Costs and Where to Retire in Latin America

By: Timothy Scott 

In an earlier post we ran down some of the elite real estate markets of Latin America. These are the places where high society gathers, where the moguls and movie stars have their fourth or fifth house for vacations and their kids’ parties. What if you’re just looking for one of the best places to retire, however? A location where you can get a lot more bang for your buck?

There are plenty of those too in Latin America, from Mexico down to Patagonia. In the elite markets you may find prices that are half what it costs for a prime area in your own country, but in these spots it may be more like a quarter of the cost of where you live now.

Although luxury real estate is by nature expensive in any country, there can be a huge variance from place to place. You’ll sometimes see some bizarre juxtapositions if you watch two House Hunters International shows back to back. Once when I did that, the first episode featured a couple looking for a beachfront home in Ecuador. All three choices were fabulous and all were under $200,000. The next show I watched had a couple looking for a French home in Provence. Their budget was $1.2 million and every place was a fixer-upper dump. Once didn’t even have a bathroom!

Most of the best places to retire in Latin America fall somewhere near the bargain end of that scale. Apart from a few exceptions, what you get for your money is going to be a better value than what you could find in the USA, Canada, or the UK.  Whether you want to buy a luxury vacation home or a retirement dream home that’s in a nicer climate, you’ll almost surely get a much better value.

For one thing, even the wealthiest countries in Latin America have a much lower average salary than where you probably live now. That means the cost of labor—especially construction—is lower. Land costs less because there’s a ceiling on what the local population will pay. So while costs in the most desirable places, like Antigua in Guatemala or the coasts of Costa Rica, may cost more than you expected, they’re still going to be a good value compared to the most desirable places in your own country. Lesser-known spots are going to be even more of a bargain.

If you’re thinking of moving to Latin America to retire, there’s a climate for every wish, from tropical heat to eternal spring to four seasons. Sometimes you can get that whole range in the same country!

Once you’ve found a few locations that meet a lot of your wish list criteria, check prices online from home. You’ll probably be pleasantly surprised with what you can get for your money, whether that’s a colonial mansion in San Miguel de Allende or a cabin on a lake with a view of the Andes Mountains in southern Argentina. Then realize if you do it right, you’ll pay something less than what you see in the online listings. Rent for a year, get a good feel for the market, then you’ll be better equipped to find the best local values and negotiate.

The Cost of Living in Popular Retirement Areas

Whether you rent or buy, a place to live in Latin America is probably going to cost you a whole lot less than it would in a prime area of your own country, especially if you’ve cashed out your current house and are getting ready to retire. Apart from real estate though, what’s it really cost to live in these places? What are the monthly expenses going to be like?

Answering that question is not as simple, but there are a few publications out there that provide a rundown each year. The best-known is International Living, which keeps a close tab on housing prices, residency perks, and other factors important to retirees. Online only Live and Invest Overseas is their main competitor. ExpatExchange is a another good resource, with message boards for different countries. If you’re watching the budget, the book A Better Life for Half the Price is the best resource to read at leisure.

If you want to just get a quick overview of prices and how they compare to where you live now, the site Numbeo.com is a terrific resource. It shows costs for common expenditures and gives a sense of average real estate prices and salaries in that location. It will show you, for example, that average rents in Buenos Aires are 91.88% lower than rents in New York City! You can see that the average three-bedroom apartment or house rental in Boquete, Panama is $1,080 and the cost per square foot to buy is around $67. (So a house of 2,000 square feet would cost around $134K.) These are crowdsourced estimates of course, but will give you a general idea.

Some of the Expat Retirement Clusters in Latin America

Over the years, we’ve covered some of the most popular areas for retirees in our real estate section and we keep an eye on the sources mentioned above to watch the trends from year to year. Some of the places that were the most popular 10 or 15 years ago have fallen off a bit since then, which means there are plenty of bargains to be found. It’s a roll of the dice if you’re waiting for things to turn around, but you can find some very attractive prices if you have the money to take on more risk.

You don’t have to be wealthy to feel wealthy in some of these spots: two social security checks can be enough to cover your regular living expenses, so if you’ve got five grand a month to live on, you’ll feel loaded.

These destinations with a murky future usually have everything going for them but one. That one may be political instability, like you have for Granada or San Juan del Sur in Nicaragua. It may be crime worries–usually justified, sometimes–which would include Ixtapa/Zihuatanejo in Mexico or Roatan Island in Honduras. There may be financial instability, which is nearly always the case in Argentina. (Locals may see real estate as the one reliable place to put their money though, which is why Buenos Aires prices are relatively stable, priced in dollars.)

Here are some of the others where you’ll find a healthy expat community and an attractive cost of living to retire in Latin America.

