#633 – The Expat Files: Real Estate, Culture, and Challenges 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 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 You know, it's a funny thing people send me emails talk to me. Call me. I do consults and they say Johnny How do you get these good real estate deals you're talking about? How can I get some of that action, too? Sure, they hear me talking about this huge real estate bubble

[00:46] That's cracking around the edges and that desperate buyers are coming out to work work But as they check on the internet always on English language websites, of course They don't see any really great prices here in Latin America. And you know what? I don't either not on the internet Well, guess what? You have to get boots on the ground if you do and you plan your trip, right? You will find some really great deals Then again, why take the word of some guy like me blathering away in the ether Well for a second opinion in some real tangible proof, I'm gonna read you this little email now Just came in from a loyal listener who's had boots on the ground here mostly in Guatemala looking for land And he's trompsing around what I call and what many call the most beautiful lake in the world Lake Atitlan

[01:32] And what's so special about that area? Well, it's like this now as for me if I wanted to take a year or two and write the great un-american novel That's exactly the place I'd move to I'd get a little house up the mountainside overlooking the lake and have one of the most beautiful peaceful existences I guess a person could have but the thing is only by exploring where you see the little eclectic cabins and homesteads though You'll only see the obvious ones because most of them are so tucked away You couldn't find them with a drone and only with boots on the ground where you see how really laid-back and inexpensive it is to live There. All right. All right, you're thinking Johnny What's so special about a lake when it comes right down to it a lakes a lake, right? Well, not quite. It's a lake That's 5,000 feet above sea level that was created and lies on the base of three dormant volcanoes

[02:23] Now I know what some of you are thinking you've got a lake nearby. That's so beautiful, right? Everybody's got in their mind's eye a picture of what they think is the most beautiful lake and it's usually in their own state You know childhood vacation memories of camping and skiing with mom and dad and drunken uncle Louie and all that Well, I'll tell you this by worldwide travel writer consensus There are two lakes that are hands-down considered to be the most spectacular and beautiful in the world One is Lake Como in Italy. The other yep, Lake Atitlan in Guatemala However, you can search all day on the internet read all the blogs download photos and youtubes But still you'll never come close to the essence of what the place is really like. So why am I talking about this?

[03:09] Hey, I'm not trying to promote the place. In fact, I'd rather you not go there What and have gringo tourists turn it into another Disneyland? No way. Why mention it then? Well, not only because people ask me all the time What's your plan C Johnny if you had decided to change base locations now and go somewhere else? Well, that would be my plan C Yep, it is way out in the boonies three or four hours by car from Guatemala City and the International Airport But still like most places in Latin America It has good internet connections and there are enough small towns around where you can get most anything you need to give you an idea I'd say you're at least a half an hour drive from the nearest Walmart Which depending on your disposition is a good and a bad thing. Now, let me repeat this I'm not trying to make this an advertisement for you to come down to Lake Atitlan in by land or rent or whatever

[04:00] In fact, I don't want you to come down so far. They get their share of tourists But they're echo green hugger type tourists. Believe me The last thing we want to see is Costa Rica spring break type tourism. That'll totally ruin it Oh and this should explain a lot when you're hanging around Lake Atitlan You're at least an hour away from the nearest McDonald's Kentucky Fried Burger King or any US fast food chain That should help paint the picture for you By the way Everyone who comes to one of my expat in insider seminars gets a chance to take the John Galt pre and post seminar trips I always recommend them and sometimes take along myself because they're four day boots on the ground Excursions through the towns of Lake Atitlan By the way, if you're coming down to check out the lake on your own believe me

[04:47] You won't see one tenth of it There are so many hidden gems and diamonds in the rough that even people living nearby Don't even know about and you know, I've seen many low-budget even backpacker green goes say I'm gonna do it by myself I don't need a tour guide. I don't need any help I'll explore on my own. Hey, and I say if you got a lot of time on your hands go for it But most gringos I know who do it on their own missed most of the best parts at first They do like everyone else. They land at the main city That would be the base city called panachella the first little town on the lake now to get an idea How to get there by car or bus you all know about the pan-american highway that goes from Alaska to Panama City, Panama After coming south through the states

