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February 2005 Why invest in Chile? That is a question I have been asked many times because Chile is not even mentioned in most conversations about South America. Brazil you think of beautiful beaches and the beautiful people that live there. Peru you think of mysteries from the long lost past. Ecuador makes you think of beautiful weather and inexpensive prices on land and exports. Argentina cheap land, good fishing and a very corrupt government. Columbia, well, you don't even think about it. Venezuela another hero of the little people and probably a nightmare for everyone else. But Chile, what's there? I would say a vibrant free market economy, and a place where with a little money and elbow grease you can make a life for yourself in the sun, be respected for doing so, and not have it taxed away into thin air when you're done. Chile has been the fastest growing economy in the Western Hemisphere for the last six years running and there really is no indication that trend will change in the near future.

Bill in Chile

Chile has a commodity-based economy whose primary exports are minerals, food, and timber as well as a world-class wine producing sector - all of these important exports keep Chile in a strong economic position world-wide as there is an ever increasing demand for commodies.

Tourism is now becoming a large part of the Chilean economy; Chile has natural beauty that can rival any country in the world, and it has great recreational possibilities as well: my son has been rafting, kayaking, fly fishing, hiking, and horseback riding. There are wind sports galore or you can just choose to relax and take in the natural beauty of the magnificent Chilean coast on a cruise ship; this is very popular way of enjoying Chile's beauty.

I have started two businesses in Chile with my friend and partner Andy Grimberg and feel very good about the future of our endeavors.

This is a different world for sure, but once you understand some things about the way the business culture works in Chile, and you show yourself to be a fair and honest person, many possibilities can open up to you. It is still a culture of large families and when you help someone from a family, such as giving them a job or helping them in some other way, you will have earned much good will and, in the future, everyone in the family you've helped will be willing to give you a hand. This has helped resolve many problems for me especially when I have needed help in getting something done in another part of the country. Seems there is always a friend of a friend who is more than willing to help you.

When the people in the town where I am building a hotel, realized that my partner Andy, and I, wanted to use local help and employ people from the neighborhood to do the construction work, our good will was paid back by the community ten-fold. On the first piece of property I bought in town, I offered a much lower price than the seller was asking, guessing we would meet somewhere in the middle. But the seller accepted my offer; I was not aware he was in such desperate need of cash, feeling great about my good fortune soon came to an end when I discovered his blight, then a buyer from Spain offered him 18,000 dollars more than I had, but we had closed the deal the day before: he had our down payment.

Andy and I could just feel the sickness in the heart of the seller, so we went to him and gave him the asking price. That act of compassion has paid us back 100 times over as the whole town knows what we did, and, so now, we are known as good people to deal with.

People want us to be in on everything now, they even asked Andy to run for Mayor. Which he respectfully declined knowing full well that would be the road to insanity: trying to undo a whole city of Latin madness would have been madness.

The new Mayor has become our friend and many doors have opened because of our investment in the community. There are problems in many areas that people in small town governments have no idea how to take care of; if you are a problem solver you can make a good living just connecting the right people in order to solve problems. We are in the process of solving one of the cities largest problems, with no cost to us other than phone calls which is going to pay us back monthly as long as the problem is solved.

Places to invest with good returns never seem to stop appearing; I am fully invested in Chile now except for my home in Montana which is for sale at this very moment, the increase in value on a home in Montana per year is nothing compared to the returns on capital investment I have experienced in Chile.

In the process of research I have discovered even not so well thought out situations often pay back a return you would never dream of in the States.

Would you like to build rentals and get 50% of your money back in the first year? It's possible, as a matter of fact, it's is very likely you will, and if you're in the right place at the right time you can do even better. But a 25% return is a no brainer.

This country is growing. Just follow the expansion and you will do fine .

Personally, I find it very easy to fail in the States, you really need to pay attention or you're going to get your head handed to you. In Chile, if you have even a modest amount of money to invest you are in a strong position. 

100,000 dollars won't do much for you in the States but I know a single mom with two children that came here from LA and has leveraged that small amount to point where she is now building herself a beautiful home overlooking the Pacific ocean, and living a life she could only dream about in the States.

Another friend in Chile that cannot hear or speak owns the nicest seafood restaurant in Puerto Montt; every time I see him I am moved by his strength to overcome such odds, but I also know it is because he is in Chile, where hard work pays off.
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Lake District in Southern Chile

He is Known as El Apa which is the name of his restaurant in the Angelmo Market on the waterfront in Puerto Montt. If you are ever In Puerto Montt you should visit this great place for dinner. Rentals is close as you can get to a sure thing, but buying land and properties has been very lucrative in all the places I've bought. I did my homework on where the expansion is going, but it was no secret; anyone can do it. I do not profess to be a real estate wizard but if I had returns in the States that I have had in Chile there would be people knocking down my door begging me to invest their money. I have never been into complicated business ventures; I've always kept things very simple. The reason I say that is I sense that someone with a broad business base could come here and identify many business opportunites that I can't see.

