“Can you recommend a good real estate agent?”
This is a question readers continue to ask me and for which, until today, I have not had a solid answer.
Considering housing prices in the middle class neighborhoods of Medellín rose more than 10% in 2014, and the peso recently hit a 10-year low against the dollar, it’s certainly looking like a good time to buy.
For those of you interested in investing in the Medellín real estate market, this story is for you.
In order to give reliable advice and insights, I consulted with local leaders in the industry who are actively assisting foreigners with their real estate purchases.
Real estate transactions in any country can be complicated, let alone Colombia where you may not speak the language, nor have as much of an understanding of the local rules and regulations as in your home country.
To learn more about how foreigners can successfully invest in Medellín real estate, I spoke with the following experts, who provided me with important insights into the local market.
- Luisa Tascon of The Real Estate Association of Medellín
- Andres Durango, lawyer and real estate specialist
- Brad Hinkelman, owner of Casacol Propiedad Raiz
- Felipe Chávez, private banker at Alianza Valores
1. Luisa Tascon, The Real Estate Association of Medellín
I began my research with Luisa Tascon from The Real Estate Association of Medellín, known locally as the Lonja de Medellín.
Founded in 1967, La Lonja’s purpose is to contribute to the design, promotion, and development of all real estate related activities with a view toward providing its members and the community in general guarantees of morality, security, honesty and efficiency. Plus, La Lonja also represents its members before the authorities, other unions and citizens.
When I asked Luisa about how foreigners should begin their search for real estate, she highlighted the importance of starting with a member of Lonja.
“In Colombia anyone can be a real estate agent, members of the Lonja have proven themselves to be the most professional in the industry. Lonja members almost always train and test their staff with Lonja courses.”
If you’re use to the well-regulated real estate industry of the United States, coming down to Colombia can be akin to entering the wild west.
One way to make sure you’re working with a reputable person is to confirm they’re an active member of La Lonja, and are thus subject to the association’s ethics and rules on doing business.
A disinterest in being beholden to La Lonja’s rules is likely a bigger reason for not joining than cost, as the monthly membership isn’t expensive.
2. Andres Durango, Lawyer and Real Estate Specialist
Next I spoke with Andres Durango from Medellín Legal Partners.
Andres is a down-to-earth, English-speaking native of Medellín. He studied in Bogotá, Paris and Singapore and assisted foreigners investing in China before returning to Medellín to do the same.
Andres thinks that foreigners should understand the legal complexities with buying real estate in Medellín before they start their search.
“The fun part is searching for property to buy, the hard part for a foreigner is actually how to do it properly,” Andres told me at his office in the Lugo building next to Oviedo.
“There’s no doubt that the opportunity in Medellín real estate is huge and foreigners enjoy the same property rights in Colombia as locals, but the paperwork needs to be in order from banking, to purchase agreements, to proper study of the property titles, to ensure the foreigner is protected in the transaction – that’s what we do.”
Andres and his family are also active real estate investors. Between his personal and professional experience with foreign investors, he seemed to me like an excellent candidate for foreigners seeking a lawyer specializing in real estate.
Andres can be reached at email@example.com.
3. Brad Hinkelman, Owner of Casacol Propiedad Raiz
I also sat down with Brad Hinkelman, owner of Casacol SAS and a local developer and property manager.
Brad himself started investing in Colombia in 2009 before founding Casacol in 2013 to help guide both local and foreign investors in Medellin.
“I was definitely early, I saw the opportunity back then and acted on it,” Brad told me from his offices in Rio Sur.
“And today I really see the opportunity to improve the architecture and construction quality that you see in Medellín, bringing it up to a more international standard.” he says.
“All of our new construction projects are much more Miami, or Vancouver or London than they are the cookie-cutter Medellín styling. And that’s what forward-thinking locals, foreigners, and global travelers want – something fresh, high quality, and affordably priced.”
Brad’s company has four projects under joint development at the moment that he is marketing to locals and foreigners.
He says 75 percent of his investors are Colombians, but says “our local and foreign investors want the same thing at the end of the day, 1) potential for price appreciation, and 2) efficient property management that gives them 10 percent and higher returns.”
Casacol manages more than 100 apartments, most of which are within three buildings and has more than 150 apartment units under construction.
4. Felipe Chávez, Private Banker at Alianza Valores
Lastly, both Brad and Andres Durango spoke to me about the importance of a foreigner having a bank account in Medellín before he/she completes a real estate transaction.
The best way to close a real estate deal in Colombia is to have a bank account in place.
The problem foreigners face in 2015 is that Colombian banks are requiring a cedula, where as recently as 2014, they accepted a passport. Of course an investor can’t obtain a cedula until he/she has invested, thus the banks have created a catch-22.
To get around this problem, both Brad and Andres referred me to Felipe Chávez at Alianza Valores, who handles private banking and low-cost foreign exchange for more than 130 foreigners in Medellín.
Felipe and Alianza can help qualified foreigners get Colombian bank accounts using their passports. He informed me that Alianza has a strict no-press policy, but I can attest to Felipes’ professionalism, and that of Carlos Cerro, his English-speaking assistant as all the staff at Alianza is.
For foreigners wanting to learn more about banking in Colombia, Felipe, who also speaks fluent English, can be reached at firstname.lastname@example.org. The offices of Alianza are located at Calle 17A Sur #48-35, Avenida Las Vegas, piso 4 (Edificio Delima Marsh).
In conclusion, there is no shortage of terrific opportunities to invest in Medellín real estate.
Potential investors still need to do their due diligence. However, my hope is that through stories like this one, we can make the process of purchasing property a little easier.