#666 – Episode 666: Navigating Expat Life in Latin America – Cultural Integration, Real Estate, and Legal Challenges

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 as I wander 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 God, I've got so many emails and articles I haven't got to yet, but we'll try to polish most of them off today Well, at least some of them. Oh, by the way, this is show number 666 Funny enough some people up in the first world freak out about that number, but here in Latin America

[00:48] It doesn't mean a thing. It's just any old number just like the number 13 You know in the states a lot of buildings don't have a 13th floor down here 13 Just another number and for you gamblers lucky number seven. Well in Latin America seven is neither lucky You know unlucky even so Latin America is a land just filled with superstitions In fact, I'd say for every first world superstition. They've got 20 of their own You'll certainly laugh at some of them But don't try to talk Latin people out of that stuff use logic or try to point out the irrationality of it all I've tried it doesn't work. Hey, we're on Latin turf So you just got to go with the flow I guess and do try not to laugh Alright, let's talk about what we're seeing lately all over the internet the hottest latest greatest expat destinations

[01:33] Yeah It's what those retirement rags and international living and AARP are always talking about how you can live for 1,500 bucks a month in certain Latin American countries Well, these are the countries they say that seniors are flocking to in huge numbers Costa Rica Panama Mexico Colombia Dominican Republic and Ecuador Sure, those are fine places to check out when you're just starting to dip your toe in the water in Latin America Especially if your Spanish sucks or is non-existent But if you don't want to get stuck in a gringo infested universe where prices are rising sometimes beyond first world prices like Certain real estate developments in Mexico Panama Colombia and Costa Rica I recommend if you go to any one of those countries you rent for at least a year and hold on to your ass and your

[02:20] Assets sure by all means transfer some of your assets out of the country But don't buy anything substantial like real estate that might hold you down in the countries I just mentioned. Yep in gringo eyes countries. There are no deals of a lifetime. They've all been picked over already Yeah, so rent for a year at least six months and you'll see how the gringos have tainted those places now I'm not saying that when gringos land there. They don't have a nice life They often have it much better than they had it up in the states But inevitably they'll fall in with another bunch of gringos and they'll never learn their Spanish And they and all their friends will fashion a protective little gringo world around themselves And the only native Latin people in their world will be people they buy things from the markets and such and their help if they

[03:07] Have them like maintenance guys and cleaning ladies in that respect. It's kind of an artificial Transplanted existence so to really enjoy the best of both worlds You really have to have one foot planted in the gringo world and another planted in the Latin world Easy to say but almost never accomplished when you're living on the tourist trail and funny enough one of the biggest complaints I hear from people living on the gringo tourist trailers They'll say I don't hang with latins because I really don't have anything in common with them besides They all look at us like dollar signs But in reality gringos who say that are either not telling the whole truth or more likely they just don't get it Fact is when you're on the gringo tourist trail almost all the latins you meet will speak some English and they're already tainted Chances are they make their living off the US dollar and US tourists and expats

[03:57] I mean, let's face it a gringo who speaks no Spanish It's not gonna make buddy buddy friends with someone who speaks only Spanish and every Latin person on the gringo tourist trail knows The only way to get a piece of that gringo dollar economy is to speak English Of course, the vast majority of gringos and expats living in Latin America are on the gringo tourist trail I'd say only maybe five percent of us are far away from that distorted gringo influence So that means only five percent of us gringos and expats know what it's like to live the life of a B grade rock star Now picture a rock band that's had a couple of hits people might know the name of the singer and the lead guitarist But they almost never know who the bass player is, but he still gets invited to all the backstage parties now, doesn't he? Well, that's what it's like living off the gringo tourist trail

[04:43] Though I have to admit it took me a couple of years living off the trail to realize that sort of B grade rock star Effect actually existed. So you do have actually three choices You can live smack on the gringo tourist trail Slightly off the gringo tourist trail or quite a ways away from the trail like I do. Yep I've done all three when I first arrived I spoke no Spanish and I lived in Costa Rica for two and a half years That's about as on the tourist trail as you can get and when I left I still spoke no Spanish Now I'm not saying you shouldn't hit those tourist trail spots Especially if you haven't been to many Latin countries and your Spanish sucks with all the gringos around It's certainly less of a culture shock. So if that's your choice at first, no problem But my advice I'll say it again rent for a year and don't

