The world’s best-kept retirement secret

By Kathleen Peddicord
International Living

The war is long over, but the bad rap remains. Today's Nicaragua is an inexpensive paradise eager to welcome expatriates. Nicaragua is virtually unknown to most people and usually misunderstood, which is why forward-thinking investors can find some of the best real-estate deals on Earth in this country. For the record, Nicaragua is not in the midst of a civil war, and it's not a communist state. The country has, however, suffered from a serious case of bad press.
Nicaragua is one of the most beautiful countries in all the Americas. It boasts a dramatic Pacific coastline; long, gentle Caribbean beaches, volcanoes and freshwater lakes dot the hilly inland. Colonial cities like Granada and León offer visitors a taste of days gone by, while Managua, the capital, is rapidly becoming a real first-world city.
The country's most famous beach destination, Barceló Playa Montelimar, is a 290-room, all-inclusive resort with four restaurants, an airstrip and miles of secluded beaches. Farther south is the popular town of San Juan del Sur, where cruise ships dock regularly. The town is quickly becoming a hot spot for North American expatriates.
Masaya is home to Nicaragua's best craft market, offering just about anything that's hand-crafted in the country ceramics, leather goods, iron work, hammocks, jewelry, rocking chairs, masks, clothing . . . you name it. There are five active volcanoes at nearby volcano Masaya National Park offering the best volcano viewing in Central and North America. It's the only place in the region where you can see hot magma rising from the depths of the Earth and you can drive right to the top.
Lake Nicaragua, the 10th-largest freshwater lake in the world, is famous for its freshwater sharks, the only ones in the world. The lake has great sport-fishing and archipelago of  350 small islands. The islands of Lake Nicaragua were created hundreds of years ago when the volcano Mombacho exploded. Today, you can explore this extinct volcano along trails in the cloud forest. You'll see more varieties of orchids than just about anywhere else in the world and all kinds of wildlife, including 170 counted species of birds and blue morph butterflies.
You can also take a canopy tour, shooting from treetop to treetop on harnessed zip-lines. Safe and stunning Nicaragua is a nation at peace. Its government is democratically elected, committed to a free-market economy and eager to attract foreign investors. A recent study by the Inter-American Institute on Human Rights and a survey of police forces in the Americas show that Nicaragua is the safest country in Central America and one of the safest countries in the world. Recent studies also point to Nicaragua's low reported crime rate lower than in Germany, France or the U.S.
The current president, Enrique Bolaños Geyer, elected in January 2002, is committed to progress and development for Nicaragua. He says, "Today's Nicaragua is working to meet the challenges of global competition, and I offer my government's support for your future business activities in our country."
In September 1999, Nicaragua enacted the most attractive and most aggressive tourism-incentive law in Latin America. If you've ever toyed with the idea of owning your own B&B, running a sailboat charter, leading adventure treks into the jungle, dishing up meals in your own restaurant or operating any kind of tourism-related business, Nicaragua is the place to do it.
Law 306 is sweeping in scope and offers hard-to-beat benefits for investors who take advantage of the program. If your business qualifies, you pay no income for real-estate taxes for up to 10 years. You can bring in (or buy locally) all the supplies you need from furniture and boats to linens and cash registers tax and duty free.

If you're simply in the market for a place to relax and spend a few months a year in a quiet, safe, affordable retreat, again, Nicaragua is hard to beat. The country's retiree incentive program is much like Costa Rica's was in the 1980s, attracting thousands of expatriates. To be eligible, you need only be over 45 and have a monthly income of at least $400. The benefits come mostly in the form of tax incentives.
As a foreign retiree, you
-pay no taxes on any out-of-country earnings.
-can bring into Nicaragua up to $10,000 of household goods for your own home, duty-free.
-can import one automobile for personal or general use duty- and tariff-free, and sell it after five years, tax-free.
-can import an additional vehicle every five years under the same duty exemptions.

 The cost of living in Nicaragua is a fraction what you're used to paying up north. Our sources on the ground say a two-week supply of pork and beef costs about $65. For enough fresh vegetables to feed four or five people daily for a week, expect to pay about $55. A 30-minute consultation with a U.S.-trained physician will cost you about $35. You can hire a maid who will cook, clean and do your laundry for less than $120 a month; and you'll spend just $25 on a wonderful restaurant meal of local delicacies, including with wine and dessert.
Because most of the world still believes Nicaragua is a country full of problems and political unrest, local real estate, especially waterfront real estate, is undervalued.
Developers are scurrying to build along the Pacific Coast, where the government is improving the local infrastructure by paving roads and improving tourist areas.
Not too long ago in 1997 we looked at raw land on the Pacific, a lot here and there for sale without amenities. Only one "development project" was under way. Now, you have several to choose from, all with water, electricity and views of the surf below. While it's true that prices are already on the rise, it's still possible to find bargains. One development on a hill outside the town of San Juan del Sur has views of the harbor and the pristine coast. The development is a walk to the beach and a five-minute drive from town. Four years ago, a lot here with water, electricity, and paved roads started at $39,000. Now, an oceanfront lot in San Juan del Sur, with a home, can sell for up to $385,000. Yet, because Nicaragua is still booming, there are plenty of new developments emerging and a number of good deals remain along the Pacific Coast.
Near Granada you'll find lake Apoyo. This crater lake, formed over 21,000 years ago when a volcano erupted, is the largest crater lake in the country and one of the most beautiful. The views from the top stretch over the hillsides, taking in the blue waters below. Because of its elevation, lake Apoyo is generally five degrees (Fahrenheit) cooler than Granada, just 15 minutes away. Its pristine water has therapeutic qualities, thanks to the sulfur and other minerals, and the temperature is 85 degrees all year long. It is in a Nicaraguan natural reserve and a proposed UNESCO World Heritage site. Large three-bedroom, two-and-a-half-bathroom villas on the shore of Laguna de Apoyo can be purchased for $170,000 to $190,000. Each has views of the lake and volcano Mombacho, access to the lake and all resort facilities. Across the lake, one-acre beachfront lots are going for $90,000. Charming Granada, on lake Nicaragua, is the jewel of Nicaragua's colonial crown, the second-oldest city in the Americas. Its large central plaza is surrounded by 16th-century colonial buildings, great restaurants, museums and other entertainment.
You can pick up a vacant lot in an area of town where you might not want to live right now, but could probably live in a couple years, for around $45,000. You
could also buy a habitable two-bedroom, two-bathroom house within walking distance of the center of town for around $80,000 to $100,000. Fully restored three-bedroom, two-bathroom colonial homes are going for $150,000 and up. Word is getting out about this country. But it's not simply because the property deals are so attractive or the cost of living so affordable. It's because this country boasts a stable democracy, a booming economy and one of the most comprehensive incentive programs anywhere.