IMPORTANT INFORMATION FOR FOREIGN REAL ESTATE INVESTORS IN ECUADOR.
First and foremost, welcome to Ecuador, a very good place for real estate investments!
Investing in Ecuador Real Estate is being promoted for retirement living by several Web sites with a high number of visitors. As a part of the service we provide to our member brokers, we monitor these sites constantly and find disturbing information contained in some of them, including some outright lies regarding brokers, commissions and legal matters.
One very popular site says there are no real estate brokers in
Ecuador. Our existence and that of sister organizations in other provinces of
Ecuador belies that claim. Not only are there real estate brokers, but we have a
law and a code of ethics that govern our activities. Legal real estate brokers are licenced after
completing satisfactorily an extensive course. They have to take an oath to
respect the law and
abide by the code of ethics.
Unlicenced brokers or agents promoted by that Web site don't abide either by the
law or our code of ethics.
Another site states that "In Ecuador sellers don't pay
commission, so it has to be paid by the buyer". The law fixes the
commission the seller has to pay the broker at a limit of 6%, being the
usual between 4 and 5%, so the gullible customers of the network of unlicenced
brokers that Web site
provides are actually paying an extra 5% (which is the commission they have
fixed), giving those illegal brokers an also illegal fee of up to 11%!
Customers do have rights in Ecuador, but if they are willing to be fooled, there
is little that can be done.
Buyer commissions are not illegal in themselves, but then the broker or agent
has to forfeit the seller's commission. It is not legal to receive commission
from both parties, as one can't represent both interests.
Another site says they are not promoters but that they search for opportunities and take "real estate tours" to see several options. They do give the customers a tour, but end up pushing a resort in which they have interests, and also pushing real estate in a mountain city where the have consigned several properties from which they will earn a double commission, from the seller and the buyer.
A site promotes remote mountain or beach houses for reitrees who plan to spend part of their time in Ecuador. That is a big mistake, as an empty house in a remote location, and even in an urban area, will most certainly be burglarized if it appears abandoned. And that will happen anywhere in the World, not just in Ecuador. For part time residents, a condominium with security is the best investment. If you plan to move permanently to Ecuador, then a remote house may be a good investment, depending on the transportation and utilities facilities in the area.
Customers usually find out the truth about those scammers once
it's too late, and as tourists, there is little that can be done to recoup a
loss.
The fooled "customers" usually find it impossible to "close"
on their "property" because of several reasons. One may be migratory
status (although it is not illegal for tourists to own property); another may be that the property doesn't belong to the "seller";
yet another may be that the property is communal land, so the buyer has to become a
member of the commune. This is like a New York Coop, where you don't
"own" your apartment but do have certain rights within the laws of the
Coop. (If they grant you the priviledge of accepting your membership).
In Ecuador, as anywhere else in the World, you will find honest and dishonest people. We strive to keep the real estate market in honest ground, so we ask that you seek the advice of local professional real estate brokers. In that line, we ask that you shy away from illegal brokers, even if they are "nice expats". If they don't have an Ecuadorian broker's licence they are acting illegally and knowingly breaking the law.
We have a list of active registered real estate brokers and a list with e-mails in this Web site. We sincerily recommend you use one of them for any transaction you carry out in Guayas and the newly created Santa Elena province. For the members of our sister organizations in other provinces, search for their Web sites with the words: "corredores de bienes raices provincia de (the name of the province here)".
All licenced real estate brokers have a physical licence issued by us. Make sure the one you contact shows you his/her licence and consult our list to ascertain its validity.
Should you have a problem with either one of our members or an illegal "broker", please let us know. In the case of one of our members, we will help you. In the case of an illegal "broker" we will try to help you, but as you have selected to be deceived, it will be very difficult to obtain positive results.