The country’s healthy economy and thriving tourism have made Mexico real estate one of the most interesting, exciting and high-potential investments out there. However, when buying with investment in mind, there are most certainly a number of recommendations that you should consider before “diving in” – recommendations that will help you make the most of your investment and Mexico’s potential.
1. Review the legal status. Whether buying for investment, vacations or retirement, this is a point that is especially important. In Mexico, there is not only the possibility of unpaid taxes or liens on a property as anywhere, but also of communally owned property that technically cannot be sold. While there are some ins and outs for those more familiar with this kind of property, the goal is to buy something that is legally “bulletproof.”
2. Know your strategy. The two main approaches to real estate investment are appreciation and rental. Appreciation usually focuses on pre-construction discounts, price reductions, emerging markets, or those at a low-point with good potential to rebound. Rental income will focus on a region and specific location where there is high demand for vacationers – usually Mexico beachfront for sale is the most appealing. Long-term rental is also possible, but the choice of community and location type would be distinct. Be sure of which exact strategy you are undertaking and focus on a location and property type that corresponds.
3. Study the market. Analyze the area, find the price per square foot of a variety of similar properties to see if you want to buy is at the same level. If the price is above market levels, then be sure that the extra investment is justified by other factors – higher rental potential, nicer property/complex, services that benefit your investment (e.g. rental pool or activities for renters,) etc.
4. Analyze growth. Find out if there are plans for development near the Mexico homes for sale you are considering, for example, if there are plans for new roads, a mall, a a golf course, a theme park, etc. Remember that this can stall appreciation in the short term, but then result in attractive growth later on. Also analyze the possibility that planned projects may not unfold. How consistent have developers and the government been in carrying out plans in that area? What is the implication for your property if a specific project does not unfold?
5. Learn about the economy. Read an overview of the region’s economic expectations. Read articles, look at airport traffic reports, tourism numbers, cash flow and large-scale investment – both private and public. The idea is to keep yourself informed of what experts expect, what the area’s performance is like and why it may be a good investment opportunity.
6. Be aware of disadvantages. Each area has its strength and its weaknesses. Know the cons of economy and investment in that specific area. If you have chosen an otherwise good area, this shouldn’t change your mind, but only ensure that you have chosen the correct strategy and are looking at the right location and type of property.
7. Check the structural condition. Don’t skip the property inspection! A structure with flaws can cause you extra costs in remodeling the property. Find an expert who will ensure that the structure is sound; this step includes a small cost, but can save you significant amounts of money (not to mention headaches) in the near future.
8. Have patience. Remember that investing in real estate involves patience. This is especially true in Mexico where bureaucratic processes can take noticeably more time and are less “smooth.” Information is also often not as readily available; yet, it is that much more important that you are patient and persistent in finding the necessary information.
Also have patience with the results. If you are buying for rental, it is worth taking time (and money) to invest in marketing and advertising. Investigating successful property management companies should be a part of your plan, or even investing more into a property which has an established marking strategy built in (such as those on resorts or in condo hotels.) Even the best rental property is only as good as its marketing. For appreciation, there are cases where “flipping” properties is possible, but this is not the case for the majority of good investments. Consider long-term prospects for healthy growth in value.
9. Investigate financing. While banks in Mexico currently do not offer financing for non-Mexicans, many developers offer short term financing, and even long-term options. Many investors rely on financing from back home; interest rates are currently very low. Be sure to investigate your options ahead of time and compare the initial and monthly costs of financing to a reasonable (i.e. conservative) expectation of income and return from your property in Mexico.
10. Insure your property and your investment. The last thing you want is to buy a condo and not have it insured. If you are renting a property out, there is rental insurance which protects you in the case that your renters incur damages. Count this as part of your planned expenses.
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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 16 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 president of Top Mexico Real Estate. Contact him at (512) 879-6546.
