CW 306: Central American Real Estate Investment Markets with Jason Hartman Podcasting from San Pedro, Belize

Welcome to Creating wealth with Jason Hartman. During this program, Jason is going to tell you some really exciting things that you probably haven't thought of before. And a new slant on investing. Fresh new approaches to America's best investment that will enable you to create more wealth and happiness than you ever thought possible. Jason is a genuine, self made multimillionaire who not only talks the talk, but walks the walk. He's been a successful investor for 20 years and currently owns properties in 11 states and South 17 cities. This program will help you follow in Jason's footsteps on the road to financial freedom. You really can do it. And now here's your host, Jason Hartman with the complete solution for real estate investors.

Hey, welcome to the Creating wealth show. This is your host, Jason Hartman and.

This is episode number 306.

Today we're going to do something a little bit different.

We've done it a couple of times in the history of the show, but not for a while, not for a long time.

We're going to talk a little bit.

More about international investing since this is sort of top of mind. And with my recent trip to Belize, my second time there, and we did a show after my trip to Eastern Europe where I visited five countries, looked at real estate in all of them, went around with real estate brokers there, met with them, saw their operations in their office and so forth.

And on that trip the best thing.

I found was some properties in Romania, but again, it wasn't good enough to recommend and I still haven't quite achieved that internationally.

But I like Mike, I met him.

In Belize and I think he's a straight shooter and really has some good information, some good knowledge of the Central American markets in a few countries. There are four countries really, so you'll hear perspective on that and I think you'll find it interesting. And if this starts to make sense to us and we can find properties that work from a cash flow perspective where they're rented to year round renters, not vacation rentals, which we're not a huge fan of, as you know. And it's something more than just a second home to retire, which is fine to do if you wish. It's just not what we do. It's not a, it's not an income property investment. And we are all about staying narrowly focused on income property and in addition to that hard money lending or private lending. So that's something I haven't talked about for a while either. So if you're interested in that, always just let me know as you have done before. You can shoot me an email directly or do it through the site@jasonhartman.com Anyway, be sure that you get your tickets. A lot of you are registering and getting the early bird price for the Memphis Creating wealth in Today's Economy boot camp and the distressed property tour in there. We've got two different local market specialists that will be showing their wares, if you will, and talking about their properties. And you'll see their properties firsthand and meet them firsthand and get some good experience and as well get the Creating wealth in Today's Economy boot camp. And that early bird price will be increasing as people register. So it'll be increasing pretty quickly.

So be sure to do that register@jasonartman.com.

In the event section. And let's talk to my friend Mike and let's look at some properties in Central America and just get kind of a perspective on that. And here we go. We'll be back with that interview in just a moment.

Here's your chance to catch up on all of those creating wealth shows that you've missed. There's a three book set with shows 1 through 60, all digital download. You save $94 by buying this three book set. Go ahead and get these advanced strategies for wealth creation. For more details go to jasonhartman.com.

Hey, welcome to today's show. This is your host, Jason Hartman. And I am sitting on the beach literally looking at the water in Belize.

Here in Central America. And it's my second trip here.

I came here about a year and.

A half ago looking at properties and so forth.

And honestly I wasn't that impressed when.

I came here before and I'm still not that impressed.

But my guest today, sitting here on the beach with me is a real straight shooter and that's what I really like about him. You know, he's a developer. He's, he has properties down here and he sits on the board for one of the banks that a lot of Americans bank with down here. And you know, I just really liked his presentation. I've gotten to know him over the past few days and we're just going to ask some questions, learn about the economics and here in Central America. And he's an American and so you'll hear more. Anyway, his name is Mike Cobb and I want to say welcome to Mike and ask him to start off just telling us a little bit about his background. Mike.

Sure, Jason. Thanks for having me on the program and no, it is nice. Appreciate being on the program. Happy to tell you a little bit about my background but yeah, I am a straight shooter. And quite honestly, of all the countries in the region that I would want to live in, Belize would be my personal least favorite. So I understand there are different strokes for different folks and I appreciate your candidness and you'll find that from me as well.

Now you live in Managua, Nicaragua, which.

