Concerns Regarding Property Ownership in Latin America

When you move to Latin America in your early to mid 20s, you don’t necessarily think about purchasing a house.

Perhaps your concerns are more related to thinking of the next city to move to or which dates to set up later in the week…

Or whatever it might be.

Simple shit.

But obviously property ownership does come into the equation as you get older.

A year or two ago, I remember sitting down at a diner with my parents back in Iowa.

And my dad brought up the topic even.

He’s always had doubts about me living in Mexico long term and one of his doubts has been property ownership.

“Can you even own a house down there?” he asked.

Because, as we know, some countries don’t permit foreigners to own a house in their name legally.

Anyway, if I remember right, it turned out that Mexico does allow property ownership by foreigners as long as the property isn’t too close to any of Mexico’s borders.

Or that’s what I remember anyway.

But it is a fair point – how would property ownership look in a country like Mexico for someone like me?

Well, I’ve had a few thoughts on the matter.

Very basic thoughts because I’ve never had a house before and know very little about property ownership.

But as someone who has about 6 years now in Latin America almost and who is getting closer and closer to his 30s…

Well, the thought does enter my mind once in a blue moon.

Even though I don’t know much about what property ownership is like, here are some thoughts or concerns I’ve had when it comes to property ownership in Latin America.

Prices

The first thing that has always come up is the price of getting a house down here in Latin America.

Now that’s a weird sentence in of itself since Latin America is such a huge region…

But I have looked at, out of pure curiosity, housing prices in different countries down here.

On top of my head, I know I’ve looked at Mexico, Argentina, Chile, Paraguay and Nicaragua.

At least with those countries, here are my thoughts when it comes to prices…

First, you have Argentina.

Generally speaking, Argentina always looked like a bad deal to me.

From my limited understanding, it seems like Argentina requires houses to be purchased in USD due to how bad their local currency is.

For some reason, that seems unappealing to me.

And I didn’t see housing prices in Argentina be any better than back home.

Then you have Chile.

Chile looked like it gets more expensive the more south you get in the country.

Which perhaps makes sense since the southern part of Chile does seem nice to live in.

I was looking at prices anyway near Puerto Montt and it didn’t seem that bad though.

I’ve always contemplated getting a house one day in Patagonia.

I could see myself being very happy there but always pondered what city it would be.

Relative to other cities in Patagonia Chile, Puerto Montt always looked reasonable for prices.

Though if you want cheaper prices in Chile, the northern part of the country away from Patagonia always looked cheap also.

Then you have Paraguay, Nicaragua and Mexico.

I put those three together because prices in all 3 countries looked pretty similar from my brief armchair research when I did look at prices long ago.

For Paraguay, prices in Asuncion seemed unreasonable or not favorable anyway but those in cities nearby like Luque looked good.

Same thing for Mexico and Nicaragua basically.

Capital city no.

Near the capital city yes.

And, for Mexico City, though I like it a lot here, I would have doubts about property ownership in the city.

Mostly because of earthquake issues and how they damage property here.

Though really the earthquake problem is more pronounced in certain neighborhoods like Roma Norte or Condesa.

Maybe a nice property in Lomas de Sotelo?

If I did own a property in Mexico City one day, I imagine it would probably be around that area since it’s nice enough.

Or somewhere over there anyway.

Either way, that topic about natural disasters is another thing to mention briefly on its own.

Natural Disasters

Really, the main issue I’d have with property ownership in areas in or close to Mexico City would be earthquakes.

I guess maybe other parts of Mexico have hurricane issues but I’m not really interested in living by the coast anyhow.

Not much of a beach person.

And when it comes to other countries..

Well, I know Chile has plenty of earthquake issues also and I believe forest fires?

But if I’m being honest…

I’m not really familiar with the other countries mentioned when it comes to natural disasters.

If I was into Colombia, I know hurricanes would be an issue if I was on the coast.

And, now that I think about it, Nicaragua has those issues too sometimes.

Paraguay?

I have no idea what issues Paraguay has with natural disasters.

I’m guessing heat waves maybe since it’s so hot but I don’t know for sure.

Then Argentina?

Well, I read Buenos Aires will have more severe flooding problems in the future.

Outside of Buenos Aires, I guess it depends since the country is so big obviously.

Maybe forest fires somewhere or maybe tornados even.

Tornados would be a major NO for me.

