The Lifestyle of A Wandering Investor, Chat With Ladislas Maurice

Yasi: Welcome to Fast Track podcast Ladislas.

Ladislas Maurice: Thank you.

Yasi: Um, very interested that I saw a lot of your YouTube videos, and it’s very informational. And you tell people what’s possible, you know, in countries, they would never imagine they will think about investing, or they will never imagine thinking about going there, for example, right now you’re in Ukraine.

So, you have very interesting experiences and personal backgrounds. So why not tell us a little bit about who you are, you know, why you’re doing what you’re doing now.

Ladislas Maurice: So I went to college in Canada, then grad school in Australia, then started working for Nestle. So I did the whole corporate thing for a number of years. I worked in Africa for seven years for Nestle. So my last role there was being in charge of a dairy business for a few west African countries.

And then, when I hit 30, I decided that I wanted to do something else. So before looking for my next career options, I went on a big road trip with my parents, actually. So it was pretty cool. We drove from Oman in the middle east to Paris and France. So going through all of around, Armenia, Georgia, all of Turkey, Eastern Europe, et cetera.

And along the way, I just saw so many opportunities. Because for the first time, in many years, I wasn’t working 60 hours a week, and I could actually spend time looking at opportunities and not have to worry about, you know, whatever my boss wanted, et cetera. So. I got involved in some deals. And then, the more I got involved in deals, the more I pushed back looking for a job.

And then it actually became a full-time occupation of mine to manage my own money. So now I travel, full-time mostly in emerging and frontier markets and I make investments in these far-flung countries.

Yasi: Um, do invest your own money into it, or you also help, for example, you know, you talk about Ukraine roasted here and then probably there were some other people interested in, would you help them to that as well?

Ladislas Maurice: Like obviously, I don’t give any investment advice, and my main role is managing my own money. Uh, but I’m always open to discussing with people. And then when people follow me on my YouTube channel or on my mailing list, I talk about the opportunities that I see on the ground, but they’re typically higher risk, propositions if I can put it this way. So it’s not something that, you know, people should just rush into. You know, when I talk about real estate in Turkey, for example, the country is going through a currency crisis. So people need to have a higher tolerance for uncertainty and risk.

Yasi: Yeah, that’s very, very good point.

Previously I interviewed, um, Alex from The Main Street Finance; he also talked about, you know, everyone should base on their personal financial situation and then decide what we invest, not just to listen to the artists blindly. And you talk about real estate in Turkey, and I saw your YouTube videos. You also talk about real estate in Montenegro real estate in Ukraine. And why are you interested in real estate?

Ladislas Maurice: Look, I don’t do just real estate. So I invest in a few asset classes. So obviously, I have a bunch of stocks. I make, uh, private placements directly with companies. I help startups as well. So recently, I invested in a chicken and egg distribution business in The Gambia.

So my portfolio is quite wide. But what I like about real estate, parts of my portfolio, is that it offers me a real asset. So it’s actually something that, you know, that I have a stake in. I can touch. I can feel. I really own it. So that’s one aspect that I like. I feel that it’s the safer part of my portfolio, rather than stocks.

You never know what can happen with those. But generally, with real estate, you know, you own it. If you have a bit of, if you have insurance with it, your, your risk is quite low. And it offers as well, especially in some emerging and frontier markets, it gives you more options in life. So for example, if you buy for $250,000 of real estate in Turkey, you can get citizenship for essentially free for yourself and your family.

So just by buying a, you know, two undervalued apartments really in Istanbul. So, which is a beautiful city of 15 million people. When you can get apartments there for a thousand dollars, a square meter in the center. So by any measure, it’s not expensive. And on top of this, you then get Turkish citizenship,

for yourself, for your wife, your husband, and then all of your children that will then pass down the generations. So by making that investment that I just need to hold for three years in three years, I can then sell the real estate. I am giving the gift of Turkish citizenship to all of my descendants for generations to go,

if the laws, stay as they are in terms of citizenship in Turkey. So I find this amazing. I find this to be a really, really interesting, offer. So, you know, compare that with just buying a random condo in some small town in Germany. Your grandchildren are not going to remember that you bought that condo, but that Turkish citizenship goes down the generations.

