When investing in Mexico real estate, one of the best ways to see quick and fairly certain property appreciation is by means of price reductions or "fire sales" from urgent sellers. While Mexico’s property market has, on the whole, been more stable than in the U.S., these urgent sales do arise on a regular basis, and buyers who are on the ball can take advantage of these sales to buy excellent properties below their value and enjoy immediate value increase.
As already mentioned, most real estate markets in Mexico have shown a greater stability in pricing. The "fire sales" which turn up in markets like Playa del Carmen or Puerto Vallarta, for example, are usually the result of personal pressures, which put owners in a position where they have to sell quickly. Since markets like these tend to still have a healthy amount of demand from buyers, the best reductions are grabbed up quickly by buyers who are on the ball. For you as an investor, it is ideal if you are one of these buyers who is "on the ball" and gets the price reductions quickly when they are at an ideal price.
The following are steps to follow in order to be one of these buyers:
- Be familiar with the market. When you’ve chosen your market and review prices of the property type you are interested in. Get a feel for what prices properties are selling for in the area, large scale investment and tourism activity. Internet resources, such as online property listings and a well informed Mexico real estate blog are a good place to start.
- Be informed on price reductions. There are also internet services which provide immediate updates on new price reductions, as well as any time a seller further reduces their price, such as TOPMexicoRealEstate’s "Top Deals" page. This particular service also offers buyers e-mail updates when new properties or updates appear, making easier to keep ahead.
- Know your budget & property requirements. When the right property shows up at an excellent price reduction it is important to be able to move quickly, since these properties get bought quickly. At the same time, every property buyer knows that rushing into a deal isn’t a good idea. For this reason, it’s good to have a very clear idea of your investment needs, so when the right property shows up a good price reduction you’ll be ready to evaluate the property without unnecessary delay.
- Make offers on urgent sales. One way in which to stay ahead of the game is to watch for urgent sales as they turn up. Even if the seller hasn’t reduced the price drastically yet, since their main priority is to sell quickly, they may accept a lower offer to avoid delay. On the other hand, if the price has already been reduced twice, it’s a significant percentage lower than the original asking price, and well below the average listing prices for this kind of property, there may be less room, and little time for lowering the price.
- Inform yourself of the differences in buying and owning in Mexico. Part of being ready to buy means knowing what it means to buy in Mexico. While many of the concepts of buying real estate are similar, there are different laws pertaining to the real estate industry in Mexico. If you are preparing to buy quickly, it’s especially important to be familiar with the process and the legalities, and to know what steps you need to take to minimize unnecessary risks. Online resources such as professional blogs, Q&A’s, and free e-books can provide the basics.
- Stay in contact with a qualified, experienced agent. In the end, your most important resource for keeping on top of the price reductions and tips and information about the differences involved in buying in Mexico will be a qualified, experienced agent. This is especially true when buying in a market area where you haven’t bought before. Take the time to find agent who is qualified (certificates, training and membership in Mexico’s professional real estate association AMPI) and reliable. They will be able to give you a special heads up when property meeting your criteria shows up, and help inform you on any special processes in your area, so making a faster move on a property won’t be a riskier move.