Growing up with tornados all my childhood, any city that gets hit with tornados is out of question for me.

I’d take earthquakes, flooding or heat waves any day of the week over that.

Crime

Honestly, crime isn’t really a top issue for me in any of these countries outside of Mexico.

For Mexico, crime is a major thing that would make me extremely cautious about buying property here.

Read this article here for example that goes into property issues that involved cartels and property invasions against an American couple that spent 20 years in Mexico.

And I’ve heard other crazy stories like that.

One guy was telling me about a guy he knows…

OK, yes – one of those stories…

A guy I know who knows a guy…

Happened to inherit some property in some rural part of Mexico from a dead parent.

Then when he moved in, some cartel or some criminal group showed up some years later and basically told him to get the fuck out.

The fuck out he did.

And it’s not just a matter of some crazy shit like that happening…

The other major worry I’d have is what if the area you buy property in turns into a shithole in like a year or less.

Let’s say you move into the Mexican city of Pachuca.

Where housing prices are very cheap! Like 25,000 USD for a cheap house at the very least from what I’ve seen!

And some good ones for like 70,000!

That’s good shit.

And while Pachuca is a nice and safe city…

How do we know the cartels don’t turn it into a shithole in a year?

Let’s say two cartel groups decide to go to war over control of the city.

Lots of people die.

Hurts the economy greatly.

Businesses close.

More people become desperate and resort to crime.

Shit like that can happen!

There was some article I read in El Universal about some part of Mexico that literally turned into a shithole over night.

Was peaceful before.

Now a shithole.

And while any part of the world can become a shithole…

No place is immune.

You usually get a chance to notice the downward trend.

And can get the hell out.

It doesn’t always happen overnight like that.

Now imagine having a property in a place like that in Mexico…

Good luck trying to sell the property when crime dramatically increases like that.

It’s not like that happens overnight.

“Oh yeah, two cartel groups decided to turn this place into a gun range with each other as targets….uhhh, want to buy a house?”

Would be a tough sell.

Either way, if it wasn’t for that, I wouldn’t be worried due to violence about buying property in Mexico one day.

The petty crime shit or occasional murder once in a while doesn’t concern me.

Just that major shit.

And while violence like that can make a place risky…

Politics

So can the political situation of the country.

Now, I know the US isn’t perfect by any means when it comes to this.

But, generally speaking, I would say there is more risk to property ownership down here due to the greater instability of political systems down here.

Venezuela is the classic case here.

One of Latin America’s wealthiest countries.

Then goes to hell under Chavez and Maduro.

Though, to be fair, it had major red flags before those two got into power.

But in Latin America more broadly speaking, you generally see certain issues that can and do exist back home…

But just more severe down here generally speaking.

You know the usual ones – corruption, weakening of civil society, presidents contemplating to expand their term limits, etc.

There has always been worry that AMLO in Mexico might try to be another Chavez one day.

Though I think that’s unlikely but I admit anything could happen!

One similarity he has with Chavez is his distaste for civil society and trying to limit the capacity of anti-corruption groups.

Definitely not a good look for AMLO.

And other countries can have that type of political instability where the institutions meant to protect democracy are not the strongest.

Then you have other countries like Chile where, relatively speaking, do have decent enough political institutions.

But Chile is basically rewriting their constitution so there’s a lot of uncertainty about their future as well.

Time will tell how that impacts their future – for better or for worse.

Hopefully for the better but we’ll see.

Political uncertainty as I said.

But beyond that…

Scams

After living some time in Mexico, I’ve noticed there is a particular scam that goes around this country…

You usually see people posting on Facebook groups saying “watch out! This person scammed me this way!”

When it comes to apartment rentals, the common scam is to just get someone to send you a deposit and never give them the key.

When it comes to property ownership?

It basically seems to be involve, from my limited understanding, telling the person that you own a certain property…

Have them sign documents and all and get the money.

But yet the documents are fraudulent.

And so the person who bought the property gave away all the money but never actually got the property.

Other then that?

The other scam I have heard supposedly happens in Mexico, Colombia and Peru.

These are the countries where I have heard (not experienced personally) a particular type of scam…

I’m not entirely sure how it works?

But it basically involves some person claiming ownership over the property you own and working with a corrupt judge to get ownership of the property you own.

Or at leas that is something I have read or heard stories of in those 3 countries.

