4 Best Places To Buy A Second Home in 2019

4 Best Places To Buy A Second Home Overseas In 2019

Kathleen PeddicordContributor

RetirementI’ve covered living and investing overseas for more than 30 years.

Brazil is a big country, but most of the viable lifestyle options are along the coast.ISTOCK/MARCHELLO74

The dollar’s current strength is creating bargains in some of the world’s most appealing places to own a home of your own.

Specifically, as we head into 2019, property markets are dramatically discounted for dollar buyers in Brazil, Colombia, Mexico, and Chile.

Brazil

Currency: Brazilian real

Currency Controls: Yes

Dollar’s increase in value over the real in the past 12 months: 16.5%

Dollar’s increase in value over the real since Jan. 1, 2013: 90%

Brazil’s history is one of the Americas’ most fascinating stories. Over the years, the country was the New World’s great plantation slave society, host to its first major gold rush, and ruled by the hemisphere’s only empire.

Brazil is a big country, but most of the viable lifestyle options are along the coast, from the big city of Rio de Janeiro to smaller beach towns like Florianopolis. I’d recommend taking a look at Maceió. The first Europeans to arrive here were Dutch settlers, who came to Brazil to start a sugar plantation to supply the ever-increasing demand in Europe in the early 1600s. The Portuguese took control of the area in the 1650s, and the city continued to grow. Maceió soon became a major seaport, exporting timber, tobacco, coconuts, leather, and spices.

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Today, Maceió is modern, clean, and elegant with miles of white-sand beaches studded with colorful umbrellas and bordered by tall, swaying palms. Its warm turquoise waters gently lap the shores as beachgoers from all over enjoy the sun and sand. The town’s long stretch of beachfront is the main attraction, and it’s one of the best you’ll find in Brazil. It’s as naturally beautiful as it’s possible for a beach to be, but without the bothersome vendors, beggars, and obvious sex trade that you’ll find in other, better-known Brazilian beach cities. If you're in the market for cheap beachfront property, Maceió should be near the top of your list. You could buy a large, three-bedroom apartment here for less than $75,000.

Downsides to Brazil include the small English-speaking population (relative to the 200 million inhabitants). Other downsides have to do with currency exchange rates and controls. You want to be careful about how you bring money into the country or you could have trouble when the time comes to take it (and any associated profits) out.

Brazil’s economy has faltered in recent years, so you stand to gain twofold… from the recovery of the economy as well as the currency. When the recovery comes, the economy should help to raise prices in reals… while the recovering real should further raise the value of your investment in dollar terms.

Historically, Americans and Canadians have needed a visa to enter Brazil as a tourist. Obtaining this visa was an annoying and time-consuming process. Brazil now offers an eVisa that you can obtain online for only $40, plus a service fee of a few dollars.

Also, new for 2019, Brazil has introduced a new residency option. A real estate purchase in this country can now qualify you for permanent residency.

Colombia

Currency: Colombian peso

Currency Controls: Yes

Dollar’s increase in value over the peso in the past 12 months: 6.1%

Dollar’s increase in value over the peso since Jan. 1, 2013: 81%

Years ago, I sat around a table in a just-opened restaurant in a little-known mountain town in Panama called Boquete with a group of investors and businesspeople, in the country, as I was, to scout opportunity.

"I believe that the potential in this place for retirees is enormous," one of the gentlemen in the group (the one who had just invested in opening the restaurant where we were having dinner) theorized.

"Right now, the opportunity here is for the investor and the speculator. Property prices are so under-valued. Apartments in Panama City are a screaming bargain on a global scale. Pacific beachfront, Caribbean, farmland, river-front, this country has it all, and it's all cheap.

"Panama is still misunderstood, suffering from a lingering case of bad press," my host for the evening continued. "When you say 'Panama' to an American today, he thinks: Noriega... drug cartels... CIA intrigue. It won't be too many years before those perceptions are flipped on their head. I predict that, five, seven years from now, when you say 'Panama' to the average American, he'll think: Retirement. Because that's what this country is gearing up to offer—a very appealing retirement option.”

That was 1999. In August 2010, the AARP named Boquete, Panama, one of the top five places in the world to retire.

A few years ago, I sat around a table in a just-opened restaurant in a little-known mountain town in Colombia called Medellin with a group of investors and businesspeople, in the country, as I was, to explore current opportunity.

