Want to purchase a condo in Mexico: Si, Por Favor!

Who has not dreamed of purchasing a condo in Paradise: Mexico’s Resort Areas – Puerto Vallarta, Riviera Nayarita, Cancun, Playa del Carmen, Tulum, Riviera Maya!

There are a great number of Canadians now purchasing property in Mexico’s Resort Areas.  Either through cash purchases or through a Scotiabank Mexico Mortgage (contact us for further info).

While real estate prices in the U.S. had drop to half the price from a few years ago, this also makes it a risky investment.  On the other hand, this does not happen in Mexico’s Resort Areas, where foreign purchase and demand continues to grow, mainly by Canadian Investors.

What are the requirements for a good Mexico resort area investment?

1. Invest in an expanding and growing population area, such as; Puerto Vallarta, Riviera Nayarita, Cancun, Playa del Carmen, Tulum, Riviera Maya.  This will eventually drive up the price of your real estate investment.  As opposed to investing in an area where the population is declining, or not growing.

2. Investigate about rental income opportunities?
The above mentioned areas, are areas that have a continuous afflux of tourism, and therefore rental opportunities.

There are English Speaking Management Companies that can assist you and handle your rental property in any of these areas.

3. Inform yourself regarding closing costs and hidden fees.
Read our previous blog article (http://henryplaya.wordpress.com/2012/04/14/couts-de-fermeture-estimation/) and remember that even if you are not actively living in your condo, you still have to pay: mortgage, condo, municipal taxes, air conditioning (hold partly conditioning unit), electricity, vermin, insects are to be monitored, etc.  Be prepared.   

How to buy in Mexico?

The first thing to do is to do his homework, to thoroughly analyze the market.

Find the right professionals (real estate agent, notary, attorney, mortgage broker, etc).

Request all kind of information regarding purchasing real estate in Mexico (real estate contracts, deposits, escrows, mortgage availability, property’s maintenance and HOA’s fees, closing fees, property management fees, etc).

There are two ways to purchase property in Mexico, as some real estate investors have learned:

-          The right way; and,

-          The wrong way

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The wrong way is to do it yourself on a learn as you go, trial and error basis.

And the right way which consists of proper planning and doing some research prior to entering into a contract agreement to purchase: visit the complex (property), hire a professional real estate agent, an attorney, ask to be introduced to a notary public, an accountant (you must consider the possibility of incurring Capital Gains at the sale of the property), a property management company, a mortgage broker (if purchasing with a mortgage), etc.

Purchasing using the right way method will prevent you from going through many hassles, and most importantly, insuring you are doing a sound investment.

There are a lot of stories of foreigners coming down and purchasing property in Mexico whom have gone through the wrong way method, and have ended up losing their investment income and empty-handed because he did not follow a propert right way of purchasing method. 

You must learn the market and the process involved in investing in Paradise.

And good luck!

Luck, by the way, is at the Intersection of Preparation and Opportunity.  Do your homework and you won’t regret the end results!