The Mexico real estate market is influenced to a great extent from its norther neighbors.  Given the fact that nearly 80% of Mexico’s exports are heading towards the United States, and another large percentage for Canada, the relation between the economies is quite extensive and influences are high for all of the industries in the Mexican market.  With the obstacles and the slowdowns faced by the economies of these two northern countries, it is thus logical that the bearish forces have also extendeded into the Mexico real estate market and has had its drag on the other Mexican industries. 

A large amount of Americans have been contributing to retirement funds for over 30 and 40 years.  They also have been using these funds in plans to purchase their retirement home or their second home for vacations.  Places such as Florida, Arizona, Texas have received a large amount of such capital flow.  The Mexico real estate market has also been receiving some of these investments in regions such as Baja California, Quintana Roo, Pacific areas.  It is estimated that just over one million north Americans now live in the Mexico real estate region on a year round residency.   The majority of these retired.   With the losses in the financial markets during 2008 – 2009 several families who were planning to purchase their second homes in Mexico were suddenly needing to reassess their plans.  During the latter end of 2009 the market began showing signs of recovery.  This upturn, although very positive, may still not have recovered the overall investor’s confidence as they have responded cautiously in regards to purchases and investments into the Mexico real estate market when compared to previous years figures.

2009 also saw a couple of spurts of exchange rate adjustments which created windows of opportunities for buyers.  The Canadian Dollar recovered ground and reached par with the US Dollar on several periods during 2009.  With this increase in the purchasing power and several decreases in the Mexico home values, Canadians were a segment of the market that remained quietly busy in these periods.

Mexico has also been witnessing a underlying growth in demand in the Mexico real estate from their large lower income and middle lower income families.  There has been massive growth of the government financing for these buyers.  In previous years approximately 150,000 units were constructed on an annual basis but in 2008 and 2009 figures have reached 500,000 annually.  The boom in this area comes from the house loan grants that were averaging nearly 350,000 per year in 2000 to today’s figure of 750,000 loans granted in 2009.  The existing growth of loans is spurred from the large population of young people that live in Mexico which will be needing housing for the next decade. 

The Mexico real estate region, will remain and become the most popular non-American / non-Canadian retirement and second home destination.  Although this south of the border real estate market was impacted downwardly during this past year, as was the case for the majority of the world wide market, 2009 had become a tremendous period of opportunities in the Mexican market.  The beginning semester of 2010 might also continue with some pocket below market windows, before the trend begins it`s upward slope.  Upward pressures will come from different factors all at different influences such as favorable exchange rate variances and the population booms.  This year will definitely be the first of a decade of interesting growth patterns in different segments of the Mexico real estate market.  2010 is not a question of waiting to buy, the important question is if you have the capital…. to buy and wait.

Thomas Lloyd graduated from Purdue University Krannert School of Management with a degree in Management/Financial Option Investments. He has been living, investing, and working professionally in Mexico for over 15 years. In the summer of 2009, he received the first federally applied Mexico Real Estate Degree and Mexico Professional Real Estate License S.E.P. #5978657. He is the current president of TOPmexicorealestate, you can contact him at (512) 879-6546 or through the company’s web site www.TOPmexicorealestate.com NETWORK

“Mexico’s Leading Network of Specialists for Finding and Purchasing Mexican Properties Safely!”

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Headlines in Canada have been pointing to opportunities for Canadians interested in a Mexico Real Estate investment.  In Canada, real estate sales have jumped tremendously during the month of October, and high bidding competition is eating up good deals.  If we combine this with the fact that the Canadian dollar is reaching parity with the U.S. dollar, and that Mexico Real Estate is still offering considerable price reductions (sometimes as high as 35%), it looks like an ideal time for Canadians looking for a winter home or a retirement property to make their move and buy real estate in Mexico.

The month of October began with sure signs of a healthy housing market in Canada, and in the middle of October the market was showing not only normal but high sales.

Even at the beginning of the months some sources were saying that the supply of housing was getting scarce in just about all of Canada’s biggest cities – Toronto, Montreal, Vancouver, Calgary and Edmonton among various other cities.  As a consequence, heavy competition in bidding had led to a tougher market for anyone looking for a good deal.  Prices for two storey homes are up from October 2008 only 0.1 %  – the average is $410,000 (remember, this is the price for just an AVERAGE house); while the increase is very low, tough buying competition will already make hard to find a good deal.

