Nicaragua Real Estate 🇳🇮 Building or Buying 2022

It can be a big decision and will completely change how you approach the real estate market in Nicaragua.
Back in April I actually wrote an article about real estate investing that might be interesting for those unfamiliar with the general risks. I definitely take investing seriously and I don't recommend buying any house lightly.
Should you be looking at building a home or buying a prebuilt home in Nicaragua in 2022?
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[@hoppeanofasgard1365]

a typical 2 story home in Colombia will cost you 50k, unless this 75k home is exceptionally large in Nicaragua it's not really the best value in latin America.

[@ScottAlanMillerVlog]

No, but home cost is only one aspect of cost of living. But it is true, Colombia is a little cheaper than Nicaragua. Especially in home costs.

[@davidwelch5186]

I just bought on the beach, playa marsella San Juan del sur. Power, water, 21,000. Bosque Del Mar. --- I lived in San Juan 5 years and have a nica partner…. My partner in invaluable. He can build. Marsella is fantastic. I’m very happy with my situation. I know of people that paid 4 times what I did. I will have a new cabin at a beautiful beach for $50,000.

[@ScottAlanMillerVlog]

That's awesome. Yes, with all the right resources things can be so easy here. People wanting to do things the expat way and/or without access to local knowledge get screwed big time.

[@davidwelch5186]

a wind turbine is more efficient and cheaper than solar. Another big plus for being on the coast. The big $ problem is storage.. one of my goals it cut my need for gas and the power company and just make my own.

[@ScottAlanMillerVlog]

We are looking at solar partially because it doubles as roofing. Just install when new roofing is needed. But electric is so cheap the payoff is decades even for cheap generation.

[@jmartin4364]

How about the 3rd option: buy and remodel an existing older home? How about replacing with newer pipes? Masonry must be cheap since it can be locally produced. Specialty fixtures would be expensive but you may not need many. How about solar panels? Just some thoughts.

[@ScottAlanMillerVlog]

That's viable and we pretty much assume that when buying. Almost anything that you buy is going to need a lot of touch up and modification. Labour is cheap still, so as long as you don't need too many materials it works out just fine.

[@craighoffman6009]

Is that still the case in 2024? Is there some sort of chart to show what they were compared to what they are now? Thanks and you always have great content!

[@ScottAlanMillerVlog]

Really no changes. It's only been about 18 months and the market remains severely depressed. Building materials aren't quite the premium that they were in 2022, but they are still somewhat high.

[@pierresouel3880]

Hi, big support from France👌 like your video so much

[@ScottAlanMillerVlog]

Thank you!!

[@markgconnors7932]

What’s the market like now? 7 months later… I’m new to your channel and really enjoy your videos.

[@ScottAlanMillerVlog]

Basically the same. The economic factors have remained pretty flat.

[@markgconnors7932]

Thanks! I’m hoping to visit Nicaragua for the first time this January. Cheers!🙏

[@ScottAlanMillerVlog]

@@markgconnors7932 awesome! i'll be there ;)

[@ranthonybab8670]

Scott what is a town or city in Nicaragua that isn't on most people's radar that you think will be up and coming roughly 5 years from now? Lake Apoyo looks gorgeous. Seems a little cheaper than San Juan Del Sur. Your thoughts please. Great videos.

[@ScottAlanMillerVlog]

Apoyo is crazy expensive and un everyone's radar. We're told new houses cannot be built so everything there is super sought after. Majorly exclusive already. Lots of the beach tons are going to be popular soon as people realize that there is empty space out there.

[@ranthonybab8670]

Thanks

[@GR-ww1bl]

This is the most thorough explanation on housing that I have heard! Thank you.

[@ScottAlanMillerVlog]

Glad it was helpful!

[@mattdavidson3283]

great vlogs Scott. Is the Market still in a low there?

[@ScottAlanMillerVlog]

Yea. Still super low. No significant changes since that video.

[@MArmour]

Really good information.🏘

[@ScottAlanMillerVlog]

Thanks!

[@randyparton5451]

Excellent info!!! This all makes so much sense. Love these informative videos.

[@ScottAlanMillerVlog]

Thanks!

[@markpedeupe1958]

Thanks Scott, great info as usual. So looks like rent is the way to go first year. Question once there I would assume you will meet people to help you find information on decent price to buy by locals and expats? I plan on going to San Juan Del Sur in Nov for a few weeks. Do you recommend using airbnb or just find a place when you get there? I've traveled a lot so used to just winging it 😆

[@ScottAlanMillerVlog]

AIrBnB or Hotels work fine. It's not that expensive so the hotels aren't a bad option to get you started. SJDS is a funky market physically because of the hills so spending a few days getting the lay of the land from a hotel downtown might be useful.

