Mexico is an incredibly diverse country that boasts rich culture, stunning scenery, and a warm climate. Not surprisingly, it attracts tens of millions of visitors every year. Mexico is also a popular destination for real estate investors looking to invest in a vacation home, rental property, or retirement property. In this blog post, we will explore some of the benefits of buying real estate in Mexico.
One of the main advantages of buying real estate in Mexico is the affordable prices. Compared to real estate in Canada, the USA, and other popular countries around the world, the cost of real estate in Mexico is significantly lower. This means that you can get more for your money, and potentially buy a property in a prime location at a fraction of the cost compared to other popular destinations. In recent years, the quality of construction has also improved drastically, with new product quality, finishings, and amenities rivalling (and often surpassing) that found in Canada and the USA.
Strong Rental Market
Mexico is a popular destination for tourists, expats, and retirees, which means there is a strong rental market for investor-owners. There are always many people looking to rent vacation homes or long-term rentals, and with a steady influx of tourists, you can expect a high occupancy rate. Additionally, there are several online platforms and services available to market and manage rental properties, making it easy to manage your investment remotely.
Favourable Exchange Rate
Another advantage of buying real estate in Mexico is the favourable exchange rate. The Mexican peso is typically weaker than the Canadian dollar, which means you can get more for your money when exchanging currency. This makes it easier for foreign buyers to invest in Mexico and potentially save money on their investment.
Return on Investment
Mexican real estate has seen strong return on investment over the past few years both in terms of price growth as well as rental rates. Since 2020, prices have increased between 5% and 10% annually depending on region. In addition, rental rates, especially in well-known sun destinations, remain high. A good example is Playa Del Carmen, where studio apartments sell for approximately $170,000, and the average rental rate per night is between $90-160+ per night depending on the season. The luxury real estate market is Mexico is also burgeoning, with a growing list of celebrities investing in real estate in Mexico.
Although future returns are not guaranteed, there is a good indication of a strong return on investment that we may see moving forward, when looking at real estate in Mexico.
A Stable and Growing Economy
As of 2022, Mexico ranked as the 11th largest economy in the world, and has a generally stable economy that is predicted to continue growing. The country has several key industries, including manufacturing, tourism, and agriculture, which contribute to its economic stability. This supports the likelihood that real estate investments in Mexico have the potential to yield high returns over the long-term.
Stunning Natural Scenery
Mexico is home to some of the most beautiful natural scenery in the world, including white-sand beaches, turquoise waters, lush jungles, and picturesque mountains. Many properties in Mexico offer stunning views of these natural wonders, providing a unique and tranquil setting for your investment.
Rich Culture and History
Mexico is steeped in a rich culture and history, with ancient ruins, vibrant festivals, and mouth-watering cuisine. Owning a property in Mexico allows you to immerse yourself in this culture and experience all that the country has to offer. It is also a great way to introduce your friends and family to a new culture and create lasting memories.
In conclusion, buying real estate in Mexico offers many benefits, including affordability, a strong rental market, a favourable exchange rate, a stable and growing economy, stunning natural scenery, and a rich culture and history. With these advantages, it’s no surprise that Mexico is becoming an increasingly popular destination for real estate investors.
Should you wish to embark on your home search in Mexico, please contact our office and we will gladly put you in touch with one of our colleagues at Initia Mexico.
Disclaimer: This blog is not intended to constitute investment advice. Should you require investment advice, please contact an independent financial/investment advisor.