Foreigners buy real estate in Mexico for a great variety of reasons. Some people are buying because they move to Mexico to live and work, and prefer to buy property instead of renting. Others come to Mexico to retire, or plan their retirement, and some are just looking for a worthwhile long-term investment for their money.
As Mexico is a major tourist destination, a significant number of people are buying real estate in Mexico with the explicit intention of renting it out as a vacation home.
Perhaps you don’t want to live in Mexico full-time, or maybe you’d like to, but your lifestyle doesn’t allow you to do so at the moment. Buying a vacation home gives you a foot-hold in a local property market and can also offer a number of other opportunities. Your investment can earn an income while it’s being rented and you can take rent-free accommodation for your vacations in Mexico. This is in addition to storing up long-term investment value. In due course, you may re-sell your property, or you might move into it full-time or part-time, perhaps to retire.
The most popular areas for vacation home investments in Mexico are the Baja Peninsula, Puerto Vallarta, Cancun and the Riviera Maya. Other beach locations which are beginning to emerge as vacation home spots include Mazatlan on the Pacific coast, and Campeche on Mexico’s Gulf Coast. Further inland, San Miguel de Allende has a well-established market of vacation homes for rent; other colonial cities with vibrant vacation rental markets include Cuernavaca, Guanajuato, Oaxaca, and Merida.
Homes designed and built by property developers are one of the most convenient methods of buying a vacation home in Mexico, especially if you’re scouting for a purchase near the coast. Structured property developments lend themselves well to a vacation home investment because developers don’t just build homes, they also encompass a variety of local services and amenities such as swimming pools, gyms, shops, restaurants and golf courses into their plans. So everything that you and your guests need may be found close-by–this is also an enormous selling point when you come to market your vacation rental property. Homes on property developments are actively maintained as part of your service contract, so when something goes awry, for example, a burst water pipe, you may easily call upon people to take care of matters locally. This is also important for rent-paying guests, who are usually understanding of issues, but expect a fast and efficient response to them.
Homes not on a development can also be rented to vacationers and offer advantages and charms of their own—including, for example, authentic ‘old world’ character that is usually missing from new build developments. If you plan to rent a home that is not serviced as part of a development enclave, then you’ll need to put into place some local management arrangements in place to look after things when you can’t be there—this is usually arranged through a property manager or estate agent—who can sometimes be one and the same. Indeed, as the market for property sales has cooled in recent years, agents are actively developing their property rental and management service.
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