All Forum Posts by: Mike Lambert

@Scarlett Noboa

You are right about airport traffic. You make money money investing in this kind of environment when you invest ahead of the path of progress, not when the area is already developed and everybody knows about it. The easy money has already been made in Punta Cana and Puerto Plata.

One of my contacts is a head honchos of the Dominican Ministry of Tourism. When I met him earlier this year and we were talking about where to invest in the country, he advised me not to invest in Punta Cana for the exact reason I just gave.

As you mentioned, Las Terrenas is great for Airbnbs and there are hardly any all-inclusive resorts to compete with because the visitors are precisely those that don't want to stay in all-inclusive resorts. Most people who go to Punta Cana go for the all-inclusive experience. If you have an Airbnb there, you won't have the amenities top compete with the all-inclusive resorts and I don't think money people who are on BiggerPockets have enough money to buy an all-inclusive resort.

Most successful investors I know focus on what the situation will be instead of what the situation is now or what the situation has been.

@Andrew Cannon

Colombia is an awesome country and in the top of my country list for international real estate investing, which is what I do.

I have posted several times about Colombia so feel free to check my profile to find these posts. Hope these help and feel free to message me if I can help any further.

@Scarlett Noboa

And I forgot to mention in my previous post that, for those who aren’t lucky to have a direct flights to the Samana El-Catey airport, there is a new toll road between Las Terrenas and Santo Domingo which put Las Terrenas at just 90 minutes from Santo Domingo’s Las Americas international airport.

Las Terrenas and Samana used to be hard to access and so are much earlier in their growth and development trajectory but this new infrastructure (new airport and toll road) is a game changer. This is what makes the area such a compelling investment opportunity.

Thankfully, the local authorities have put the necessary building restrictions in place so that the area stays the most beautiful part of the Dominican Republic and doesn’t become another Punta Cana.

So you have increasing demand and a future cap on short-term rental properties. This is the best recipe for higher nightly rates and property values in the future.

@Scarlett Noboa

You think that Las Terrenas and Samana are too far from an airport. Are you serious?

Are you aware of the existence of the new Samana El-Catey international airport which opened in 2006 and is 15 - 30 minutes away from Las Terrenas and that has direct flights to North American cities and even Russia. Is that too far for you? You don’t get closer to that in the Dominican Republic or elsewhere for that matter.

Moreover, it takes only a few minutes to get out of the airport once you land I’ve never been that quick to my final destination.

@Derek Woods

What sort of information are you after and are you talking about the Yucatan peninsula or the state of Yucatan (the Riviera Maya is in the peninsula but in the state of Quintana Roo)?

@Alex Washburn

It is fake news that you can own beachfront property "in your own name in Mexico. I'm amazed that so many people believe this.

To set the record straight, it is true that, if you want to buy property in the so-called "forbidden zone (within 100 kms from an international border or 50 kms from a coastline), you have to own it through a fideicomiso (bank trust) or a Mexican corporation (a corporation is better if you own more than two properties). For all intents and purposes, holding a property through a fideicomiso is exactly the same as holding it in your own name, the only difference being that the bank's name is on the title. Why would you want to have the property in your own name? Every experienced (US) investor wants to avoid owning properties in their own names for all the obvious reasons and thatMs why they're using LLCs. Owning through a fideicomiso is like owning through an LLC but it's actually even better because when you have an LLC, all the operations have to be performed by the LLC and you have to do the accounting and produce a tax return for both the LLC and yourself. With a fideicomiso, the bank doesn't do anything. You do everything as if the property is in your own name and there is no accounting or tax return necessary for the fideicomiso.

Costa Rica is a great place to invest but you have to be able to find deals most of the country that is well developed has become very expensive. Mexico has 10 times more tourists and is much more easily accessible than Costa Rica from pretty much everywhere in the world. Moreover, Mexico has a huge population of US and Canadian retirees that Mexico that Costa Rica doesn't have. This means that your rental income in Mexico is potentially much higher while property prices are much lower so the rental yield is potentially much higher in Mexico.

