BiggerPockets

How to Buy Mexico Real Estate: The Purchasing Process

Monday, July 20

I have been involved in hundreds of Mexico Real Estate transactions.  Hardly any of the Mexico Real Estate Purchases have had the same procedures, or the same situations to occur.  As in any real estate transfer, there are many factors and parties involved, and when dealing in Mexico, with Mexican foreign buyers or sellers, the variables only increase. 

Thus, there is a high probablity that when you go to buy Mexico Real Estate transaction, it will be unique in itself, have its unique obstacles but following a common and legally protected Mexico Real Estate process.  I have written an introductory guide from my many years of Mexico business experience outlining the steps involved in How to Buy Real Estate in Mexico which I have shared with many first time Mexico buyers and sellers.

MEXICO REAL ESTATE DEFINITION

Lets start with the definition of Mexico Real Estate.  Click here to see a general  DESCRIPTION OF MEXICO REAL ESTATE.  As outlined in this web page definition, Mexico’s Purchasing Process has several EXTRA steps if the buyer or seller is a Mexican Foreigner.  There exists a Mexico Restricted Zone where the buyer will need to establish a bank trust.  Or, if you purchase outside of the restricted zone you can hold the property out right but just need to receive a simple permit from the Mexico Foreign Affairs department. 

MEXICO REAL ESTATE PURCHASING PROCESS 

a)  MEXICO REAL ESTATE AGENT

First tip,  surrond yourself with a very well qualified Mexico Real Estate agent and broker.  When you are hundreds of miles away back in your home country,  simple obstacles can easily become headaches if you have not taken the first intelligent step of surronding yourself with professional agents.  Ask for certificates, diplomas and credentials.  Are they members of any associations, if Mexican foreigners how long have they lived in Mexico and working in the real estate industry?  Do they speak spanish?  AMPI link.   

b)  MEXICO REAL ESTATE FINANCING 

Second, define the amount of money you plan to invest in your Mexico property investment.  If you plan to Mexico financing the purchase, begin to study and see if you qualify for such resources.  Do you plan to finance using the Mexican property or raise money from your home country.  Define these issues before investing time and money on your Mexico property search.    

c)  DEFINE THE MEXICO REAL ESTATE CLOSING COSTS

Third, understand all the costs that will be involved in the real estate acquisition.  Mexico closing costs include several extra items that most people are not accustomed or aware.  Although the entry costs may be a little higher, the carrying costs (property taxes, maintenance fees etc) are on average much less here in Mexico than in other parts of the world.    

With the above three items defined and understood, put your agent to work on collecting qualified properties that match your criteria search.  Review the options, have your agent prepare visits to the properties, do your comparison evaluations and ….have fun. 

There are various more steps involving preparing the offer to purchase, the contracts, notary publics and other issues for the Mexico property purchasing process which are outlined in several of my articles.  To see these articles and to learn more, please click here.  Mexico Real Estate Purchasing Process.

 TOP Mexico Real Estate NETWORK; "Mexico's Leading Network of Specialists for Finding and Purchasing Mexican Properties Safely!"

Region:  Playa del Carmen Real Estate     

Thomas Lloyd Graduate from Purdue University Business School with a degree in Management/Financial Option Investment.  He has been living, investing, and working in Mexico for over 15 years.  A Mexican certified & licensed realtor, he is the current president of TOPMexicorealestate NETWORK     "Our experience at work protecting your interests"  (512) 879-6546.

Comments

1. JOSE LUIS REVILLA ESCUDERO Reply
   over 2 years ago

   CITY BRANDING
   
   CHICAGO, TOKYO, RIO or MADRID are the applicant cities for 2016 Olympic games. An event supposed to be followed by more than 4.000 million people around the planet.

   Obviously, and since the games are being broadcasted by all TV channels, this event is supposed to feed the most aggressive marketing campaigns for most consumer brands and what is more important, positions the host city in a privileged place in terms of international exposure and knowledge, extremely beneficial for tourism and Real Estate developments.

   Formula 1 world series championship tours every year around places such as SINGAPORE, MONACO, SAO PAULO, BARCELONA, ISTAMBUL or KUALA LUMPUR. The TV audience is incredibly remarkable, mainly in the Asian territories, while the assistance to the circuits does not matter that much in terms of cash income, this event positions each of these cities as glamorous destinations, and therefore they become extremely profitable for touristic and Real Estate purposes.

   MONACO is more known in Asia by the yearly MONACO GRAND PRIX than for being a very wealthy and glamorous country-city place in the south of France.

   KUALA LUMPUR was introduced to the world in a wide basis through the image rights of the PETRONAS TOWERS appearing in this championship merchandising.

   ABU DABHI is for this year 2009 the new city that hosts a Formula 1 race, and together with Bahrein mean that 2 cities in the Middle East have decided to focus their City Branding strategy through this competition.

   Tennis events, through the currently called TENNIS 1000 MASTERS SERIES, are trying to emulate F1 world tour effects, by joining cities such as DUBAI, SHANGHAI, TORONTO and the traditional MIAMI – KEY BISCAYNE or INDIAN WELLS championships.

   Soccer European leagues such as the PREMIER LEAGUE in England or LA LIGA in Spain found out that becoming global was a great solution to increase the number of fans mainly in Asia and Latin America. Therefore, sponsors began to pay huge amounts of money to place an ad in the break time of a match, or even to sponsor the own teams through world tours. This has been translated into huge salaries for players and agents, and an incredible return in image rights for the soccer teams.
   MANCHESTER UNITED is actually the world´s most famous and valuable team, followed by REAL MADRID, MILAN, LIVERPOOL or FC BARCELONA.