[@jtest07]

Even in San Juan del sur? Do I just need to go there to find something? What I’m finding online looks pretty expensive

[@ScottAlanMillerVlog]

You need to watch my other videos about real estate ;) I talk about how the prices online are all "fake" gringo prices and almost no legit sellers post anything in english or online. Listings are in person, on facebook, and in Spanish. Most of the websites aren't even real properties let alone real prices. Check out my rules of real estate, understanding the market, and hail mary videos. I cover exactly what you are wondering about.

[@ScottAlanMillerVlog]

I was in SJ an hour ago. It's a ghost town. There ARE people trying to make a windfall on sales, but market value is still super low. But agents are paid to make everything as expensive as possible so people who make their money by getting the price as high as possible are unlikely to tell you the actual market value.

[@jtest07]

Such good info thank you. We are just diving in, I’ll be sure to watch your videos. Thank you!

[@ScottAlanMillerVlog]

thanks!!

[@jackmahones3855]

thanks again youve sold me.

[@ScottAlanMillerVlog]

Great! Now you just have to decide what region to look into!

[@dennysgarcia8418]

Scott building is better and be in Nicaragua

[@ScottAlanMillerVlog]

No, you definitely want to buy here. Building would be only an extreme case. You pay such a premium to build and getting pre-built is so discounted.

[@OneOutTheODD]

Hi Scott I caught on to your blog and have been watching quite a few of your videos since right before you finalized the purchase of your house in Leon. I notice you warn against real estate agents. I notice much of what agents list and post on YT seem to have expat considerations and comforts. As if those homes were already owned by expats. If buying the land and building our own place is not the best option, how do we go about buying an existing home, with the features we may want, while avoiding real estate agents ... basically what I'm saying is it seems US/Canadian/Euro sellers with US/Canadian/Euro outfitted homes, are gonna want US/Canadian/Euro equivalent money. Getting to know locals and buying from them is kool, but then we'd have to actually find a Nicaraguan who is already living close to what my ideal living situation would be. How do you find land with existing structure that has the stuff you want as part of the build, without wrapping up with person who calls themselves a real estate agent? I guess you made that clear in another video. It can be alright to use them but make sure the agreement is not what we typically view here in the US. So, we can say hey we're gonna give you a set fee if you help us no matter how low or high the purchase price is. So they have no motivation or incentive to warp the price, unbeknownst to the seller and buyer. I mean, I don't need opulence, but certainly appreciate quality and comfort. When I do visit down there, I'm gonna come check out your hotel and bar. I'm partial to Leon or Matagalpa anyway. Thank for the videos and information.

[@ScottAlanMillerVlog]

So in a lot of cases, not all but most, houses that are listed by real estate agents are also for sale otherwise (and some are not for sale at all.) You dont need a buyer's agent to show you homes. You can just ask the seller to show you (or the seller's agent.) You will have to use seller's agents sometimes we do in the videos even. That's different.. that's the seller engaging an agent. Not you. But you can often just talk to the sellers. That'll give you a chance to get lower prices. It's rare that the sellers actually have a contract with the agents, often the agents are just hopeful that buyers don't know that. If the seller has an exclusive deal with a seller's agent, contacting the seller is still fine, they'll just introduce you to the agent that represents them. The cost of US/Canadian houses here is generally quite affordable. Of course anything built in that style is going to be a cost premium in the market since it is built exclusively for expats. But it'll be nothing like it would be in the States or in Canada. There's a lot of luxury available in Nicaragua style homes. I prefer them myself (mostly.) A little living with Nica style will save a lot of money. But you can get "almost" American style in Nica neighbourhoods for cheap if you work at it. I've got a video coming out soon that shows how cheap some American-esque stuff is. What REALLY gets you is being in enclaves of expats. Then you are in an isolated little America and prices might as well be in the US.

[@OneOutTheODD]

@@ScottAlanMillerVlog Thanks for the reply. Yeah I would like to avoid those enclaves. Looking forward to spending some time down there and really seeing what's what. i understand the seller's agent point. Thank you. I figure boning up my Spanish may be integral in talking directly with sellers. Or meeting someone who is well versed in Nicaraguan innuendos, terms and such. Thank you for sharing.

