Purchase Mexico Real Estate – Villa La Estancia Real Estate

Destinations, FAQ, Fractional Vacation Ownership, Full Ownership, Real Estate, Residences

Pre-Construction Real Estate in Mexico: What To Know

It’s easy to see all the major changes that have been happening in Puerto Vallarta within the last five to ten years, especially if you know the Puerto Vallarta area well. Within the past few years, the Old Town and Downtown neighborhoods of Puerto Vallarta have experienced major transformations as developers are building more and more condominiums to meet the demand for people who are relocating to make Puerto Vallarta their new home. With many new construction projects under way, it has surely altered the charming appeal of Old Town, and many people are not very happy about the effect to the authenticity, charm, and ambiance that has been altered. There are more construction units underway and the change is not going anywhere, so the question is should people purchase pre-construction real estate in Mexico? Continue reading below if you would like to know the top tips to buy pre-construction real estate in Mexico to determine if the investment is worth the risk.

Upscale Condominiums
If you take a quick stroll through Old Town Vallarta, you will quickly notice all the new construction buildings being built amongst the charming, older buildings. Many of the new condominiums that are being built come with modern décor, gyms, an infinity pool on the rooftop, and many high end appliances. These high end amenities are fantastic for people who are wanting to purchase a modern condo that still provides access to the Mexican lifestyle they desire. These new condos come with luxurious amenities, and buyers will not have to worry about keeping up with the maintenance and repairs that come with older, out of date condominiums.

Problems to Avoid
One of the major problems that occurs when purchasing a pre-construction Mexican real estate property is that the product is unfinished, which is a huge risk. It has happened more than once when a real estate property in Mexico has had financial issues, which led to the construction being stopped when it was only halfway done, which left many investors upset along with being scammed out of a lot of money. When you purchase pre-construction real estate in Mexico, it comes with this risk and this can occur anywhere, but you can lessen the chance of becoming a victim to real estate scammers or a developer that is dishonest when you know the tips to prevent it.

Reputable Developer
When you are purchasing Mexican real estate, the most important tip is to make sure the developer is reputable. To find out if a developer is reputable, you should look over their qualifications, and to review the properties that they have completed on time. You should always ask the developer for references and then research the developer thoroughly. If you want to protect yourself, then you should always research and do your homework on the developer before you decide to purchase a pre-construction Mexican real estate property. Don’t decide to purchase any pre-construction Mexican real estate before the research has been done even if the developer promises you big discounts or incentives.

Construction Delays and Risks
It is not uncommon with any new construction projects to have delays, especially with real estate in Mexico. Many of the real estate developers in Mexico will include a contingency clause of 3-6 months past the due date of completion so that they have a buffer in case of delays. You should be aware that your construction may not be ready by the due date, so you should make sure that you are prepared for this so you avoid any unwanted stress. When you are dealing with any pre-construction real estate in Mexico, you should try to negotiate with a small down payment so that your initial investment is minimal. Once you have the key and you can move into the completed property, you can finish paying for it then.

Experienced Realtor
Another helpful tip is to always deal with a realtor that is experienced and qualified when you are wanting to purchase pre-construction Mexican real estate. You should look for one that has an outstanding reputation, and one that knows the local real estate market very well. When you choose a realtor that also has experience with pre-construction real estate in Mexico, then it will be a big help when you purchase your property.

Avoid Risk – Buy Completed Real Estate in Mexico
Last, but not least, a risk-free tip is to only purchase a unit from a property that is already completed. You may miss out on discounts that are generally offered on pre-construction Mexican real estate, but it will be worth it in the long run to avoid the unwanted risks and delays that could occur. One of the best real estate in Mexico properties to consider that is fully complete and move-in ready is Villa La Estancia in Nuevo Vallarta. With solid construction, spacious units, high-end furnishings, and finishes as well as beautifully landscaped grounds, Villa La Estancia is a guaranteed solid investment if you want high-quality real estate in Mexico. In addition to the amazing units, Villa La Estancia is considered a condo-hotel where you also have access to professional and courteous staff twenty-four hours a day who are available to help you with any reservations, tours or transportation arrangements you may need. Visit https://rivieranayarit.villalaestancia.com/ to learn more about all the amazing amenities and services available at this award-winning property.

Villa la Estancia Nuevo Vallarta Real Estate

We hope this information will assist you in evaluating whether purchasing pre-construction Mexican real estate is right for you.

by VLEAdminRE, August 23, 2018

Destinations, FAQ, Real Estate

Is dollar king for Mexico’s real estate market?

If you are thinking about purchasing real estate in Mexico, you may be wondering about which currency you will use to make the transaction. While the official currency in Mexico is the Mexican peso, you can still carrying out transactions for Mexico’s real estate market in dollars in top tourist areas such as Puerto Vallarta and Cabo San Lucas. There are advantages and disadvantages to this, as will be discussed below.