[05:32] It goes through a few major cities in Mexico and through almost all the major cities in Central America It's the main transportation artery in the whole region This little town of panachella is a one-hours drive from the pan-american highway on a pretty decent road, too But please don't try it at night again You'll know exactly why if you get boots on the ground here enough said about that So everyone that's going to the lake always ends up at that very first town called panachella And I always suggest you make that your base camp book a hotel there for a couple of days and every morning Take a boat around the lake to a different town then when it's just about dark Take a boat back to that little town and your hotel But you see most people don't do that There's come in for a day or two and never get out of that little town

[06:17] Problem is you see that little laid-back town is where all the gringo backpacker style tourists end up Mostly people just popping in as day trippers sure you'll have a good time there and you'll get to see some fabulous views Well, that's a right for a day or two But you have to get out of that little town if you just visit that place and never visit the other small towns around lake There's a dozen of them. You'll be missing the best part of the whole lake experience Oh and about eight of those towns you can only get to by taking the boat by the way It costs around two or three bucks to hop on a boat and hit any one of those little towns each of those boats Holds 20 people or more and that's a real fun experience, too Anyway, the point is 90% of the people that come to Panhacheld to see the lake Never get past that first little town, which is no great shakes. So how do I explain it?

[07:08] Well, it's kind of a lost-in-time hippie tree-hugging backpacking tourist town in low gear and the tourists mostly laid-back Low-budget Europeans and because it's the first stop off the pan-american highway It is kind of a mini tourist trap Which is why I occasionally run into a gringo or a gringo couple or I'll see a blog on the internet I'll say yeah, I was at Panhacheld. The lake's fabulous, but Panhacheld is nothing. I don't see what the hubbub is about Then you find out they never took a boat around the lake to check out any of the other 12 towns And to give you an idea the size of those towns ranges anywhere from 500 people to around 10,000 Each with its own different indigenous population and indigenous arts and crafts, too Again, it's all about getting boots on the ground the right kind of boots on the ground

[07:55] So the point of this little exercise is talking about real estate. Wow, you're thinking where'd that come from? Well, listen up Suppose you wanted to live by rent or build in an area that the experts call the most beautiful lake in the world Or perhaps second most beautiful if you're listening to a reviewer who is of Italian descent Now we've all heard that overused term Million-dollar view well forget about that. We're talking hundred million dollar views here that said What do you think you'd have to pay for land housing even rent? Situated around Lake Atitlan. We're talking about unobstructed views of the lake and the volcanoes and such With close access to a main road and within five or ten minutes of one of those small towns where they'll always have those

[08:45] Fantastic food markets and basic shopping by the way They've got those annoying tuk-tucks in most of those towns cost you around Buck or two to take a trip around that town or down the back mountain roads to the next town Okay, that's the setup. But the question is based on what you know about real estate up in the first row What do you think you'd have to pay for land housing or rent around the most spectacular lake in your own state? Well, you think about that for a while while I read this email from longtime listener Shannon He says hi Johnny. Let me start by offering my appreciation for the work on your show I've been a listener for three years now and loving it. I really appreciate the information and your sense of humor and irony Nice he put it that way like my mother used to say that's a kind way of calling someone a wise ass

[09:35] Anyway, he says I'm in the middle of my third trip to Guatemala and I found your show Invaluable in preparing me for my first couple of stays in Guadi It was almost like I had already been there. Thanks to your show You also helped me avoid the very tempting pitfalls of places like Costa Rica Well, I'm here at beautiful Lake at it land in the little town of San Juan La Laguna and I'm getting ready to jump in and start swimming In fact, I found a nice fixer upper house near a youth hostel called Maya check at a 20 K That's twenty thousand dollar opening offer. It seems like I could hardly go wrong. Did you hear that? 20,000 bucks now the bargaining starts

[10:22] I know there's always some tricks in the real estate biz and I don't want to get screwed So Johnny, I was wondering if I could get a suggestion on a lawyer to give me some help on checking out this property Basically, he said I'm looking to avoid mistakes I know you advocate renting first, but I see huge business potential in this house I can elaborate if necessary in another email Anyway, I see opportunity here and any help would be appreciated. Thanks for your show and consideration Shannon so anyway, I got that little email just recently and yes, I referred him to a trusting honorable attorney He'll be the one to check out the deeds the paperwork and how it's registered at the municipality One thing everyone has to know is that there's no title insurance in Latin America That's not an option down here