You like, and I've been to 64 countries, but I have not been to Nicaragua yet. And it's funny because the other night when I met you, you were talking about how you love the raw nature of Nicaragua.

It's raw, but tell people where you're from and your background.

Sure, yeah. No, I grew up in western Pennsylvania, about an hour north of Pittsburgh in the country. And right after I went to college, a couple hours north of Pittsburgh in a little school called Allegheny College in Meadville, Pennsylvania. And right after college said, you know what, I got to get out of western Pennsylvania. Actually, I knew that a long time before I got out. But anyway, moved to the D.C. area, lived in Northern Virginia, was in the computer business for about 13 years. And it was a great time to be in the PC. I was in the PC side of things. It was, you know, the big wave of transition from mainframe mini over to a PC world. And it was a great time to be in the business. And got out in 98. And it was very, very good to me. I was good to the business, it was good to me, and I had a great time. But, you know, somewhere in there, 93, 94, I came to Belize for the first time right here, Ambergis Cay, this island. Started to see, you know, it was a fun place to come, vacation. I figured, all right, yes, no shoes, no shirt, no problem, whatever. And I'm in this high stress computer job in the D.C. area. So came back a couple months later, bought a condo, two condos. Me and my friend each bought a condo and started coming down a lot. And what we saw were these incredible opportunities to serve consumers in ways that they weren't being served in this part of the world. Banks in the US would not lend on a Belize piece of collateral. And a Belizean bank would not lend to a gringo. You had to be a resident to get a loan. And so all you had all these. A loan for real estate. That's right. Or probably a loan of any kind actually at the time. And so what we saw was this opportunity to serve consumers who wanted to own property in this part of the world, but didn't have 150, 200 grand to buy a condo. They might have 50 grand and they needed to borrow 100 grand or 150 grand. And so we started working with developers and helping them to finance the sales of their property to North Americans. And that's how I got involved in the region. Then in 1998, we actually bought this resort that we're sitting in today as a foreclosure property. And.

I'd left the computer business a few months before that. I'd gotten married and my wife and I moved down here to basically turn around a foreclosure property. And that was my real entree into doing business in this part of the world.

Okay, so you moved to Belize first then, is that correct?

It is 1998, but I was here short term. It was a six month. It was roughly figured six month stint, come in, hire new people, put systems in place, get the property profitable and then leave. And that's what we did. We came for six months and then we moved back to the D.C. area, stayed there until 2002.

And so you're down here. We're at this conference called the Global Escape Hatch Conference. I'm speaking tomorrow here at the conference you spoke today and I think you likened it to the Wild west down here. It's kind of like going back to America maybe. I don't know, some ways, of course it's not.

And then it is in other ways.

Maybe 70 years ago or kind of going back to the old days where there wasn't a lot of infrastructure.

There's not a lot of infrastructure here, which is what I don't like about it.

But at the same time, that does represent some opportunities. And I do see that and I notice it. And with all these different speakers that I've seen here over the past two days, it's just kind of interesting, but it's raw. How many countries are we looking at? There's basically like six Central American countries. And you do business, I believe, in four of them.

Is that correct?

That is correct. We work in Belize, Nicaragua, Costa Rica and Panama. And we're looking at property in South America as well. I'm working on a deal in Ecuador and we'll end up with property in Chile as well at some point. So we'll be in six countries. But there are six countries in the region. Seven if you count Panama, they call themselves South America, but Panama, Costa Rica, Nicaragua, Belize, Honduras, Guatemala and El Salvador. And we work in four of them.

Fantastic.

So you talked about something today that you call the S curve, and that's.

A term Harry Dent uses all the.

Time and the S curve as it applies to these different countries, some are a little bit more advanced and established, and that would be like Panama, for example. And some are far less advanced and less established. And those less established properties may represent, or countries may represent more of a ground floor opportunity, but more risk, I assume, is associated with that. Kind of. Talk about that for a minute. And which countries are where on the. That S curve? Absolutely.

I think if you start sort of at the. It's also, I use it as a popularity curve. That's sort of my thought process and in sort of a thumbnail way to kind of gauge where does a country fall on this S curve, this popularity curve? I think, you know, one of the. One of my favorite thumbnail things is where do people take their honeymoons?