[05:31] Buy anything that'll tie you down like land or a business Because you'll kick yourself when you find out that five ten or fifteen miles away from those gringo iced areas Rent help land services almost everything his half again is cheap So in effect the more gringos around the more your gringo advantage dissipates Of course now there are some Latin countries that are so gringo eyes You can't even go 10 or 20 miles from a gringo epicenter and see prices drop as you might expect They just don't especially in places like Costa Rica Panama big cities in Colombia and many cities in Mexico Why again because all the locals have been so tainted by the influx of gringo dollars And they've all got stories and rumors about our relative or a friend or an acquaintance

[06:17] Who's gotten rich off his land because a gringo bought it So even latin's who own dumps in bad areas will put hugely inflated prices on their properties Because they think there's a clueless gringo out there who's got the money to buy So those countries that get the top rankings from AARP and international living like Mexico, Colombia, Costa Rica, Panama Dominican Republic and Ecuador well, it's true in those countries There are some gringos living on fifteen hundred dollars a month for now They're living a regular middle-class first-world life, but don't bet on that. You'll be able to do that for long Just look at the gringoized areas in Mexico Panama Costa Rica and Medi in Colombia prices are rising It's all due to the gringos In fact, I was just talking to a friend of mine a lady who lives in Costa Rica with her Costa Rican husband

[07:04] She told me that when she first got down around 12 or 13 years ago out in the hinterlands Not the gringo eyes cities and towns She was able to get a maid for around 15 to 20 bucks a day and now she said they don't charge by the day Anymore, it's the hour just like gringo maids charge up in the States So now she says maids in Costa Rica are asking four to six bucks an hour And you know to most you guys up north that sounds pretty good Still down here. That's a three to four hundred percent increase in just a couple of years Meanwhile way off the gringo tourist trail Honduras Salvador Guatemala Bolivia Guess what maids still get ten to twenty bucks a day You know, I promised I wasn't gonna beat up on Ecuador anymore at least not for a while

[07:49] And today I'm actually gonna applaud their government for doing the unthinkable. They lowered a tax Did you ever hear of such a thing? They lowered the IVA, which is the VAT tax here It's a tax that's included in everything that you buy unless you buy it on the street for cash or from one of the tens of Thousands of off-the-books kiosks you see everywhere But man are those off-the-books places popular they make up in most of Latin America from 20 to 40 percent of the economy Gotta love it, right? But anyway in Ecuador the VAT of 14 percent spend lower to 12 So slightly lower prices for everything should be in the pipeline not to mention Ecuador just signed a huge trade deal with Europe So now cars and all kinds of appliances and electronics coming through Europe that get this had normally an

[08:38] import tax of from 40 to 50 percent Yep 40 to 50 percent added on to everything you bought and now the tariffs on most European stuff been lowered to 5 10 or 15 Percent when that's passed down and it's already happening That should be a huge savings for people who are interested in buying big items like European cars and machine tools But still remember with a 12 percent VAT and let's say an average of 10 percent on imported items from Europe You still get around 22 percent tax, which is a huge improvement. So that's just Europe Any imported items coming out of the states or Canada will still be hit with combined taxes and VAT of over 50 percent But then again, what does the US or Canada make that might be shipped to South America? I can't think of anything

[09:24] Can you hmm? I don't believe the US manufactures anything anymore Does it in fact? It seems like the only things the US exports these days are bad foreign policy Inflation arms weapons and things that blow up mostly throw away Hollywood movies pathetic television shows and of course diabetes inducing and artery clogging franchises like McDonald's Wendy's Pizza Hut Carl's Jr Dairy Queen I hop Taco Bell, etc. Etc. Some legacy for a failed first-world superpower, huh? Now again I don't want to beat up on Ecuador, especially Cuenca Ecuador, which is gringo landia in that part of the world But I want you to hear this the city of Cuenca recently conducted a census. Remember, that's one city in Ecuador Cuenca the favorite of international living and many other rags, of course

[10:12] They're reporting that Cuenca is home to over 10,000 mostly gringo American expats The majority the article says retirees from Texas and Florida now I want you to keep that number in mind 10,000 compare that with over 1.5 million First-world American expats living in Mexico. And how about this? It says that there are over 100,000 gringo expats living in Colombia right now. Wow in that context It sounds like Cuenca Ecuador is the place to be right? Well, not so fast It's been reported that there are less than 5,000 gringos living permanently in the entire country of Honduras You get it in that one city in Ecuador There are twice as many gringos living there than in all of the country of Honduras

