that hassle by hooking up with a rental management company There are plenty of them out there And if you don't know where to look just call up the usual suspects sentry 21 or remax and they'll lead you in the right direction And they'll always have someone in their office that speaks english, too Now i'm in no way a fan of sentry 21 or remax You know, they put their listings all over the internet and so you're talking gringo prices, right? But we're not talking about using them to find a rental or house for yourself Though I always recommend when you first land in a place you think is going to be a great plan b for yourself By all means call up remax or sentry 21 and tell them to give you the tour of what's for sale rent and available That way you'll get an idea of where the good neighborhoods are because they always take gringos to the best areas But just be aware they'll be throwing gringo prices at you and generally especially in this market

[15:54] Whatever they're asking for a rental or a purchase will be way on the high side Well, here's a few tips regarding latin american real estate and real estate agents Every town has some good and some absolute bottom of the barrel people who say they are real estate agents And sometimes just sometimes a few expats that know what the good and the bad buys are You know whether at prices astronomically high or dirt cheap and how much you can push the envelope when someone gives you a price Problem is when it comes to real estate gringo prices generally come along with tall white english speakers with glitzy websites in english And of course those well-known franchises sentry 21 and remax are everywhere So be on the lookout for that I'd say my most valuable real estate tip is to try to get a latino or latina to do the legwork for you beforehand

[16:43] They'll find all those nice offerings without gringo prices then that makes a big difference The thing is most gringos and expats when they first get down Have no idea what a real estate agent really is or does in latin america because it's a lot different Than real estate agents up in the states. First of all, they mostly sit on their dead asses and wait for the phone to ring Oh, and did you know that it takes no license or classes exams or legal registration to be a real estate agent Not here in latin america to be a real estate agent. All you have to do is get your business card printed That means there are no ethical requirements either Most of all and what gringos and expats don't realize is that there are no listings that belong to just one realtor In other words, there's no such thing as exclusivity Like up in the states and even if a real estate agency like santry 21

[17:31] Says you can be exclusive with them by signing a document It's not legally binding and you won't get in any trouble at all if you happen to sell it out from under them Or make a purchase or sale on the side and cut them out And most of all note that real litters here in latin america are not your personal representatives They normally represent both sides, which means they're on neither side, especially not yours They're only in it for the money. Of course They've got no vision or sense of building a relationship the idea of cultivating you as a good future client or as a referral source They don't care about that. It's all about making an immediate sale That's the way it is for everyone down here who's got a product for sale or a service For example, just recently a gringle friend of mine had to call in a repairman to fix his gas dryer The guy took it apart and said it was really filthy had lint everywhere, you know

[18:20] Lint problems because most latinas and cleaning ladies don't clean out the lint till it's about to catch fire Anyway, he did take it apart and it was really filthy inside He was there maybe two hours cleaning it got it working really fine and my gringle buddy asked him how much and he said 150 bucks his job was dropped on the floor now he lived in an apartment complex So he called the latina next door had her call the number on the guy's business card To ask how much it was for a routine maintenance call and she said 40 bucks. Well, truthfully it was the gringle guy's fault for not asking what the price was going to be ahead of time But here's what happened next by the way I forgot to tell you this guy lives in panama city panama So anyway, this gringle buddy of mine who speaks very little spanish had his next door neighbor translate the following

[19:06] He told her to say to him We just called your office and they said it's only 40 bucks to have a routine dryer maintenance call And the guy paused for a while He thought and he said well I took your igniter apart and completely cleaned it out So you have a better gas flame now and then my buddy said through the translator. Did you replace any parts? He said no just cleaned it Well, that's part of maintenance then isn't it for which you charge 40 bucks and the guy hemmed and hawed and said no That's extra then here's what the gringo guy said through the translator. Of course There's something like 50 units in this apartment complex He said I got a hold of you because your business cards on the bulletin board down in the lobby Here's what i'm gonna do I'm gonna put my own little notice on that bulletin board in spanish That says not to use you because you rip people off and you'll never ever get another client in this building

[19:58] He said i'll pay you the 150 bucks under protest But your reputation will be ruined around here And it took about a minute for the guy to drop his price down to 50 bucks But he dropped it However, if my buddy would have been living in a single family house and not in a big complex like that He would have had no leverage at all All right. There you have it another lesson to be learned from a boots on the ground story And now a few words from a good friend and expat insider seminar alumnus kelsey. He sent me this joke It's a good one. Basically, uh comment on the dumbing down of american spades He says when the upcoming generations write our history books as they inevitably must do Books that no one will read by the way One thing you can be sure of our history will be misspelled have run on sentences

[20:45] No punctuation and every historic event will be generically described as totally awesome Sad, isn't it? All right. Now it's time to get completely Politically incorrect with some latin american covidied observations for march 2021 This one comes from roe though. I think he had some help with it seems to well You'll see roe starts dear johnny me and the wife were trying to get back to the states from nicaragua last week All right, me johnny here Remember, I don't recommend it and I never have recommended nicaragua as a good plan b destination though It's a nice slow laid-back place to visit for vacation And though I don't think it's a good plan b destination people don't always listen to me And some of my expat insider seminar alumnus have set up shop there and are now regretting it

