You want to buy a home in Mexico to rent it as an Airbnb, but you don’t know where you should buy it. Let us guide you into making the best decision.
Which factors to consider when deciding where to buy a home in Mexico?
The first factor will be the traffic area, so you must look at the place that has more tourism in the area. In this case, Quintana Roo is the number one tourist destination by far because of the Caribbean beaches. As a matter of fact, it is the number one tourist destination in the whole country.
Cancún, being the oldest city, has the advantage of name recognition, and it’s the highest. Even today, a lot more people know Cancún or have heard of Cancún than Playa del Carmen or Tulum, and Merida much less.
Then you will have to look at the kind of activities in the area. If you want to compare Cancun, Tulum, and Playa del Carmen Real Estate, right now, there are a lot more tourists coming to Playa del Carmen than to Cancún. However, you want also to keep a close eye on Tulum condos for sale because it is rapidly becoming a hot spot.
The third thing you want to be looking at is what your competition is like in terms of volume. If you are buying a property to run it as a vacation rental unit, what you want to look at is what hotels you will be competing against. And this is just to keep them on the radar.
Most of the time, it is not really direct competition. The type of person that wants to come on an all-inclusive vacation is different. While there’s no way that you will be able to compete with a hotel and all those amenities.
However, a considerable number of people would prefer to have a unique type of vacation, stay closer to downtown, and live like a local. Hence, they would prefer to stay in a condo off of the gated community of a resort hotel. So they want to stay n Playa del Carmen, one block to 5th avenue and two blocks from the beach. This way, you should be comparing yours to other units similar to what you offer.
Let’s look at an example
Let’s say you buy a studio condo. You will be looking at what other competition exists, how many other studio condos exist within a ten-block zone. Try to find a place where there is less competition. You want to be unique. For example, you don’t want to be getting into a price war with other 50 or 60 similar condos.
So with that said. Tulum is still a small town with a construction boom, but it’s still in that process. All of the buildings are new, so you have to be innovative and see what type of amenities will separate you from the rest.
You have to see the pricing range, their occupancy rate, if they are successful, and then you will come up with your position.
Therefore you will want to be looking at uniqueness as well. If you think there is still a small amount of competition and you want to jump into it, or maybe you think you should be looking for a four-bedroom condo instead. Because you know there are not many of them around. So you are looking for unique opportunities, unique experiences.
Which other places are good to buy a home in Mexico to rent it short term
Another thing you may want to think about is if you want to look at a colonial city like Merida instead. You want to offer a unique experience. There is not as much traffic as Quintana Roo, but you want to use a different strategy.
And it could be even Bacalar homes for sale which is an interesting place too. Bacalar is right behind Tulum and is going to become a tourist destination very soon.
How can I know if the city I am looking at is a good choice?
Most of our investors come from the United States or Canada. If you compare the price of a square foot in New York or Vancouver and the price of a square foot in Tulum, there will be a substantial difference. So if you are an investor, you would think, should I put my money in a condo in Tulum or New york?.
There will be a five or ten-year period to start recovering your investment. You want to start studying what Mexico is doing. Suppose the federal government is investing money in that place. If the government sees a lot of promise, it will be investing in the infrastructure. Therefore, if the federal and local governments of Quintana Roo are investing, it is a good bet.
For example, in Quintana Roo, the federal government is investing in the Mayan Train. That is a considerable investment, and that only means that they have a lot of confidence.
That over the next 20 years the tourism is just going to continue growing in that area. In Playa del Carmen, in Tulum, Bacalar, and towards the south.
Another sign is that there is a lot of talks about an airport in the Tulum area. They are seeing that the traffic trends of Cancun are high, and they already have four terminals, and still they are looking at building another possible airport in Tulum, which tells you how confident they are.
An excellent way to measure tourism is by looking at the traffic of the airlines. Over the last couple of years and even after Covid, airline traffic growth has been constant.
How is travel around the area?
Travel is just increasing worldwide, and another significant factor you can look at is that tourism is diversified. If you look at other beaches of Mexico, 80% of their tourism is from North America. However, if you look at Quintana Roo, they not only have North American tourism but also a tremendous amount of Europeans come to this part of Mexico. They not only come from North America but from other parts of the world as well. If you want a diversified target market, that is a massive advantage for Quintana Roo, making your investment more solid.
Follow the Big Money
And finally, you can look not only to the government investing in the area but also to the private money, follow the big money.
We are talking about large international hotels, airports, amusement parks. For example, Hard Rock has already opened another hotel south of playa del Carmen. Nickelodeon just opened a hotel less than a year ago. Hyatt has been busy over the last three years. Cirque du Soleil has a lot of places in Las Vegas, which is a huge tourist destination, and they decided to open one in Quintana Roo. That is excellent news because they have studied the market and have decided that it is an ideal place to invest.
Please contact Top Mexico Real Estate and let one of our representatives guide you in the purchase of your next investment.