[@renancastillolopez6033]

No vengas aquí

[@jimmygorgiev9379]

Buying a house in Canada is the best investment anyone can make!!! Renting is for suckers!!!! How can you say house prices remain flat over time. That’s like saying there is very little inflation. If you know economics and math, you should never rent!!!!!

[@ScottAlanMillerVlog]

Just check house prices over time. They are flat against inflation. If you looked at actual house values over time you’d see that buying is pretty crazy the majority of the time and especially now. Just check historic house prices and it’s beyond obvious. But everyone confuses inflation with growth and sees an increasing number and forgets to adjust for inflation and gets confused and thinks that houses gain value. But logically they can’t or no one could afford to live in them. It’s an obvious financial fallacy to think that buying is a safe bet.

[@ScottAlanMillerVlog]

Of all places Canada has to be one of the worst places to buy today as the market is so over inflated with nothing to back it up.

[@jimmygorgiev9379]

@@ScottAlanMillerVlog Are you suggesting no one should buy a house and it makes more sense to rent. If I continued to rent in Toronto I would be broke. I bought a townhouse and now I can rent it out for income. I can sell it one day and move abroad with money, ie. Nicaragua. It doesn’t matter which way you slice it. It’s better to buy a house than it is to invest in the markets. I know people that moved abroad. Never bought a house and when they returned to Canada they would never be able to buy anything because of the price increases. That’s just my opinion. I like your KZbin presentations.👍

[@ScottAlanMillerVlog]

@@jimmygorgiev9379 Absolutely nothing that I said can have suggested such a thing. Just because buying isn't always a good thing, or even a good thing (financially) on average, in no way whatsoever suggests that renting is always better. There is no financial vehicle, nor can there be, that is always right. If there was, we'd all buy it and the concept of economics would break because we'd all get rich and no one would lose. It can't work that way. Also keep in mind that you are asking if I am saying that no one should buy, on a video where I recommended buying. So obviously I couldn't possibly mean that no one should do it. However, on average, buying will lose money. All economic history supports this. The markets are the safest long term investment, bonds are the worst, real estate is closer to bonds than to stocks. Economics forces the housing market to stay at equilibrium over time. Bubbles are bubbles, It wasn't long ago that I was considering a $50K condo on the waterfront in Toronto. Just because it's inflated now, doesn't mean it won't return. In 1929 everyone said stocks could never lose, by 1930 no one trusted stocks. For everyone winning investment, someone has to lose, more or less. For every person you know in Toronto who made money to retire on from housing, someone lost their shirt (or will.) The housing market is playing what is known as a "greatest fool" game. Everyone keeps raising the stakes and someone is left holding the property when all the buyers are gone and loses all the gains that everyone else made. Certainly if you are a savvy investor you can make the most dangerous vehicles work in your favour (even bonds), but you have to understand the risks and know when you are gambling against the market. As a long term investor, Toronto is a place I'd avoid buying in like the plague. The risks are sky high. The base property value is so far below what people are paying. It's never going to return to $50K condos, but it'll be close to that someday. The "return from the bubble" has never not happened in recorded history. House prices have been the same factor compared against income (which tracks inflation naturally) since housing markets have existed. It's not going to suddenly change now when there is no factor to make it change. And I said the same things that you have said in the past as have many other people that I know... and we all lost over time, just like the markets say that they will. Housing has to track inflation over the long haul, it has to. People, on average, can only give so much of their income to housing and that has to dictate what houses will cost. Just look at NYC. Everyone said the same things as Toronto, but eventually people just moved out and the market collapsed.

[@ScottAlanMillerVlog]

@@jimmygorgiev9379 something you have to consider isn't if you can buy and rent today. IF you can do that, and people considered that a safe bet, everyone would do it. People aren't doing it because people (or banks) don't feel that it is safe long term. In the short term yeah, it's relatively easy to buy and rent and make out. But will that remain true for the entire future history of the property? That's the gamble. If you buy a house for $1m today and rent it out for $3K/mo maybe you do okay. But you have to worry about months with no renters, renters who don't pay, house damage, maintenance, upkeep, upgrades, modernization, etc. Over time houses cost more to maintain. Now if the market adjusts and the value of the house drops to $500K you are still holding that expensive mortgage but your rental potential drops to $1500/mo. Can you keep making profit? You can't sell the house anymore, it isn't worth enough. Now you are trapped with a house you can't afford to live in , but the rent isn't enough to cover the mortgage. That's where things get scary. What happens if people stop wanting to live where that house is, or the market just goes down, or interest rates plummet and people stop renting and buy instead because it is cheap or building materials get super cheap. We are at the record highest cost to buy a house versus income in history for the US and Canada. Statistically, that means we are at the worst time to buy ever recorded. If you plan to hold onto a house for any length of time, that's scary. If you plan to flip, well that's always its own thing. But as an investment in the real estate itself, its' a lot like buying stocks in 1929.... overinflated to a level no one is sure what the correction will look like. So if you look at a normal year for hosing, say 1955, and consider that in an average year you do best to buy or rent at about a 50/50 rate. Then consider that houses are like 300% the cost that they would be comapred to the historic median, that 50/50 goes way, way to the side of renting. And that's before we consider things like the modern shift to remote work which is, for the first time, making renting more valuable in ways it has never been previously. The career risks to ownership are new in the last couple decades and have been punishing buyers over renters in ways that are poorly tracked (career impact vs real estate investment impact.) Today there are huge ways to lose on buying that didn't exist historically, and historically it was only good slightly less than half of the time.