And then, in some other countries, you don’t get citizenship when you buy, but you get residency. Um, so places like in the Balkans, most countries in the Balkans, so Montenegro for example, beautiful country, just by buying real estate in Montenegro, you have the right to move to Montenegro and live in Montenegro.

So let’s say that you work online, or you manage your investments. You can work from anywhere in the world. Why stay in a high tax Western country when you can move to a beautiful country like Montenegro, 600,000 people, stunning national parks, beautiful beaches, warm water, history, just a beautiful little country with very low taxes of between nine and 15%.

So you get to make an investment. That is one interesting, and that two is lifestyle and three that can help you reduce your overall tax burden and live in a lower cost environment as well. So it’s a lot of benefits that you don’t necessarily get when you buy normal real estate in Western countries, but then again, it comes with an issue in the sense that you need to have the cash to invest in these emerging markets. Access to credits is one complicated, two often non-existent, and three when you do have access to credit, it’s very expensive and not worth taking. So it’s not like getting a 30-year mortgage and paying 1% like in Germany like you’re just not going to get that. So it’s really more for people that already have a fair amount of investible assets.

Yasi: I remember once I was interviewing Andrew Henderson from The Nomad Capitalist. And he talked about plan B and what you talk about here; I think it will be very interesting for people who already have the cash on hand. Then they are looking for global mobility or more choices, or lifestyle change. But for those who do not have this cash on hand, maybe at the beginning is to accumulate wealth, and then you can look for more options.

And what would you think about, you know, besides the benefits, what are the risks associated to have a real estate property in different countries or even emerging markets?

Ladislas Maurice: Cool. So that’s a very good question. Um, because there is definitely a number of risks and they’re quite different from the risks that you face in Western countries.

So typically the risks that you face in Western countries are credit cycles. So if interest rates rise, then you generally see housing markets being quite volatile. Two, often kicking out tenants in Western countries is very complicated. If someone stops paying and they have a family, or you know, it’s a single parent with three kids and you’re trying to kick them out. It’s going to take months if not years, in some cases. And then there’s the risk of government regulation. Um, so that’s a very real risk in Western Europe. In particular where governments just like coming up with all these different regulations and norms saying, for example, that, oh, your house needs to be green.

If the isolation, if the house is considered to be bad in terms of energy, you need to do all of these renovations, et cetera. So it can be very, very honorous to carry real estate in Western countries. The set of risks in emerging markets is different. Often the biggest risk is currency.

So investing in a country where the currency just plummets, which is for example, in Turkey, people who invested in Turkey in 2012, uh, when the lira was that I don’t know, two liras to the dollar. And now the lira is like 14 lira’s to the dollar. That’s an issue. So what we see now in Turkey is that prices really have bottomed.

And now they’re just kind of indexed to the dollar, but still, the currency is an issue in these countries, and also liquidity. And that’s one that is often not understood by Western investors. People need to understand that in many of these emerging markets, selling can take a while. So it’s not like selling a house in Austin, which will take a day, you know, or in Germany two-three weeks. In Montenegro it’s pretty common to have to wait six months, a year, a year and a half to be able, to sell your house or your apartment. Um, the same thing in Ukraine. You know, it can take at least a few months in Africa. It can take a few years. So liquidity is a risk that is often underappreciated by Western investors in emerging markets. When you invest in these countries, you need to understand that. It might take a while for you to get your money back once you sell. So you need to really take this into account when you make that investment. And which is also risky, if you’re taking a loan in Europe for three years, et cetera, that you have to pay back, and you’re hoping to do a flip in these countries with that money, that’s definitely your risk.

Yasi: Alright, thanks. I think it is really suitable for again, not financial advice; So there’s really suitable for people who have literally extra cash on hand.

They’re not relying on the cash to feed a family and then maybe it’s, they have high-risk tolerance because they already have their stable income, stable assets somewhere else safe. How would you evaluate which properties to buy? What are the numbers you are looking at? What are the factors you take into concentration?

Ladislas Maurice: Look, um, real estate is real estate. At the end of the day is how much yield are you getting for the money that you’re investing, and what do you expect the capital appreciation to be in your own home currency. So you also need to factor in potential currency, depreciation of the country you’re investing in.

So just that, just yield, and potential capital gains.