Another factor for Canadians to consider is the climbing value of the Canadian dollar.  By the middle of October, the Canadian dollar had reached 97 cents U.S., and some experts predict that the dollar will reach parity again by early 2010.  This means that the buying power of the Canadian dollar is at one of the highest points that it has had in decades, especially when compared to the peso which has been sitting at about 13 pesos per U.S. dollar for some time.

Now take all this and compare it to the situation in Mexico.  In the major Mexico Real Estate areas for North Americans the supply is still larger than the demand, and many sellers are still offering super price reductions.  A top-notch Mexico Condo (far above “average” in terms of luxury and design) in Puerto Vallarta, for example, can be found for a discount of as much as 30-35%.  Other areas, such as Playa del Carmen real estate, Cancun, Ixtapa, also offer price reductions and preconstruction discounts on condos.  Homes can be found for excellent prices in these areas, as well as Lake Chapala.  Tulum is offering great prices for lots with high development potential.  Great offers can currently be found in many other beachfront locations.  Besides accessible prices, developers and banks are also offering other attractive financing options and very accessible down payments.

Canada looks to be pulling out of the recession a little ahead of many other parts of the world; this makes it an ideal time to buy in Mexico.  If you are planning for your retirement or you need a winter home, you couldn’t find a better time than now while prices and buying competition in Mexico Real Estate are still low, and the Canadian dollar and economy are on their way up.  If you are looking for an investment, it is best to buy now, because when Americans and Europeans start buying more property in Mexico again, the prices are likely to soar, showing similar appreciation to the last two decades – 15% annual on average.

The other benefits of owning property in Mexico are endless: a much lower cost of living;  excellent, fast, modern health care – although you have to pay for it, prices are considerably less than in the U.S., and there are no Canadian waiting lines; excellent infrastructure, which receives continuous investment; a rich cultural heritage of music, festivals, food and history; beautiful white Mexico beachfront real estate; amazing mountain scenery; eco parks, and many other ways to enjoy nature; availability of a broad range of international stores and products.  Mexico offers just about everything – except cold winters.

If you are a Canadian thinking of joining thousands of other Canadians in buying real estate during these months, consider the option of buying in Mexico.  For more information about properties, the buying process, and life in Mexico, call us.

Thomas Lloyd graduated from Purdue University Krannert School of Management with a degree in Management/Financial Option Investments. He has been living, investing, and working professionally in Mexico for over 15 years. In the summer of 2009, he received the first federally applied Mexico Real Estate Degree and Mexico Professional Real Estate License S.E.P. #5978657. He is the current president of TOPmexicorealestate, you can contact him at (512) 879-6546 or through the company’s web site www.TOPmexicorealestate.com NETWORK

“Mexico’s Leading Network of Specialists for Finding and Purchasing Mexican Properties Safely!”

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A couple of weeks ago I had the opportunity to sit down and talk with the president of the AMPI Mexico national president, Pedro Trueba who was visiting us from Mexico City,  and president of the AMPI Riviera Maya president, Wilberth Gutierrez.  There are many factors that influence or makes the Playa del Carmen real estatemarket a leading region in Mexico which we discuss in the interview.  And Pedro Trueba discusses various issues about the Mexio Real Estate  market that makes this country a leading and growing retirement destination for Americans and Canadians.  As many of you have learned and read, the Mexico retirement  area has become an important focus point for many politicians and developers in the past couple of years.  We chat a little of why this is a leading solution to some of the problems that many Americans are facing amongst those being the higher costs of living and lower dollar value in savings.  Below on the video screen, click on to hear this interview   

To listen to part one of our conversation where we talked about the AMPI association and their role here in Mexico in helping buyers/sellers of real estate and a discussion about the new Mexico Real Estate Degree, Click here; Mexico Real Estate Blog.  

Thomas Lloyd graduated from Purdue University Krannert School of Management with a degree in Management/Financial Option Investments. He has been living, investing, and working professionally in Mexico for over 15 years. In the summer of 2009, he received the first federally applied Mexico Real Estate Degree and Mexico Professional Real Estate License S.E.P. #5978657. He is the current president of TOPmexicorealestate, you can contact him at (512) 879-6546 or through the company’s web site www.TOPmexicorealestate.com NETWORK

“Mexico’s Leading Network of Specialists for Finding and Purchasing Mexican Properties Safely!”

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Upon retiring from Houston, Texas more than ten years ago, we were very fortunate to have chosen the Puerto Vallarta real estate area as our retirement destination. Fortunate, because during the past decade, more specifically during the past seven years while the PAN Party has governed all of the Mexico real estate markets, the Vallarta area economy has virtually exploded with growth resulting in a doubling in population and a tripling in real estate values, thus attracting all of the modern day conveniences that you would expect to find in any other US or Canadian resort destination.

