Cuenca Real Estate Scams And Cons
Cuenca, Ecuador - As growing numbers of retirees arrive in Cuenca to take advantage of the lower cost of living, many real estate agents and locals are waiting to take advantage of them. Unsuspecting or uninformed expats are the most popular targets for real estate scams and real estate cons in Cuenca. With few local friends to warn them away, these new arrivals make for easy prey.
To avoid real estate scams in Cuenca, you need to do your research. Understanding the most common types of real estate swindles in Ecuador will also help. Here's a quick overview of some of the real estate con jobs that have popped up on the radar in Cuenca to help close your knowledge gap and help you avoid being taken to the cleaners.
Cuenca Con #1: Not Owning The Property
One scam that is seen in Cuenca is when the person selling the house is not the actual owner of the house. This real estate scam is more common when dealing directly with locals rather than through a real estate agent. In Cuenca, most professional realty agencies offer some kind of title research or title insurance to protect against this scam. Part-time agents who are not affiliated with an agency or "friends" helping you buy a place do not do this research, and it makes you more vulnerable as a buyer.
This scam has become less common as expats buying a home in Cuenca become more informed. However, it's worth mentioning because it has some of the most serious consequences for you as a property buyer. Often you will discover the scam only after the money has been transferred and your "friend" has disappeared. Ecuador does not have a great system in place for tracking people down who have ripped off foreigners, and there is little chance that you will be able to recover your money.
Cuenca Con #2: Misrepresenting The Property
Another very common real estate scam in Cuenca is misrepresenting the size of the property for sale or for rent. Basically, before you buy anything in Cuenca - or anywhere in Ecuador - get your own measurements of the property and figure out what is and isn't being included in the square footage.
Sometimes this scam isn't even meant to be evil - it's just that Ecuadorians often include areas of the home in their square footage descriptions that expacts don't. For example, terraces, garages, and even sidewalk space has been known to be counted as a part of the home. I've always felt that if you can't sleep in it, eat in it, or use it as a bathroom, then it's not a room. Since the price per square foot is an important apples to apples data point when comparing properties, you'll want to be sure that you get your own set of measurements.
Cuenca Con #3: Misrepresenting Themselves
Along with misrepresenting the size of a property in Cuenca, some property sales agents scam buyers by misrepresenting themselves and their relationship with the property in question. They may pass themselves off as licensed real estate agents and they may insist they have an exclusive listing on the property. Some "friends" may even pose as the owners of a property to make you feel like you are getting some insider deal on a place.
Run away, fast! If something sounds too good to be true, it is. This is doubly true in Ecuador.
It is not currently required for real estate agents to be licensed, and so most are not. Even CuencaRealEstate, one of the oldest expat-oriented agencies in the city, does not have its own (it operates through an associated agency's license). There's no scam going on there and I don't want to imply that - I just want to point out that the guideposts we have in other places, like licensure, don't apply here.
Instead, it falls to the buyer to do extra due diligence on their real estate agents here. Ask about longevity in the market. Ask for testimonials. Ask around at Carolina's Bookstore, the Inca Lounge, or at one of the city's gringo nights for information about local real estate agent reputations. The owners will give you an earful, as will local residents, about their experiences, positive and negative, with the various players in the real estate market. If your agent is unknown, be wary - the expat community here is still relatively small and close-knit, so reputable agents are well-known. Shop around and don't let anyone pressure you into immediately buying something if you're not 100% confident of their character.
Concluding Thoughts
Buying a new home in Cuenca or any other foreign city requires you to be on guard and do more research on your own. Cuenca real estate scams and cons do exist, and they are perpetuated by gringo realtors and locals alike. If you are a new arrival, you will find many friendly and wonderful people here, but the few bad apples can leave a big mark.
If you know of a real estate scam in Cuenca or have heard of a Cuenca real estate swindle, mention it in the comments below! I'll moderate for obscenity and verify where I can with my local sources, but it's my hope that this article can grow and provide some protection for new arrivals so that their real estate experiences in Cuenca can be positive.
