FAQ – Frequently Asked Questions

Why the discrepancy between chilean peso prices and us dollar prices?

We´ve tried in a number of ways to explain this – youtube video and templates to each post- but still we get this concern a lot. We aren´t trying to profit from exchange rates nor to confuse anyone. The prices shown are only estimates. If you´re buying in US$ then your final cost will likely be lower than the price shown on the website listings (specific property pages).

We´ve been doing this a number of years for hundreds of properties, and we´ve used the same ratio as when we started. Furthermore, we are additionally adding 5-10% to estimate all closing costs.

The short answer for “Why haven´t we changed this method or exchange rate?” is that we´d rather you be pleasantly surprised than to do a lot of work to update the site´s old listings…in the end, it could be equally confounding and likely to result in under-estimated prices after the dollar is no longer = 700 chilean pesos.  [SEP 2015]

Rest assured that when you get serious about a property, all this costs will be re-calculated and explained per item at the present values.

Note: “The List” shows the seller´s asking price, then the USD dollar price (outdated). After we show a yet higher price on the website to estimate all closing costs.

Where are you?

We are in Chile. Full-time residents of Chile. We don´t live or work anywhere else. Just Chile- west of Argentina, south of Peru.

You have a USA phone number. Why?

It´s an extra feature on our Skype account. We added a USA phone number (412-447-1950) and unlimited calling to the USA. We receive a lot of inquiries from the US, and these features allow us to communicate more simply and without high international phone bills…you have the option of calling us as you would any US phone number. It´s all Skype-based. We do not have an office in the United States, and don´t live there.

What´s a RUT? Investor´s RUT? ID Card/Carnet?   Changes in Obtaining an Investor´s RUT in Chile – August 2014

Recently, we’ve heard reports that the SII – the Chilean tax authorities-  have tightened up what was once an easy process for obtaining an investor RUT. So I went down to the local office and spoke with the SII staff to verify this. Here´s the deal:

Over the last few years, some people have been providing the “service” of obtaining RUTs for others who are out of the country; but they’ve been charging silly amounts of money, and making false promises about what can be done with an investor RUT. Such unprofessional/ predatory practices resulted in many foreigners arriving to Chile with confusion about what they were able and authorized to do with their investors´ RUTs. Consequently, and rightly so, the SII enhanced their requirements to issue new RUTs.

For anyone who’s not familiar, the investor´s RUT is only a taxpayer ID # for the purposes of buying property, starting a business, and other investment activities. It will NOT allow you to work; and it will NOT help you to receive a visa; and it will NOT help you open a checking account, nor anything else not expressly permitted.

 

READ MORE ABOUT THE RUT APPLICATION IN THIS ARTICLE

How often is this site updated?

We generally update the property listings once per month. In the busy times of the year it might not happen – our first concern and attention goes to the clients we currently have or who are arriving soon. Also, we try to update the SOLD properties as soon as they are confirmed closed.

Where are you finding this information? Are these your listings?

Suggested Reading:   Finding Land in Chile  …what they call “giving away the recipe”

We look at hundreds of properties every week- meeting in person by referral, in newsprint classifieds, networking with brokers, and in local online classifieds. We also receive some properties directly from Chilean sellers. 

Few of the properties shown on our website are “our listings” under contract. Generally speaking, we have not been to many of the properties, we simply translated the information – this is particularly true of the older listings (numbered in the 500s or lower). When you see a property you want to know more about, contact us, and we will make a better inspection of the property and interview the seller.

We’re only looking for a small building lot. Why are these parcels all so large?

We like land and we know land, so this website focuses on larger parcels. However, we’re happy to help you locate a small plot if that’s what you’re looking for, you just need to tell us. 

We rarely post parcels that are smaller than 3 acres (usually only ocean-view or lake-front properties). Note: More than half of the parcels available in Chile are 1/2 hectare (1.24 acres)- this is the most common lot size. There’s an enormous availability of small parcels and easily found in the location you want.

How much are sales commissions and taxes for these properties?

It depends- case by case. The prices shown on this website are estimates of the total price, including sales commissions, taxes, and all closing costs. There’s “a first time for everything” but so far the final prices have been less than our original estimates. When you’re ready to make an offer, we will give you an itemized break-down of expenses… it will almost certainly be under the price you original saw posted on our site.

Are the prices negotiable?

Absolutely. We hope to be your representative in a purchase, and we will certainly give you our opinion of value. In many cases, we encourage you to make a lower offer. But be aware, so many are selectively chosen because they stuck out as better deals – you´ll notice they tend to get sold before long. So if you find a property that’s perfect for you and priced well, you might want to tie it up.

 

Closing Costs

Closing costs are fairly low in Chile- you should budget 3-6%, but it can be lower, depending on the value of the property (the higher the value, the lower the percentage) and whether there are other sales agents involved. Costs can be broken down as follows:

  • Typically, a buyer’s commission is 2% – 3% + taxes    In Chile, the norm is for buyers pays their own broker a sales commision; and the seller to independently pay their borker (if any).

  • Title search: 0.5% – 2% (max)

  • Notary costs: us$100 – us$1000, depending on property value

  • Consulting fees (banking, tax numbers, powers of attorney): us$2,000 – us$4,000

REMEMBER: We have tried to estimated all these expenses and included them in price of the property listing on this site. In other words, the prices you see are usually the maximum final prices, based on a “full asking price offer”.

Can I invest in Chile as a tourist?

Yes. Chilean laws are very clear, friendly and consistent for foreign investment. Regarding purchasing property, your citizenship and visa status are irrelevant, and you have exactly the same legal rights to property as a Chilean national. But beware that you may/will have visa concerns for other issues.

Are mortgages available for foreign buyers?

Chilean banks are conservative and slow to lend (even to Chileans). Unfortunately, it is extremely difficult for individual foreign investors to obtain mortgages in Chile. Before you try to even think about applying for a mortgage here, you would need to establish residency, bank accounts, local credit history, etc. for At Least a few years. Short answer: You should expect to make your real estate purchases in cash.

How much are property taxes in Chile?

Compared with most western countries- property taxes in Chile are quite low. And rural/agricultural property taxes are particularly low. Some parcels will have a low annual tax (contribuciones) and others will have no tax at all, other than a one-time sales tax when it’s sold. We will report to you on all tax requirements before you you make an offer on the property.

Do I need to be in Chile to complete a purchase?

No. If you can’t be present at contract signings and/or closing, you can appoint someone to act on your behalf via Power of Attorney, or you can give the power to an attorney to do the same. But keep in mind it´s easier to make such powers while in Chile. It can be done from abroad, but you´ll have a few steps added in order to make it a legally recognized document in Chile. It´s not fun, so if you want to give someone the power to sign documents, do it while in Chile if at all possible.

Can I build a home on my land? Are there zoning requirements?

In the Chilean countryside, there are very few specific planning requirements. So long as you’re not going to build anything of serious environmental impact, you should have no issues with building whatever you want.

Are small-scale farm investments economically viable?

Yes, very much so. And Chileans definitely care about their food quality and there is a demand for organic foods. If you are managing and living full time on the property, then it is possible to make a living from what is considered small-scale agriculture in Chile (under 30-40 hectares of productive land). But if you want to purchase a small vineyard or orchard and manage it remotely by contracting a farm manager, then you should understand that there is little chance of doing anything but breaking even for many years.

If you are a purely passive investor, then we should have a one-on-one conversation about your goals.

Please be free with any questions you may have!