A Four-Bedroom Contemporary Home in Ecuador
$550,000
Perched at the eastern edge of El Cajas National Park, a UNESCO-designated biosphere reserve, this contemporary home sits on four undulating acres outside of Cuenca, Ecuador’s third-largest city.
With the 110-square-mile park as its backdrop, the four-bedroom, three-bath house “is isolated and surrounded by nature,” said Ashley Rogers, founder of Ecuador At Your Service and the listing agent. “But in less than 30 minutes, you can be at dinner or the symphony in Cuenca.”
The sellers worked with the Cuenca architect Sergio Zalamea to create “a modern house with nature inviting you in, but a home that’s private, safe, and secure,” Ms. Rogers said. Its design includes underground tanks for fuel and water storage, and a discrete 818-square-foot apartment beneath the 1,830-square-foot main home.
From a paved local road, a winding dirt path ascends to the home’s electronic gate and a steel-framed carport. The front door opens to an airy great room whose floor-to-ceiling windows offer sweeping mountain vistas. “The house is near a cloud forest, so the scenery’s ever-changing,” Ms. Rogers said. “Cajas is also one of the world’s best bird-watching areas. You might see condors or a llama, but you won’t see people.”
The great room, heated by a wood-burning stove imported from Chile, opens to a kitchen with steel countertops and stainless steel appliances. Opposite the kitchen, the owners tucked a small office behind a free-standing entertainment center. German-made vinyl tiles, resembling wood panels, cover the floors. Sliding doors open to a floating terrace that juts from the house.
The primary bedroom, with an en suite bath, is on the same level. An oversized headboard conceals a closet area behind the bed, and views from the wide window take in the rolling Cajas scenery. A guest bedroom and bathroom are down a short hallway. The home, built in 2012, is being sold fully furnished, Ms. Rogers said.
Ten feet below the main floor, the owners designed a two-bedroom apartment with a kitchenette and a living room, as well as a “huge pantry and food storage area, perfect for preppers or chefs,” Ms. Rogers said. The level is accessed from its own exterior entrance or by a pull-down staircase under a steel door in the great room.
An antenna-based WiFi system makes up for spotty internet access in the area, and the Mazan River, which runs through the property, supplies the home’s water.
A city of about 700,000 in the Andean highlands of central Ecuador, Cuenca is the leading destination for expatriate buyers in Ecuador, said David Morrill, editor of CuencaHighLife, an English-language news site. “It’s a cultural center with a rapidly rising level of sophistication, and it’s relatively comfortable if you don’t speak Spanish,” he said. “You have the big-city advantages without the megacity problems.”
Mariscal La Mar International Airport, about 1.5 miles east of central Cuenca, connects with Quito and Guayaquil, Ecuador’s two largest cities.
Market Overview
Because expatriate buyers tend to prefer a limited range of locations and home types, Cuenca’s market is “a tale of two cities,” said Zach Cashero, president of MLS-Ecuador, an English-language listings and data site.
“It’s a seller’s market if you’re selling to foreigners,” he said. “But for local buyers, who make up most of the market, there’s too much inventory.”
Before the pandemic, “the expat community was mostly retirees seeking small apartments in the low $100,000s,” said Xavier Amoroso, owner of the HouseHuntEC agency in Cuenca. (Ecuador adopted the U.S. dollar as its national currency in 2000.) Most preferred to live in the downtown historic district, the surrounding “new town,” or in condos along the banks of the Tomebamba River. But a wave of younger and wealthier buyers is increasing demand for homes in rural areas, Mr. Amoroso said: “They don’t want condos. We have beautiful mountains here with animals and nature. With a detached house, you can see it from your garden.”
In the wake of the pandemic, resident foreigners are also upgrading to larger homes. “If they lived in high-rises, they now want access to fresh air and more space in the country,” said Ms. Rogers, the listing agent. At the same time, retirees who had chosen rural areas “decided they needed to move closer to medical care. So we’re seeing a shuffle among people who were already here.”
With continued economic challenges for Ecuador, prices in Cuenca have held steady over the past decade, Ms. Rogers said. “There are a lot of new high-rises going up, and their prices are rising because construction costs are going up,” she said, estimating that “a nice high-rise condo that an American would consider” averages about $1,300 a square meter ($120 a square foot). A “high-end home in a nice area” costs about $800 a square meter ($75 a square foot).
