Real Estate Buyers Tips-related Realty Information

Following are Real Estate Buyers Tips and related Realty Information from the website of Broker, Paul Juan, Cartagena, Colombia.  See:  While Paul works only in greater Cartagena, this information equally applies to Medellin.  Disclaimer: The Editor of (this website),is a junior associate with Paul. 

Some of the Topics Paul covers are:













Under Colombia Law, your right to: Buy, Own, Record, Sell, Rent, etc. real estate, and return the sale proceeds to your country of origin, is the same as if you were a Citizen of Colombia!

Colombia is the longest established democracy in South America.

In many ways, we are considered very progressive, and in others, our old colonial culture and charm are features of life, that many move here to savor and enjoy.

Can a foreign citizen buy property in Colombia?
Answer: Yes, no problem. Any non Colombian citizen can buy and own real estate in Colombia. The state will protect your private property rights.

NEW LAW: Now it is even easier for foreign citizens to buy property in Colombia!

The old law required foreign citizens to have a Colombia Cedula (ID), or have someone with a Cedula, to act as their officious (official) agent, when signing the scripture (Deed). This Law was recently repealed. The new Law makes it even easier to purchase real estate in Colombia. Under the new Law, Buyers will feel more comfortable when signing their Deed themselves.

Paul Juan, and other Colombian real estate professionals have been pushing for this change in the Law, and we are grateful that the current administration and lawmakers have followed through with our request.




When you send me an E-Mail, you will immediately receive an AUTO RESPONDER acknowledgement. You now know that your E-Mail is in my mailbox. I check my E-Mail at least 3 times a day, and when in the office I am instantly available thru Hotmail Messenger at:, I'm also in Skype: paul_juan.

My cell phone number is: 57 311 660 2756, or send a free text message to my cell phone click here:

Regarding E-mail requests for information, please be as specific as you can. I will respond as soon as I have the information. If you require additional photographs, describe exactly what you want to see in the photo. Usually I can send you the photos as E-Mail Attachments in 12 hours or less.

It is best to build a "history" of our E-Mail communications, rather than start a new E-Mail for each correspondence. Please hit REPLY, when you respond, and I will do the same. In this way, we will have a continuous running history of our communications.

In all of our dealings, I will do my very best to be honest with you. If I do not have the answer, or I am not sure, I will tell you. If I tell you I will do something, I will do it. I expect you to treat me in the same businesslike manner.


Yes, there are many differences between the Hispanic culture and what you may be used to. Having lived for many years, in both the United States, and in Cartagena, I am both familiar, and comfortable with these differences. If I feel they could cause a misunderstanding, or a problem in our dealings with each other, with sellers, or others, I will let you know. No surprises!

You may ask me for information that only can be secured direct from the Seller. It is not always easy or fast to make such contacts, or to obtain certain information, as many Latino's are very secretive-it is our culture! Should a delay occur, I will inform you of the steps I am taking to obtain the information you need.

Thank you, Paul.




For a limited time only. Here's why!

For the past forty years our country has been engaged in an internal war with guerilla factions known by abbreviated initials such as FARC, ELN, etc. Initially their "mission" had some popular support, especially among the poor in the distant mountain regions, 500 miles to the south of Cartagena. The current, and very popular President Alvaro Uribe has vowed to eliminate this problem. The U. S. government has declared these groups, "Terrorist Organizations", while pledging millions in aid and manpower, to the Colombia Government, in an effort to help resolve the situation.

All Colombian's have suffered, mostly the poor. When lasting peace returns, the economy will boom, international investors and corporations will return, and, REAL ESTATE PRICES WILL SKYROCKET. We have seen this rapid economic change take place in other Central and South American countries when they have resolved their civil conflicts.

And, here in Cartagena, every day, we see positive changes-new construction taking place on projects that have been "mothballed" for years.

For the first time in decades, the general population is showing positive signs that they believe: "the wind is changing in the right direction"-toward a lasting peace.

We don't expect a real estate "boom" to occur until the entire country is safe. But, already, there are many individual investors, and new businesses pumping serious money into our local economy. In confidence, many believe they are investing: "ahead of the crowd", taking advantage of current low prices. Judge for yourself. Come and visit Cartagena, for a vacation, and to see firsthand: It's a Buyer's Market.

Our best advice to Cartageneros who ask if now is a good time to sell: we tell them in all honesty: "NO, if you don't need the money, hold on to your property, and wait for a big payoff!" We believe it will come, sooner than later. Because of the poor economy, there are many who MUST SELL. There is an over supply of good investment grade properties of all types.