Right.

Where are people taking honeymoons? And if you look at a country like Nicaragua, I mean, nobody's taken their honeymoon in Nicaragua or Honduras. Very few. And if you look at a place.

Like Berkeley, hippies in the Peace Corps will take their honeymoon there.

And.

And I just have to make the disclaimer, folks, if you haven't heard me say it before, my mother graduated from Berkeley in the 60s with a degree in social welfare, but she was never a hippie.

It's kind of funny.

She was not a hippie.

Never, Never.

Okay, so you got one end of the extreme right people that are taking their honeymoons not in Nicaragua, not in Honduras, not in Guatemala, not in El Salvador. At the other end of the spectrum, you've got where people are taking their honeymoons, which is the Pacific coast of Costa Rica, you know, Jaco beach or Guanacaste Peninsula. There's a Four Seasons in Papagayo. So I mean, JW Marriott's there. I mean, so, like, it's arrived. I mean, people are taking their honeymoons by the thousands in Costa Rica. And then you've got Panama, which is maybe just a little less popular, and Belize somewhere where the S kind of really begins, that curve. And so one of the things that I talk with people about who are investors, real estate investors, is that if you're looking for cash flow, if you're a cash flow investor, which I know a lot of your folks are when they're buying rental properties, 100%. If you're looking for cash flow, don't look in Nicaragua, don't look in Honduras, because those are immature markets. And you want to be looking on the Pacific coast to Costa Rica. You want to be looking in Panama City, because. And even Belize is now sort of cusped over. It's still cuspy, but it's over the hump. And again, by defining your location very specifically, you can be in a cash flow place in Belize, or you can be maybe a little on the other side of the curve. If you're looking for appreciation. Well, then you want to be looking at a place like Nicaragua. It's the least popular of the countries in the region. And I think it. And I don't think. I mean, it suffers from a perception problem, negative perception problem. The reality is very different. So people that come to Nicaragua, they see it, they understand it. Like, I mean, Agora's got a huge project there. I mean, it's. I mean, a lot of folks have invested in Nicaragua once they've come and looked at it. But. But the perception issue is what has artificially depressed prices in Nicaragua. And then, you know, again, you kind of come up the scale. Honduras, Roatan's a little more popular. And then you get to Belize, and then you kind of get into the more popular countries. So if you're looking for a real value that's been priced into the market, look at a country like Nicaragua. The risk factor, by the way, I don't think it's a risk factor in the way that we would associate with Nicaragua. Oh, they're going to steal my property. That's not the risk. The risk is that it takes longer for Nicaragua to gain popularity. So it's a time value of money risk, because nobody knows the future. So, I mean, I'm going to have to sit on this property for three years, five years, seven years, I don't know, to get a. To get a double or a triple out of it. That's what. That's what a country like Nicaragua holds. But it also holds that risk. Whereas cash flows fairly predictable, you know, in the sense that you can know what you're going to rent it for and you can do your numbers.

Okay, so very interesting point there. And I got to ask you, though, you know, when it comes to enforcing a contract, I mean, first of all, who is your renter? Is it an expat? Are you talking vacation rentals here? Because we get pitched. Literally. My real estate company, which you can find out more about@jason hartman.com. this is my jetsetter show, so we don't talk too much about my real estate company. I have a few different businesses, but that company, we get pitched all the time from most commonly Costa Rica promoters. And we get Belize also, you know, developers that have projects in Belize and so forth. And there's really no cash flow model that they can ever present because the natives can't afford to rent anything they want the ARC clients to buy. Maybe an expat would rent something. But most of these are like resort properties and it's not really vacation rentals. They're all really recommending things that you just buy and retire in or you just buy for someday you'll want to.

Come and retire there.

I mean, is there a true renter business model here?

