Great Retirement Places

Have you been wondering how overseas retirement places stack up to each other? In this post, we’ll compare Mexico versus Uruguay. These countries are quite different from each other, but each offers opportunities for investment or as a second home. The factors considered below are focused on finance and investment, but there are many other factors to consider if you are more interested in the purchase as a second or retirement home.

Thanks to Margaret Summerfield, writer at Pathfinder International for this look at Mexico and Uruguay.

Prices:
Both countries offer a wide choice of affordable property, as long as you are willing to look beyond the most popular spots. In Mexico’s northern Yucatan, there are inexpensive beach lots and historic colonial bargains in places like Merida. In Uruguay, Rocha Province offers small beach towns with inexpensive beach lots. It’s pretty much a draw.

Construction Quality:
While both countries hold to good standards, they cater to different markets. Mexico caters to the North American market, and Uruguay to the Latin American market. It’s a draw.

Ease of Buying:
There is an obvious difference in the markets served which is reflected in the sales materials and sales staff. The process in Uruguay is simpler and less pushy, plus it is not necessary to establish a trust to purchase beachfront property in Uruguay. Neither country regulates real estate sales closely, nor is it feasible to obtain local financing. The edge goes to Uruguay here.

Property for Residency:

While it is possible in Uruguay to gain residency by real estate purchase, it is complex, and not recommended for everyone. It is simple to establish residency, though, by meeting the income requirement of $6000 per year. In Mexico, you have to show at least $1000-$1500 a month, although residency and occupying the home may offer capital gains advantages. Another draw.

Holding Costs:
Besides home country tax obligations, there is the capital gains tax, 12% in Uruguay and 30% in Mexico with some allowances for inflation and improvements. Advantage: Uruguay. Then there is the annual property tax. Although the computations are complex and unique to each country, it is essentially a draw. For closing costs, the range is from 4% to about 8.66%. Mexico has a slight 1% advantage here. Given the big advantage Uruguay has in capital gains, it is the winner in the holding costs category.

Property Management:
Despite the fact that Mexico has the edge in availability of property management, Margaret gives the nod to Uruguay for its better rental income tax rate: 10.5% to 12% versus 25% for non-residents in Mexico.

Investment Potential:
Mexico’s proximity to the US gives it a demand advantage that keeps occupancies fairly high. On the other hand, it is very sensitive to economic fluctuations in the U.S. Uruguay has a wider appeal among several Latin American countries, and as its real estate investing is less well developed, it has the more promising upside. Investors feel safer with Uruguay.

The Winner:
Uruguay wins this financial shootout, with good prospects for long-term appreciation and investment and a more tax-friendly environment. As stated above, if you are looking for a second home, there are many other important factors to consider, including climate, healthcare, culture, amenities, language, currency and residency requirements.

For more details, read the complete article: Down to the Wire: Mexico vs. Uruguay at PathfinderInternational.net

Have you been wondering how overseas retirement places stack up to each other? In this post, we’ll compare Brazil versus Costa Rica. These countries are quite different from each other, but each offers opportunities for investment or as a second home. The factors considered below are focused on finance and investment, but  there are many other factors to consider if you are more interested in the purchase as a second or retirement home.

Thanks to Margaret Summerfield, writer at Pathfinder International for this look at Brazil and Costa Rica.

Prices:
Prices are difficult to compare. Brazil, a large country with cosmopolitan cities in coastal areas, contrasts with Costa Rica’s small size and properties with stunning ocean-view properties. It’s a challenge to find comparable real estate in these countries, but to the extent you can, it’s a tie.

Construction Quality:
Brazil edges Costa Rica here. Brazilian builders are larger, more experienced companies that excel in interior finish design.

Ease of Buying:
Costa Rica has vast experience with the North American buyer, frequently with English-speaking sales staff, printed collateral, and websites. The bulk of Brazilian real estate buyers are newly minted middle-class Brazilians. Brazilian real estate sales brokers must be trained and licensed; not so in Costa Rica. Buyers can get bank financing in Costa Rica with some difficulty, but in Brazil, developers offer no-money-down deals and inexpensive pre- and post-contruction payment plans. Advantage: Brazil.

