Investing Apartment Colombia - Finance and Roi

[Luuk Kivits]

Hi all,

I am Dutch and my girlfriend is Colombian. We live in The Netherlands and would like to invest in a single family apartment for longterm rental in Colombia.

I am looking to talk to someone with experience investing in Colombia as we have come across some challenges.

My girlfriend already owns 1 apartment in Ibague, a relatively small city close to Bogota which is expanding quite quickly among locals. The main advantage of this city is that family lives near and can take care of the management. This is also the reason we would like to find the next real estate in this area.

Many of the appartements we have looked at are 33000 euros with a monthly rent of 200 euros. Monthly 0.6% or 7% yearly seems little considering administration costs of the appartment building are not included. When looking at more expensive appartements, the ROI stays similar. Is such ROI common in Colombia and/ or price range? Or are we not looking in the right spot?

The mortgage with Bancolombia got recently approved, the rate is variable and increased during the application to 20% and is still increasing. The rent will no longer cover the mortgage payments at this rate. Due to the increased interest in the Netherlands a loan here won't be covered by the rent either. We have sufficient funds to purchase the appartment in full and are unsure if this the best way to go forward.

Any advice or information is welcome! 

We are happy to explain more about our investment, experience with the bank and mortgage application.