[11:00] Same with Guatemala less than 5,000 permanent gringos in El Salvador There's less than 2,000 permanent gringos living there. That's the whole country not just one city By the way, speaking of Cuenca and most every other place in Latin America where the gringos are piling in the city fathers and the local population are saying that American retirees are driving up land prices and Bleeding the public health care systems not to mention they're over utilizing the subsidized public transportation systems, too Not to mention in a lot of the gringoized towns Spanish signs are being replaced by English signs Sound familiar? Have you seen some of the barrios up in the states lately? Same thing only the signs are increasingly in Spanish, aren't they? Oh, and here's a little negative secondary side effect when gringo start piling in much of Latin America has been a destination

[11:48] For a low-budget backpacker sleeping in five and ten dollar a night fleabag hotels and such often You know their college students or even teachers from up in the states who have three months off and they'll have as their goal Latin America on 50 bucks a day. Hmm. Isn't it funny when I first came down to Latin America? I picked up that same book only back then it was Latin America on 12 bucks a day Didn't do me much good though because I have a little bit higher standards I have to have a single room with my own bathroom Yep, back then I could get a decent private room with my own bath for around 10 or 12 bucks a night Oh for the good old days Anyway, when low-budget backpackers come down to Latin America and I see this all the time when their dough runs out They want to stay on they find they love it here in Latin America And they know they can get by on just a tiny bit of dough So many of them try to pick up a cash job here and there bartender waitress trinket seller tourist guide

[12:40] Especially in gringo bars and touristy in somewhat touristy areas And you know, there's still are dozens and dozens of towns and cities where you can do that now They don't make much but for a full-time bartending or waitressing job They can make two or three hundred bucks a month Which can be enough to squeeze out a few more extra months of Latin American adventure That is living low-budget communal backpacker style However, you'll find as more and more gringo tourists invade a country and pick up those side jobs That does tend to make the natives restless By the way Why do you think bars restaurants B&Bs and tourist agencies like to hire gringos for cash? Well number one they speak English and number two most of them have already worked as bartenders or waitresses up in the states So they don't have to be trained and they know about customer service and food hygiene

[13:27] And Latin help has to be vigorously trained up to meet gringo standards on those two points in particular However as I first began to see some 25 years ago in Costa Rica once gringo is start piling in and they open bars restaurants tourist agencies Hotels, etc And start hiring gringos as receptionists and waiters etc for cash and or room and board the locals get pissed They want those jobs They complain to the government and the government sets up a tattletale hotline and a labor Inspection task force where people can call in and report businesses were hiring visiting Foreigner tourists instead of the local citizens. Gee, what a novel idea. They should try that up in the states, huh? Oh, and by the way, expat Eddie made the comment Isn't it funny how a gringo or gringo here on vacation?

[14:13] Well gladly wait tables or serve beer for 200 bucks a month at the local beach bar. Whereas up in the states Person would laugh in your face Maybe even spit in it if you dared to offer him or her such a proposal Hmm. I guess that's just another case of the three else You know location location location though. It doesn't that speak volumes for Latin America. I mean, come on It's a place first world people even college graduates will line up to get a two or three hundred dollar a month Waitressing or bartender job. Go figure, huh? Do you think they're destitute? No, because they could go back to the states and live with their parents or work a regular job, right? Obviously, they all agree on one thing. They absolutely love being in Latin America But getting back to latin natives and latin governments all pissed off about gringles and expats stealing those coveted bartending

[15:02] Waitressing floor sweeping and dishwashing jobs from the natives now It's true every latin country in every country for that matter has laws on the book saying foreigners Can't work in their country unless they're legitimate residents. That is not tourists They've gone through the residency process or they've got a work permit Which is by the way, a very tough thing to get on your own But in some cases a company that wants to hire you can get one for you For example call centers who definitely need perfect gringo English speakers, especially when they're looking to hire trainers And that's true of upscale K through 12 helicopter private schools They'll advertise for first world English teachers and often provide the work permit Yep, and I know a few gringo English teachers who got their jobs and work permits that way

[15:50] So some private K through 12 schools will offer a gringo expat a package deal like that In fact, I know one gringo who's been working at a private helicopter K through 12 and the administrator Arranged for him to get his permanent residency I also personally know of a few cases in Costa Rica where the locals got pissed at the good-looking Gringas work in the front desk at a certain hotel and called the hotline number Reported there were gringas without permits working for cash and they don't need any proof of this by the way Just to call the hotline and people come out Well, it took an hour or two the labor police came asked for work permits There were none and the young gringo ladies were unceremoniously booted out of the country the next day But that only happens in gringo saturated areas

