Q: Is the negative publicity from the US about Mexico affecting the real estate market in Puerto Vallarta?
A: Yes, it has affected it. We are now into our third year of negativity, and there is a point at which people tune out what they hear too often, and began to make their decisions from fresher data. Yes, people who have never experienced Mexico will be the most unlikely to change their opinions. It is unfortunate we still deal in “stereotypes.”
A friend and client recently gave me a quote from one of John Kennedy’s speeches “We choose to live with the comfort of opinion, rather than the discomfort of thought.” Thank you, Randy.
Q: For the brave soul willing to buy in Mexico right now, what are they going to find?
A: This is the time to buy, not to sell. The cash buyer has a gourmet selection of properties from which to select.
Prices are down from lack of demand. Because the majority of purchases are all-cash here, there is not the problem caused by foreclosures and flooding of inventory from purchases on credit. Credit purchases and defaults create more cyclical markets like happens in the US, Canada and more recently Spain.
Q: Why do people buy in your market in Mexico?
A: We forget sometimes the immense important to Homo sapiens of warm climate, sunlight, air, water, etc. We are still animals and our subliminal needs are based on “shelter” and comfort. Let’s put it this way, if we didn’t have an average temperature of 80° F between November -April, we would be a different real estate market. It is not an accident that the majority of owners are from New York, Washington, Oregon, and BC Canada.
We also offer a fantasy, or “dream of something different.” Humans have dreams at any age and on any income.
We also offer an enjoyable lifestyle and standard of living much less costly than many areas of the rest of North America. Large towns are more expensive. Small towns normally do not normally offer amenities of ocean front, beach, superb climate, jungle, mountains, and exotic culture. To get these amenities up “north” will be more expensive than the Bay of Banderas.
Q: Is Mexico dangerous?
A: All cities now have the potential to be dangerous. Making generalizations is not the answer. Border towns on both sides of the border can be dangerous for obvious reasons. Where there is lack of money and opportunity, there is crime.
To quote Vincente Fox, former President of Mexico in his NY Times interview recently, “ The cartel gangs are nourished through the drug consumption in the United States. The U.S. provides the markets and guns that come back to Mexico and allow the cartels to be active.”
I believe we all realize this, but many of us are in denial.
Q: Is Mexico a weak and poor economy?
A: Mexico is a strong country with resources and a young population to compete globally. We tend to lose our focus when we only think of reduction in resort home sales. Prudential Investment Fund has just created a partnership to invest in warehousing in Mexico. This type of real estate is needed to houses Mexican exports to the USA, China, and within Mexico.
Mexican currency reserves are high, and bond ratings are excellent. Mexico is in better financial shape than the USA, and they both know it.
Q: What is one of the major weaknesses you see living in Mexico?
A: As I experienced living in the southern US and Texas, lack of education is one of the most basic mistakes any country can make. With education comes a professional labor pool, development of more entrepreneurs, more stable home life and less crime, and nourishing of local talent and “brain power.”
This article is based upon my personal experiences in the Puerto Vallarta-Bahia de Banderas areas. I recommend that each potential buyer or seller of Mexican real estate conduct his own due diligence and review.
Harriet Cochran Murray, Director of Cochran Real Estate, is a seasoned Real Estate professional both here in Puerto Vallarta, Mexico and in the United States. Harriet has served in many capacities as a board member for the local Real Estate Association AMPI (AMPI is the national association of real estate professionals). She is also a member of FIABCI and NAR in the United States. Harriet’s expertise and experience in the Real Estate and especially in the Mexican market makes her Viewpoint blog articles both informational and intriguing. Harriet is an Agent who specializes in getting the best deal on the right property for her clients. Visit her website at www.casasandvillas.com and Check out her Real Estate Listings.
