Cancun is one of the most popular destinations in Mexico with an estimated 2 million tourist visitors each year. Located on the tip of the Yucatan Peninsula, Cancun overlooks the Carribean Sea. Cancun‘s real estate market has been largely driven by tourism over the last fifty years. It is the most popular tourist destination in all of Mexico and is located at the southernmost tip of the Yucatan peninsula, in the Mexican state of Quintana Roo.
In the late 1960’s, under the leadership of then Mexican President Gustavo Diaz Ordaz, Cancun underwent a transformation from a small relatively deserted island to the tourist mecca that it is today. In 1976, Cancun’s residents numbered only 18,000, but the population growth in the past 30 years has been astronomical, and the permanent residents of Cancun now number more than 500,000. On an annual basis, Cancun receives almost 3 million tourists, and has within its boundaries upwards of 30,000 hotel rooms to accommodate them all.
Critics are warning that Cancun’s tourism is about to reach its peak capacity and it appears that the high standard which made it a favorite destination is on the wane as evidenced by a survey which shows that only 20% of the tourists who responded said they would consider returning at a later date. Lowered standards in the tourism business in Cancun will certainly keep the rich and famous away, which will affect the local economy. In addition, lower standards will lead to the social and environmental degradation of Cancun as a tourist destination.
The entire Yucatan peninsula is often subjected to hurricanes that can cause loss of life and significant property damage. While the Mexican government moves quickly in the aftermath of a hurricane to restore the beaches and tourist areas, it’s important that property owners have adequate home owners insurance to cover this eventuality.
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Individuals wishing to buy property in Cancun have a wide range of choices, including beach front homes, condominiums and commercial property. Fractional ownership of resort property is also an option.
While in recent years, it was not possible for foreigners to buy or own property in Mexico which was located in the “restricted zone,” specifically beach front property such as that in Cancun, new laws have been enacted which allow a foreigner to acquire property under certain conditions. A foreigner buying property which is located in a restricted zone must have the purchase made for them by a Mexican bank. The bank will establish a Mexican real estate trust, known as a fedeicomisos. If the property to be purchased is commercial, a Mexican corporation, which is permitted to have foreign ownership, can purchase the property directly.
Prospective buyers should seek qualified professional help in order to finalize the purchase of restricted zone property. The U.S. Embassy in Mexico’s website provides a list of recommended lawyers, realtors and notaries, but states clearly that they will assume no liability, and that all buyers should exercise due caution when purchasing Mexican property.
Hurricane Wilma
There has been 1.5 billion dollars invested in rebuilding after Cancun was hit by the 140 mph winds of hurricane Wilma in 2005.
Sources:
http://www.ampiinternational.com/Restricted_Zone.htm
http://www.usembassy-mexico.gov/guadalajara/Gereal.htm
http://www.travelyucatan.com/cancun.php
http://www.travelandleisure.com/articles/the-next-riviera-resort-phenomenon