Great question, and I hope not too many developers are listening or they'll be kind of upset. But here, here's my belief about rental return generally. And again, I think there are specific ways to, to deal with this. But generally I believe that if a project cash flows significantly, 10, 12, 15%, which is generally what you hear if you walk up and down the beach, people try to sell you a condo and they're going to sell you a condo based on this. Oh, buy the condo and it'll pay a 16% cash on cash. If we only do 60% occupancy, and that's a conservative number. Blah, blah, blah, blah, blah. What I believe is, I'm sorry, let me just say I'm a developer. We sell to end user consumers. We don't really sell investment product, although we have people who buy our product as an investment. But generally I think most of them are thinking, I'm going to use it in three years, five years. So in the meantime I'll rent it out, make a little money when I'm not here. But in five years I'm going to move to Belize or Costa Rica or Panama to live in my home. And that's why I'm really doing this. If somebody was really producing 12% cash on cash return, I know if I would. Let me say it in me, if I had a cash flow deal that was producing 12% cash on cash return, I would have canceled checks. I would black out the person's last name. I would have a wall of canceled checks in my sales office. And when somebody walked in, I mean, I wouldn't answer any question. I would just put the paperwork in front of and go sign here. And if they go, what about, I'm sorry, 12%? What part of 12% are we getting? Sign here. Well, what about. No, no 12% sign here. That would be my sales presentation. I have yet to see a wall of checks. Okay, all right. So I don't know that I've believe very often or ever the condo sellers story about, you know, 60% occupancy. 12, 12% return, blah, blah, blah, blah. However, that all said, I think there are tremendous opportunities like we saw in the States. People went to Miami and picked up condos for 30 cents on the dollar. You pick up a $200,000 condo for whatever, 70 grand. Okay? I mean, now all of a sudden, what do you need to rent it for to get a decent cash on cash return? Those kinds of opportunities are available in the region. They're not the, hey, I came on vacation, I walked down the beach and I found this great deal. No, no, no, no. I mean, if you want cash on cash return as a, as an investor, you need to come down here, live, live in this part of the world. Pick a country, pick Costa Rica, pick Panama City. If you're looking for rental Jaco beach or Panama City, go live there for three months. Sniff out the bank deals, sniff out the guy that has to move back because he's whatever.

Get to know the network, there's always an informal network there.

And then buy a condo or a home for 30, 50 cents on the dollar. And then the market, I'm going to just wrap up. I know you want this microphone back, but the market is expat. You want to rent it to an expat.

Yeah, very, very interesting point. And expats, are they ever going to be long term renters?

That's one question.

But the other question is, can you do single family homes? I mean, does your company, I know your company builds condos, and you know me, I'm no fan of condos because you've got a homeowners association and they exert power over your property. And I just love this. My third commandment is thou shalt stay in control of your investment. And a homeowner's association, you relinquish some control. Now, a detached home can also have a homeowner's association, but they never exert that much control when the walls aren't connected. It's a different type of association. But do you build single family, too? I know you've got right here, here in Ambergris Cay, here in Belize, some condos. But do you also have single family?

Yeah, we do both, depending on where we're where we're developing. Here in Belize we have condos because we have a small parcel. We have six acres, six and a half acres. So we'll develop that as a condo community with covenants and restrictions with the condo association. Absolutely. Our Grand Pacifica project, we've got 40 single family homes. We've got 22 condos. So we got about 60 residences completed and then we've got another 42 under construction there. We have again twice the number of single family as we do condos, because it's really built to be a single family type of neighborhood. And I personally do too. But the one thing I would say, and you heard me talk about this earlier today, is that actually condo associations or property owner associations in this part of the world are actually your best friend, because unlimited freedom again in the US You've got county regulations, city regulations, state regulations.

We got to get into that, Mike, because when you told me about the building inspector, what a joke, it's hilarious down here, basically what they do is they come in and they pound a sign in front of your property that you're building and then you never see them again. You told me that. That was fascinating.

But the, so the condo associations, actually, you may need them more in this.

Part of the world, where in the.

States you don't need them as much because you've got public roads, you've got county rules and regulations, you've got city rules and regulations. So that's a very good point. Maybe those associations, your, your, what I call private governments, that's what a homeowners association is, is a little bit of a different thing. And as long as you don't get like radical vigilantes on the board of.