Those who have the means and foresight to make wise investments in Cartagena Real Estate NOW, can receive an added bonus as they enjoy the "GOOD LIFE" that Cartagena on the Caribbean offers.


If they look familiar, your right, as they are patterned after commission plans in the U.S.!

Common Commissions used by real estate professionals in Colombia are about one half of the percentages used in the U.S. For example: residential properties=3% total commission, farms and commercial properties=5% total commission.

SELLER'S AGENT: Commission is paid by SELLER. Commission normally totals 3% of the final sales price. Paul's duty is to represent the SELLER in obtaining the best price and terms for the SELLER.

SUB AGENT: Paul Juan cooperates with ALL recognized real estate professionals, in Cartagena, Colombia and Internationally. The normal Colombian commission split between real estate companies is 50-50, or 1.5% commission payable to the agent securing the SELLER, and 1.5% commission payable to the agent securing the BUYER. If the SELLER pays the entire commission of 3%, both agents are considered agents of the SELLER, and are to do their best to represent the interests of the SELLER. The agent who secures the BUYER, when the entire commission is paid by the SELLER, is technically regarded as a SUB AGENT of the SELLER.

BUYER'S AGENT: Commission is paid by BUYER. Commission normally totals 3% of the final sales price. Paul's duty is to represent the BUYER in obtaining the best price and terms for the BUYER.

The fact that the BUYER is paying the entire commission is conveyed to the SELLER, and usually the price is adjusted downward resulting in a sales price that often is the same, irregardless of who pays the commission.

INTERMEDIARY: Commission is SPLIT equally between BUYER AND SELLER. Commission for residential property normally totals 3% of the final sales price. When working as an Intermediary, Paul's duty is to EQUALLY communicate the wishes of BOTH PARTIES-THE BUYER AND SELLER, to each other. The goal is to minimize conflicts of personality, to expedite the sale, concentrating on the mission at hand, obtaining a fair price that is acceptable to BOTH BUYER AND SELLER.

Referral Fees: Paul Juan Realty is happy to pay recognized real estate professionals a Referral Fee for introducing qualified Buyer's to Paul Juan Realty. Because our commission percentages are about one half of those paid in other countries, the Fee naturally is less than "normal". We will pay a Referral Fee of 25% of the total commission received by Paul Juan Realty. The Fee, is paid by corporate check when earned by U.S. or Canadian Brokers, and is drawn on our Bank of America Account. The Fee can also be paid by Western Union, with the WU fee split 50-50. Fees payable are paid in the name of the Real Estate Broker from where the referral originated. Register your referral clients by E-Mail. We promptly confirm all registrations.

The Commission Plan used and the peso amount of commission is detailed in the SALES CONTRACT which is signed by all parties: BUYER, SELLER, and real estate agents involved in the sale. TOTAL COMMISSIONS are due and payable at time of closing, in cash, or certified bank check.

ATTENTION INVESTORS: Do It Right The First Time!
How to bring money INTO Colombia, AND take it OUT.

The short answer: work through a Colombia bank.

The Colombia government requires foreign investors to use "clean, non laundered money". Since 9-11, all responsible governments are cooperating in the exchange of information relating to international transfer of funds. Governments control their banking systems. When investors try to circumvent government bank regulations, they can end up paying heavy fines.

Before banks can accept or credit an international transfer, they perform a preliminary study to establish the origination of your money. The only way banks can document your credibility as an honest person with "clean money". is with your help. Banks may ask you for: proof of income, labor certificates, receipts, tax returns, bank statements, etc. If you have nothing to "hide", this preliminary study will also help establish you in Colombia. as a law abiding person. Paul will be happy to introduce you to a bank in Cartagena, and guide you through the process. As Paul says: "it's no big deal, and now days, all responsible countries require this".

When buying a new house or apartment through Paul Juan Realty, wiring money from your bank to the developers Fiduciary Account (similar to an Escrow Account) is simplified because the relationship between the bank and the developer is established.

If buying a pre-owned property, and the Buyer does not have a Colombian Bank account, the process requires more coordination between the intermediary or agent (Paul Juan) and the Buyer(s), and Seller(s). Paul will obtain, and have notarized, a legal Contract protecting the Buyer, so the down payment or purchase money can be wired direct to the Seller´s bank account.

In all cases, Paul will assist Buyers to make sure your money is received in Colombia with a Formulario 4 (form 4) at a Cartagena Bank. Once the Deed is registered, it is then presented as your investment in Colombia, to the Federal Banco Republica on a Formulario 11 (form 11). The Buyer will receive an official document with confirmation of the registration of the investment. Compliance with both Forms 4 and 11, entitles Buyer's to take the cost(s) of their original investment(s) out of Colombia, tax free, with no hassle.