[16:36] So if you're in a Latin City town or a Latin setting anywhere and you hear of stories like that You know, it's a gringo infested area Now you won't find that an author gringo tourist trail places, man Not in Honduras Salvador Guatemala Bolivia Nicaragua and Paraguay and such Now the bad news is the latest country to crack down on gringos work in these kind of gigs is guess where? Ecuador in an article coming out of Ecuador on June 6th, there's an interview with the labor minister Raul Clemente Let is not he says quote We have too many young Ecuadorians who are not working or working at jobs beneath their skill levels He says therefore we are targeting the informal employment of foreigners in service sector jobs That is our priority now

[17:23] Quote in restaurants discos and bars We see that many of the jobs are held by foreigners who do not have the legal status to work in Ecuador He says Ecuador has become an attractive destination for foreigners And it's important to keep entry-level job positions open to our own people He said a report issued last month claims workers from North America are crowding out our Ecuadorians Many of these workers do not have legal status. He said we must work to end this and we'll step up enforcement So like Costa Rica Panama Mexico and some of the larger tourist destinations in Latin America Ecuador will be sending in the labor and employment police By the way, and those off the gringo tourist trail countries I previously mentioned they all have such laws

[18:09] But none of them have what you might call employment or labor police that'll show up and check documents However, when the gringos start piling in things change now, doesn't that just suck? All right, kind of on the same subject Here's an email from Jennifer a two-time expat insider seminar attendee Hi Jen not to be confused with Jen Galt our fearless number one seminar logistics lady and Organizer of the John Galt pre and post seminar trips. Hey now, here's an awkward segue, but it only take one minute I promise we're about exactly one month away from my July 2017 expat insider seminar You can still sign up just go to www.thenewexpet.com Click on Johnny's seminar link and while you're there You'll find out how to kill two birds with one stone Yep, by combining the seminar with your application for permanent or temporary residency

[18:58] You'll save yourself a trip down in the time necessary To organize a separate trip for residency And if you can't get boots on the ground just yet do take my expat essentials course go to www.expatplanb.com And don't forget the triple dub at the beginning and check out my three free video introductions to the nine-hour course That's www.expatplanb.com And finally at whatever stage you might be in your plan B if you need help You could always do a one-on-one phone or Skype consult with me Just go to www.thenewexpet.com to download my phone consultation questionnaire for have a look See if you're missing anything on your own plan B list. All right, I guess that only took a minute. Anyway, here's Jen's email

[19:44] She says Johnny even though it seems you don't like Ecuador. You should mention Ecuador has just elected the first paraplegic president Lenin Moreno Does that mean that Ecuador will become more handicap friendly? Do you think well general also mentioned that he said died in the wool Socialist I mean he's got the name Lennon, you know Well, all I can say if he was living in my Chicago neighborhood as a kid He'd got his ass whooped on a daily basis But you know Jen he was vice president once too and he's already drastically improved the handicapped access situation there In fact, that's one of his pet projects But just because he's got a kind face and his handicapped Well, don't let that fool you true to form with all Latin American dictators leaders and sociopaths

[20:34] Sorry for being redundant there. One of his claims to fame is that he's increased government spending dramatically for people with special needs But again, don't let that fool you. The problem is Latin American governments are so corrupt It's a license to steal and live like a prince They're all on the take and when you see on the Internet or in the media Some good deeds done by government then the NGOs in the first world do-gooders start sending money and I'm telling you 80% of the dough that was spent went into the pockets of these politicians their friends and families I don't care what the first world media says or what you think, you know, as news coming out of Latin America Governments here in Latin America I'm talking about all of them are full of lazy ass small-time thieves who aren't even smart enough to be

[21:21] Classified as sociopaths not to mention censorship is alive and well in Latin America, you know that so in most cases You only hear what the government wants you to hear anyway So then how do Latin governments normally prioritize things like for example a road repair project? now suppose a road has a hundred potholes in it and it's been like that for years and one day a senator's wife Hits one of those potholes dead center on her way to the beauty parlor now That's a catastrophe and it becomes number one priority for the maintenance crews Now if you think this is a joke and you don't believe me Just go to any big Latin city and map out where the best concrete roads are then map out all the neighborhoods where the gas Bag congressman and high-level large-ass embassy types and diplomats live and you'll see an amazing correlation going on there