[11:08] that also means there are no title companies to hire to check out a piece of property to see if it's registered properly if There is a lien against it, etc Because you know people will always tell you there's a clear title when they're trying to sell you a piece of property, right? Which is why you absolutely have to get a lawyer to check that stuff out So what he'll do is go down to the local municipality and property registry Pull all the paperwork and the maps check into the property taxes By the way here in Latin America the property tax divisions are known by the letters USI or oozy anyway It's not something that you or I could check out with a hundred percent certainty at all Even if your Spanish is perfect There's almost no way for a lay person to do that What I mean is if you think Legalese in English is a pain in the ass you ain't seen nothing until you've seen it in Spanish

[11:57] And remember the American legal system is based on British common law and the Spanish legal system on Napoleonic law further complicating things. So anyway, our email writer Shannon has found himself What he calls a fixer-upper on the most beautiful lake in the world or second most beautiful with the starting bit of? 20,000 bucks by the way I know of a few other gringos who have bought it into such deals on that lake now Of course, I haven't seen the place, but I know there are great deals to be had But you have to get boots on the ground You won't find deals like that on the internet because you know Then you're dealing with one or more middlemen gringos who've translated everything to English, you know the story So how do you find those deals? Well, of course you come down and get boots on the ground

[12:42] Do some exploring and poking around yourself however, your best option by far is to hook up with a bilingual local person and I'm not talking about a Latin or gringo person Advertising themselves as a realtor. In fact one guy who came down to one of my expat insider seminars some four or five years ago now formerly, he was a very successful real estate man in the States who got pretty much wiped out in the 2008 real estate bubble blow-up and after living in Central America for four years now specifically in Antigua, Guatemala He wrote me a little note not long ago Explaining the real estate situation in Antigua, Lake Atitlan and some general tips that gringos should really pay attention to but often don't when looking to rent or buy

[13:29] Here in Latin America. Now he came down to Latin America to retire He is not involved in real estate, but he watches the real estate game very closely and here's his thoughts on it He writes Johnny as far as gringos and expats coming down looking for real estate first thing they'll do is they'll run into gringos, especially in gringoized area and semi gringoized areas and They'll get recommendations from the clueless expat community. What I mean is regarding real estate They really are clueless, especially the ones that hang with other gringos exclusively and don't speak much Spanish I'd say most of the people that call themselves realtors both latins and gringos are not good Once you've been down a while you will start hearing stories that'll curl your toes

[14:16] My own personal experiences with realtors in Latin America are not good either And you'll find if you're in a gringoized area or there's some turnover of tourists that tend to obscure Unsavory gringo real estate happenings in the past. In other words, people leave especially the ones who've had bad real estate Experiences as well as the fact that the memory of incompetent realtor dickheads even the crooks fades after a while Still some clueless expats will recommend the same real estate idiots Perhaps because they're drinking buddies or they're the only game in town Like I said as time goes by people leave lose track or just forget about bad experiences Which is human nature and how we move forward, which is why you're almost always better off hooking up with a local bilingual

[15:05] Motivated somewhat educated person in this area the concierge ladies that Johnny talks about and who he has vetted fit that bill nicely That way you'll be able to write down your wish lists whether you want to purchase rent the amount you want to spend The view you want to have just list your preferences Do you want peaceful or busy just have that bilingual person that you contracted pursue the so-called real estate offices and bulletin boards for you Skype with them a bit have them do the legwork ahead of time Looking for low medium high quality real estate, whatever you want Let them pick through the signs the postings in the news dads let them gather up some photos of those places and Contact the owners well before you're ready to go on the hunt in every town There are some top and bottom-end people and sometimes even expats that know where the good buys are

[15:55] Though it's pretty much a given that only a local will know whether a price is Astronomical for the area or dirt cheap and how much one can push the envelope After all gringo prices come along with tall white English speakers Not short dark locals So getting someone else to do the legwork Beforehand and to have some nice offerings picked out makes a big difference No one that first moves into an area can do it all by themselves and still get the great deals Most gringos don't know what a Latin American real estate agent is or does not knowing that often having no realtor at all That's better than using one. First of all, it takes no license at all down here to be a realtor No tests. No training. No exam. Therefore. No ethics either. Most importantly, there's no such thing as

