Ecuador
Real Estate Archive VIII
Updated July, 23 2005
By
Gary Scott
To help you get a feel of Ecuador
real estate we have posted this special archive that lists many of the hundreds
of messages we have shared with our readers about Ecuador real estate this decade.
Gary's report on his latest Ecuador real estate
tour.
Clouds rise, fragile milk lace,
floating dreamlike in the daybreak's breeze. Fields of green are adorned with
apricot rays of early morn spread over razor edged ridge lines and announce the
dawn.
Quito Ecuador-August 2000, Breakfast
at one of the highest restaurants in the world. The city of Quito's elevation
is nearly 10,000 feet and the Quito Hotel sits on one of the city's highest knolls,
overlooking downtown and surrounding valleys. The hotel's seventh floor restaurant
is one of the highest points in town with a commanding view east, north and west.
Daybreak here is one of life's memorable events.
Merri and I watched the mists
rising off the valleys, sunlight filtering through the clouds and saw the city
waking up, a few headlights glimmering in the dawn, local indigenous salesmen
carrying bundles of goods to their stalls and the scenic mountain peaks coming
into view through the gray haze of fading night.
We are focusing on Ecuador strongly
now because in the past thirty years of live, work and travel abroad I have manage
to stumble upon five golden real estate opportunities, Hong Kong in the early
70s, London in the late 70s, the Isle of Man in the early 80s, Naples Florida
in the Mid 80s and now Ecuador. The first four opportunities returned from five
to twenty times my investment in just short years and Ecuador may be the best
of them all.
The fact that Ecuador has been
through several years of enormous political and economic turmoil has kept prices
so low, yet have given time to learn the market and where the opportunities are.
One amazing feature about Ecuador
real estate is that on every trip we learn something wonderful, surprising and
new. We shared this last journey with 100 readers and saw incredible value, but
the spotlight went beyond money and was focused on the Ecuadorian people. They
have suffered extreme adversity, yet their sweet nature and desire to please seems
hardly diminished at all.
Despite the severe monetary hardships
the locals have felt, this trip was smoother than any of the trips we’ve
experienced before. Our efforts may have been profitable because the austerity
has created prices so low many found it hard to believe, but the lightness of
spirit in the people we encountered went beyond wealth.
Gary & Merri Scott discuss
Ecuador real estate in the top floor restaurant of HOTEL QUITO.
Ecuador Real Estate Guayaquil
For example we spent our first
night in Guayaquil at the first class Oro Verde hotel. This five star hotel has
accommodations with an opulent, European feel of rich hardwoods and marble polished
until gleams. Service was always good but now we noticed a special caring at every
level of staff from the general manager to the young shoeshine boy.
These people have suffered every
financial humiliation imaginable including a currency plunge from 3,000 to 25,0000
sucres per dollar. Now in an ultimate economic insult their currency is being
totally removed. U.S. dollars, nickels dimes and quarters have become the currency
on the street. After September the greenback will be the only official currency.
Sucres will cease to exits. Yet the hotel’s blend of Swiss training, a large
.75 cent per hour labor pool and has loaded this hotel with ever-ready, wanting
to please staff. There is not a hint of anti-American resentment.
Despite warm, friendly, really
competent service and world class accommodations prices were decidedly third world.
Breakfast for Merri and me at the hotel‘s Patio restaurant was from a sumptuous
buffet that overflowed with a dozen varieties of fresh croissants, rolls, pastries,
breads, platter upon platter of fresh fruit, cereals of many types including an
intoxicatingly rich muesli, thick tropical juices, numerous hot plates of eggs,
bananas, potatoes, sausage, ham, tamales, omellette bar, many cheeses, fish, quiche,
cevichi and more. Thick Ecuadorian coffee and steaming milk, a variety of teas
and herbal teas and sweet Ecuadorian cocoa finished the choices. Yet our bill
was barely over five US dollars, for the two of us and the entire time we were
hovered over by pleasant, helpful staff.