Yasi: What would be the yield in, let’s say Ukraine and the emerging markets because I know in Switzerland you cannot find something more than five or 4%.

Ladislas Maurice: Even if you get 5% in Switzerland, you’re doing very well. So it depends. People often have the misconception that all emerging markets have higher yields because the risk is higher.

And it’s not necessarily the case, because in many of these markets, for example, in Africa, yields are typically quite low, actually, because there is nothing else to invest in. When you save your money in these countries, all people do is just buy real estate because there is a local stock market, but people don’t generally do this often. Getting money out of the country is an issue.

So they can’t invest overseas easily, and they don’t necessarily trust their banks either because a lot of these countries have, they have a history of backgrounds of banking issues. So people just pile into real estate. So often yields can be quite low, in some countries. So I think then your question would be which markets currently offer interesting yields in terms of emerging markets.

So I’m in Ukraine right now and Ukraine has the highest rental yields in probably in the world on a cash basis. So you can get into Kyiv, for example, the capital of Ukraine, and you can buy apartments, historical apartments in the city center, and make rental yields of between if you’re going with smaller amounts to invest maybe 7% gross, but if you start investing bigger sums, like at least 250 $300,000, you can get 12, 13% gross.

So, and that’s nearly impossible to get in Western Europe. In Turkey, for example, yields are quite low because Currency depreciates faster than your rents in local currency get revaluated.

Yasi: And would they also have, um, capital gain, like appreciation of the use?

Ladislas Maurice: For sure. So for example, when Ukraine prices dropped approximately 75% from peak and only in the last two years, started going up again by five to 10% a] year and the last, three years or so, but Ukraine saw two revolutions, multiple bouts of currency, devaluation, hundreds of thousands, actually, millions of people immigrate to Western Europe.

So everything that could go bad just went bad and war, et cetera, et cetera. So the market just reached the bottom. And now you just get very interesting deals, good potential for capital appreciation, and high yields, but then it comes with, you know, Ukraine risks. I mean, it’s all over the news. So it comes with that sort of risk.

But the reality is people are making these yields.

Yasi: Um, so besides real estate in those frontier markets, that you’re interesting earlier, you mentioned you, you know, as part of your portfolio, what are the other kinds of investment you are making.

Ladislas Maurice: So typically the way I approach it is I look at the macro story of the country.

So am I interested in the country from the macro point of view? If I am, I typically go there, I fly there and then I stay there for at least a few weeks, sometimes even longer to get a feel for the opportunities on the ground, because some countries have interesting macro, but few investment opportunities. Or you go somewhere for example Uzbekistan; I went there, I think like two years ago. I was very interested in the reforms happening in the country. And so I took a flight. I went to Tashkent, I stayed in the country for a month. My idea was initially to just buy an apartment in the city center because they were quite cheap about a thousand dollars.

A square meter for a city that is going to boom over the next coming decades. Really? And it hasn’t been booming. But buying there as a foreigner was full of ambiguity. So technically you’re not allowed to, but if you create a local company and you buy through that local company, it’s possible, but it’s a bit of a gray zone.

And then I looked at the local stock market. So there is a stock market in Uzbekistan. And I saw some incredibly cheap companies, companies that were growing 20, 30% a year that had no debt on their balance sheets, and that we’re paying dividends of 15, 20%. And, I thought I looked at this and was like, wow, this looks like less work than managing real estate from abroad.

And very attractive. So instead of buying an apartment, I bought a bunch of local stocks, cement companies, just basic businesses. So cement companies, local banks. What else? Um, a steel-making company, a commodities exchange, um, an oil and gas services company, just all these random stocks. And it did incredibly well.

Um, you know, uh, I don’t know two and a half in two years. And based on strong fundamentals, it’s not like these companies just took a bunch of leverage and levered up their balance sheets. Not at all. You know, very healthy companies that are still growing. So I just, essentially, I look at my options when I’m in the country. And then there are places like Serbia.

I like the story. I like the growth story that Serbia has, but it’s actually hard to play because you go there, real estate is actually expensive. Um, the local stock market is very illiquid. There’s barely anything trading there. Um, sometimes they trade like. 20 – $30,000 a day. So for the whole stock market.

You know, it’s how do you play it? And I don’t know, some markets are just very hard to play.