You won't find a US bank to finance a property in Costa Rica and this has nothing to do with the economic situation there, which is still pretty good. Banks will never finance a property in a foreign country because they don't have the necessary means, knowledge and willingness to go through a foreign legal system to repossess the property should the borrower default on his mortgage.

If you hear or read that somebody got a property financed by a local bank in a foreign country, this is because that bank took some local assets as collateral or gave an unsecured loan. Obviously, this is not a financing specifically for the overseas property and the borrower could use the money to do anything they want.

If you want to use leverage in Costa Rica, the alternatives to local bank financing are developer financing for pre-construction properties (which is rarely given if you don't have the necessary personal relationships) or seller financing.

@Rachel NA

Es una muy buena idea :)

Feel free to reach out if I can help you with that!

Sorry @Candace Majedi and @Danielle Thomas I just realized I was meant to answer to Candace and I answered to Danielle instead (in my reply two posts above). Well hopefully it adds value to both of you!

@Steve K.

I forgot to mention in my previous post that you're absolutely right about Medellin. It's a great place to invest and I'm looking into opportunities there.

@Danielle Thomas

Kudos to you to be willing to invest overseas! I have been in the Latin America and the Caribbean myself and I would definitely recommended but I will never invest in Belize.

I listened to that sae podcast and was stunned by what I heard. This is a good example of why one shouldn't blindly follow self-proclaimed gurus, especially when they don't understand what they're talking about.

Investing internationally is an awesome idea but you need to understand the economics and the legal system or know people who do.

@Steve K. did an awesome job of talking about the micro aspects locally so I'm going to concentrate my aspects on the macro here, which trumps everything in my opinion.

I imagine the poverty, crime (mentioned by Steve), the money laundering issues and the fact that the country is one of the favorite refuges for criminals of all sorts might be enough for most to stay away. The United States Department of State (USDS) has cited Belize as a country for major money laundering and illicit drug trafficking in the 2019 International Narcotics Control Strategy Report (INCSR).

But let's assume all that doesn't bother you. The main problem is that, as Steve mentioned, the country is 100% dependent on tourism. Costa Rica and Panama have much bigger and more diversified economies and they have two coasts, a Pacific one and a Caribbean one and each of these coasts are several times the length of that of Belize. Belize only has a small stretch of Caribbean coast and that's pretty much all the country has to offer. Should anything happen to that coast or country like a hurricane, an earthquake, tourists accidentally getting killed, it would kill their only industry, tourism and they wouldn't have the money to cope with it. You would end up having a property that nobody would buy or rent, as the small local population cannot afford to either buy or rent nice properties.

While tourism is pretty much their only livelihood, Belize cannot compete with its neighbours like Mexico or the Dominican Republic for example. Those countries have huge budgets to bring in tourists, airline connections and tourism investments. While you can fly to Cancun directly from pretty much all over the world, getting to Belize is very lengthy and complicated from most places and this will put off most tourists.

Unfortunately, the prospects for the country are not bright in my opinion. As Steve mentioned, many Latin American countries like Mexico, Colombia or Brazil have made big progress towards development over the last few years. This is the result of their middle class emerging out of poverty. Panama and the Dominican Republic also have had huge growth over the last 20 years. Unfortunately, Belize has no middle class and the country is so tiny in terms of population anyway that most multinationals won't invest there and create wealth, except maybe in the tourism sector.

The main way they have found to attract some people is by putting the taxes at 0 but, as a result, the government isn't making much money and they can't help their population, whose basic needs remain unmet.

Buying a property there for your own use if you love the place is one thing but buying a property as an investment is a total different story.

I hate to be the party pooper but Costa Rica and panama are great places to invest if you know what you do. And so are Mexico, the Dominican republic, Colombia, Brazil and Uruguay.

I know most countries in the Latin America and Caribbean region pretty well so don't hesitate to message me if I can be of any further assistance.