In Vallarta, located on the same latitude as Hawaii, we have some of the finest weather on the planet for seven to eight months per year. The “high season” of November through May provides about 220 rain free days having an average daily temperature of 73 F. It is absolutely ideal weather for doing whatever pleases you; and you can rest assured, everything that might be of interest to you is available in this Puerto Vallarta retirement destination!

Because the summer months in Vallarta are similar to those in Houston, i.e., hot, humid, and rainy, most of us retirees head north for the summer. We have spent the past three summers in the Lake Tahoe area; however, the summers of 2001, 2002, and 2004 were enjoyed in beautiful Victoria, B.C., Canada. During those years, the Canadian dollar was at an all time low. In 2004, the Canadian dollar was equivalent to about .66 US dollar or about 66 cents, US currency.

At that time, there were a number of beautiful condos on the Inner Harbor of Victoria that were termed, “leakers”. Rain and moisture were somehow able penetrate the walls, probably around windows, and then migrate down between the inner and outer walls, causing substantial damage to the buildings. Each of the condo owners were assessed an average of $80,000 for the repair work and the buildings were draped in tarpaulins for months while the restoration work was done. Consequently, many of the frustrated and dollar poor residents were anxious to unload these troubled properties.

There we were, with strong US dollars in our pockets and eager sellers all around, and like fools, we did nothing! Of course, since then the buildings have been fully restored to better than new condition, and being in an absolutely prime location, they have tripled or quadrupled in value. During this time period of price appreciation, the Canadian dollar has increased in value by 50%, relative to the US dollar (and the Mexican peso, which has held steady with the US dollar). Therefore, for those of us holding US dollars, those “leaking” condos in Victoria have become almost cost prohibitive.

That being said, there are now many fortunate Canadians holding valuable real estate in Canada and strong Canadian dollars when compared to the Mexico exchange rate. It s therefore time for those rich Canadians to start shopping for their winter retirement destinations! What better place to shop than in Puerto Vallarta, Mexico, where three or four years ago the Canadian dollar would buy 7 pesos, whereas today, it ll buy close to 11 pesos

Of the nearly 50,000 North Americans in Vallarta, we estimate that 30-40% of them are Canadians. This percentage will surely increase as the Canadian dollar strengthens and the US real estate prices and the US dollar weaken. Just imagine, summers in Canada and winters in Vallarta; retirement just doesn t get much better than that! The head of the Puerto Vallarta Chamber of Commerce has recently estimated that the greater Vallarta population will reach 600,000 residents by 2015, and therefore, if it were located in Canada, would rank among the top ten largest Canadian cities! By 2015, there will probably be about 100,000 North Americans in Vallarta, half being Canadians. Just imagine, more Canadians living in Puerto Vallarta, Mexico than in Brandon, Manitoba or Prince Albert, Saskatchewan!

There are over 100 Puerto Vallart condo complexes currently under various stages ofconstruction in the greater Vallarta area with more than 7,000 units recently placed on the market. During the next decade, Fonatur, the Mexican tourism agency, has forecasted at least 20,000 additional units to be built along the Riviera Nayarit, 40 minutes north of the Puerto Vallarta airport. This doesn t even include the incredible expansion plans for the land south of Vallarta which is slowly but surely being converted to privatized land, available to foreigners. There is certainly no housing slump along the Mexican Riviera, and an infrastructure that s improving daily.

In summarizing, now, is the perfect time for all of you loonie laden Canadians to head south this winter and check out the wonderful opportunities that await you in sunny Puerto Vallarta. You'll be amazed to learn how easily you can afford to live in luxury while enjoying your favorite pastime activities with fellow retirees in Paradise.

Author Jim Scherrer has bought and sold real estate in Puerto Vallarta for almost a quarter a century and has made Vallarta his permanent residence for over ten years. a retired entrepreneur from Houston with an engineering degree and business background. He was a co-founder of a Houston based manufacturers' representative firm almost 30 years ago. Current member of (REBAC) real estate buyers agent counsel and (NABEA) national association of buyers exclusive agent. He is the owner broker of Puerto Vallarta Real Estate Buyers Agents. For more information (512)-879-6546 THE www.TOPmexicorealestate.com NETWORK

” Mexico's Leading Network of Specialists for Finding and Purchasing Mexican Properties Safely!”