Mexico – There are at least a million foreigners living in Mexico at any given time, understandable since this country in North America is easy to reach by flights or even by road. The most popular spots for retirees go from high-end Los Cabos to relative bargains Mazatlan and Zihuatanejo for the coast, with the Riviera Maya, Huatulco and the Puerto Vallarta region somewhere in between in terms of costs. Inland, the most popular cities and regions are San Miguel de Allende, Lake Chapala/Ajijic, Merida, Oaxaca, and San Cristobal de las Casas.

Guatemala – Antigua is the most popular city for both travelers and retirees, with beautiful Lake Atitlan coming up next. A smattering of foreigners live in Xela as well, also known as Quetzaltenango.

Belize – By percentage of population, Belize may have the largest collection of retirees in Central America. Most of them cluster in two places–Ambergris Caye and the Placencia Peninsula–but some others are in the jungle areas or Hopkins. This may be the best place to retire in Central America if stability is at the top of your list. This sparsely populated country is generally well-managed and fiscally prudent.

Honduras – Roatan is the most popular expatriate location here by miles, a gorgeous island right by the coral reef. Other foreigners are mostly on nearby Utila or mainland La Ceiba. The bad crime reputation is mainly due to the two largest cities, which nobody would ever retire to on purpose.

Nicaragua – A major up-and-coming hotspot until two years ago, Nicaragua’s expat (and tourism) numbers declined substantially when deadly riots broke out and the leadership started looking like a dictatorship. Those staying are hoping the 2021 election brings better times. Most foreigners are in the colonial city of Granada and the beach area of San Juan del Sur.

Costa Rica – It’s been a long while since Costa Rica was a bargain and real estate is inexplicably overpriced considering the level of local salaries. But 25 years of foreign buyers that hasn’t abated will do that. The retirees here tend to cluster on the Nicoya Peninsula, in the Guanacaste region, and on the coast from Jaco to Manuel Antonio National Park. The best values are inland, especially around Lake Arenal and the valley there.

Panama – There are a lot of good choices for retirement spots here and the country has done a great job of attracting foreigners: it’s easy to gain residency and there are a lot of perks for retirees. Everything is priced in dollars, including real estate. Panama also has some of the best health care in the Americas. The most popular area is Boquete, with others including Bocas del Toro, the Azuero Peninsula, Coronado, and Valle de Anton. Those who love urban life end up buying a condo in a high-rise in the capital.

Colombia – The favored location for digital nomads, remote workers, and retirees alike is Medellin, a city with enough altitude to have pleasant weather all year long. The top beach location is the walled city of Cartagena and its surroundings, with Santa Marta a distant second. The Coffee Triangle region that’s popular with travelers also has a smattering of foreign retirees. Many consider Colombia the best South American country to live in because of its easy flights home, a fun culture, good music, and ease of moving around comfortably within the country.

Ecuador – The clear winner in this South American country is Cuenca, which has nice “eternal spring” weather most of the year and is one of the best bargains in the Americas for living expenses. It may have the most foreign retirees of any city on the continent, so there are good clinics and hospitals too for healthcare needs. Other retiree spots include Vilcabamba, Cotacachi, and the various beach areas along the Pacific–though most of those are not year-round residences. Ecuador uses the U.S. dollar as its currency.

Peru – There are surprisingly few foreign retirees in Peru, presumably because it’s tougher to gain legal residency here than in other South American countries. The few who do end up here tend to be in Cusco or the Sacred Valley, though there are plenty of other pleasant places to live, like Arequipa.

Brazil – The largest country in South America hasn’t done much to lure foreign retirees and having to learn not-so-useful Portuguese is another hurdle. Most expats who gravitate here tend to live in Salvador Bahia, Rio, or Fortaleza on the coast.

Uruguay – A liberal beacon of stability on the continent, Uruguay has a lot going for it for retirees. Most who move there end up in the beach zones around Punta del Este or in the capital of Montevideo. There are very few population centers at all beyond those, so your real estate options are mostly limited to farms and vineyards.

Argentina – You need to be able to ride an economic roller coaster here, but if you’re coming in with dollars or earning them online, you’ll feel rich most of the time in Argentina. Buenos Aires is eternally popular, but more retirees find a version of paradise in Mendoza wine country or in Patagonia, especially around Bariloche. The lakes and mountains here present some of the best places to retire in South America if you’re looking for a country home.

Chile – Since prices are generally more attractive in neighboring Argentina, Chile only gets a smattering of foreign retirees. Some nature lovers, ski bums, and wine lovers gravitate here, but there’s no set expat center with a large cluster of foreigners. It’s better if you’re looking for a wide-open space where you won’t see your neighbors much.

Consider this your starting point if you want to retire in Latin America, especially if you want to be around lots of others like you who can speak English and be assured of a high quality of life. If you’re more adventurous, there are hundreds of attractive places all around Latin America where you can find your dream–for a lot less money than in your home country probably.

Orginal article: https://luxurylatinamerica.com/blog/2020/07/05/how-much-does-it-cost-to-retire-in-latin-america/