The Colombian Economy is RED HOT

[BogotaJim]

 


Its been one year since I moved from Florida to Medellin and I thought I would give you an update.  My biggest disappointment is that living here a working knowledge of Spanish is essential and it is time consuming to learn.  After 1 year I am just beginning to learn the language. Fortunately there is a couple of dozen Americans living here and we stay in almost daily contact so I can deal with the language difficulties.     As everyone already knows the women are beautiful here and they care nothing about your age so my social life is incredible especially when I consider how bad it was when living in Florida.


Probably the most positive thing to happen is the timing of the real estate market here and in Florida.  I started selling off my Florida properties 3 years ago when the market there was still strong and I began buying here one year ago when I arrived.  Listed below are the first 2 condo units I bought in a strata 6 neighborhood minutes from parque llegas in Poblado.


Size       Price in pesos  Price per meter  pesos per dollar  Cost in dollars


123 meters  180,000.000      1.46            2550              $71,000


Meter price today   Pesos per dollar   Value today


          1.90                  1900                 $120,000


Size        Price in pesos  Price per meter  pesos per dollar  Cost
153 meters   225,000,000      1.47            2550               $88,000


Meter price today  Pesos per dollar  Value Today
            1.90                  1900             $149,000









Since these purchases I have been buying smaller units in strata 4 neighborhoods as rental property investments, these are pre-construction and about 60 sq meters in size and the results have been about the same as those listed above


IN 2007 THE COLOMBIAN PESO HAS GAINED MORE THAN 16% AGAINST THE DOLLAR THE BIGGEST GAIN OF THE 70  MAJOR CURRENCIES. posted on the internet.  Since I arrived you can see the gain is even larger.  Last year the Colombian economy grew at 7.8 % AMONG THE BEST GROWTH IN THE WORLD.  As a result of the peaceful political situation here and the great potential for continued growth  money is arriving here in mass from financial markets around the world.


I have watched Costa Rica and Panama go through similar growth patterns in years past and I feel Colombia has a lot more to offer than either of those countries so I feel that this growth will continue for some time.


By the way they do not have escrow accounts here and the banks will often try to cheat you on the exchange rates when you wire your money down for purchases so " so buyer beware"

[doombug]

A recent cover story of BusinessWeek echoes your comments.

Extreme Investing: Inside Colombia. An improbable journey from crime capital to investment hot spot. Can this boom last?

Traveling to Colombia to chronicle the investment miracle unfolding there seemed perfectly reasonable a few weeks earlier. The stats all scream "Go! Go! Go!": Colombia's stock market has soared fourteenfold since October, 2001. Foreign direct investment and capital inflows have more than doubled, while real estate prices have tripled in many areas.

...

On a continent whose economic history is the stuff of a blooper reel, Colombia's strong fundamentals stand out. Its $130 billion economy, a world leader in the production of coffee, petroleum, textiles, and flowers, is growing at 6.8% a year, two full points faster than the Latin American average. In the past 10 years, Colombia has slashed its inflation rate from 18% to 5%, and since Uribe was elected, unemployment has dipped from 16% to 13%. The nation has never defaulted on its debt or experienced hyperinflation.

...

More high-rises are under construction here than in Manhattan and Los Angeles combined.

[Dan Las Vegas]

When I was in Medellin recently, I was amazed at the amount of new construction that was going on in the city, not only in Poblado but all over the city. While I was there, I looked at the possibility of purchasing an apartment and found that the prices were still very reasonable, especially compared to where I live in Southern California. The economy is definitely booming in Medellin!! 

[utopiacowboy]

I know that the prices are accurate but it's still hard for me to imagine paying $100,000 for an apartment in a Third World city. I guess it was quite prudent on my wife's part to keep her 200 sq meter apartment in Medellin which she owns free and clear. It's got 3 baths and 4 bedrooms along with a nice big patio and a good location right next to Laureles in Belen-Miravalle. She figured it was worth about $30,000 back in 2003. 

[pan de bono]

How about some of the other major cities in Colombia? how is Cali doing? how about Bogota?

[Frank Rizzo]

UTC, you'll do really well on that place if you ever want to sell, really well depending on where it's at exactly. Everything's up, Cart. the most. I'm looking to buy in san andres next before it gets hit like Cart. did.

[SocialDreg]

What happens when the money starts pouring OUT of Colombia and the dollar and euro start rising against the peso?

The state of Iowa has a larger GNP than Colombia. 

[BogotaJim]

Of course what goes up must come down but what  I am trying to say is  that if you are looking for an opportunity NOW is the time to invest in Colombia as there will be several more years of growth here. - sadly I don´t think that the same can be said about Iowa.

[BogotaJim]

Utopiacowboy -  I pay these prices in a third world counry because I can live here for about 30% of what it would cost me to live in the U.S and at this time I prefer to live here as the weather is better and the people are so nice and sooooo many outstaNDING WOMEN AVAILABLE they make your daily life so much more enjoyable.

Your wife was indeed wise to hold on to that apartment.  I have been buying 60 square meter apts in the Belen area for about $33,000  US and they rent for about $250 monthly US.  They are building so many new roads in this area and all the rental units are full with happy people.  Your wifes apt is worth a great deal more today.

[BogotaJim]

Pan de Bono -  In my opinion Cartagena is almost peaked out as prices are quite high there, Cali is a city with bad leadership, too much crime and dirty so prices there are not escalating as fast, Bogota the capital is booming and prices in Bogota are on average 30% higher than Medellin but there is a good way to go.

[markanthony7]

BogotaJim, I bought my property in Cartagena 4 years ago at $15,000 American it has already appreciated in value to $30,000, Colombia is in comparison to ancient Las Vegas that was barren land and a desert, the gangster Benny Sigel had the vision to see the vast potential in investing in property in Vegas and many people scoffed and laughed at him, they are not now!

 Papi's threat of legal action