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Mexico condos are popular investment options for Americans, Canadians and British and even more so those which are in the pre construction stages But identifying the risks and knowing how to manage such risks are important factors to ensure good returns and avoid costly surprises

One question was brought to our attention from a reader which is listed below:

Q.) I have a question I'm wondering if you can answer about tax implications for pre construction condo purchases. I entered into a contract in July 2007 for a unit a Mexico real estate project X It was still in with a good reduced price when I purchased They required a 30% down payment and a final payment of 70% at close My contract is all in US dollars. My question is “What will be the peso amount captured on my Mexico title deed given that in 2007 the Mexico exchange rate was $10 pesos and in 2009 the exchange rate is $15″

A.) Linda Neil of Linda Neil Properties from the La Paz real estate market advises the following:

“the 30% paid in 2007 should be shown at the exchange rate the date paid and the remaining 70% at the rate on the date of that payment. Acquisition taxes will be paid on the total amount but that is only 2% of the total.”

A.) Ivan Castillo, regional director and practicing Mexico real estate lawyer from Stewart Title responded:

“Even though the purchase price was set in US Dollars, the deed by which the property is transferred will mention Pesos It s important that the purchase price calculated is well determined, since it could affect the parties when calculating closing costs.”

A:) Thomas Lloyd from Lloyd's Real Estate in the Playa del Carmen real estate market included the option “there are money exchange homes that can lock in exchange rates for future payments If you see your currency is slipping in strength, this may be a viable option Write us and we can give you more details”

A.) Linda also included that “This figure, plus allowable deductions, creates basis for the eventual sale of the property so it is not a negative to show the higher peso amount.”

For more reading click here for Mexico Real Estate Questions and Answers

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The Mexico real estate market is many times effected by the exchange rate currencies People can save thousands of dollars from the significant movements of the USD to Pesos exchange, as well as the Canadian dollar to the USD rates Imagine that you are going to pay the closing costs on a Mexico property with a fixed peso rate of 100 pesos If the exchange rate sits at $10 pesos per dollar, you will need $10 usd to cover this fee If the exchange rate increases to $15 pesos, all you would need is $6.66 usd, a savings of $3.33 per every $100 usd It adds up Now in the case of today's news, if you are paying in USD, and the price of the property is quoted in USD, you would see no change in benefits

On the other hand, if the property is priced in USD, and you have Canadian dollars and this currency gained on the USD, this will result in cost savings upon the purchase of the property.See a previous post on Mexico Exchange Rate

This afternoon the US federal reserve made the announcement of purchasing large amounts of Treasury bills This should bring large amounts of US dollars into the market which will have a downward pressure on the cost of these units A friend of mine that works at the exchange house HiFX brought my attention to this occurrence and I wanted to share with our readers Keep an eye on the exchange rates in the next several days and weeks HiFX offers various services, including locking in exchange rates for future transactions This could be very helpful if you are witnessing or participating in an asset transaction Contact me for more information on this subject.

Thomas Lloyd graduated from Purdue University Krannert School of Management with a degree in Management/Financial Option Investments. He has been living, investing, and working professionally in Mexico for over 15 years. With a Mexican Real Estate Certifications and various diplomas he is the current president of TOPmexicorealestate, you can contact him at (512) 879-6546 or through the company`s web site www.TOPmexicorealestate.com

“Where TOP real estate experts from ALL regions of Mexico come together to share their Tips & Knowledge to help you buy safely !”

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Mexico Real Estate Investments have been extremely profitable in this country for the past number of years But the overall consensus with our panel has been “surround yourself with Mexico real estate experts” to avoid unsuspected pitfalls Stewart Title has a team of lawyers that assist non-Mexican buyers, investors, and developers who are coming down in record numbers to purchase properties and develop in this growing Real Estate market

A question was asked a few days ago regarding a property purchase.

Mexico Real Estate Investment QUESTION

“Can you give us an estimate on the amount that would be due on Mexico Acquisition Taxes for a pre construction condo purchase

I entered into a contract in the summer of 2007 for a unit at Mexico Pre construction Condo “X”. They required a 30% down payment with a final payment of 70% at close.

My contract is all in US dollars How do I calculate the amount that should be captured on the deed and how will this affect the amount payable for the Acquisition Taxes In 2007 the Mexico exchange rate was approximately 10 pesos per dollar and in 2009 we are approximately 15 pesos per dollar

Mexico Real Estate InvestmentANSWER

Even though the purchase price was set in US Dollars, the deed by which the property is transferred will mention Pesos. Since 30% of the purchase price was paid previously at an exchange rate of 10.00 Pesos p/dollar and 70% will be paid at 15.00 p/dollar, the most practical way is to determine the amount paid in Pesos at the time of each payment:

Example:

Purchase Price in Dollars in July 2007 = USD$ 10,000.00

30% Down payment at 10.00 Pesos per dollar paid on July 2007= $30,000.00 Pesos.

