Ecuador Property Practicalities

by | Feb 7, 2008 | Archives

Ecuador property practicalities are creating opportunity.

A reader just sent me this note.

“Hi Gary , What do you think of the seizing of mining claims by the leftist government? I’m quite interested in doing some business in Ecuador but it seems they

shoot themselves in the foot all the time. Bill”

My reply:

Bill, Like most governments the Ecuadorian government does some really illogical things….I won’t go on as I am not much of a fan of politicians everywhere.

There have been some bad ecological and tax and husbandry infractions by the oil and mining companies that leave little sympathy even for a die hard capitalist like myself. Let’s hope that both the government and the big resource firms both learn to be smarter. Chasing foreign investment away surely does not help anyone in the end.

However let’s be practical for a moment. None of this seems to affect us little folk much.

In fact so far it has just created opportunity. Though there are many differences there are also many similarities to the situation when I lived in Hong Kong in the late 60s and the Chinese Communists were threatening the then British Colony.

Government stupidity created opportunity for wise business people.

Personally I am buying as much as I can. In fact I am buying five more condos on the beach right now.

There are several more reasons why I am bullish on Ecuador property and keep buying while investors let the press use word’s like “leftist” and “populist” (the word in the Hong Kong days was “communist”) to scare people away. Those who saw through the babble of the local press and remained or invested made incredible fortunes.

One reason is that a president’s hold is never strong here.

Ecuador’s president is young. I think his heart is in the right place but he is between a real rock and hard spot…so many poor voters…just a few rich and so many promises made. Ecuador has a history of giving those who do not perform short shrift.

Actually conditions now are pretty much as they were when we came almost 15 years ago…except that everywhere now there is more prosperity. There was a new president. He began a new constitution. He did not keep his promises and the people demonstrated peacefully in the streets and threw the guy out. Then that happened again …and again …and again.

Not much is new in the political world.

A recent article at entitled “Huge Rally against Ecuador reform” says:

“Tens of thousands of people have staged a protest march in Ecuador ‘s largest city against President Rafael Correa’s planned constitutional reforms. Critics say the reforms will focus more power in the president’s hands and this will frighten off foreign investors. But Mr Correa, 44, who made reforming the constitution a key part of his election campaign, enjoys widespread popular support. Last year, nearly 80% of voters backed his call for an assembly that would bypass Congress and rewrite the constitution. A draft document is expected to be put to a national referendum this July for approval. His supporters held a demonstration on a similar scale in Guayaquil last week to celebrate the anniversary of his first year in office.”

So the process has once again begun. Personally I hope this president lasts a bit…but if not, I’ll probably keep buying. Seven years ago the country’s economy collapsed. All the banks closed. The currency collapsed. I helped clients buy as much land as they could. They have made a fortune from this.

Prices were unbelievable then. They are not anywhere as low now, but are still way below many other areas.

Plus let really be practical. How much money have investors lost in the US property value?

Investing anywhere has an element of risk. My son Jake, recently pointed this out when he wrote:

“Hi Dad, I was thinking about those who are concerned about some third world country like Ecuador confiscating property. Your explanation that people are not always as safe as they think in first world countries really hit home when I read in the Telegraph that thousands of Brits who retired to Spain are facing forced eviction and having their homes not only taken but bulldozed by Spanish authorities. The first occurred recently when a British couple were given 2 hours to leave by armed police and watched their dream $1 million retirement home demolished before their very eyes. Hard to imagine this happening in Ecuador .”

The January 2008 article by Fiona Govan is entitled “British couple’s Costa dream is demolished.”

Here are excerpts:

“A British couple living in Spain have become the first expatriates to see their home demolished in a move that threatens thousands of properties built on the Costas.

“Helen and Leonard Prior sold their home in Berkshire and spent £570,000 turning an area of barren scrubland into a villa with heated swimming pool and landscaped gardens. They named it ‘Tranquilidad’ in expectation of how they would spend their retirement. But yesterday, a demolition ball turned their home of the past four years to rubble. Thousands more expatriates living on the Costas could see their homes demolished after it emerged the properties – bought in good faith – had been built illegally. Local corruption and the flaunting of planning laws have allowed swathes of the Spanish coastline to be developed during the last decade.

“We looked outside and saw a team of policemen – about 20 of them all armed – approaching our house alongside a team of lorries and diggers and we knew we had lost our home. We are in shock.” The couple was given two hours to remove their belongings from the house before the bulldozers moved in. Mr Prior, 63, who has a heart condition, collapsed with the stress of the situation and was taken to hospital before the demolition began.”

We take risk every day just by getting out of bed. Then we increase that risk. We step out of our house. Then we drive on roads with other cars zooming near by. Even freeways. That’s real risk!

This is true in investing as well. Every investment has some risk. The wise investor recognizes this and looks not at whether there is risk, but tries to judge if the premium paid to take the risk is more than fair. The really informed investor actually seeks places where investors perceive more risk than exists…and this I believe is Ecuador .

If you wish to know more or want experienced help from someone down here who is not selling real estate for commission, who is enormously experienced in investing here as well as globally you should subscribe to our Ecuador Living service. You’ll be glad you did. We are worth much more than the small cost. You can learn more at

Until next message, may all your risks be premium!


Join us this winter or spring at one of our tours and courses are below:

Feb. 18-23 Ecuador Import Export Course

Mar. 7-9 International Investing and Business Made EZ Ecuador

Mar. 10-11 Imbabura Real Estate tour

Eat in rustic and fun beach front restaurants like this where we will stay on the coastal tour.

Next to elegant homes like this.

Mar. 12-14 Coastal Real Estate tour

Mar. 7-9 IBEZ and Mar 10-11 Imbabura Real Estate tour

Mar. 7-9 IBEZ and both real estate tour

Most delegates in March will join us for two or three courses as there is a sizable savings.

If you attend all three courses separately the fees are $1,847. Sign up for all three at only $1,499 here. Save $348. Three course savings.

Three courses for two separately are $2,597. Two on our three course adventure is only $1,999. Save $598. Three courses savings for two.

April 10 – 14 Super Thinking + Spanish

June 19- 21 Ecuador Shaman Tour

Here is a shot taken at a recent Ecuador Shaman tour.