[16:44] Exclusivity, you know how up in the states you can sign an exclusive with a realtor and no one else can get a piece of it However down here Latin America, there aren't no listings that belong to just one realtor Even if you sign what you think is an exclusive contract with a certain realtor. It's not binding It's business down here in a way of life to go behind one realtors back and buy up a property directly from the owner Bottom line realtors here in Latin America are not really your personal representatives at all They normally represent both sides, which means there are neither side and all for themselves So by all means use realtors to show you properties But don't limit yourself never just strictly go through a realtor best idea of all hire a bilingual local to do your legwork for you

[17:31] Okay, that was a little blurb from a very successful US realtor who came down here to live and observed the unconventional and Unprofessional goings on in the local Latin real estate biz good stuff to keep in mind. Okay moving on I still get emails occasionally asking me about chemtrails and different oddities up in the sky I don't doubt they exist up in the States not at all But down here in Latin America, I've yet to see any trace of chemtrails though People have sent me some very convincing photos of chemtrails over Mexico City But somehow I never seemed to get emails about chemtrails from the younger crowd because they're not looking up at the sky They're looking down at their stupid cell phones and texting and Facebooking their latest bowel movements to their 5,000 virtual pseudo friends

[18:22] Though things might be getting better Remember just a few years ago when people measured their social importance by how many Facebook friends they had? Hmm. I take that as a signal that the herd definitely needs to be called Starting with sucker Berg Soros Hillary Gates, but I digress where were we? Oh, yeah Chemtrails in Latin America, you know to me one of the few pleasures in life That's free is just looking up at the sky not to mention How about a nice big breath of fresh air free for now? Anyway, huh? How about a good sneeze now? That's an underrated free pleasure except maybe for the sneezy How about a good read from an old book? And of course, we have to mention those normally unmentionable bodily functions that well also can be included on that list

[19:11] Nothing upset about that. Oh, yeah, and used to be a nice fresh cool pure glass of water was on that list too But clean water is not free anymore. Is it? I know we've all got our own additions to that list But for sure just looking up at the sky during the day or the night is one of those pleasures It really seems to be a lost heart which brings me to this email He says Johnny in case you're having a brain fart and ever thought about coming back to the US Take a look at these pictures. I'm sending from Scottsdale, Arizona From the waste management golf open what a waste management golf tournament What do they think of next so do you tee off a dumpster or something? Anyway, he says boy. Was there a lot of shade Johnny in what would have been a normally clear sunny day

[20:01] He's talking about chemtrails there He says I've been meaning to ask you if they have chemtrail events there in Latin America Cuz they're getting worse every year up here reducing our clear sunny days in a year to practically nothing No, it's famous Johnny Jason. So with that he sent some very convincing chemtrail photos from Scottsdale And if you're looking at the YouTube right now, you'll be seeing them Anyway, Jason, I commend you for looking up into the sky once in a while Even if it was not in this case one of those few free pleasures in life, by the way How many can you list have you ever thought about it? Alright moving on remember last time we spoke about the Argentine government talking about building a wall like the Trump wall To keep out those illegal Bolivians, you know, that's getting like zero press up in the first world

[20:52] I hear speaking of press every single newspaper blog and TV station has Endless coverage about Trump. They're always beaten on them. Of course, everyone hates them People are protesting everywhere narcos and even regular people are talking about bumping them off I've never seen anything like it yet funny enough You never see any upper-middle-class or wealthy Latins dissing Trump or getting out on the street with signs It's all the uneducated and under educated masses doing all the squawking by the way Did you know the average educational level of any legal immigrant in the US is sixth grade? Yep, just the kind of talent you want flooding in your country, right? But I digress as usual Anyway, the Argentines apparently are in the same mess, but no one's talking about it

[21:38] Not up in the first world. Anyway, the news today is according to Argentine secretary-minister Patricia Bullrich the vast majority of immigrants in Argentina are from Bolivia and here's the startling fact according to Argentines own government data. They've discovered that 71% of all the Bolivians living in Argentina are there illegally without proper documentation And get this a spokesman for the Argentine Senate says in the case of our country Argentina. We don't need any more laws Practically our entire penal code without changes is sufficient cause for deportation of all these people However, he said our government has been extremely lax in our expulsion process. Yes He says we have all the means necessary, but we're just not enforcing the law. Hmm. That sounds way too familiar, huh?