Net profits earned from investments are taxed by the Colombia government, at reasonable rates, before profits can be transferred out of Colombia.

Paul Juan will perform the above procedures, or if you prefer to do-it-yourself, Paul will be happy to literally "walk" you through the process. Naturally, this service is included in the standard 3% real estate commission payable at time of closing.

Life is to be enjoyed. Keep it simple. Keep it honest. Do it right the first time!




If you are planning to visit Cartagena, and would like me to show you properties, please send me an E-Mail BEFORE you arrive .

Check with your accountant or CPA, and you will learn that you should be able to show communications, such as E-mails, relating to your interest in real estate investment before your departure , in order to qualify portions of your trip as a deductible business expense.

Use E-Mail, and you will help me protect

What follows is not an uncommon occurrence with some real estate companies. "Buyer's" drop in un-announced wanting to look at: "expensive properties". One of the office agents drives them around town, providing access to the properties.

The so-called Buyers "case" the properties, select the best targets, and return later to rob, mug, and burglarize the owners.

With the help of our Buyer's, the above has not happened to Paul because:

1. Paul maintains personal and direct E-Mail contact with all Buyer's. It's Paul Juan Realty, not Paul Juan and Associates.

Paul's web site pre qualifies Buyers. Buyer's see photographs, prices, and know the details about the various properties which may interest them. Both the clients and Paul use E-Mail to establish a mutual confidence in each other. When visitors first meet Paul, many have said: " I feel as though I already know you". We want Buyer's to proceed at their own pace, with confidence, and to relax, but be alert, as they inspect properties. AND, this is most important: to have a good time on their Cartagena vacation.


The short answer: "FORGET ABOUT TERMS"
For an explanation as to: WHY, read on . . .

Currently, the bank loan rate for real estate in Colombia is between 20-25% annually. Loans are short term, usually 5 years or less, and are made primarily to Colombians. There is no "owner financing" except loans made within families. Perhaps now you understand why we advise you to: "FORGET ABOUT TERMS"?

Make the TWO "systems" (Colombia's, and yours) work to your advantage

In most countries, interest rates are at an all time low. Many people with limited funds are taking advantage of low interest rates by borrowing against the built up equity they may have in their homes. Home Equity Loans are being offered at rates of 5% and less. If you have the ability to repay these loans, even if you loose your job, or have a major illness, this can be a great way to utilize your net worth by investing in bargain priced property in prime locations such as Cartagena?

In Cartagena, real estate prices are slowly on the increase, but the city remains a "Buyers Market" . Prime residential properties, in the best locations can be had for around $200,000 u.s. There are few Colombians with this kind of money, and those that have it would be equal to multi-millionaires in developed countries. Prices of prime properties are 25 to 35% of the cost of equal properties in developed countries. The quality of construction is equal, and often better. AND, the cost of "living the good life", while enjoying a much higher "lifestyle" than you may be used to, is reality.

In Cartagena, the price spread goes from over one million u.s., to as low as $15,000. for a studio apartment.

Depending on WHAT you are looking for, and WHERE you are looking, many properties within this wide price range represent bargain prices when compared with "back home"!

LOCATION, LOCATION, LOCATION remains the three most important factors effecting real prices, even in developing countries!

C A S H  IS  K I N G



A common question asked, even before looking at a residential property is: "what is the average cost per meter"? The answer can get you in trouble, but it is a starting point.

This year, and for the past couple of years, the average cost per meter for residences in good condition, and in the more desirable locations is approximately 1,000,000 Pesos per square meter.

Many foreign buyers are more familiar with area size expressed in square feet. Pesos one million is currently, about $350. u.s. per meter, or about $32.50 per square foot. This figure will become more meaningful if you consider the variables which make up building costs: bathrooms and kitchens per square foot are the most expensive areas. Larger areas cost less per square foot than smaller. Apartments with features such as a swimming pool, dedicated parking space, garden area, etc. will cost more per square foot. And, of course, the location can have a large effect on the per square foot price. A property that fronts right on the Caribbean will be more than one that is across the street from the beach, and a quiet location that is more "residential" in appearance but close to shopping, will usually cost more than one that is in the middle of the congestion. Regarding monthly administration fees, an apartment building with hundreds of units will cost less per unit to maintain and secure, than one with 20 or so.

Current construction costs in the U.S. are about $100. per square foot, which does not include the cost of land, permits, design, etc., and can go up to $350 per square foot for custom luxury construction.