Directors, which you do in the States, all these people that are hungry for power and have no power in their own lives, but want to exert them over others when they get on some board. There's even a show on an episode of Frasier, the TV sitcom from the old days in the States where they get on the condo board and Fraser's fighting with the condo board and you.

Know, it's, it's pretty accurate really, but you get that. And the other problem you have in the States with condos is they always seem to find their way into litigation. And as soon as they find their way into litigation, no bank wants to.

Lend inside that association.

And as soon as there's no financing, the properties just plummet in value. It's a terrible thing. And the litigation could be either side. It might be the condo association suing the developer, which almost always happens right.

Before the 10 year mark is up. Okay, it's, it's welcome to the United States, right, where litigation is the name of the game.

Or it could be homeowners or, you know, some slip and fall or whatever in the association that are suing the association from the internal threat or the external. It could be plaintiff or defendant. Doesn't matter if there's litigation, the lenders just put up their hands and go.

Whoa, we don't want a loan in there.

Because it's just.

You never know.

Litigation is just too volatile. So the building inspector thing is interesting. That's a very good point you made about the condo association. I want to ask you about building because when we were walking back from.

The restaurant last night, there were several.

Of us in the crowd, and you showed me a condo complex that was very interesting and quite an interesting landfill there.

I guess they just do things kind of however they want over here. Maybe you don't want to talk too much about it. I'm getting the sense that you don't, but anything you want to say about that?

Yeah.

Again, I am careful what I talk about, and I suggest strongly that people do due diligence when they're buying property. And that's one of the reasons, again, even my salespeople kind of hate me a little bit because I usually tell people, look, don't buy on your first trip, right? What you really need to do, if you wanted to buy here on Ambergris Cay would be to come down and spend a week, two, three, right? Invest. Hey, you're an investor. Invest a little money in your due diligence and hang out, Walk up and down the beach, talk to. Talk to 50 people about the three or four places that you think you want to own and let them tell you all the stories about it. Because an expat who's lived on this island for 15, 20 years or three years or seven years or whatever the number is, can tell you an awful lot about the history of a project or the history of a site. And those types of facts, those types of insights that you can get are invaluable. Because once. Look, once the cement's up, once the plaster's on the wall and it's painted, you have no idea what's behind those walls ever. And that's critically important.

It sure is. I mean, it goes down to the level of, what did they do to the land before they built on it? Did they fill it up with compacted dirt? Or is the property going to, in.

A few years, sink into the land and there's going to be all kinds of structural problems?

You know, this is not the United States, folks. This is the Wild west, like you say. The other thing that happens is the way they do the construction. You showed a great slide in your presentation today about the rebar.

That just wasn't connected to the concrete, and that was interesting. Or the water lines where, you know.

If you didn't look under the sink.

The hot and the cold water was just one valve, it's supposed to be two.

And then the power lines that come to the project, you call it three phase power, where there's three different lines coming to the project versus just one. So you have redundancy and you have more power. Another thing that you talked about was a lot of developers will put in septic tanks rather than being hooked to a public sewer. And with that, the soil may not absorb the waste for the septic tank. Right. So you know a lot of stuff. And what was the concrete made from? What kind of sand? Is it the sand that you find here locally or is it the sand that you find in another place? That's the right sand, but you got to bring it in, in, in a truck. So if you want to mention anything along those lines, I mean, your company, from everything I've learned, does like a legitimate western style construction job. But most people don't out here, huh? Because they don't have to.

I think that's the key. They don't have to. I think that that's a correct way to say that, But a lot of people do. And I'm not saying we're the only people that do it. Right? Not all of them are bad, but unless you really do your due diligence, there's really no way to know. And I mean, is it okay if I tell people how to get these 15 questions? Yeah. Okay, I've got 15 questions that we presented today. And these are the 15 questions that you should ask a developer or a real estate agent if you're buying property overseas. Because there's no way to know a lot of these questions unless you've lived here, worked here, done business here, seen it with your own eyes. Because quite honestly, who would believe that underneath the cabinet in the bathroom where the faucet is, that you'd see one pipe coming out with a Y adapter going to the hot and the cold, and. And you don't have hot water in the bathroom. I mean, why would you even think to look for that? Right?