The TOP Mexico Real Estate Network; “Mexico’s Leading Network of Specialists for Finding and Purchasing Mexican Properties Safely!â€
¿Qué es la plusvalÃa?, ¿Cómo saber si una propiedad tiene potencial de plusvalÃa?. Recordemos que la compra de una casa es una inversión a largo plazo, y lo que buscamos es que nuestro patrimonio crezca. Bien, con esto en mente, es necesario exponer algunos de los puntos básicos a evaluar en la futura utilidad de nuestra propiedad. Recuerda que los bienes raÃces en México representan uno de los mercados de inversión más estables e importantes del paÃs.
La plusvalÃa es “el aumento del valor de un objeto o cosa por motivos extrÃnsecos a ellosâ€, esto es, el valor agregado que con el tiempo adquieren los bienes inmuebles. ¿De qué depende que una propiedad eleve su valor? Simple, algunos de los factores principales a considerar son los siguientes:
Zona.
El valor que una propiedad puede ganar o perder depende directamente de su ubicación. Por ejemplo, si optamos por comprar una casa en un desarrollo residencial, es necesario saber si el nivel de la zona donde se ubica el desarrollo es alta, media o baja. El simple hecho de que una casa sea “bonita†no necesariamente la hace una buena inversión. Habrá que revisar todos los factores externos. El crecimiento de la zona y su potencial a futuro es el factor principal a considerar. Los planes de desarrollo de la ciudad, las construcciones aledañas, alumbrados públicos, infraestructura en servicios, etc. Consideremos preguntar lo más posible sobre los planes futuros de construcción en las zonas colindantes, y quizá revisar los derechos de uso de suelo no estarÃa de más. Si con el tiempo algún centro comercial o complejo turÃstico se instala en la zona, la plusvalÃa de nuestra propiedad se irá por los cielos, por el contrario, si en un futuro la zona se infesta de fábricas, viviendas abandonadas, o zonas comerciales ambulantes como tianguis o zonas rojas, nuestra inversión se podrÃa ver perjudicada.
Planes maestro.
La mayorÃa de los desarrollos residenciales cuentan con planes maestro, esto es, la planificación estructurada de su interior. Saber si cuentan con zonas comerciales exclusivas y planes futuros de crecimiento o expansión, también ayudan a mejorar nuestras opciones de inversión. Un buen desarrollo residencial procura pensar a futuro. Ver una maqueta no es suficiente. Hoy en dÃa, los desarrolladores procuran hacer de tu inversión un plan a largo plazo, por ende, tratan de cuidar hasta el último detalle la planeación y proyección de sus instalaciones.
Construcción.
No hace falta ser un experto en ingenierÃa para saber si una construcción es de calidad o no. Es importante revisar hasta el último detalle de ella, y recordarle al desarrollador otorgarte una garantÃa (en el caso de casas nuevas) por desperfectos en el uso, como pueden ser muros cuarteados, tuberÃas, o cableados eléctricos. Revisa los acabados y la calidad de los materiales que se usaron en la construcción, además si tu casa nueva cuenta con cocina integral, closets, tanques de gas, estacionamientos y demás caracterÃsticas, procura también inspeccionar la calidad de sus materiales y recibir la garantÃa propicia para cada una de ellas.
Reglamentos locales.
Los desarrollos residenciales, además de los planes maestro, cuentan con reglamentos de convivencia internos. Estos reglamentos regulan lo que está permitido y no, como pueden ser reglas en los diseños de construcción para poder mantener una simetrÃa general en la imagen del fraccionamiento, o reglas generales de convivencia, como son las especificaciones básicas de comportamiento entre los vecinos, y que pueden incluir tanto las áreas privadas, como las áreas comunes. Todo con el fin de cuidar la plusvalÃa general del residencial y sus residentes.
Riesgos externos.
Recordemos que en algunas zonas tropicales los temporales son habituales durante ciertas temporadas al año, asà que contar con protecciones especiales para nuestras casas o departamentos, como mallas anti-ciclónicas o muros reforzados, pueden ser una muy buena inversión a futuro. Además adquirir seguros contra huracanes, en lugares de costa, suele ser bastante inteligente.
www.topmexicorealestate.com la empresa lÃder en bienes raÃces en México.
pozos real estate says
It was nice to read your post. the rules which you have specified are actually very much important.and these should be known by every investor and seller as well.I am sure other readers will also like it.