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Wednesday, August 31, 2011

"The Gringo Effect"


Do you wonder if property sellers in Ecuador inflate their price as soon as they find out that the buyer is potentially a foreigner?

Putting it bluntly.."Of course!" There is ways around this to prevent this happening to you. Let me explain. Developing countries such as Ecuador are not immune to this type of behavior. It is common practise to inflate the offering price of any commodity when the foreigner is purchasing. Real Estate is no exception to the rule.

In Ecuador Domenick Buonamici writes on his website *"Now, to be fair, maybe 80% of the time you’ll get quoted the same price as locals do, but there’s still that 20% chance you’ll get “upped”. In fact, it happened to me this week. I got a tip a hotel was for sale for $150k… a deal… I approached, the owner saw I was a gringo, and quoted me $400k!"

It happens because the locals think you are rich, and to be quite honest if you look at it from a comparative viewpoint they're correct for assuming so.

If you are looking at real estate to buy or rent, In my e-book How To Live In Ecuador coming this fall, I will show you a simple secret to avoid this pitfall. It's so simple you will wonder why you never thought of it. You can subscribe early to make sure you have a copy reserved for yourself.
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