Guide To Buying Property In Ecuador
If you're interested in buying property in Ecuador for a vacation home, there are several things you need to understand. First of all, you need to understand how much money you're going to pay in taxes, as well as how to apply for a residency visa. Last, but not least, you need to know how much you are going to spend buying property.
Taxes To Anticipate
Any real estate purchased in Ecuador is subject to a variety of taxes. You need to understand these taxes in order to know what extra fees to expect after your purchase. The taxes you can anticipate when buying property in Ecuador include:
- Transfer Tax – 1% of the value shown on the deed – paid by the buyer.
- Property Tax – Varies based on the home's value, but is generally no more than a hundred dollars.
- Rental Income – If you are renting your home or plan on renting it, rates will vary from 0% to 25% of the home's value depending on your location.
- Capital Gains Tax – Can be up to 25% of the net gain of the home.
- Inheritance or Gift Tax – Applicable only if the home is given to you as a gift: between 5% and 25% of the home's value.
- Alcabalas Tax – A tax charged when the property is registered, from 10% to 38% of the home's value.
Residency Visa Expectations
Filling out a basic residency visa will allow you to spend six months to a year in your home. Applying for one is relatively simple, but it requires several pieces of paperwork.
- Criminal Background Check – Requires an FBI report and a police criminal background check from the state of your residence. Must be apostilled by a state or federal authority (such as a Secretary Of State office)
- Completed visa petition addressed to the current Director General of Extranjeria. Must be signed by applicant and their attorney.
- Completed "Solicitud de visa de inmigrante" form for the residence visa.
- Notarized copies (two) of a legally-current passport.
- A "hoja de datos para la cédula" form.
- Passport photos (two) on a white backdrop
- $500 for visa application
All documents must also be translated into Spanish and all must be original and notarized by the person preparing the documents. You can have them prepared by any immigration official at the federal level
Real Estate Prices To Expect
Like any real estate market, the prices in Ecuador change very year. There was a period of time in the late 2000s when prices rose at a steep level. However, as of 2013, the prices have stabilized to a more reasonable and acceptable level.
For example, apartments in Ecuador were around $80-$95 per square foot and house were around $65-$75 per square foot in 2013, the most recent year that rates have been released. This translated to a price of $75,000-$90,000 for a two-bedroom apartment and up to $275,000 for 3,000-5,000 foot square house.
Investing in Ecuador property is a reasonable proposition for anyone who has the money and the skills to invest. Check out Ecuador real estate listings or talk to a dedicated Ecuadorian real estate agent to work out the details: they can help guide you to a successful sale.