Construction quality in developing countries is often better than "back home". Here, engineers and designers will typically "over design", because they are required by law to personally stand behind their work for five years. To reduce or eliminate potential structural problems, they will specify more steel and concrete than commonly used in developed countries where insurance will cover any "errors and omissions".

The big reason for the difference, of course, is the cost of labor. Workers wages here in Cartagena, can be as little as 10% of cost per hour in your country. Labor cost is normally one half or more of construction cost.

Lower labor costs often means that the design is more ornate and labor intensive than boxy "cookie cutter" designs that are economically common back home. Look at the hundreds of photographs of apartment buildings and homes on my web site and you will notice a large variety of designs including many that are curved which may be more of a challenge to furnish (ever try to buy and hang a traverse rod drawn curtain, covering a round window?), but which is the most expensive type of construction when it comes to material waste, and more importantly, higher labor costs. Cartageneros take pride on being "unique"!

The caveat to the rough price guideline, of course is that you must compare the property with others in the same general area, to establish a better idea of relative value. This is where depending on a reputable Real Estate professional, that has full command of your language, and is a graduate engineer from a respected U.S. university, can be a big plus. And never forget the three most important rules that apply all over the world, relating to real estate value: location, location and location! Cartagena is a great world-class location, so already, your batting .333! Now let Paul Juan Realty find your neighborhood location, and your home location!

Enjoy your life-in Cartagena on The Caribbean.


Annual Property tax rate in Cartagena is 0.65% of the assessed value as determined by The City of Cartagena. Market values are usually higher than Assessed values. While a property is under construction, the worst case scenario is that government INSTITUTO GEOGRAFICO AGUSTIN CODAZZI, assess the property at market value, which would be the sale price.

Example 1: if you pay $180.000.000 pesos ($64,000 U.S. dollars) for a previously owned apartment, that is assessed at $120.000.000 ($42,800 U.S. dollars) you will pay $780.000 pesos (0.65%) or $278 U.S. per year.

Example 2: if you buy a property that is under construction the assessed value would be undetermined. The worst case scenario is that it would be assessed at the sale price. For example if the sale price was $250.000.000 pesos ($89,000 U.S. dollars) you would pay $1.625.000 pesos (0.65%) or, $578 U.S. dollars


Prices per sq. ft. should be considered only as one factor when determining value.

Consider the following prices per sq. ft. for the many new apartment complexes that Paul is offering for sale, as of the first day of 2006.

The lowest price was: $76. U.S. per sq. ft.
The highest price was: $174. U.S.per sq. ft.
The average price was: $121. U.S. per sq. ft.

Why the big differences?

The biggest difference can be attributed to land costs, which are based on LOCATION. Land fronting on the water costs more than if it were inland. Land within the Walled City costs more than land outside of the Historic District. Land in Castillogrande costs more than land in Bocagrande or Laguito, etc. Land costs are included in the per sq. ft. price, and they can represent as much as 20% of the total cost of the apartment.

1. Projects with spectacular views are usually more expensive than those with non-dramatic vistas.
2. Some projects include a parking space as part of the apartment cost. Others do not.
3. Some projects offer a full bath for each bedroom. Bathrooms and kitchens, on a cost per square foot basis, are the most expensive rooms in an apartment or house.
4. Apartment buildings with few apartments usually cost more per sq. ft. to construct, than projects with many apartments. In addition, the monthly maintenance fee is normally higher on buildings with few apartments, rather than many apartments.
5. Architects and Developers offer different concepts and specify varying grades of finishings.
6. Architects and Contractors with a good history of quality can charge more for their work. You may pay a bit more, but a good project earns a reputation often resulting in higher re-sale prices!
7. Developers marketing and pricing plans differ. One Developer may offer two different size apartments at the same price per sq. ft., while another may charge as much as 60% more per sq. ft. for a large unit than for a small one.


If you know what you are looking for, be specific, and tell Paul what YOU want, and he can guide you to a good value that will match your needs, investment objectives, and hopefully your budget.

New apartment project prices should be considered as "firm". If they are fairly priced, they do not decrease, BUT, they may increase 2-3 times during construction! FOR THIS REASON, IT IS IMPORTANT THAT YOU FEEL CONFIDENT YOU CAN BE ON TIME WITH YOUR MONTHLY PAYMENTS. Most sales contracts stipulate that if you are late with the monthly payment(s), the developer has the right to return your money, and void your Contract. If this happens, the chances are that your apartment will immediately be offered (and sold) at a higher price! In a strong real estate market, such as now exists in Cartagena, there is no reason for a Developer to offer a Buyer a discount. If a buyer should "drive a hard bargain and get a good deal", it may be an indication that the projects sales are slow, perhaps because the units are overpriced? If this is the case, it will be reflected in the future re-sale prices of the apartments.