Yasi: It’s still a way that, um, you always follow a method that when you go to a new country where to start, what to evaluate? I mean, as a foreigner, you land in a foreign country. Where to check the real estate market?

There’s a language barrier. How would you deal with that?

Ladislas Maurice: Yeah, I mean, you’re right. That’s a good question. So typically I just walk around a lot, to check out real estate. I check online, I go speak to real estate agents, and then I go speak to local lawyers to make them talk about the process. How to buy.

Often all these people have pretty good insight when you speak to a few different people. Um, sometimes I go approach as well, brokers for local stock markets. You know, I make them essentially pitch what they have to pitch and I listened to what they have to say. So it takes time. It’s not efficient, you know, it’s, it takes a lot of time to do all of this research.

There is the delta often between the perception that people have of a place and what is actually happening on the ground. And by spending time in these countries, I’m able to make money this way by exploiting the market inefficiencies. Because in Western countries, there are very few inefficiencies in the markets.

They’re very efficient. You know, everyone has the information, and everything’s very liquid, et cetera, et cetera. So it’s harder as a retail investor to have an edge, but in those countries, when you have cash and you spend time on the ground, you can find these opportunities. And often in many cases, um, risk can be actually a lot lower than what people think.

Yasi: Yeah. When you actually know more about this investment, the actual risk is way less than the perceived risk without having any information about it. Right. And especially if you are on the ground in the market. So I want to know, how long have you been doing this?

Ladislas Maurice: Uh, it’s been like four or five years now. And then I started my, blog about it because people were always asking me, hey Ladislas, you know, they see my picture on Facebook and all of these countries that are like, what do you do? Why are you always in these weird countries? Like you don’t seem to have a job? So I started blogging about it for fun, and then the blog turned into a little part-time business where I help people. Um, Look at opportunities in emerging markets for investments and also for immigration.

Yasi: Aha. And now you have this YouTube channel, also. I like it because people actually can see through your lens. They can see the building, they can see the street, they can see the country. And so for four or five years to have a home base or you’re always on the road,

Ladislas Maurice: I have, yes, I have residencies in multiple countries and essentially, I travel full-time.

Yasi: Okay. And how do you deal with the current situation during COVID? Are there any restrictions for you?

Ladislas Maurice: I just don’t go to places that won’t let me in. So I haven’t been going to Asia a lot.

Yasi: Yeah. That’s a good point. I haven’t been there for one or two years. So another question, if you can choose not to answer me, but it’s a little bit, you know, like straightforward, uh, people might ask, you know, if you want to sustain this kind of lifestyle, just manage your own money, travel to different countries, you have to pay for the hotel, pay for accommodation, pay for our tickets; Right? How would you go around with it? Like how would you have sufficient cash flow to support your activities?

Ladislas Maurice: Oh, from my investments, you know, I received dividends. I received, rental income and capital gains because, you know, often not all of them, but often my investments do quite well.

So I make my money this way.

Yasi: Okay. For someone new to this field and they have no idea how the cash flow thing can support their daily expenses. Can you explain to us what other ways can people get cash flows without the need to go to the office like five days a week to earn a salary?

Ladislas Maurice: Yeah. And before we get to this question, life is a lot more affordable in these countries as well.

You know, when I’m in Turkey, I can get a decent Airbnb for, I don’t know, $35 a night. When I go to the Balkans, Latin America, et cetera, it’s not very expensive. So instead of paying rent, I just stay in Airbnbs, and it’s probably less than what your audience is paying in Germany and Holland, and in the US so I actually spend less than your audience wherever they are in Western countries because I just don’t spend time in high-cost environments. So to get to the cash flow yeah. A few ways to get cash flow, invest in businesses that give you cash flow. So companies that give good dividends, I mean, there are companies out there giving fantastic dividends.

There’s this blogger that I follow, who is really good, um, undervalued-shares.com and he put out a report on Petrobras, so the big, Brazilian oil company. And they’re projected to get dividends of about 15, 20% a year. So that’s quite attractive, you know? So you just invest a bit in that and then you’d get a decent income, not investment advice.

Yasi: I don’t even know that exists like a 15, 20% for you.

Ladislas Maurice: Yeah. Um, rental income, and then also starting little side business. So, you know, invested for example, in that chicken and egg distribution in the Gambia, the cash flow looks very good. And then also starting some sort of online business.