[22:10] Meanwhile, there are countless thousands of roads here in Latin America that have over a hundred asphalt patches per city block Oh, and by the way, the new Ecuadorian president Lenin Moreno has a spectacularly useful degree in psychology Now he might be the world's only head of state that's in a wheelchair But a few people know how he got that way. No, it wasn't polio or muscular dystrophy or anything genetic turns out in 1998 two guys approached him in a grocery store parking lot and keto took his car and shot him in the back So it was that spinal injury that left him paralyzed. So anyway now that he's president and even as vice president He was appointed as special envoy on disability and accessibility by UN Secretary General Ban Ki-moon

[22:57] In my opinion another totally disreputable scumbag who lives the life of a prince on other people's money And I mean that in the most heartfelt positive Christian way, of course now Jennifer also says this in her email She says here's something you don't often mention on your show disability travel in Latin America You've mentioned the decameron all-inclusive hotels. Well, there's one called Fiesta Americana travel club They've been advertising that they are equipped to handle travelers with disabilities at all their resorts in Mexico And they're offering a 40% discount to come to their resort Now for those of you who have to deal with wheelchairs and handicapped friendly bathrooms This may be a good option for a vacation Especially since many places in Latin America are not wheelchair friendly. All right

[23:43] Thanks for that chat And I'm sure a lot of people will be interested in handicapped access because well I'd say over 50% of the people who come down to Latin America as a destination are What you might call senior citizens and thus naturally have a greater percentage of issues with mobility and getting around and it seems Here in Latin America only very new government facilities airports and get this US Franchises that have landed down here including those US hotel chains We all know so well have full handicap access and handicap restroom facilities, etc Well, Jennifer, guess what? I know about that Fiesta Americana vacation club and you're right It only exists at resorts in Mexico. And by the way, they do have one other place

[24:31] It's in Portugal But Jen you see it's just like the decameron you buy a given amount of points for a given amount of years And if you do the analysis you'll find it's about twice as expensive as the camera In fact the come on introductory teaser you're talking about where they offer 40 even 60% discount Well, I'm looking at one of those offers right now and guess what their four-day three-night introductory teasers are actually Designed to get you to buy a points package in a timeshare like spiel Just like to the camera and to put it on your credit card So problem number one all but one of these resorts is in Mexico and Mexico You know is a nice place to visit But I wouldn't want to live there unless of course you love Mexico so much You want to spend every vacation there for the next 10 or 20 years?

[25:17] Because if you buy into the club plan, you'll get a lot of points and you'll have to use those up Just like a timeshare you'll feel terribly guilty if you don't So anyway, I'm looking right now at one of these introductory deals four days three nights in a beautiful resort in Cancun It's 450 bucks double occupancy. It's all inclusive But you're there so they can present that package deal to you now I looked at it in the end you'll use up the points about twice as fast as you do with the decameron plan However, these fiesta american hotels are definitely much nicer and swankier than the decameron now to be fair Decameron's do have handicapped access though. It may not be as extensive as the fiesta amaticana club

[26:04] So in the end you'll pay a lot more for that point system with the fiesta americana club deal But if you're disabled and can get that 40 off the whole package deal, maybe it'll work out fine However, if you read the fine print, there are lots and lots of piddly extra charges with the fiesta americana plan However, they have one very good thing going from their websites in english if you so choose and the point system Well, it's just as crazy and confusing as the decameron's point system and I have a strong feeling They want it that way. So you have to have a master's in accounting to figure it out I wonder if that five to ten page contracts in spanish like the decameron's is So it's buyer beware with both of those deals And I for one have been noticing in the news here in latin america that tourism is way down in mexico at the big resorts

[26:51] Obviously because of all the bad press mexico has been getting about narcos and crime now a few years ago There were narcos in crime But the narcos went after other narco cartel enemies in their own neighborhoods and now it's spread Well to the resorts which is why the other day I noticed some fantastic deals coming out of the resorts like cancun and playa del carmin Offering all inclusive five night resort stays for just 250 bucks for a double and you wonder how can they possibly do that? Sure, it's a loss leader But look if they've only got 30 or 40 occupancy They have to try to fill more rooms having a hot body in the room and half price is better than having nobody at all south of the border This is the expat files living in latin america

[27:38] 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.xpatplanb.com and check out my three videos. See ya nos vemos