   In Madrid, Spain, the REAL MADRID FC Stadium guided visit enjoys during some monthly periods more affluence of visitors than even the PRADO museum.

   What would be the recognition of LIVERPOOL or MANCHESTER as worldwide cities without their soccer teams ?? ( Apart obviously, in the case of LIVERPOOL, for being the place where THE BEATLES phenomenon was born )

   How can we measure the real economic impact for these ?... It is extremely difficult to validate since the tourism income, the assistance to local restaurants, pubs, or the sale of merchandising and souvenirs is very disaggregated. But, what becomes undoubtful, is the development of the worldwide image of these cities projected through these events.

   “City branding” strategies are also focused on huge and notorious Real Estate developments.

   Dubai is famous around the globe for being the city with more cranes in the skyline, including the building of the tallest tower in the world- BURJ DUBAI-, the most expensive hotel –BURJ AL ARAB-, the artificial islands on the water, or the ATLANTIS Condo extra glamorous inauguration.

   Also important to identify the city worldwide, are the key political and social personalities or celebrities that decide to move or spend vacations in these locations.

   Dubai is famous to be the vacation home of tennis legends such as Roger Federer or Boris Becker and F-1 seven times champion Michael Schumacher.

   Costa Rica has added to its nature attractions the fact that this is the place where Mel Gibson spends his holidays, or the Dominican Republic is being repositioned as a luxury destination mainly due to the international singer Julio Iglesias moving from MIAMI to PUNTA CANA to drive his investments in condo developments and golf areas. The monthly stays of Tennis champion Rafael Nadal during their relax periods also help to expand the Dominican image as a luxury tourist destination.

   If we get into the official surveys, the annual issue of the WORLD´S BEST CITIES TO LIVE outcomes the following list of places:

   1- VIENNA
   2- ZURICH
   3- BERN
   4- GENEVA
   5- VANCOUVER

   Obviously, the indicators to survey these places outline the public services quality, environmental issues, health facilities, air quality, pollution, and the dynamism or the cosmopolitan mixture of the people living in the cities.

   I consider myself a worldwide traveller. I have been travelling around the globe for a long time, and therefore, I have my own list of cities also classified under criteria such as the most cosmopolitan, trendy or dynamic…:

   1- SAN FRANCISCO
   2- SIDNEY
   3- MIAMI
   4- TORONTO
   5- VANCOUVER

   If we dive further in my list, anyone can find certain common aspects:

   - The first three enjoy an incredible warm and sunny weather along all the year.
   - The five cities enjoy an incredible mixture of nationalities, cultures and religions living together under the same atmosphere.
   - Gay, racial and religion communities allow them to develop a special lifestyle, quality of leisure services, and dynamism. As well as a continuous renovation spirit.
   - They are all placed in incredibly beautiful landscape environments.

   Obviously the prices for the properties listed in each of these cities reflect perfectly the personal characteristics mentioned.

   SAN FRANCISCO is the second most expensive area in the US, behind MANHATTAN in NYC.
   A 67 M2 apartment in a fancy community surrounded by the famous bay views is worth more than 1,5 million euros.

   SIDNEY harbour properties, close to the famous OPERA house, may be at prices around 2 million euros, for a 100 M2 condo apartment.

   Finally, MIAMI SOUTH BEACH luxury resorts, with private yacht marina, and amenities such as tennis courts, gym facilities or social clubs, may be fixing their quote at 1 M dollars for a 90 m2 property.

   VANCOUVER was selected by the HONG KONG millionaires as their living place after the Chinese break up in the famous S.A.R. They decided to leave HK afraid of the communist Chinese future impact, and transformed VANCOUVER from a lonely place into a dynamic and trendy location.
   Properties in gated communities outside downtown start at 1,5 M dollars.

   In terms of investment, it is clear that the business opportunities are on forecasting the future renaissance of a place before it becomes a hot destination.
   Therefore, this is a very difficult task since it depends on the government investments decision or the movements of celebrities from one vacation destination to another.

   Was it easy to forecast that DUBAI was due to become what it means today ?

   How can an average investor identify opportunities such as VANCOUVER before the Chinese Break up in HONG KONG ?

   To identify some opportunities, I would add in our current worldwide financial situation the following:

   - MIAMI DOWNTOWN: The new developments to be projected in Brickell area, now stopped due to the credit crunch in the US.
   - MEXICO DF downtown area, heavily impacted by the PESO devaluation of more than a 50% in one year.
   - RIVIERA MAYA condo resorts, with the option to rent the units for those months not occupied, and therefore very useful to pay the mortgage associated without any cash outflow.
   - PANAMA – Av BALBOA AREA luxury lofts with a little pre-payment, and complete cash outflow at the end of the construction, with the option to rent the unit at a 12% rate per year.
   - RUMANIA, TURKEY or even MOZAMBIQUE in AFRICA will become hot opportunities in a 5 year timeframe, mainly for the vacational investment, but obviously with an added risk because of the government stability and specific property owning conditions.

   I would finish this article mentioning that the current credit crunch is creating huge opportunities almost every day in the Real Estate investments around the world.

   It is only a question of cash disposal to make extraordinary deals !!!

   Jose Luis Revilla Escudero
   Chairman & CEO
   WWShares, Inc
   -Global Wealth Management –
   www.worldwideshares.blogspot.com

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