Property for Residency:
Neither country offers a specific residency through investment in a property.

Holding Costs:
Besides home country tax obligations, there is a capital gains tax, 15% on property in Brazil, but in Costa Rica, only the developer pays capital gains tax. Advantage: Costa Rica. Then there is the annual property tax. Costa Rica’s property tax runs about 50% of Brazil’s, but Costa Rica has higher taxes on luxury property. Brazil charges additional tax on properties near the beach. For closing costs, Costa Rica costs are generally lower than Brazil. Costa Rica wins holding costs.

Property Management:
While property management is a much easier task in Costa Rica, the potential for rental income is greater in Brazil which is experiencing an unparalleled economic boom. Rental property in some areas cannot keep up with demand. Brazil wins on potential here.

Investment Potential:
For the same reasons the potential for rental in Brazil is very promising, so is the whole real estate market, particularly on the northeast coast.

The Winner:
The superior low-money-down developer financing in Brazil allows investors to leverage their funds in way that’s not possible in Costa Rica. Brazil is the winner. As stated above, if you are looking for a second home, there are many other important factors to consider including climate, healthcare, culture, amenities, language, currency, and residency requirements.


For more details, read the complete article: Round Two: Brazil v Costa Rica at PathfinderInternational.net

Have you been wondering how overseas retirement places stack up to each other? In this post, we’ll compare Panama versus Ecuador. These countries are quite different from each other, but each offers opportunities for investment or as a second home. The factors considered below are focused on finance and investment, but  there are many other factors to consider if you are more interested in the purchase as a second or retirement home.

Thanks to Margaret Summerfield, writer at Pathfinder International for this look at Panama and Ecuador.

Prices:
Ecuador wins this hands-down. Comparable homes cost 1/2 or less in Ecuador.

Construction Quality:
There is more variability between builders and contractors than between countries, so exercise great care in selecting a pre-construction development, in particular. When it comes to quality of finishing, you’ll find a better quality of materials and workmanship in Ecuador than in Panama.

Topography & Climate:
If you are looking for cool highlands living with scenic snow-capped mountains, Ecuador has the edge. However, for a greater variety of ocean beach living, with more sunshine, or cool highland living, Panama comes out ahead.

Ease of Buying:
Panama easily wins in this category. Years of dealing with Americans in a market that boomed in the mid-aughts by brokers, developers, and sales staff (many whom speak English) make buying an easy, familiar process. International banks in Panama offer financing to non-resident foreigners. The brokerage scene in Ecuador is more chaotic and commissions vary significantly.

Property for Residency:
Ecuador requires an investment of $25,000 for residency, versus $300,000 in Panama.

Holding Costs:
Besides home country tax obligations, there is the capital gains tax: 10% in Panama and 0.5% in Ecuador. Advantage: Ecuador. Then there is the annual property tax. Taxes in Ecuador are paid on the assessed (municipal) value of the property rather than on the sales price, as they generally are in the U.S. In the coastal city of Manta, you’ll pay 0.15% of the property’s assessed value, but this will vary from one municipality to the next. In Panama, if you qualify for their tax exemption, your taxes may be quite low. Otherwise, given the lower costs of real estate in Ecuador, you may come out ahead there.  For closing costs, Panama closing, transfer, and legal fees can approach 6%. In Ecuador those fees run about half as much. On the whole, Ecuador fares a bit better in this category.

Property Management:
Panama wins here. Panama offers a wider choice of rental management companies, and more rental potential, than Ecuador does. You’ll likely have better occupancy and higher rental rates in Panama. Ecuador’s market for short-term rentals is in its fledgling stage.

Investment Potential:
It’ll take a while, but Ecuador’s low starting prices means it offers more potential for appreciation. Investment gains in Panama boomed from 2004 to 2008 then slowed.

The Winner:
Ecuador wins this financial shootout with good prospects for long-term appreciation and investment, and it offers a big advantage in price. As stated above, if you are looking for a second home, there are many other important factors to consider, including climate, healthcare, culture, amenities, language, currency and residency requirements.


For more details, read the complete article: Winner Takes All: Panama versus Ecuador at PathfinderInternational.net