It was a year ago or so when I read some story online about this happening to a foreign guy who bought a property near Cartagena in Colombia and he got fucked over.

I also know a guy who has residency in Peru and told me that this has happened before in that country also.

In the Peru case, the guy told me that the scammer looks for foreigners to steal the property from for whatever reason.

You know – they know the country less and don’t know their rights as well?

Probably that logic or something.

Either way, the prospect of getting scammed has kept me concerned about ever getting property down here.

Especially when, at times, it feels like property rights are not as well respected down here than in the US.

At least from my novice opinion…

And that is evident also in the last concern I have…

Social Movement Eruption

Finally, we have cases in Latin America where property rights are violated by social movements.

The case I am most familiar with is the uprising in Chiapas by the social movement Zapatistas in 1994.

Basically, you had a bunch of indigenous folks in that area who were marganilized and didn’t have shit for their communities.

Then a guerrilla group called the FLN originally (later the EZLN) came by after getting their ass handed to them by the Mexican government in other parts of Mexico.

They competed with other local groups to gain a monopoly of the support of the local indigenous groups…

Then the indigenous groups voted on a resolution to start an uprising in a year.

They did just that.

Took a shit ton of property and released some declaration called the First Declaration of the Lacandon Jungle.

Which was basically a declaration of war against a government they deemed illegitimate.

Then the Mexican government kicked their ass but then activists from around the world brought attention to the conflict and pressured the Mexican government to stop.

And while many of these folks considered the land they took during the uprising as being their property by dating it back to what their ancestors had before Columbus arrived…

Well, they still damaged a lot of property in the conflict and also, justifiably or not, took the land of others in Chiapas.

Now regardless of if you think they have some legal right to that land…

At the end of the day, when you are buying property, you would like to know that it is yours without being worried that a armed social movement with a guerrilla wing is going to steal it from you.

Yes, I get it – this was supposedly the land of your ancestors 500 years ago (which is arguable not every indigenous group is the same and they didn’t own all of the land of the Americas back then).

Still, I don’t want to buy property and then be worried that a social movement will just spring out of nowhere and take it from me obviously.

For any sane person, their self-proclaimed level of “wokeness” ends when their livelihood is threatened.

And it’s not just Chiapas…

If I remember right, there were conflict tissues regarding land ownership during the Allende years of Chile as you can read here.

Where you basically had groups of people stealing shit in some cases.

Then we have Brazil!

Where, as you can read here, I met up with a social movement called the Homeless Workers Movement.

One of the biggest movements of Latin America (if not the biggest?).

Where how they work very briefly is like this…

When the Labor Party is in power in the federal government…

This movement will basically scope out land that they deem to not being used productively by their own measurement.

Then they squat on it.

And the federal government comes in and sides with the social movement.

Where then they negotiate with the land owner on how much to give him to take the land from him.

If he doesn’t comply on selling it, the government might just take it from what I remember.

Then the government gives financial aid to the social movement to build property on it for poor people to live in.

Yes – we need to help poor people.

But not at the expense of having my property basically being forced out of my hands.

If I buy the fucking land, I want to keep it.

And here’s the thing…

Latin America is one of the most unequal parts of the world socioeconomically.

In the last few years, we’ve seen a shit ton of social tensions arise up with protests in various countries.

While I would argue that the statistical likelihood of some social movement stealing your land is unlikely if you buy something down here…

Given the recent history and given the leniency of leftist governments to sometimes play ball with those wanting to steal land…

And given the ever increasing socioeconomic inequality…

Well, I can see the issue becoming more noticeable in the decades to come.

Again, the risk to you is low I would argue.

It’s unlikely you would be hit from this issue.

But in my nights of thinking about property ownership down here…

It has been just a side thought that has come to mind when it comes to the risk of property ownership in Latin America.

Not something that would likely be an issue but, if it did, would be a major fucking in the ass.

So it’s food for thought essentially.

Thoughts?

And that’s all the food for thought that has ever come to mind when thinking about property ownership in Latin America.

As I said, I’ve never owned property before so this is all Ivory Tower talk.

Just food for thought?

Mental exercise.

Thinking about the possibility of one day buying a house down here…

And what the benefits and risks would be.

Got any thoughts yourself about buying property down here?

Drop a comment below.

Would appreciate it.

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Thanks for reading.

Best regards,

Matt