US buyers told Ecuador is the new number one hotspotEcuador was named as the best overseas investment destination for U.S. international residential property buyers this week by The Global Property Index, created by International Living.
According to International Living, Ecuador’s north Pacific Coast, which was once considered difficult to get to, is now a real development hotspot following the construction of a major new access road. This, along with low property costs and quality housing, are the key factors that put the Latin American country in the top spot.
"This is one of the nicest stretches of Pacific coast you will find," says Ronan McMahon who authored the International Living report. "It stayed undiscovered because it was difficult to get to."
McMahon added that the construction of the new road will cause prices to rise making the area’s appreciation potential considerable and rental yields high. Luxury beachside homes in gated communities are now selling for $135,000 and land lots starting from $31,000.
"I visited a home that grossed $3,800 in rent last December alone,” he says. “The owner bought the property for $180,000 so that's a gross yield of 2.1% - from a single month.”
International Living also points out that Ecuador benefits are a result of using the U.S dollar and that its economy is reasonably stable. The country had an unemployment rate of 5.1% in December 2011.
The magazine has been ranking retirement, luxury residential and investment properties for 30 years and judges locations on factors such as “Value for Money”, “Costs,” “Appreciation Potential,” “Income Potential,” and “Ease of Buying.” According to McMahon, “across the board, our top-scoring markets make good sense.”
Strong appreciation potential pushed Tulum in Mexico into second, while Costa Rica's Southern Zone came in third, thanks to its easy-to-navigate real estate industry. Las Terrenas in the Dominican Republic and the Iracema area of Fortaleza in Brazil's northeast rounded out a top five dominated by Latin American countries.
Depressed markets in the struggling Eurozone also figured, with Ireland's capital Dublin coming in at 14th place and Spain's Murcia region sneaking into 22nd. Asia was represented thanks to strong showings from Cambodia, Laos and Vietnam.