Time for a little update on your favorite Guatemalan telenovela… Last time I updated, the big piece of news was that our land development’s deeds got approved!!
Complete with property titles!
It is a big middle finger pointed right at the council as they had required us to provide a lot of useless and costly studies (telling me straight to my face that they wouldn’t read them anyway but that was an attempt at getting a bribe to grease the process) and we never provided them, nor the bribe. Now out of 100 plots we have 95 deeds approved, and the remaining 5 are pending inspection because they are less than 200 meters away from the lake shores, and that is a lease we rent for 30 years at a time from the government, you can’t have full ownership of the shores. As the land was a cattle farm before that, no one ever bothered getting a lease, but thankfully we won’t have to pay any dues in arrears, they are too happy already that we are legalizing the process. We could have kept silent too, however, that would have meant going through that process once the land had a buyer, delays for the buyer, and maybe new laws in the meantime that could make things more complicated.
After all, this is a protected area, in close vicinity of the Maya biosphere, so environmental laws are likely to tighten in the future.
We are still pondering how many services we should provide to the buyers. Water and electric would seem obvious, however, selling first the posts nearest to the village, the new owners could ask for a connection to the public services without us spending a penny. That would mean a lower sales price on the other hand.
Last week, as we were driving back the cars we bought in Miami after importing them, we stopped at a hotel for the night, and stumbled upon two gentlemen who volunteer a month every year at a charity called Water for Life. They drill wells all around the country, and when they aren’t busy drilling free wells for charity, they drill paid wells to customers like us, and use the money to buy diesel and other non reusable goods needed on the free wells.
They flew over to our land a few days later to check where they could drill a well that would provide water to our first customers. The first 125ft drilled are part of a flat $10,000 fee, then you pay around $70 per extra foot. You don’t want to guess wrong, but you don’t have a way to know for sure there will be water where you drill!
The options were drilling near the lake shore, but on the government leased land, drilling a bit further up on full property land, or drilling on top of the hill, so you save money on pumping the water drilled down near the lake up the hill. They recommended the second option, not too high up the lake but on our land, in case the public authorities decide not to grant us the lease. It is also close to a power line so we can get 220W for the pump.
The last option is to forego the well and ask a neighbor if we can use his shores to pump water directly from the lake with a submersible pump which is expensive and could get stolen, while the pump on our land could be in a small locked unit. But there would be no well drilling fee, which could be 100% lost if they dig and don’t find anything, they don’t guarantee there will be water, even though they’ve been doing that 40 years, they say they have been surprised too many times.
Anyway, we are thinking it over at the moment.
It looks like things are going in the right direction, albeit a bit slow, but that’s ok, the more we wait, the more the land appreciates.
I also talked recently about how I got quite a bit of cash ready to invest at the moment, and investing more around here was one of my options. Many of you pointed out that it was not super wise to put all your eggs in the same basket, having a house and 90 acres of land around the lake already, but last weekend, BF and I took the boat out on an exploration trip of the nearby shores, and the change we saw in the short 18 months we have been there was impressive. That is a new hotel that was built during the past year:
Would you believe me if I told you the pictures don’t even start to do it justice?
Well, it’s true, the bungalows are charming, and so is the whole complex.
Here is another hotel that was built recently, even more luxurious:
They have full comfort with AC and flat screen and plush bedding in the middle of the jungle
Price tag: around $200 a night for the former, $300+ for the latter.
Not that long ago, much simpler hotels were the norm:
And I that is what I am offering now, meet my fully finished luxury double room:
Straight on the lake…
And with total privacy. I raised my rate at $70 a night after seeing that the competition was still three to four times more expensive. What do you think? According to some of our Airbnb guests it is “a unique piece of art” and they were “blown away by the beauty” of my place.
Anyway, potential investments could be a couple more waterfront plots with the mid to long term in mind, either to build more rooms or a single family home and put it on the market once it is finished.
I am also thinking about building a second stone room, a bit smaller than the one above, as this is my usual bedroom and I only rent when I am traveling which is a lot, but would be nice not to have to move my clothes and personal items around or worry about snooping guests. I would rent one full time and live in the other one, plus have the two more basic ones to rent as well.
Expected costs for a new room, complete with AC unit, mattress, etc is around $15,000. I can make back the investment in 214 nights rented at $70. Prices go up for Christmas and Easter too. Say 200 nights.
So far the last 3 months I have rented an average of 15 nights a month, I expect a lower rate during the rain season June to September, let’s say I can average 7 nights a month, and make my money back in two and a half years. Few rental properties pay for themselves in such short periods. However, that would mean enduring 3-4 months of intensive work, with half a dozen builders banging and drilling and screaming and spitting all over my land. Just when I felt it was finally over… Don’t know if I am up for it just yet.