"Property values in this city are so under-valued," one of the gentlemen having dinner with me remarked. "I believe that apartment costs here are the lowest for any cosmopolitan city in the world on a per-square-meter basis. This is because Colombia, including Medellin, is still misunderstood. When you say 'Medellin' to the average American, he thinks: Drugs... gangs... Pablo Escobar. It's such a misperception. The current reality of this city is so far removed from all that.”

As in Panama years ago, the opportunity today in Medellin is for the investor. Right now you could buy almost anything in this city and feel comfortable that you could make money from the purchase. And this is a market where you could buy in with as little as $50,000.

The coming opportunity in Medellin is for the retiree. I predict that, five, seven years from now, when you say “Medellin” to the average American, he'll think: Retirement. This City of Springtime and Flowers offers a very appealing and competitive retirement option.

Cautions associated with buying in Colombia have to do exchange controls and other bureaucratic restrictions. Also, taxes are high.

On the other hand, Colombia is one of the easiest places in the world to obtain residency. The country offers 17 visa options, and requirements are minimal.

Mexico

Currency: Mexican peso

Currency Controls: No

Dollar’s increase in value over the peso in the past 12 months: 5.5%

Dollar’s increase in value over the real since Jan. 1, 2013: 58%

Mexico is a big place with a bad reputation. The reputation isn’t altogether undeserved, as drug cartels do control parts of this country but hardly all of it, and some of the most appealing regions for both living and investing sit outside the conflict zones.

Mexico offers two long coasts, mountain towns, and colonial cities, plus Mayan ruins, jungle, rain forest, rivers, and lakes. It's also the most accessible “overseas” haven from the United States. You could drive back and forth if you wanted.

For all these reasons, Mexico is home to the biggest established populations of American expats in the world. More than 1 million Americans live in Mexico, and more than 500,000 own homes here. These expats are enjoying a low cost of living at today’s exchange rates, while new arrivals are getting great property bargains.

Real estate trades in U.S. dollars or Mexican pesos, depending on the region. It’s the peso-priced properties that offer dollar-shoppers increased buying power. Mazatlan, on the Pacific coast, a city with both beautiful beaches and a Spanish-colonial center, is one such market.

The process of establishing residency in Mexico is easier even than in Colombia. You can obtain your visa from a Mexican consulate in the United States in as little as 30 minutes.

Finally, the country’s accessibility from the United States makes it a top choice if you’d like to continue to use Medicare to cover your health costs. Medicare doesn’t cover you anywhere outside the United States; however, living in Mexico, you could drive back across the border to get your healthcare in the States. This can take a big concern off the table. Many expats living in Ensenada, for example, drive to San Diego for their major health care needs.

Chile

Currency: Chilean peso

Currency Controls: No

Dollar’s increase in value over the peso in the past 12 months: 7.8%

Dollar’s increase in value over the peso since Jan. 1, 2013: 46%

With its modern four-lane highways, reliable communications, and high standard of living, Chile can be one of Latin America’s easiest transitions for American expats and retirees. If not completely First World, it is not far off the mark. The country feels efficient, well-run, and safe. Utilities work, buses leave on time, and you can stroll the streets without worry.

For American Baby Boomers, our introduction to Chile was the overthrow of President Salvador Allende in 1973. The aftermath of this event, the long, harsh dictatorship of General Augusto Pinochet, proved more of a shock to Chileans than everyone else. It was largely out of character with this nation’s history. Chile today is peaceful, stable, and prosperous.

Santiago, Chile’s capital city, was established by Spanish conquistador Pedro de Aldivia in 1540. Over the next decade, Valdivia expanded the colony in Chile, founding La Serena in 1544. It is this town that I would suggest you consider. Santiago is a great and modern city, but the high levels of pollution can make it an uncomfortable place to be. In La Serena, the skies are clear, with little pollution.

La Serena is a coastal community but more temperate than tropical. Temperatures are pleasant year-round.

Historically, the biggest downside to Chile for the potential expat, retiree, or property buyer has been the costs, which couldn’t compete with those of other Latin American destinations. However, at today’s exchange rates, both the cost of living here and the cost of buying a second home are a bargain.

Chile is another country where the residency process is relatively simple. You can apply by mail, and there’s no minimum income requirement to get started.

If there’s a disadvantage to Chile, it’s the distance from the United States. It’s at least a nine-hour flight.

My newest book, "How to Retire Overseas: Everything You Need to Know to Live Well (for Less) Abroad," can be found here.

Kathleen PeddicordContributor

What you should know about the listing of your new home

What you should know about the listing of your new home: Ask Joe

By JOE RICHERRegistrar, Real Estate Council of Ontario

Sat., Jan. 26, 2019

I bought a home several months ago, and yet the listing photos are still online in an ad placed by the seller’s brokerage. Can RECO help me get them taken down?