Prices should be the same whether you buy through a developer's sales office, or a reputable independent real estate company. The major advantage of buying with an independent company, in addition to forming a more personal relationship, is the experience and local knowledge they can provide in being able to present a wide variety of properties and locations for the buyer's consideration.

When all the apartments have sold, and the Developer moves to a new project, you may want to sell? Consider the relationship you already have established between you and the realty company who sold you your apartment. If it was a good experience, (whether it was with Paul Juan, or another Cartagena realty company) consider working with them again. Colombia commission rates are low-about one half of what you may be used to. Most buyer's and seller's consider the honesty and work ethics of a good realty company worth much more than the "low cost" of the normal 3% sales commission.


Paul Juan will inform the Buyer that the property can be legally recorded. If it cannot be recorded, we will clearly state the conditions or challenges to the title. For example, property in the Rosario Islands does not have clear title, but it is still desirable property. Many wealthy, and politically powerful people "own" property in the Rosario's.

When both Buyer and Seller are in complete agreement, it is customary for both parties to sign a BUY/SELL CONTRACT in which the agreed Price, Terms and Conditions are clearly stated. Usually the two parties sign the BUY/SELL CONTRACT in front a Notary. A good faith deposit (down payment) of between 10-20% of the agreed upon price is presented to the Seller. With completion of the Buy/Sell Contract, it is normally considered by all parties, that the "the deal is made".

The Contract gives the Seller time to bring the property up to the agreed condition, and to pay past due taxes, utility bills, etc. and, finally, to move out. The Buyer uses this time to arrange for funds to be available locally to complete the purchase. The BUY/SELL CONTRACT normally contains a Penalty Clause of 50% of the total Sale Price to be paid by either the Buyer or the Seller, whichever backs out of the Contract! At the agreed upon day and time, as stated in the Contract, both parties meet, normally at a Notary office, to begin the transfer of title to the Buyer and pay the money to the Seller. At this time, according to the terms of the CONTRACT, the Real Estate commission is also paid.


If everything is in order, the Closing can be completed within  10-15 days, with occasional closings in five or less!

However, sixty to ninety days is more common. Closing dates are made at the convenience of the Buyer, Seller, Attorney, or Notary, etc., who may be assisting with the Closing. Final payment, is usually made in the form of a Cashiers Check, wire transfer to the Sellers bank account, personal check, but not cash. If a personal check is used, it must first clear the local bank in Cartagena. Paul Juan Realty will accompany the Buyer, or with a Power of Attorney, go to the government Registry Office where the Title will be recorded.

Closing in Absentia (without the Buyer actually present at the closing) can be completed with a Power of Attorney Document which has been notarized by the Embassy or Consul of Colombia in a major city near yours. Search on Google to find the location. Paul Juan Realty is prepared to assist Sellers who cannot be present for the closing.


Notary expenses are paid and shared equally by Buyer and Seller. Seller pays for, and presents to the Notary, the proper amount of Sales Tax. This information is recorded by the Notary, and within 48 hours the Notary will release the documents for Registration with the Government Registry Office. Along with the documents, a receipt showing that the Buyer has paid a Fee which is used to support Public Health, is presented to the Registry Office. In about one week the Registry Office will have recorded the documents, and at this time the Buyer can claim the documents showing that title has been legally transferred to the Buyer. The total amount the Buyer has to pay in taxes and title fee is about 2% of the agreed upon Sales Price.




Fri Jan 27, 2006 6:55 PM ET
BOGOTA, Colombia, Jan 27 (Reuters)

Colombia's economy could grow by more than 5 percent this year, similar to last year's growth rate, Deputy Finance Ministry Gloria Ines Cortes said on Friday.

She spoke to reporters on her way out of the central bank's first regular meeting of 2006, at which she said it decided to hold interest rates steady and keep buying dollars as a way of controlling the strength of the peso.

The Ministry chairs the bank's board of directors.

The Colombian economy is being propelled by foreign investment, thanks in part to tough security policies of President Alvaro Uribe aimed at beating back a 41-year-old Marxist insurgency, and a bounce-back in domestic demand following the Andean country's 1999 financial crisis.

The Colombian peso has risen 4.22 percent against the U.S. dollar over the last 12 months thanks to improving confidence in Colombia, higher exports and increasing remittances from Colombian workers abroad.


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