70% at closing at 15:00 Pesos per dollar paid on July 2009 = $105,000.00 Pesos

Purchase Price in Pesos to be declared in the deed: $135,000.00 Pesos

It s important that the purchase price calculated is well determined, since it could affect the parties when calculating closing costs. The seller could pay more Mexico Capital Gains Taxes or the purchaser can pay more transfer of property tax and deed registration at the Mexico Public Registry if the figures are not registered correctly.

Ivan Castillo is the regional manager of the Stewart Title offices for the Yucatan Peninsula and Los Cabos region.Both a practicing lawyer and administrator, he has been working in Mexico Law specializing in real estate for more than 13 years Licensed in Mexico, his offices administer a variety of services ranging from Escrow Services, Legal/Closing Coordination, Title Insurance and brokerage services for American, Canadian, Spanish & British buyers and owners Please note that the above article is his professional opinion and an in depth study will be necessary for individual case by case accounts www.TOPmexicorealestate.com 512-879-6546

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Mexico- About a week ago I wrote a short post regarding a sudden jump in the exchange rates between the Canadian dollar versus the US dollar The Canadian dollar had gained some ground with a one day record jump back in 29th of October I thought it was interesting enough to make a short note that another little jump occurred yesterday to bring the Canadian dollar upto $.8664 USD As Nathan Barcic points out, “A property that was worth $200,000 usd on Monday, would be worth $8,000 CAD less today” There appears to be a transition away from US treasuries and back to world equities on confidence of positive stimulation to the economies published HiFX Check out some Playa del Carmen Real Estate property listings and calculate how much you can save if purchasing a property this month Write to me to find out how you can freeze an exchange rate for future operations

Thomas Lloyd graduated from Purdue University Krannert School of Management with a degree in Management/Financial Option Investments. He has been living, investing, and working professionally in Mexico for over 15 years. A Mexican Certified Realtor he is the current president of TOPmexicorealestate, you can contact him at (512) 879-6546 or through the company`s web site www.TOPmexicorealestate.com

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I have several Canadian clients who are in the process of closing upon some Mexico Real Estate properties here in the Quintana Roo area Over the past 60 days, “the foreign currency markets have been extemely volatile” goes without saying Several Mexico home buyers from Canada and US have written asking how this will be affecting their closing and final payment obligations So, how does the Canadian dollar fluctuations affect the purchase process down in the Cancun real estate market or even a property up in Baja California

To be brief in the explaination Prices of Mexico properties listed within markets with a high concentration of international buyers are normally quoted in United States DollarsWhy is this The reason is that normally the USD gains in strength against the Mexican peso Although the gains in the past 8 years have been quite stable, most Mexico home owners feel safer in quoting in the more affluentAmerican currency So, Canadians buying here in Mexico, when making deposits, must pay the equivalent of a price quoted in USD Now a little history: in the fall of 2007, the Canadian dollar had gained important strength against the United States dollar to a record level Where as before, the exchange rate was hovering around $1.00 Canadian dollar per every $.65 – $.70 USD, within a short time span of several weeks $1.00 Canadian Dollar could then buy $1.05 usd This was an increase of nearly 30% which many people of this country took advantage and investd into Mexican Oceanfront properties or similar assets Recently though, within the past 30 days, the Candians lost a good percentage of this gain as it returned to near $.75USD In the past day, the Canadian dollar began gaining back ground when a surge from $.7680 upto $.8100 against the green back was registered Nathan Barcic, senior business development at HiFx Inc.stated “this move alone of 7% can save Canadians nearly $6750 CAD per every $100,000 CAD investment” HiFX Inc. has several tools that are quite interesting for people investing into latin american or even international countries such as “lock in rates” for upto 60 days or soFeel free to call me if you want to discuss this topic further or if you have any other questions regarding How to buy Real Estate in Mexico.

Thomas Lloyd graduated from Purdue University Krannert School of Management with a degree in Management/Financial Option Investments. He has been living, investing, and working professionally in Mexico for over 15 years. A Mexican Certified Realtor he is the current president of TOPmexicorealestate, you can contact him at (512) 879-6546 or through the company`s web site www.TOPmexicorealestate.com

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