Thursday, August 11, 2005

About Buying in Nayarit Mexico

When you purchase a real estate or property in Mexico, you are making an investment in Mexico. Many people do not consider such a purchase as an investment.

There are good reasons for seriously considering an investment in Mexico:
The stock market has probably hurt more people than it has helped. Savings accounts are now paying historically low yields - even when
yields are higher, they’re usually failing to keep up with inflation.
Retirement Plans – many retirement plans have been greatly altered as
people’s 401K’s have declined in value.
Why not Mexico?
Your 401K may still afford a comfortable retirement there.
People are increasingly turning to real estate.
Oceanfront real estate property is the most sought after real estate in the world. A home on the Nayarit coastline can bring great personal enjoyment and also
produce a source of rental income.

Things to avoid:

Buying Ejido (pronounced "Heedo") land / property- Although vast stretches of virgin beaches exist in the area between Puerto Vallarta and Chacala, most are owned by the Mexican government or a Ejido. You may buy a parcel from one of the Ejido people (a Ejidatario) but you will have great difficulty legally carving this parcel out of the Ejido. As long as it remains in the Ejido status, you’ll encounter problems (e.g., it cannot be subdivided).
Buying an isolated lot or parcel that has been legally removed from the Ejido - Where individual lots or small parcels do exist, they are frequently a long way from good roads and utilities. These can prove to be enormously difficult to procure and unjustifiably expensive for a small piece of land.
Buying an isolated lot on a beach with other lots surrounding it - In the event the utility/road problems have been solved, such a purchase is still suspect as it presents the great uncertainty of what may happen on the neighboring lots over which you have no control. More than one nice beach house has one day awakened to a high-rise hotel that has been constructed right up against their common property line. Even if that never were to happen, the price you’ll pay for such a lot is somewhere between $300-600 per square meter.
Buying beachfront real estate / property outside of a controlled development - The problem is that all beaches in Mexico are public and as such your home is subject to all the problems you might imagine with strangers having unlimited access to your property.

Things to Consider –
Ocean front and ocean view real estate has consistently risen in value and risen at rates that have more than offset the ill effects of inflation.
Small lots in the heart of certain villages have been removed from the Ejido status and have good roads and utilities to them. Shops, bungalows, restaurants and offices can be inexpensively constructed and, as rentals, reward their owners well.

5 Comments:

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