So this blog that I created with a YouTube channel, so that’s also helping me on a daily basis.

Yasi: What are the countries that you invest in real estate for like rental income?

Ladislas Maurice: For rental income? Right now the best is Ukraine. I’m most likely going to make a, probably a significant investment in Ukraine in the coming month or two.

Um, so I work with this Canadian fund manager. He is planning on buying a, an old flour mill in the city center and then turning it into an office building. So he’s paying like a thousand dollars a square meter for a very structurally sound building with a ton of parking space in the center of Kyiv.

And then he’ll put about $600 per square meter of renovations at two floors and then flip it in two and a half, three years. I’m expecting about 150 to 200% return in two and a half, three years. But this is in the myths of media going around and saying, there’s war, Russia is going to invade this, that’s.

And when you actually look at the market in Kyiv, if nothing happens, whatever things continue on the investment, we’ll go. We’ll probably do well. If Russia does take parts of Ukraine and it’ll probably only be parts of in the east, but it doesn’t hinder the fundamental thesis that is about supply. There’s just not enough supply of office buildings in Ukraine. So in the rest of the world, you know, when I tell people I’m going to make an investment in an office building in Ukraine, they think I’m absolutely insane because one war with Russia and two offices are dead because people work from home, but there is just not enough supply of offices in the first place in Ukraine. So like the vacancy rates are extremely low. Whenever you have, an office attendant that leaves within a week or two, you have other tenants. There’s just not enough supply.

So you can have a whole bunch of stuff that hit demand, but it’s not going to hit demand enough to solve the supply issue. So that’s, probably one of the next investments I’ll be making. Uh, but it won’t be giving me cash flow. So that’ll be capital gains one, but in terms of cash flow yet again, Ukraine is a good one.

I’m also evaluating. I spent time in Columbia in Medellin, which has some very interesting yields as well. If you target the midterm market. So it’s a bit of a niche. So you buy an apartment and you rent out for like one to three months to typically American and Canadian, some European digital nomads that want to spend time in Columbia.

So, because if you rent out apartments on the long-term markets in Medellin, you get very low rental yields like three, 4% gross. So it’s not worth taking Columbia’s risk for these sorts of returns. But if you play your cards right, you can get 10% gross by targeting that market. So that’s, that would be an

Yasi: That’s very informational. Thank you so much for sharing with us. Actually, the last few questions I want to ask actually is about you. Since when did you get started in, you know, into this investing, you know, wandering around, across different markets and you said you worked in a big corporate for seven years.

So how, how did this transition happen?

Ladislas Maurice: Yeah. I mean, because when I was working in corporate, I was investing a bit, but when I look back, many of my investments were suboptimal. Because I was working sixty hours a week. I just did not have the time nor the inclination ’cause I’d come back home and I’d be tired to manage my own money.

So it’s only when I actually left my job that I was able to boost my returns really because I’m fully dedicated to it. So this transition, as I said earlier, just happened organically. It wasn’t really part of the plan. It just happened.

Once you’re doing something and you’re enjoying it, you’re traveling and you’re making money, why would you go get a job?

Yasi: It’s impossible to go back. Right? This side is much better. And my last question, short answer. What does money mean to you?

Ladislas Maurice: Freedom.Yeah. I like freedom it’s and all money is to me, is a means to freedom and to sleep well nights and to do what I want to do and to not be dependent on anyone or any government. Yeah.

Yasi: We always say money actually is the tool. Money is not a goal. It is a tool for you to live a lifestyle that you want to live.

Right. Um, so if the audience wants to learn more about investing in different countries, they want to follow you. Where can they find you on?

Ladislas Maurice: So I have this blog called The Wandering Investor. So I really encourage people to sign up for the private list it’s entirely free. So it’s a mailing list. And as I travel around the world, I sent essentially my notes from the ground to people in terms of opportunities that I see.

So really the mailing list is the best. And then I’m also on YouTube, Instagram, and you can find me in The Wandering Investor.

Yasi: All right. Thank you so much Ladislas, and I hope to see you soon, in Switzerland when you come back.

Ladislas Maurice: Sure. Okay. Thank you very much. It was my pleasure.