Ecuador Real Estate Salinas
The caring of the people did
not change next morning when we rode two hours to Salinas for our first real estate
inspection. There we visited the brand new (opened in August) apart-hotel Colon
Miramar. Salinas is Ecuador’s leading coastal accommodation (not Merri’s
or my favorite) reminding us of Miami beach. High rise condos line a smooth crescent
beach overlooking a blue Pacific bay. The exclusive Salinas Yacht Club gleams
a short distance across the water, with super cruisers and sailboats snuggled
gently in first class docks. Here the people who served probably earned less than
a hundred dollars a month, yet we found nothing but complete and earnest service.
The property we viewed is the
third Colon hotel in Ecuador (the other two are the Guayaquil and Quito Hiltons).
This is a first class building, with every accommodation. There are hotel rooms
and a number of condominimized apartments. The two condos we viewed included a
1,300 square foot, two bedroom unit facing away from the sea. The asking price
of $85,000. The unit facing the sea was US$120,000. These are the most expensive
apartments we would see on the entire trip and the broker who led this tour explained
that actual selling prices would almost certainly be much lower. One delegate
summed up prices perfectly when he explained that the architecture in this building
is exactly like all the new buildings in San Francisco. “The difference”,
he said, “is you cannot buy a closet there for this price!”
What that reader did not think
of as well (we are so far removed from the ideas of service in the U.S.) is that
for about $300 a month (total) he could also have a maid, driver and cook. These
apartments also can be included in a rental plan with the hotel.
Ecuador Real Estate Coastal
After refreshments and a two
hour drive north up the coast we arrived for lunch at the award winning ecological
resort Alandaluz which adjoins Machalilla National Park. We dined in a huge bamboo
restaurant overlooking lush gardens embraced by organically grown fruit, vegetables,
herbs, bamboo and exotic palms. Delegates viewed charming bamboo and thatch apartments
with names like “The Tree”, “The Poet” and “The
Painter”. This tiny village is run by people who care for more than just
making a buck and it shows. They have a respect for beauty, harmony and nature
and are trying to take responsibility for the present and the future with a passionate
embrace for life, light and land to preserve it for future generations. They say
the humans, animals, plants, skies, land, sea and horizon itself are all unanimous
in this preservation.
Yet our impeccably served meal
of fresh organic fruits, grains, vegetables, shrimp, fish and tasty blackberry
juice (a local favorite) cost less than five dollars a head. The rest of the coastal
trip worked this way as well. People served us caringly and perfectly everywhere
we visited, from the Oro Verde hotel in Manta (where they saw nearby houses on
the beach for as little as US$24,000 and 1,800 square foot apartments with terrace
and sea view plus ocean front swimming pool at very negotiable prices in the US$
100.000 range) to the lunch in a small restaurant overlooking the fishing village
of Crucita. This area is famous for hang gliding and the restaurant owner provided
a professional to take delegates on free rides off the cliffs and out over the
indigo sea.
Ecuador Real Estate Quito
In Quito the people were even
friendlier. Such warmth is unusual in a huge city (in the U.S. road rage and ill
tempers are more likely to be found than smiles). Service was friendly and earnest
and though many people there are suffering extreme financial hardship, tips were
not expected. When money was given for extra-ordinary service the recipients seemed
surprised and genuinely pleased.
Several delegates also expressed
surprise that Quito was a real city, with modern buildings, broad avenues and
every infrastructure one would expect. They thought with such low prices they
would find a ramshackle shanty town instead of a modern city with broad avenues
and gleaming high rises everywhere. Quito is a was called ‘Paris of the
south” in the Victorian era and is truly a place where you can get anything.
Here the delegates viewed modern
spacious apartments of material and décor not seen in North America for
years at prices not seen in decades. The property they saw included new, central
apartments for US$25,000 and really beautiful 1900 Sq foot three houses in the
Tumbaco valley outside of Quito at US$ 88000 asking price.
Model adobe houses of incredible
architectural design at the architects Barro Viejo which can be built for US$
15-20 sq. foot, incl. fixings, bath, etc. were also viewed.