I mean, would assume that you have hot and cold water, right?

You have two handles and they both work, right? So if you're Interested in the 15 questions, send me an email, just put 15 questions in the subject line, I'll send them out to you. These really are. If you're even possibly considering owning property overseas, these are the 15 questions. And what will Happen is, yeah, the must ask. But what will happen is if you start to ask these questions, you start to think, think through these questions, you'll come up with five or six or eight more of your own. Be like, well, what about that? And what about this? And, and you'll tease out information from the developer, from the real estate agent real fast. Because a real estate agent or developer will either love you for asking these 15 questions because I, when somebody asks me these 15, I love them because I know that, like 80% of my competitors are dropping off like flies.

Let me take a brief pause. We'll be back in just a minute.

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But the other thing is, I mean, look, real estate agents in most places around the world, unlike the states, are not licensed. There's no license. There's nothing to lose if you tell a lie. You can't, I mean, you can't really sue them if effectively it's not like.

The United States where you have, you.

Know, you have some recourse in the US out here, it's, it's caveat emptor. Let the buyer beware. And will they even answer the question honestly in the first place? You know, I guess they'll, I guess they'll know just by the fact that you ask that you're, you're paying attention. So that'll. That might scare off the bad guys.

Right?

Yeah.

And I think it's important to be, you know, obviously to be able to read people and read their reports. Body language, right? Just read the body language. Is it an. Oh, my goodness, I can't believe they're asking me these. And they're uncomfortable or they embrace the questions because. Right. I mean, it's. Yeah, you can read so much by how somebody answers or how they react to the questions. I mean, the answers are almost irrelevant. Although. Although a lot of them are very visual. I mean, you can look under the bathroom sink and see which way Right. I mean, so probably half of them are visual and half of them aren't. But read the person and you'll, you'll know the answer.

Absolutely.

The other thing I want to ask you about, Mike, is what happens when someone wants to. And I don't want to do maybe another, we'll just make it another segment, another show, talk to you about banking because I think banking is a big deal. You know, lending, banking, offshore, all that kind of stuff. And you're on the board for one of the main banks here.

So I want to talk to you.

About that as well.

But what, what happens with property management down here? I mean, do you, is it like the States where you hire a property manager?

I mean they're not going to be licensed, they're just like the realtors or not realtors, they're real estate agents. And the last time I was down.

Here we spent like three days with.

A real estate agent and every property.

We saw was in his boat.

We saw it from the water and.

We'D pull up to docks and go look. But it was amazing.

I'd never been shown property in a boat before. It was always in a car.

Oh yeah, it was nice. It was nice.

We saw a huge shark come below the boat too. It was mind boggling. I think I got a picture of that. It was pretty amazing.

But what do you do about property management? I mean, the person listening is probably not going to be here. They're not going to self manage the property. How do they handle all that?

I think that depends on whether somebody's buying inside a development or they're buying a foreclosed property or a bank property or distressed property in all of these areas, even, even in Nicaragua. Okay. I mean it's probably the least mature market, least popular market all the way to Costa Rica, Panama City, you've got people who do property management. And if you're buying inside a development, generally the developer will offer it, sometimes they mandate it. That's another good question. It's not one of the 15, but does the developer mandate you use them? Maybe yes, maybe no. I tend to find exclusives to be not good. I mean, monopolies generally don't produce great service or results. So when there's freedom of choice, it's probably better for the customer. But there are always people who do the work. And I think the reality is that licensing doesn't mean anything in the states either really. It just means you've passed some tests. Yeah, you may have some bonding in there, some back. There's some Depth to it. Well, go ahead.

Yeah, let me just comment on that. The thing about licensing in the states is it, I don't necessarily think it.

Look it, I'm a, I like Milton Friedman. He's against licensure in pretty much every profession.

And you know, I see what he's saying about that. However, the one thing the license for sure does, if it doesn't do any bonding, if there's no errors and omissions, insurance, if there's none of that, it gives the person with a license something to lose. So if they have made their career out of selling real estate or managing properties and they lose their license or their license is sanctioned where like the department of Real estate says you can't practice for six months, that's, you know, that hangs over their head. And I think that is a bit of recourse.