Mr. Amoroso said that the “average upscale house in the outskirts,” on half an acre of land, average $550,000 to $580,000.
Mr. Cashero, of MLS-Ecuador, said mid-market condo prices average $125,000 to $150,000, while a “middle-of-the-road detached home that a foreigner would look at” averages $150,000 to $200,000, “with the top end at $600,000 or $700,000. Those are more like country estates.”
Prices have soared in Cuenca’s old town, with its limited inventory, strict building regulations and Spanish-colonial architecture. “When we started in 2009, nobody cared about these properties,” said Juan Heredia, founder and CEO of ISAM Proyectos Inmobiliaros, which converts older commercial properties into multiunit residential buildings. Now they go for about $1,600 a square meter, he estimated, significantly more than what they cost a decade ago. “Foreigners want to be here. It’s where social and cultural life happens.”
Who Buys in Cuenca
While Ecuadoreans power the market in greater Cuenca, the city has long attracted retirees with its low cost of living and high quality of life. Most of them are Americans, with a small portion from Canada and Europe, according to Maite Duran, founder of the Gringo Visas consultancy, which helps foreigners obtain visas. “Americans see the cost of groceries here compared to home, and they’re amazed,” she said. “Services here are pennies to the dollar.” In 2018, the website International Living named Cuenca one of the world’s best retirement destinations, spurring another surge of arrivals.
The Ecuadorean government has courted foreign buyers with accessible, inexpensive visas. The newest, the so-called Digital Nomad visa launched in March 2022, requires proof of employment with a minimum monthly income of $1,275, Ms. Duran said. The most popular visa remains the retirement visa, which requires a $1,275 monthly income from sources like pensions, dividends or Social Security, and specifies an income of $250 a month for dependents or additional applicants. Visas, valid for 24 months, “allow the same benefits and guidelines as any Ecuadorean, including access to government health insurance, opening a bank account, and the ability to work here,” she said.
About 30 percent of the property market is propelled by Ecuadorians who are repatriating, said Ms. Rogers, the listing agent. “They’re driving prices as much as expats,” she said. “They’re opening new businesses like restaurants. It’s a creative pool of newcomers.”
More Ecuadorean buyers are now moving to the old city, Mr. Heredia of ISAM said. “When we started, 85 percent of our buyers were foreigners,” he said. “Now, it’s 50 percent locals. And since the pandemic, we’re seeing more families with young kids and young people working remotely.”
Buying Basics
There are “virtually no restrictions” on foreign buyers in Ecuador, said Grace Velastegui, co-founder and partner at the Grace Nelson law firm in Cuenca. “Some exclusions apply around borders with Peru and Colombia, but foreigners don’t buy there,” she said.
Notaries oversee property transactions, “though we always advise that foreign buyers retain an attorney,” Ms. Velastegui said. “A lot of people here claim to be real estate agents, but they’re not.”
The attorney executes a title search, and both parties sign an “earnest money agreement,” with a small goodwill deposit for taking the property off the market.
Most of Ms. Velastegui’s foreign clients grant her power of attorney for property transactions, “and not just people outside Ecuador,” she said. “If you don’t speak Spanish, it’s mandatory to have a representative translate for you during the closing.”
Most foreign buyers pay cash “because they have to,” said Mr. Amoroso of HouseHuntEC. Mortgages are not available to foreigners until they have lived in Ecuador for three years, he said, though in rare cases buyers short on cash may arrange a mortgage directly with sellers.
Websites
Languages and Currency
Spanish; U.S. dollar
Taxes and Fees
Buyers in Ecuador can expect to pay a total of about 3 percent of the sale price on taxes and closing fees, Ms. Velastegui said. That includes notary fees, a 1 percent transfer tax, and a municipal registration fee that varies by region and sale price.
Lawyer’s fees generally total about 1 percent of the price; a power-of-attorney agreement costs an additional $80.
Fees for visas begin at $450, Ms. Duran said. Her company charges $1,550, including visa fees, to complete applications.
Broker commissions in Ecuador vary from 4 to 6 percent, Ms. Rogers said. Annual property taxes on this home total about $40.
Contact
Ashley Rogers, Ecuador At Your Service, 011-593-99-547-5116, ecuadoratyourservice.com
For weekly email updates on residential real estate news, sign up here. Follow us on Twitter: @nytrealestate.
