If you dream of owning a vacation home in one of the world’s most popular beach destinations, but are unsure how to find investment properties overseas, it’s time to take a closer look at what Playa del Carmen real estate has to offer!
To help you understand the realities of buying investment property in Mexico, we’ve put together this list of five common misconceptions about buying real estate in this Mexican Caribbean beach town, so you won’t fall for any of these untruths:
1. Foreigners Cannot Buy Real Estate in Mexico
One of the biggest misconceptions people have is that foreigners are not legally permitted to buy property in Mexico, but that is simply not true. In reality, foreign buyers are permitted to legally own real estate in Mexico, just like they could in the U.S. and Canada. As a matter of fact, not only are foreigners permitted to buy and own property in Mexico, but the federal government has gone to great lengths to protect their rights. The main difference is that, when buying property in Mexico that is along the coast, it is required to establish a living trust known as a Fideicomiso for property that is purchased for personal use, or a Corporation for property that is purchased for business purposes. Just be sure to work with a reputable real estate investment advisor who will ensure that all documentation is handled properly and with the help of an English-speaking Mexican attorney.
2. Buying a House on the Beach is the Best
In reality, beachfront real estate in Playa del Carmen (or anywhere else along the coast in Mexico) is going to be much more expensive than real estate that is just a few minutes away from the beach. Also, you can expect to get much less for the money than you would if you purchased a vacation home that is only blocks away from the Mexican Caribbean. As a result, the best deals are going to be turnkey vacation rentals and investment properties that are within easy walking, biking or shuttle distance to the beach.
3. Getting a Loan is the Best Option
While financing is available in Playa and other parts of Mexico, an experienced real estate investment advisor will tell you that paying cash is always a better option to maximize your return on investment (ROI) and ensure that you receive maximum benefits from the purchase. Although many would-be buyers don’t have the cash on hand to plunk down, it is possible to buy real estate with a Self-Directed IRA account, which opens up a whole new world of possibilities. In some cases, it may also be possible to roll over funds from a 401k or other employer-sponsored retirement plan into a Self-Directed IRA account, so be sure to work with a trusted real estate investment advisor who can walk you through the simple process of buying real estate with an IRA.
4. It’s Best to Use a Realtor from Your Home Country
While it’s definitely best to work with a realtor when buying investment properties in Mexico, a realtor from the U.S., Canada, or wherever you are from is simply not going to have the in-depth knowledge it takes to buy safely and securely. Don’t make the mistake of basing who you trust on where they are from! The truth is, there are excellent local real estate investment advisors who are experienced with buying Playa del Carmen real estate and who can speak perfect English, whether they are from the U.S., Canada or elsewhere. Instead of focusing on where the realtor is from, look for someone who has a great reputation, is proactive and always open to answering all of your questions.
5. Buying a Fixer Upper Brings Greater Return on Investment
Last but not least, don’t fall for the idea that investment properties have to be in disrepair to constitute a great deal! The truth is, there are vacation home rentals available in Playa del Carmen that essentially pay for themselves after purchase and provide an ultra-luxe place for you, your friends and your family to enjoy. Also, property appreciation in the Mexican Caribbean is very high compared to what you will find anywhere else in the world that offers similar services, amenities and infrastructure.
Do you have any questions about buying real estate in Playa del Carmen? Let us know in the comments below!
Want to know more about why this Mexican Caribbean beach town is so special? Click the following link to read A Quick Guide to Playa del Carmen’s Booming Real Estate Market!