Is dollar king for Mexico’s real estate market?

Mexican Pesos

Technically, it is not legal in Mexico to use foreign currency to pay for goods; however, in practice, areas where there is a large community of expats and foreign investment will find that prices for high cost items like real estate are quoted in US dollars. Therefore, Mexico’s real estate market allows buyers to purchase properties with US dollars so long as both parties agree. However, you must remember that, even if you pay for your property in US dollars, the price quoted on the title deed to your property and used for calculating your property taxes in Mexico will be documented in Mexican pesos.

Remembering that the value of your property is recorded in pesos is important when navigating Mexico’s real estate market, particularly when you come to sell your property. For example, if the Mexican peso continues to devalue against the US dollar—as it has in the last few years— when it comes to calculating your capital gains taxes on your house, you may find that you will be subject to higher taxes, even if the equivalent sale price in US dollars is the same as when you bought it.

Let’s say you bought real estate in Mexico three years ago when you would have got 16 pesos for each US dollar, and it cost you the equivalent of 100,000 US dollars when you bought it, which would be 1,600,000 pesos. Today, one US dollar is worth between 18 and 19 pesos, which means if you were to sell your house for 100,000 US dollars, that would be at least 1,800,000 pesos, so you would pay capital gains on 200,000 pesos even though your property is not worth any more in dollars. You will essentially pay taxes on the profit that it appears you have made in Mexican pesos, even if there is no profit in real terms when you convert the price into dollars.

US Dollars

There are very real advantages to advertising your property in US dollars in Mexico’s real estate market in popular tourist areas, regardless of whether your buyer ultimately pays in US dollars or Mexican pesos. The reason for this is that historically the US dollar has been more stable than the Mexican peso and is less open to fluctuations during the selling process.

Selling real estate in dollars is attractive for foreign investors, though some Mexican nationals may be deterred from making an offer on your property as it becomes complicated when it comes to signing, particularly if the buying is relying on a Mexican mortgage, which will be calculated and awarded in Mexican pesos. If you insist that the offer price be paid in dollars, local buyers will not have a clear idea how much the property will cost them until the day of the signing. Such variables can lose a sale. Often, the best compromise is to advertise real estate in US dollars but be open to accept Mexican pesos or US dollars in payment.

If there is one fact you should take away from this article about Mexico’s real estate market it would be to remember that your title deeds will be quoted in Mexican pesos regardless of whether you paid in Mexican pesos, US dollars or coffee beans!

by VLEAdminRE, March 9, 2018

Destinations, FAQ, Fractional Vacation Ownership, Full Ownership, Real Estate, Residences

Is it possible to Purchase Real Estate Legally in Mexico?

You might have heard that there is no way for a foreign national to legally purchase real estate within Mexico. This is largely due to the constitutional limitations put upon the ownership of land and real estate by foreign nationals within 50 km (31 miles) of the coast and 100km (62 miles) of the international borders. Nonetheless, it is more than possible to purchase real estate legally in Mexico as a foreign national; you simply need to have the land held in trust through a fideicomiso. Thankfully, this process is very simple and straightforward since there are plenty of top Mexican banks willing to get involved these days.

Fideicomisos and Bank Trust Institutions

If you wish to purchase real estate in the restricted zones around Mexico (such as in Puerto Vallarta, Riviera Nayarit or Cabo) you will need to establish a fideicomiso, or trust deed, through a bank. The bank will then act as a trustee on your behalf; they will manage and oversee the trust in question, but you will retain all of the rights of ownership to the property in question. This means that you will be able to occupy, rent, transfer, sell, or bequeath in a will the property. The requirement to have a fideicomiso in place for property around the coasts and borders of Mexico does not, however, make it illegal for foreign nationals to own land or property in these area.

Renewable Bank Trusts

The initial life of a fideicomiso bank trust is fifty years, and at the end of this term the trust can be renewed for another fifty years, and so on in perpetuity. If you choose to sell your property at a later date to another foreign national the fideicomiso can be transferred, or cancelled so that they can set up their own, and if you sell to a Mexican national the fideicomiso can be terminated.

Appointing Beneficiaries

When you purchase land through a fideicomiso in Mexico you will be required to appoint substitute beneficiaries when the trust is finalized so that if the worst should happen and you pass on before the fifty year lifespan of the fideicomiso, your heirs will be given all ownership rights to the property. This means that your heirs will not need to follow any probate proceedings with the Mexican courts, thereby saving them time, money, and stress in already stressful times.

If you wish to know more about the legality of buying real estate as a foreign national in Mexico, contact us on 1 877 499 1901 or 1 866 843 7005.

by VLEAdminRE, August 20, 2017