That’s it for now, what’s new with you?
This post was featured on the DQYDJ, thank you!
Great update Pauline. The hotel (and your room) both look awesome. In fact, I think your room looks better which is great that you can underprice the competition and gives you a fair bit of scope to increase prices once you’ve got the “business” up and running.
I like the idea of investment into further lakeside rooms, especially if you believe that the demand is there (once you comfortably get your property rented out for over 200 night a year).
Thanks Graham, I hope it is a sound investment.
Wow, those are very nice hotels!! That should mean there is good clientele to buy your plots. Good luck with drilling for water, it’s always such a risk! That’s neat that you met those people in Miami and they drill in Guatemala.
2.5 years to recoup your investment in a new room is pretty good, but like you said, you would have to put up with another construction crew. I remember how much you hated them last time, so maybe sit on that idea for awhile?
Oh no we met them when we went to the Caribbean coast here to bring back our cars from customs!
Great update Pauline! I had never heard of that charity before, they sound very cool. It’s amazing to see that change over such a short time span! I know I was one of the ones who said not to put all your eggs in one basket, but if it’s growing like that and you can make what you can, I’d be awfully tempted to continue doing what you’re doing. 🙂
I know, that’s tempting! Riskier, but potential yields are much higher than established markets…
A coworker is retiring in the next 18 months. She and her husband are planning on retiring south and Guatemala is one of the countries they are investigating.
I told her about your development but they are not prepared to build and are looking for something easier. She just wants to paint landscapes while her husband putters in a garden. They are planning several trips to visit prospective developments in areas friendly to foreigners.
I sort of thought that retiring to somewhere so south was a very unusual idea but there seems to be many, many Canadians who are planning retirements somewhere other than the traditional destinations of Florida and Arizona. My coworker says that catering to foreign retirees is big business in several countries.
There is quite a market for sure. But my niche is a bit smaller in that we are in the North, which is hotter than the spring like highlands, and the whole region is a bit rough so if you are looking for Western standards it is better to go to the South which has a bigger expat community. Some developments are amazing and offer you Western living at a fraction of the cost.
I think I would try to keep water access on land that I owned outright. The last thing you want is someone to have that kind of power over you and the people on your development once people start building and settling in.
The public land is owned by the government, which is less problematic than the small town council, and not sraight on the lake so the gvt would have a hard time justifying they want it back for a project. If they did they would have to pay any improvements so we would have the drilling fee back, but that would be a hassle for sure.
Pauline,
Your hotel room looks awesome! I wouldn’t be surprised if you could actually much more per night for your rooms. Yours has a much more authentic and interesting aura about it than the cookie cutter ones pictured above. You can find fancy hotel rooms like the earlier pictures anywhere, but yours is truly unique!
Thanks Derek! It is unique that’s for sure but for a different niche that the one of people looking for full comfort and international standards. My garden has turkeys and chickens!
It looks very romantic and relaxing. How I wish I can spend one week to unwind such a beautiful hotel in the remote atmosphere.
Thanks Walt, it is a very nice region.
I wonder if you might kill two birds with one stone if you raised the nightly rate to $100 or more. Fewer guests, potentially, but then that might free up some additional time for you to consider other projects, while still getting the same (or more) for your bottom line.
That is a good idea, however I don’t think I should have a $100 room if I am not providing hotel services, like 24/7 reception or just a more hotel-y feel. Though there is a market for people paying more.
Wow – that’s a lot of change in year. The new hotels look very luxurious but I think your room is just as lovely. Plus, a lot cheaper. I suppose the bigger hotels may have some more amenities but sometimes people don’t want all those extras and would rather not pay for them. Tough call on whether to add more rooms. I understand the desire to bask in a little peace and quiet after finishing a big project like that but it does sound like it would be a good investment overall. I would get tired of having to move my things in and out of my room after awhile. Options are always good!
Good point, I think the rate difference makes up for the shortage of amenities. Leaning towards building the new room so the current one is fully mine.
Wow, first of all, congrats on getting your land development deed approved! You must be thrilled and that’s one huge step forward.
The hotels you posted look beautiful, but equally as beautiful is your room that you’ve been renting out. Adding more rooms can be a great investment, as after the initial build there are very few overhead costs. I’m interested to see what you decide!
I love it! I’m so glad to see you developing the land in such a positive way. With the way it looks like things are going, the second room would probably be a good idea, especially since you wouldn’t have to move all the time. It certainly is beautiful in your little corner of the world.
Wow does that look amazing! First time here do you have a timeline post of what you have done down there?
Hi Evan, yes I do! You can check the old posts here https://reachfinancialindependence.com/guatemala/ although thanks for the idea, I need a before/after post all in one.