Real Estate, Investment and Retirement opportunities in Baja and Mexico overall
Mexico and Baja have received a lot of bad press over the past years but many are still coming to vacation, relocate, retire and invest here in Baja and Mexico.
Why? Later in this article you will see why Mexico has created a new non-profit organization named Mexico Real Estate Coalition (MREC).
First off no matter what the media says not all of Mexico and especially the majority of Baja California and Baja California Sur (reportedly by the government to be the safest state of Mexico) is as unsafe to travel or live in as the media likes to infer. Yes, like anywhere in the world there are problems, but many are finding they are indeed safe to travel, as well live and enjoy a very comfortable lifestyle here in Baja.
Secondly, the cost of living in Mexico is much less “even in Cabo which is one of the most expensive places to live in Mexico” as Carol Billups, a Cabo real estate broker said to me today. I completely agree, you just have to know how to live, in Cabo or in any other tourist area.
Thirdly, and possibly most importantly, this is a great time to invest in real estate and take advantage of new opportunities. I spoke with several realtors around Baja today and they all pretty much were saying the same thing. There seems to be a larger inventory as developers over built and many people overextended are giving up their second homes, condos and properties in order to save their main residence in the U.S or some other country.
Proof they are still coming; According to the Mexico Tourism Board, tourism was up 18% from January to October this year compared to 2009. This is allowing for more opportunities whether it be directly related to tourism or not; the money trickles down. People wanting to relocate and possibly retire seem to be on the increase as Gustavo Torres a Rosarito Beach broker “We have seen a 30% increase in inquiries over last year at this time, with an definite increase of people wanting to relocate” Rosarito and the nearby areas have been hit the worse by the problems reported in Tijuana yet with the great work done by Gustavo's father, Hugo Torres, Mayor of Rosarito, Governor Osuna and of course many others, “tourism has held at least flat” according to Gustavo.
In speaking with a new contact Jim Moore in San Felipe that I found on Mexico-MySpace he too has seen a welcomed increase in inquiries and said 2/3 more are for already built homes and more are looking to relocate or buy for retirement. Carol Billups also pointed out today that in the Cabo area they are not selling near as much land as completed homes and these are retirees or people relocating from the US and other areas in the world.
Billups has created a 2010 Los Cabos Market report ( data from the AMPI LOS CABOS FLEX MLS system December 23, 2010) here are just a few of the facts from her report.
Median sale price = $350,000 USD, down 41% from 2009
Price ranges by area:
Cabo San Lucas = $41,600 - $3,050,000 USD
Tourist Corridor = $95,000 - $ 8,700,000 USD
San Jose del Cabo = $32,000 - $650,000 USD
East Cape = $12,500 - $700,000 USD
ACTIVE listings: 2,366 total including all properties on the Los Cabos MLS system
On our own www.BajaInsider.com site we are seeing an increase for inquiries for people that want to purchase real estate and retire here with the intention of retiring or semi-retiring as well as to work. I have also received inquiries from via my old site BajaRealEstateandConsulting.com from developers and investors that want to create large developments to boutique hotels, B&B's, fishing charters, studios, spas, gallery's, restaurants, bars as well as many other service businesses. With import and export easier every day, people are becoming more creative in ways to invest and create new businesses to live in Baja as well as the rest of Mexico.
I myself am putting my money where my mouth is so to speak as I'm currently in the process of purchasing a great deal in the Pescadero “Huerta” area on the Pacific side just south of Todos Santos and north of Cabo. I already have properties in that area but am now buying a new home, really two on the same property for less than I could buy the materials and land.
Now why has Mexico created the MREC and encouraging foreigners to retire in Mexico?
To begin I'd like to use an excerpt from Patrick Osio editor of HispanicVista.com that just sent out his Osio Report today as I was researching this article.
Osio states”Attracting retirement can be an economic boom to Mexico, A typical buyer who invests from $200,000 to $400,000 in the purchase of a home and without taking employment from local workers contributes from $2,000 to $5,000 per month to the local economy is a very positive economic plus for Mexico. For instance, in the Rosarito Beach municipality with 14,000 foreign retirees at a monthly local expenditure of $2,000 represents $28,000,000 a month $336,000,000 a year. It is not difficult to see that for every additional 100 retirees at the $2,000 per month expenditure $200,000 a month (2.4 million a year) to the local economy is generated.”
Osio also points out “foreign retirees are good citizens who care for Mexico and its people creating another plus for attracting their presence. But above all, it’ is in the best economic interest of the Mexican Federal, State and Municipality governments to support and promote foreign retirement in Mexico. “
Obviously the Mexican government as well as other real estate professionals are waking up to facts like Osio has pointed out in his report. The fact the US dollar are holding strong at this time relative to the peso (at approx.12:1 today) and that the Mexican government is trying to make it easier to invest, the U.S. title insurance and escrow companies that are available are also making it easier and safer to purchase. It is a very good time to find those great deals and you can do very well investing in Baja or other parts of Mexico.
However, please, please, please understand that even though there are many great deals to be had you must do your homework! I don't care where in the world you are investing without due diligence you may find you did not get such a great deal. I always like to remind myself and others. You make your money when you buy; not when you sell. In other words if you make a good investment you can always sell at a profit and of course if you buy a bad deal you will always lose.
James Glover
Publisher BajaInsider.com
Owner Baja Real Estate and Consulting
Resources:
Mexico-Myspace http://mexicomyspace.ning.com/
MREC http://www.mrecoalition.org
Carol Billups, Cabo broker loscabos@realtyexecutives.com
Gustavo Torres http://www.remax-baja.com
Jim Moore , San Felipe broker www.sanfelipevillagerealty.com
Patrick Osio www.HispanicVista.com
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