THE BLOG
10/10/2014 07:03 am ET Updated Dec 06, 2017

Lock The Door And Don't Let Any More of Us In

What did one gringo say to the other gringo?

"This used to be a nice little country until all the darn gringos showed up!"

It may seem surprising that one of the most common complaints from expats living in a foreign community is about the number of other expats living in the same community. But expats themselves are often the first to notice the effect that an influx of foreigners can have on a popular expat destination.

In fact, we were recently on an Ecuador expat Facebook page and saw a post complaining that more incoming expats would mean the ruin of the very culture expats were moving to the country to enjoy.

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Photo: Erica Mills, InternationalLiving.com

The post was from someone planning to move to Ecuador...they hadn't even left the U.S. yet. This future expat was worried that future expats would spoil the country for him. The fact that he was actually the very thing he feared was apparently lost on him.

There are always a few expats who feel that, once they arrive in a country, no other foreigners should be allowed in. As soon as they're settled, they'd like all talk of this great place they've found to live or retire to cease (except for their own blogs and posts about what a great place they've found to live or retire). No matter when they arrive, they seem to believe that it is those who come after them that pose the biggest risk of ruining their paradise.

But most experienced expats know that they have very positive effects on the locations they settle, and that any negative effects are often exaggerated.

It is a fact that the arrival of just a few dozen North Americans...with North American tastes, attitudes, and dollars...can cause ripples in local economies and cultures. Especially in tiny villages and towns in poor countries, even small monthly U.S. Social Security payments can look like fortunes.

That's why locals often assume that all North Americans are rich...because, compared to many local standards, they are.

And a smart local business person will do what any business person anywhere would do to get some of that influx of new money. They will develop products and services that the people who have that money seem to want. And they will charge prices for those products and services that the people who have that money seem willing to pay.

If an expat knowingly or unknowingly pays more than the local established rate for products and services, prices will rise...sometimes above prices the locals themselves can afford. This can happen with anything from real estate prices to labor rates to taxi fares.

All it takes is a few expats who are unaware of or don't care about standard prices in the local economy. They may jump at a rate for a gardener or housekeeper or piece of property that is an obvious bargain compared to back home...even if it's three times the standard local rate. Or they may decide to pay U.S. prices, especially for labor and tips, simply because it makes them feel generous or less guilty about taking advantage of low local prices.

This can quickly skew local economies, especially in small towns. Expats who have been there a while and know the going local rates will naturally complain about their less experienced fellow expats ruining things for them. And they have a point, as do locals who complain about the same thing.

However, the impact of an expat population with North American money, tastes, and attitudes is often exaggerated. In places like Merida, Puerto Vallarta, Cuenca, Panama City, Montevideo, and other popular expat cities, the percentage of expats to locals is actually tiny. And because these places have their own thriving middle and upper classes, the effects of expat money on the local economy is fairly diluted.

However, North Americans do tend to stand out in crowds...especially Latin American and Asian crowds...so they tend to get blamed for things they aren't always responsible for.

Case in point: Property prices have been rising in Imbabura Province, north of Ecuador's capital of Quito. Those rising prices have often been blamed on incoming expats willing to overspend and developers and real estate agents happy to let them. But in fact, much of the price rise is due to middle and upper class families in and around Quito moving out of the city and surrounding valleys...particularly now that Quito's new international airport has jets taking off and landing over some of the city's most popular suburbs.

The natural market effect of Ecuador's own middle and upper class buying property in and moving to quieter neighborhoods in Imbabura has a dramatic effect on local real estate prices. But it's often the expats who take the heat...even from other expats.

Experienced expats also know that expat communities often have very positive effects on local economies and cultures. Local entrepreneurs start new businesses to fill new niches. Local schools benefit from donations of time, money, and materials from concerned expats. Local hospitals and dental clinics improve services to attract expat patients. Local companies--and their workers, and their workers' families--benefit from construction and remodeling projects undertaken by expats. Even local dogs benefit from expat organizations created to bring North American sensibilities to the often harsh treatment of street animals common in much of the rest of the world.

In fact, almost every dollar spent by foreign residents in local communities eventually ends up in local pockets, raising the general standard of living. That's the case even when expats patronize expat-owned businesses...because these businesses hire locals, use local resources, and pay local taxes and fees just like every other local business.

So if you're the latest expat to arrive in a popular retirement spot, don't be too surprised if it takes you a while to overcome your newbie status with some of the older hands in the expat community. Just take a little time to study and adapt to the local economy, local prices, and local customs. You'll not only (eventually) earn your stripes with the established expats...you'll also save money and gain the respect of the locals for being a smart gringo in the bargain.

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