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Comments
- AUTHOR
Both are good options overall ... but if you're just checking the city out or are in South America for the first time, it's better to get a short term rental in Cuenca before investing in a home!
This hub and the comments were filled with great information. It definitely sounds like home ownership is more complicated and convoluted then it is in North America. I suspect renting might be a better option.
- AUTHOR
@AmyWriteNow - Macrina Serrano was formerly based out of Turi, where she was on the PTA board there until some accounting irregularities appeared. I do not have all the details, but some of the other expat forums (such as the yahoo groups) carry the back and forth. She has since relaunched herself as a real estate agent in Cuenca. Thanks for the heads up about what to expect from her in that line of work!
- AUTHOR
Hi Fabina - You seem to be mistaken - those are three different companies run by three competing groups of people! Cuenca Real Estate is David Morrill and Kathy González Corral (best known for their International Living ties), Cuenca Central is Perry, Juan Carlos Granda, and (formerly) Michael Edwards, who has since left the firm. Cuenca Condos is Benjamin Wheeler-Harsh. Not sure what your experiences have been, but it pays to not confuse the three!
There you go again. Michael B . and his thieves at work. Cuenca condos, Cuenca central and Cuenca real estate are one and the same . Don't be decieved you get what you pay for. Wish these crooks would leave our city it would be a better place.
You forgot the rental scam of friendly locals inflating the prices for gringos. I got shown a house by Macrina Serrano out by Monay Shopping Center and she told me it was $600 a month for a year lease. Thank God I didn't rent it right then - the same house is listed on www.CuencaCondos.com for $450 per month for a year lease. In the end I didn't take the house at all, but wanted to warn other people about her. I thought I was getting an "insider's deal" working with a Cuencana, but she was dead set on scamming my ass out of an extra $150 per month.
- AUTHOR
Hi Sandy,
The lawyer vs. realtor debate often depends on the quality and experience of the individuals in question. In Cuenca, we have one or two very good realtors who will do title searches, deal with taxes, correct land survey problems, and so on. Then there are the rest ... and the same is true of lawyers who promise much and deliver little. One thing that is great to ask for from either one is a list of what their services include - do they do title search or is it the buyers responsibility in their mind, for example? If you have it in writing it shows organization on the part of the person you are working with (always a plus) and lets you know what you need to cover with a back up professional. Hope that helps!
Jen
Whew! We bought a property in Tumbabiro but have friends looking in Ecuador. We didn't buy from an Ecuadorian owner and used a realtor. Our friends want to use a lawyer rather than a realtor, thinking the lawyer can do the title search, etc. I have advised them this is a bad idea but would like some feedback from some of you, please.
Thanks! Sandy
- AUTHOR
Just got wind of a new one. If not a scam, this is certainly a serious complication. It has to do with usage rights for a piece of land - evidently the seller had underage children who were entitled usage right to the property, and their claim to the land held up the sale. Just another example of why it pays to know EVERYONE involved with a piece of property before buying!
- AUTHOR
Thanks for the comment, Dom. I agree - homes where the owner has recently passed away are kind of worrisome if you're not sure you've tracked down all the right family members.
Good article. I agree, for me the most common scam in ecuador is when one property owner wants to sell you their property and even agrees in principal...only for you to find out later they weren't the only owner and the others don't wish to sell... this is especially prevalent after deaths...
- AUTHOR
Thanks for reminding me of this one! I see it on the rental side of things here too - a place will have a contract with the husband and then the wife's family swings in and won't let them rent it or they demand more money. Naturally, people run from that and I don't blame them, I just feel bad because we all want a good apartment and it sticks that this stuff stands in the way.
Another scam has to do with legalities of the contract you sign. A buyer must have all family members of the property sign the sales contract. After this is completed, and just before you begin to build, an unsigned family member of the property will suddenly show up, saying that they have been living elsewhere and were unaware the property was being sold. In order for the buyer to get his/her signature, it will now cost them twice as much as the original price. If the buyer will not pay, they can lose the money already paid, or take the family to court which likely will take many years and huge lawyers fees, with no guarantee of winning the case.
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