Jason, Point taken.

You're right.

That is, there is something to lose and that is an important, important consideration in this part of the world. There isn't licensing, as you mentioned, for realtors, for property managers, I mean, make a business card, you know, I'm a property manager today.

That's it.

The thing about it is again, if I call it Margarita madness, people come down, they're sitting at the bar, they meet a realtor, they're happy, they go on a boat trip on a beautiful sunny day and the guy's got snorkel fins and you jump in and right, woo. And now I'm gonna in paradise, I'm gonna buy this house or this condo. The real issue is that there are good property managers, there are not so good property managers. And the way you're going to find that out is to be here for a week or two, talk to a bunch of people, right? Sit, you know, go out to the, to the wine and cheese party, hang out at a bar. But not just in bars because they tend to be mostly negative, right? But mix and mingle at various parts. If you're a Rotarian, go to the Rotary Club meeting. If you're a Lions, go to the Lions or Kiwanis, right? Go to church, go volunteer at one of the organizations. There's so many organizations, Green Reef, it's protects the reef or there's a homeless shelter. I mean there's lots of places you can plug in and if you plug into the community and just show your intention or talk about your, you will learn about and you can, hey, look, I'm thinking about a property manager. And you'll hear three people say, this person's great and this person is not so good. Well, now you know, right? And I think that's truly like, that's how you can make the best decisions. It's a patient process because again, you don't have licensure, you don't have other ways to verify. And you know what? The Internet's such a powerful tool now. Look, if people screw somebody, it's up on the Internet. So you can do a lot of your homework up front, right, to see who, where, how, why.

You know what Mike is really saying there, folks, is it's like the government. The reason government doesn't work is because the government generally, their philosophy is if there's a problem, just throw money at it. And just throwing money at something doesn't.

Solve problems all the time. I mean, it's helpful sometimes, but you.

Got to do some work here. You got to roll up your sleeves and do some doo doo diligence and hang out and chat with people and you're going to learn stuff, put your ear to the ground, as the old saying goes. So, so good point there. Well, let's kind of wrap up on this property issue. Any other thoughts that you have? I just finished a beer and maybe.

I'm not the best interviewer when I'm drinking a beer and sitting on the beach here with you. It's beautiful out here.

But we'll do another segment on banking.

Because I really want to talk about.

The lending environment and the banking environment. What if you want to have an offshore bank account?

How does that work? There's lots of regulations, especially if you're a US Citize.

So we'll do another show on that. But any other thoughts you have on.

The property market issue?

Yeah, I think the real bottom line is just do it. Like the Nike slogan, right? Just do it. There are a lot of great properties, There are a lot of great developers. There's a lot of great homes and condos. And for folks who are looking to be overseas, I encourage people to really do it. There's a lot of things that are scary, but it's never as big a deal as people imagine it might be. It's not as difficult as it might be. We're here at the Escape Hatch Conference. Bobby Casey, I interviewed him for my radio program. We'll get you on ours in a few minutes. So turnabout's fair play here, but he bought one way tickets to Europe when he moved, he bought one way tickets and people, I'm sure lots of people are like, oh, you're out of your mind. And he probably is, but you don't have to be out of your mind to buy a one way ticket. I mean, just go do it. The opportunities overseas are phenomenal. And that's probably one of the reasons a lot of people come to this part of the world is because it is the land of opportunity. It is the wild west in a way that the US used to have. This wild west, land of opportunity, go and make it right, Hang out a shingle and make it. And I love that, I love the freedom. But I also understand that personal responsibility comes with freedom. And if you bundle those two together and you work in this part of the world, you can have a phenomenal experience. And I encourage people to take the steps and have the experience. It will be a great experience.

Yeah, thank you. And the bottom line to that message is, as you said in your presentation today, you got to look out for yourself. You got to let the buyer beware. This isn't where you have a lot of infrastructure like you do in the.

States or European countries, for example.

You got to pay attention a lot.

More and you got to bring your.

A game to it. But you know, one final question I do want to ask you is that Costa Rica? It feels like people been talking up the Costa Rican real estate market for 20 years now.