Yes, the Real Estate Council of Ontario can look into the matter if the brokerage hired by the home’s previous owner is unwilling — or unable — to take down the advertisement.

If your new home, and its photos, are still listed for sale, ask the seller’s real estate agent to have the ad taken down.  (MARUZHENKO YAROSLAV / DREAMSTIME)

Your first step, however, should be to get in touch with the seller’s agent and, possibly, their broker of record; that’s the person who oversees a brokerage and its compliance with the Real Estate and Business Brokers Act, 2002, and its Code of Ethics.

Most real estate brokerages want to make things right when a problem emerges and are committed to following the advertising rules that we enforce. Those rules help ensure that real estate ads are accurate, and consumers aren’t tempted with false or deceptive claims. They also exist to protect the privacy of buyers and sellers. Here are some of the basic rules:

When a home is listed for sale, the seller’s representative may market the property on the Multiple Listing Service or other websites with the seller’s permission. Once an offer has been accepted, the seller’s brokerage can then advertise that the home is now off the market and use a “SOLD” designation in their marketing.

The brokerage is allowed to run such ads until the home’s ownership changes hands. Once that happens, the brokerage can’t make any reference to the property in advertising without the new owner’s written permission. That includes posting photos of the property on the brokerage website or anywhere else.

And if the seller’s brokerage wants to include pertinent details of the transaction, such as the selling price or the closing date, it needs written permission from both the buyer and seller, regardless of who owns the home when the advertisement is published.

It sounds as though the seller’s brokerage probably forgot to remove the ad after you assumed ownership of your home. I imagine a gentle reminder of their responsibility to respect your privacy will do the trick. If that doesn’t work, feel free to contact RECO.

A final word about listing photographs: salespeople will often advise their seller clients to declutter and depersonalize their homes before a photo shoot because mostly-empty homes are easier to market.

But that’s also good advice from a personal safety point of view. If you decide to sell your home, make sure your valuables, keys and confidential information (bills, bank statements and other documents, family photos and computer passcodes, for instance) are safely hidden before the photographer takes any pictures, and personally review any photos your representative wishes to post online. You don’t want to inadvertently assist web-surfing burglars.

• REAL ESTATE INVESTING

DUE DILIGENCE: 10 STEPS TO TAKE BEFORE YOU BUY

Auction.com // January 2, 2019

Due diligence is one of the most critical periods in any real estate transaction. But many buyers cut corners in the due diligence process in their haste to have their bid accepted. Here are 10 due diligence steps you shouldn’t skip, especially if you’re considering a foreclosure, bank-owned property or short sale.

1. Do a title review. Always get a preliminary title report on any foreclosure property you’re interested in buying, and look for any secondary liens or tax liens. Make sure there aren’t any hidden liens or encumbrances on the property that will blossom into unpleasant surprises later.

2. Inspect the property thoroughly. You may not be able to get inside a foreclosure property that’s still occupied. But if you can, have a licensed professional inspector review the house for evidence of structural defects, water damage or other major problems.

But most importantly, make sure everything is functional. I know of one case where an owner who had lost his home to foreclosure did what some owners do in that situation: he ripped the wiring out of the walls and took the piping. But then he did something different: after he was done, he put up new drywall. So when they did an inspection of the house, it looked fine, but there was no wiring or piping behind the walls.

What if you can’t inspect the property, other than driving by it? For the properties listed on Auction.com, once you have an account and find a property you’re interested in, you can access its due diligence documents in a secure online “vault.” Be sure you’ve read and understand all of these documents before the auction.

3. Consider the surrounding property and neighborhood. Don’t confine your inspection to the structure itself. Look around at the landscaping. Does the property back up against a bank that has no vegetation? Will the drainage work in the event of a heavy storm?

Check out the surrounding neighborhood as well, as its condition can affect the value of your property. Do you see pride of ownership in the other homes? Or do you see abandoned properties in the area? And note that abandoned houses aren’t just a problem in “bad” neighborhoods. Because of the recent housing crisis, you might find abandoned or unfinished homes even in relatively new housing developments.

4. Examine recent sales activity. Look at how many days homes have stayed on the market. Are properties moving quickly or languishing? What are the buy vs. rent trends in the neighborhood? How many of the homes sold were distressed inventory? Too many sales overall could suggest that people are leaving the neighborhood—see if there’s an underlying reason why.