Something that would be of incredible value in Chile and would make millions if you put it together right would be a way for expatriates and foreigners to borrow money against property. You could get 8 to 10 % on your money and have your investment backed by land and properties that are worth 30 to 40% more than the loan value. Now where else in the world can you get that kind of return with that kind of protection.

I know we could use a system such as this for our ventures and we are not the only business in town with this need.

One of the services we offer in Chile is finding land for foreigners; they all want financing and they are not qualified as the banks don't lend to foreigners even when you are a legal land owner. If you are a citizen and you have not been in business for at least a year you cannot borrow money no matter what your asset base may be. That's is one of the maddening issues the government is promising to fix.

Now before you throw yours hands in the air and say that's crazy how can anything get done, realize its because of this stupidity that there are opportunities in many parts of the Chilean economy.
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Another great reason to invest in Chile are government incentives to do so. In the tenth region where I am building my hotel, the government is paying us back 20 to 33% of my investment because this area is in such need of this type of facility. 20% on my building cost and 33% on local labor cost as far as I understand it at this moment. The documents are at our lawyers office at this moment being turned into something we can digest without all the legal mumbo jumbo that legal papers are famous for no matter what country they are written in. I am no expert on laws in Chile of this kind, but when you are investing in the same direction as one of these incentive programs the governemnt has already decided that there is a big need to give incentives in order to fill a gap in the development of a particular region: your job is to fill that gap. This is a pleasant surprise we learned about just last week. Thanks to a family member of a young man we employ that happens to be high up in government. Remember that I mentioned small favors are valuable. Now if I've fired your appetite for Chile, you are proabably saying to yourself, but it must be a paper nightmare to get legal status in Chile.

Chilean Altiplano

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Take 15 minutes and it's free: its called a rout number. That number makes it possible for you to own property and a business with the same legal rights as any Chilean citizen. This country is not dumb; they can tax you; your rout number is a social tracking number: you put it on all major purchases and that way they can determine if you're working and making money. It's the IRS all over again.

It's a great country I didn't say it was perfect. But it is improving all the time, something even an eternal optimist would not say about the States.

Now for the hard economic facts of the country I would just go to Chileforsale.com Website and on the home page there is a Tab that says for buyers click on that and it has volumes of info. on Chile, some of the information is old but it is still current concerning legal issues.

The following statement is my opinion and I should of learned by now not to express it but here we go. Another wonderful reason to invest in Chile is Pinochet did a great job of cleaning the country up. His methods may have been a little extreme, shooting drug dealers without a trial is a bit harsh, but, hey, you can walk the streets of Chile at night and be safe: the police are probably some of the best in the world. Crime does not pay in Chile. In Argentina the rich live in gated communities with guards much like some places you see in the States, but not in Chile.

Chile is much different from other places in Latin America, all you have to do is walk down the street and look at your neighbor's house: no bars on the windows, usually a happy dog on the porch, and a family inside. Chile to me is what the United States will never be again.

One more thing that should be said about Chile is that English is not widely spoken, unless you speak Spanish or have a Spanish speaking partner you're going to have a lot of frustration. I do not speak much Spanish but I work on it daily, for some it comes fast for me its getting faster. So I am proof it can be done, but many times I have felt God was smiling on me the day I met Andy in Puerto Montt. Having a well connected partner is a godsend if you can find one. I feel partnerships probably have a much better chance of surviving in Chile than in the States because Latins are not as private as we Americans. They mix with others much more quickly than gringos.

I have had many dinners and many a good time with someone I have only known for 20 or thirty minutes. One family invited me for the weekend to their vacation home in Viña del Mar. After only speaking with them 15 minutes, I did go to their home and we have been friends from that time until today. Life is not all business; my Latin friends remind me of this all the time and I cannot think of a better place to keep it all in perspective than Chile.

The value of money is something to consider when investing in another country. I have watched the dollar drop in value against the Chilean currency for three straight years; the world is waking up to the fact that the US inflation rate is a lie that anyone with common sense can see. You cannot increase the money supply by 8% a year for 8 years in a row with only a 3% increase in GDP without a 5% inflation locked into the economy, I don't care how you look at the inflation rate.

In ten years that's 50% of your buying power gone. At that rate you better have plenty of money if you ever plan on retiring. If you live twenty years after retirement, your inflated dollar will be worth 20% of what you started with.

With all the baby-boomers retiring with you its going to make it pretty crowded down at the dumpster looking for something to sell at the swap meet.

Chile has reduced its inflation rate for ten years running and it's getting very close to 0. Little inflation is a law in this country and part of the good governing practices you find here.

There has been a war on poverty in Chile and it has been waged by making opportunities available and destroying policies that crush wealth. The Chilean government is smarter than the U.S. government; they don't take from the producers and give it to the nonproducers.

If you have questions about Chile please feel free to write me; I try to answer every email I receive. My only request is be specific: general questions are difficult at best. On the question of buying land ask about price range and what you want to do with the property.  Email Bill@ChileForSale.com

Cell in Chile is 08-2013847

In Montana 406-889-3689

The following is the first article that Bill wrote for the magazine:

Argentina For Vacation, Chile For The Good Life - Vacationing In Argentina And Buying In Chile
Buying Land In The South Of Chile ~ What You Might Find
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