[22:29] Okay, shooting off on another tangent here. I like doing that We were talking about expats and gringos doing business in Latin America And here's some statistics that just might shock you not in a bad way But just to kind of give you a better feel of how business is done on the street here in Latin America According to the Central American business data network now get this because it speaks volumes six out of ten Establishments with economic activities that means businesses operate out of homes That's three-fifths of all the so-called Legitimate business activity being done out of someone's home meaning in a general sense People live in their houses in the front area facing towards the street is some kind of business whether it's shoe repair mechanic shop

[23:15] Stationary store bakery. That's how the majority of business is done here in Latin America It's a throwback to the 1930s 40s and 50s in the States when many many Residential homes had a front space where business was done Of course nowadays zoning laws would never allow that up in the States on rare occasions The only businesses that can get away with it are dentists and physician and professional offices like accountants But there's more the study says two out of ten businesses in Latin America That's one out of five are located in commercial and business districts That is they're not attached to a home then it goes on to say one out of every ten businesses operating on the books He's located in a mall or shopping center and over Shattering all of this is the fact that 30 to 40 percent of all business activity in Latin America

[24:06] He's done off the books for cash. No receipts right out in the open in big chaotic street markets So all you gonna bees and wannabes and new BX pests thinking about coming down to Latin America and opening up brick-and-mortar business Those are the stats. That's what you'll be dealing with. But what other info can we glean from that? Well when you read between the lines Once again, you can see there's a huge lag time effect in the way businesses are organized in the economic sector And it's not hard to figure out why it's so much easier to do business in Latin America The fact is if you could just clear out your living room and start doing business right out of your house in practically any neighborhood You can bet as long as you pay your taxes Anyway that the government's just gonna leave you alone Just like the US government kept their noses out of small business back in the 30s 40s and 50s

[24:55] You get the idea and finally we have this from Richard news about Latin America They never report in the first world the article starts as police go on strike in Brazil Cities there are being wiped out in quote purge fashion I'll paraphrase this a bit It says police in Brazil have gone on strike leaving the country unarmed and left in a purge like chaos as in the 2014 thriller Purge with people running rampant with guns and machetes Stealing from malls even dead bodies showing up lying in the streets Buses are set aflame at night as people are crawling their way to shelter covered in blood School has been canceled and according to this report the death toll related to the strike is now at 72 with over 80 car

[25:42] hijackings a day Now the strike is all about a salary increase and the police won't return to the job till they get it Meanwhile the majority of Brazilian citizens say they won't be leaving their houses any time soon With one resident in spiritual Santos saying in a phone interview It's a effing mess. What's going on here And the worst part is that regular citizens are not allowed to have guns so they can't defend themselves Meanwhile says the article neither the US media or any other country media has commented on a developing chaos spreading through Brazil Now according to the article there are two police forces in Brazil the local city police force and the national Militarized cops and they're the ones on strike

[26:28] So there you have it reason 2736 why Brazil should not be high on the list for your plan B destination. All right We're getting towards the end of the show now, and I'd like to remind everyone who's interested in coming to my July 2017 expat insider seminar It'll be in and around Guatemala again to get on the early bird list send me an email the expat files at gmail.com I should have all the information in detail up on the new expat.com website by March 1st a little more than two weeks from now In the meantime as long as you're up there in Seattle Cleveland, Milwaukee or wherever at the home front Don't forget you could further advance your plan B by just going to expat plan B calm and signing up for my

[27:14] Expat essentials course. Are you thinking about a plan B or even sometime in the future? Contemplating voting with your feet. Well, my expat essentials course will help you line your ducks up in a very orderly Logical way. So don't forget go to expat plan B calm and check it out This is the expat files living in Latin America If you want me to help you out with your own plan B Just schedule a one-on-one consult send me an email the expat files at gmail.com And if you want to learn how to move forward with your own plan B From right up there in the States go to www.expatplanb.com and check out my three videos. See ya nos vemos