“Kathleen, you write much about Nicaragua as a possibility for retirement,” writes reader David M. from the United States.

“I am in agreement for the most part. However, as opposed to Panama, about which you are very frank concerning the downsides, I have not read anything about the problems in Nicaragua.

“Most prominent in my mind is the shortage of electricity. The country’s electrical system is a mess. Before the Sandinistas came to power, the electrical system was sold to a Spanish transnational. The last time I was in the country, there were random blackouts, unannounced and sometimes lasting many hours.

“Friends who live in Nicaragua say that the situation has improved somewhat. There are still blackouts, but they are scheduled, which at least allows people to make alternative arrangements…”

Should you live, retire, or invest in Nicaragua?

And, if not…why not?

I’ve been investing in Nicaragua for more than a dozen years. I own several pieces of land in the country, as well as a little house overlooking the lake outside Granada. And I’d invest further today if presented with the right opportunity.

Furthermore, Nicaragua figures in our long-term plan. It’s one of the places we’ve put on our “retirement radar”…one of the places Lief and I plan to return to regularly once we’ve flipped the switch to the retirement phase of our lives.

In other words, I’m sold on this little country with such a big heart…this land of lakes and volcanoes that also boasts a beautiful Pacific coast and the most romantic city in the Americas (colonial Granada).

But here are good reasons why you might take a different position:
As the dear reader above explains, the infrastructure in Nicaragua is unreliable and under-developed. Not only the electricity (the supply of which, as your fellow readers points out, is cut off with some regularity), but also telephone and Internet. Don’t move to Nicaragua to be a day-trader.

Many of the roads in Nicaragua are dirt. And rutted. And impassable when it rains. Some of our best “Do you remember the time…” stories have to do with trying to travel Nicaragua’s dirt roads during the rainy season.

Nicaragua is a little country. Its capital and biggest city, Managua, is a small town. You can get what you need…but you can’t always get what you want.

That is to say, don’t move to Nicaragua for a life of luxury. In Nicaragua, you’ll enjoy a life of adventure in a land of beauty. But this is one place where you can’t live the high life, no matter how much you’re willing to spend trying.
These are reasons you might not enjoy living (in retirement or otherwise) in Nicaragua. Here are two more why you might not want to invest in this country either:
Clean title. The piece of real estate the guy you met in the bar in San Juan del Sur is trying to sell you might not have it. Before you buy any piece of property in this country, make sure you understand the history of its ownership. Was it ever cooperativa land, for example? Bottom line, if you decide you’re comfortable investing in this country, don’t do it without investing, as well, in title insurance. (For this, I recommend First American Title, http://www.firstam.com.)

President Daniel Ortega. Sandinista Danny makes people nervous. When he was re-elected in 2006, foreign investors pulled out quick and have taken a sidelines position since. So far, El Presidente hasn’t done anything to cause any trouble…except buddy up publicly with Hugo Chavez. Again, some foreign investors see this as cause for concern. If the Ortega Factor keeps you up at night, put your money elsewhere until he’s out of office (in about 2 ½ more years).
Kathleen Peddicord www.liveandinvestoverseas.com