5. Review price trends. Are they going up? Have they plateaued? How do they compare to what they were during the last peak? That information should give you an idea of whether property values are going up or down, and help you figure out what you should be spending.

6. Find out how many homes in the area are in foreclosure. Too many suggests price weakness over the near term. Are there a disproportionate amount of distressed properties in the area? Before the crisis, only about 1% of properties went into foreclosure in any given year—or one home out of every 100. In today’s environment, you might see maybe three or four. But more than that might indicate a problem and a reason the property is priced as attractively as it is.

7. Look at the upside potential. Are you near a good school? Are you near a transportation hub? Are there new businesses that are popping up or being launched in the area? Those are potentially all good upside opportunities for you. Conversely, has there been a plant shutdown recently? That will probably lower property values. The local chamber of commerce can supply some of this information; it also helps to have some local connections.

8. Go to open houses. See what the standard of quality is in other homes that are currently for sale. Are tile countertops fine, or do I need to install granite? This is a good thing to do whether you’re planning to flip the home or rent it. It doesn’t mean you have to overspend. But you want to meet the neighborhood standard or be slightly above it, and spend as little as you can to attain that standard.

9. Research zoning requirements. If you’re going to rent out the property, consult with a real estate attorney to see if there are any local ordinances or laws that might make it difficult to be a landlord. Some areas aren’t zoned for rental property. Some developments limit the number of rentals in the neighborhood; others have limits on the number of adults that can live in a single house, which could be a problem if you plan to rent to people who want to room-share (like college students).

10. Check your liability insurance. If you’re going to be a landlord, check with your insurance agent to find out how much liability and property insurance you’ll need.

While these 10 steps may sound like extra work, they’ll pay off in the long run. Whether you’re going to occupy it, flip it or rent it, real estate is one of the most expensive investments you’ll ever make. It makes sense to protect it.

Hire Movers or Move Yourself?

 By Diane Schmidt  

Updated 10/24/18

This is a question that plagues all people on the move. And like most decisions, the answer is different for everyone depending on numerous factors such as time, money, difficulty and complexity of the move. If you're moving across town, a self-move may make more sense than if you're moving across the country. Still, to ensure you're making the best decision, it's a good idea to weigh all options.

So, before we begin to ask ourselves some questions, decide first what your first priority is; money or time or a bit of both. Knowing what is the most important factor will help lead you to a satisfying answer.

How Much Stuff Do You Have? 

For a general idea of what it will cost to move your household, use the guide most truck rental agencies use, and count the number of bedrooms. Here's a sample truck-size guide from U-Haul:

• 26' will move 4+ bedrooms
• 24' will move 3-4 bedrooms
• 17' will move 2-3 bedrooms
• 14' will move 1-2 bedrooms
• 10' will move an apartment

How Far Are You Moving? 

The budget can provide rates on the cost to rent a truck to move from Point A to Point B and factors in the type of move (one-way or return). Remember when you're moving one-way the cost can increase by 50% or more.

Okay, so that covers the fee to rent a truck, but what about gas costs and mileage? You'll have to factor both in when determining the cost of renting a truck vs hiring a moving company.

Distance calculators can provide estimates on how far you'll be traveling and fuel calculators will give you an idea of how much you'll be paying to fill up the gas tank. Both costs need to be added to the truck rental fee if mileage is not already included.

Once you've answered these two questions, call some moving companies and ask for a sample quote over the phone. Many will insist on coming out to your place for an estimate, which may or may not is something you want to do. You can also look for online quotes from companies such as Moving.com; however, keep in mind that these quotes are not always guaranteed and also make sure the moving company is reliable.

So, now you have a cost-comparison between hiring a company or moving it yourself. Now, if this is all you're concerned about, then you can pretty much stop right here and make your decision. But if time is important to you, then you can also weigh the various options in between; from hiring a company to pack, load and ship, unload and unpack your goods, to hiring a company just to load, ship and unload your household or to do it all yourself. Here are some final questions to ask:

• How much time will it take to pack your things, load your things and drive it all to your new destination?
• Do you have additional help? Friends, family, neighbors or colleagues that can lend a hand?
• Do you have fragile or special items that will require special handling? Can you move these items yourself? If not, what will it cost to move them?
• Will you need to rent additional equipment/supplies/hired-hands to move larger items such as appliances?
• Are you confident that you can move your household goods safely?
• Are you aware of hidden costs that can creep into your move, such as additional insurance or packing supplies?

And one last piece of advice: no matter what you decide to do, save all your receipts and make sure you claim your move (if possible) on your tax return.