Ecuador Real Estate Otovalo
After hearing attorneys, accountants,
U.S. expatriates and even an indigenous Yatchak (Shaman) speak on differing aspects
of Ecuador the group headed north along the Pan American highway towards the shopping
village of Otovalo. Here amidst the Twin volcanic peaks, Chimbaroso and Pichincha,
and clear Andean skies the group encountered perhaps the sweetest Ecuadorian people
of all. The indigenous Ecuadorians are Incan ancestors and live in fertile patchwork
valleys, crisscrossed with plantings of corn, potatoes and Quinoa. Though they
are the poorest of all with incomes ranging as low as $30 a month they have a
charm and sweetness that cannot fail to touch one’s heart.
There are some economic reasons
for Ecuadorians to be feeling even brighter. The roads and bridges were in much
better shape than those our previous tours encountered. A year’s worth of
road work after El Nino and La Nina have improved transportation throughout the
country. Better paving is not the only improvement we found in this Andean nation
either.
Ecuador’s economy appears
to be improving. The consensus from the many experts who spoke to the group is
that Ecuador’s economy has turned the corner and is now ready to improve.
A recovery may be on the way based on five cornerstones of higher oil prices,
dollarization, government reorganization, privatization and a simple rebound.
Ecuador is the second largest
oil exporter in South America and oil the Ecuadorian government’s main source
of income. As oil prices have skyrocketed so have government revenues. In addition
the government is now finally starting to privatize oil, telephone, electricity
etc. If this trend continues the economy will be helped enormously.
There are some problems associated
with all this change. Dollarization will hurt the poor from a psychological and
buying power point of view, (someone who was earning 100,000 sucres a week will
be earning four dollars. This will make their income seem less. Buying power will
drop as low cost products and services (shoe shines for example) that used to
cost less than the lowest U.S. coin in regular circulation will rise. Also inflation
will now not be offset by currency devaluation and is still expected to run about
30% in the next year.
However the good news is that
the dollarization law prohibits the National Bank of Ecuador from printing money
or from being a last resort lender to banks. This will force the government to
increase their spending discipline which should force forcing it to reduce costs
and keep privatization on track. This should reduce long term inflation and increase
the economic efficiency in years ahead.
Will the economy improve and
the people of Ecuador become even sweeter as the economy improves? These are answers
no one knows, but what I do know is the country offer sweetness and opportunity
now. During this limited time before the economy really recovers this rich country
offers a special blend of wonderful service, low prices and a sweetness we may
never see in this world again.
The final inspections on the
tour was in a visit back to the coast and the Casa Blanca Resort where delegates
found everything, tennis, golf, marina and water sports, yet 600 to 1400 Sq. foot
apartments and houses and apartments from US$ 30.000 to US$ 77000 with financing,
including golf membership.
The tour ended with a visit to
Otavalo, the largest market in South America. Wool coats, handmade "fishermen"
sweaters, and vicuna blankets cost under $10. A good leather coat goes for under
$100. Panama hats are made in Ecuador, and the least expensive come in their own
handmade balsa boxes for about $3. Rugs, jewelry-especially silver and emeralds,
crafts, wood carvings, and pots are on offer at bargain-basement prices.
The group lunch at hacienda Cusin,
a 17th century monastery that has been converted into a lovingly restored 40 room
hotel. There the delegates saw new houses, built to look 300 years old available
on seven year leases (the price is $25,000 which seemed expensive to us but did
include all hotel facilities.
On the way back to Quito the
inspected brand new pre fabricated vacation homes that can be purchased for as
little as $3,000. These houses were previously only $800, so we can see some effects
of inflation already, but these sweet little places (about 460 sq. feet) are still
a bargain for a vacation home in the mountains or on the sea.
Interested in a second place
to live with good services, low prices and wonderful investment opportunity. Visit
Ecuador.
Contacts
Dr. Andres Cordova. Tel:593-2-241-105. Fax: 593-2-920-665
Email: andres.cordova@garyascott.com
Andres is an attorney in Quito.
His firm represents the National Bank of Ecuador and other government economic
agencies as well as private individuals. He is also advisor to Gary Scott’s
International eclub.
We have continual Ecuador
real estate tours.
I hope to see you in Ecuador. Until then, good
investing!
Gary
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