[21:33] Anyway, he says johnny last friday We sat in a bar in managua nicaragua arranging flights back from san juan del sur on the pacific beach As you know johnny san juan del sur is the most gringoized area in all of nicaragua So there we were that hotel bar in managua with multiple tvs over the bar some with soap operas some with sports Meanwhile, the extra loud speakers on the floor were pounding out reggaeton music That made sure you couldn't understand what anyone was saying, which I guess is okay because our spanish sucks Anyway, so sitting there with a couple hours to burn before we went to the airport We reflected on the differences the things that make us gringos different from latinos our culture race nationality religion, etc Like for example here in the third world. It's always disorderly traffic goes every which way sometimes the wrong way

[22:21] Trash gets tossed into the trees and the gullies people never form up into neat lines Though there are lines everywhere people coming up to your car at practically every stoplight trying to sell you something or wipe your windshield It's so obvious when observing things down here that some latinos are much more successful than others to put this in perspective Some latinos are just as wealthy as as gringos and expats But not many and the rest of the population deemed middle class here are not middle class by american standards They're much lower than that Another thing that's easy to notice is that in latin american countries those with more european blood Tend to be much better up more educated have better jobs and higher positions than darker people Meaning those with indigenous or african blood there seems to be a direct correlation the whiter the skin the taller the person the higher

[23:11] The income one could definitely prove that point by making a study of it But you'd certainly get attacked and then cancelled on social media And then there's always those backroom conversations and gringle conversations at expats bars where people try to define and explain the third world With people of european blood blaming the shift list hispanics for their lower incomes and such and the hispanics blaming the european oppressors Who created the social and class distinctions that they've been stuck living under then roy says Sometimes I think it would be a bad thing if latin americans suddenly shifted their country into high gear and became first world In most ways. I prefer it like it is with manana time and all the other inconsistencies most gringos and expats and gringo and expat tourists are living in pleasant bubbles and pleasant neighborhoods

[24:01] The ones down here that is especially in tourist districts And we only see the country as it really is When we drive out of our neighborhoods to go visiting shopping or to the airport case in point getting a covet 19 test To go back to the united states. That's required. Now, you know without the test. You can't get on the plane You can't leave and in our case in nikaragua We had to go to the ministry of citizen power for health a government agency to get the covet test And to drive to that government compound you have to drive through a maze of terrible slums Quite a shock for first time american travelers who've been living in their bubbles First thing you notice is that in america builders throw old tin and rusted sheets of metal away In nikaragua, it's all recycled and recycled and recycled whether bent and broken pierced by holes

[24:51] It doesn't matter it's put to work as a wall or a roof or a floor pan in your car Sometimes it almost seems as if rusted metal is the most common material in all of nikaragua, especially in the poor neighborhoods Exactly opposite of the way us americans think the world should be at first glance totally unattractive and repulsive to us But from the air at 15 000 feet kind of quaint and rustic fact is people here don't seem to care What we think about them we're always thinking in the back of our heads that the poor here For example should build their houses of cinder blocks and concrete and glass like we do We're thinking what's wrong with them. Why don't they have neat little houses and nice laid out cookie cutter neighborhoods Imagine if there was no more manana time and everything got cleaned and fixed today What if they suddenly insisted everything be done well into high standards and even being a minute late would generate dirty looks

[25:43] What would happen if they banned driveway chickens and didn't allow people to collect their own rainwater? Meanwhile back at the mandatory covid government testing station It was exactly as we feared chaos and bedlam people mulling around everywhere the front entrance jam It was hard to determine if there was any logic to it at all We explained to a man in a uniform that we were there to get a coronavirus test and that we'd already paid for it online Mistakenly believing that online payment might speed up the process It didn't what it did do However was get us into another very long line where our payment details were verified and our documents rubber stamp We must have shown our papers and passports to a half a dozen people at dozen different times Eventually, we got the wooden stick up your nose and after a few more lines and bureaucrats and missteps

[26:30] We got the papers and on the way to the airport I kept thinking is it really right that do-gooders and gringo and european first world organizers are always Prodding third world countries along telling them they got to get with the program Always, of course our version of the program Then again, you have to think if every country was first world all of them now being big brother surveillance states It would be sad to think we'd have no place to escape to Signed longtime listener first time commenter roi. Well roi. Thanks for that very interesting. All right We're getting towards the end now one last thing There won't be a show this sunday because remember my brother is visiting from chicago And i've been successful so far at keeping him out of harm's way You know from all those kidnappers and no goodniks down here who certainly would love to steal his organs

[27:16] Then again, if they did they'd be making a big mistake because he's you know, your typical 50 something american. He's on something like 18 prescription meds. I You not you should see the pillbox he's got with him man. Am I glad i'm living in latin america? You've been listening to the expat files living in latin america If you need some help with your own plan b we can schedule a one-on-one phone or skype consult Just send me an email the expat files at gmail.com And if you want to get on the waiting list for my next week long expat insider seminar in central america Where you're guaranteed to get a two to five year head start on your plan b Send me an email the expat files at gmail.com