Maybe it's been longer. I didn't notice it before that, but 15, 20 years I've been hearing about it.

Costa Rica, I mean, with roads, with potholes the size of Volkswagen bugs.

I couldn't believe it when I went there. How big their potholes were blew my mind.

But is Costa Rica just sort of.

Overdone and over saturated?

And as the investment operator, you say that's a mature market and I'd agree with you. I mean, it seems like every other.

American is looked at the Costa Rica deal.

And I just gotta think that the opportunity there just has largely disappeared.

Yes or no?

No. I think anywhere it's, you know, it's location, location, location and you're gonna have places that have done better than others. And I mean Costa Rica, of all the countries in the region, when we had the big real estate bubble in the US it bubbled with the US and it probably most mirrored a Miami or a South Florida. It ran way up and then it fell way off. But the reality is that if you just look at simple demographics, if you look at the number of retirees who are already living outside the U.S. about 529,000 according to AARP already live outside the United States. Maybe 2, 250 of those live in Mexico. So about half live in Mexico and half live elsewhere in the world.

And what was that statistic you quoted today? 10,000 per day, or what was that one?

10,000 baby boomers retire every day for the next 19 years. So we're really talking about 84 million US baby boomers and another nine and a half million out of Canada. And the Zogby company did a big survey looks. I mean, again, surveys are just what people might do. But another 4 to 5 million people looking at Latin America over the next 20 years. So do I think Costa Rica has seen its day? No way. Costa Rica went up and it dropped off. It's probably back to being a decent value in most places. And I think over the next 10, 15, 20 years, what we're going to see is that Costa Rica will quadruple the number of expats living. And I think each of these countries, not just Costa Rica, Nicaragua, Panama, Costa Rica, Belize, Chile, Ecuador, I think all of these countries are going to see an influx of literally millions of U.S. and Canadian retirees. And so we're actually at the very beginning of the opportunity in this part of the world. But again, it's serving consumers. It's not a speculative investment. I'm going to buy a lot and flip it in three years. It's not. I'm going to put 5% down on a condo and sell it before the building is done. I mean, that's not what it is. It's gambling.

No gambling. Remember, thou shalt not gamble. That's commandment number five.

Right. And I love that one. Thou shalt not gamble. And so the real opportunity is serving true consumers who want to be in this part of the world for some part of the year as part of their retirement lifestyle.

Yeah, good advice, good advice. And you know what we've been profiting.

From and our clients have been profiting.

From is those baby boomers moving to the southern states, especially the southeastern United States, and a little bit of the.

Southwest, Phoenix and so forth, although that's gotten a lot more expensive.

But moving from the cold states, the.

Rust Belt states, a lot of them from Michigan, certainly, what an economic disaster that is.

But a month ago, Michigan became a right to work state. Maybe there's hope.

I don't know. I'm. I'll keep my ear to the ground on that one.

But yeah, you know, baby boomers, when they retire, they want low cost of living, they want natural beauty, they want recreational opportunities, they want cultural opportunities. And so we've noticed that in the southern United States and I think for the more adventurous ones or the ones with less money, getting out of the country completely and being an expat, you can live really inexpensively down here.

Tremendously inexpensive. I mean in most rural areas of Nicaragua, Costa Rica and Panama, I mean, 1500 would be a nice amount of money to have. 2000 would put you into a really a life of luxury, full time maid, going to the movies, eating out, pretty much kind of a nice lifestyle for a couple on a couple grand a month. You're not going to find that anywhere in the US Really. That's what this region holds for people.

And I think the reason I like modernity too much and I'm not too.

Into this is because maybe I'm just too successful. I can afford the United States.

States.

I like the U.S. i like Europe. I like the more advanced countries.

But I kind of see it, I see what people are talking about.

So it's been really good talking to you about this. I think this is the most straightforward answer and interview I've had on this subject.

So I appreciate you coming on Mike. And just give out your website if you would.

Sure. It's ecidevelopment.com ecidevelopment.com look us up.

Mike Cobb, thanks for joining us and we'll have you back on to talk about banking in Central America.

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