[@jaymesturdivan3635]

Is Nicaragua a cash purchase only for real estate?

[@ScottAlanMillerVlog]

Not officially, but practically. Are there mortgages? Yes. Can you get one? No. Would you want one if you could? No, the rates are very high. If you are from the US, banks normally won't touch you because the banks were burned badly in 2018 when so many Americans and Canadians fled and defaulted on their mortgages and loans. American banks refuse to finance things in Central America because there's no protections for them. So while mortgages exist and are legal, they are rare and not very accessible.

[@ScottAlanMillerVlog]

Because of what I just said, owner financing is more popular than elsewhere, I think.

[@jaymesturdivan3635]

@@ScottAlanMillerVlog thank you so much. There's so much conflicting information out there. I really appreciate you and your videos. Honesty for the good points and the bad, it's very helpful!!!

[@realismatitsfinest5745]

@@ScottAlanMillerVlog New subscribe, and loving the content and advise. However, just a couple of corrections to your comment ("Not officially but practically"): I believe you mean 2008 not 2018. Secondly, Canadians were barely touched by that financial meltdown. One of our 6 banks had problems (CIBC) because they heavily invested in the mortgage backed securities. But unlike other countries like USA and most countries both Europe (albeit the latter for different reasons), Canada and Canadians came out pretty much unscathed. Yes, we had a minor recession but hardly any Canadians defaulted on their mortgages during that time ... at least not to the extent Americans did.

[@ScottAlanMillerVlog]

@@realismatitsfinest5745 at what point did I say 2018? 2018 was the Nicaraguan real estate crash. 2008 was the American. easy to state backwards when recording :)

[@meginwolf515]

Here is a guide to sea side property in Nica. Property in Nicaragua within 200 meters of the ocean is governed by law 690. This law states that all land up to the high tide line, and 50 meters beyond, is property of the country. You only by a rental contract from the vendor. The contract is with the local municipality for a number of years (maybe 99 years, maybe less). You also have to pay a one off quite high fee to the alcaldia-municipality for the new rental contract. And then annual rent as well. You own nothing and you will be....?

[@ScottAlanMillerVlog]

Good info. But there are tight laws here. This isn't like the US. This rental is true and it isn't just the alcaldía but also the indigenous community. That's why waterfront land is so cheap. But this isn't the whole country just some places like where I have land. But the rental agreement is iron clad and auto renews on land transfer. It's automatic. So you are able to renew when you sell. It's 99 years anyway so it works just like ownership basically. It's important to understand but it's more ownership than land in the US is for example. It's not a Real, but it's more than a US deed. So is all context.

[@davidwelch5186]

I have beach property at playa Marsella, San Juan del sur. in a surveyed development. My lot is one of the closest to the playa. . 50 meters is not very far.. I keep my kayak on the playa.

[@jenniferthorndyke7379]

Use Math for sure, my husband thinks the same way :) I’m the emotional one hahah. Patience 😵‍💫

[@ScottAlanMillerVlog]

All investing is very much math. It's hard not to be emotional about our homes, that's what makes the average person lose money on their homes.

[@jenniferthorndyke7379]

I just saw ( online) a home for $360k it wasn’t even that big :(

[@ScottAlanMillerVlog]

And not likely even for sale and if it is, not for that price. There's no reason to look online because it doesn't inform you of anything. Because the info is so wildly inaccurate so much of the time, you can't gather a baseline of reality to compare against. So you only risk confusing yourself info thinking more expensive prices might be realistic when they rarely are.

[@DG-ln6nx]

Could I please contact you via email? Thanks

[@ScottAlanMillerVlog]

Sure. It is Scott at NTG.co and no there is not an m at the end.