From where to buy property and what type, to the best questions to ask and what you can expect to see in the future, we’ve put together some of our top Playa del Carmen real estate investment tips to help new investors gain a deeper understanding of this robust property market.
“Playa is the fastest-growing city in Latin America and enjoys an active resale market”, wrote U.S. News & World Report, which also named Playa one of the top six places to buy property overseas in 2017. “This is another market [that is] interesting for its strong and growing rental demand, thanks to greater numbers of both foreign and domestic tourists”.
Take Advantage of High Occupancy Rates
Annual occupancy rates in downtown Playa del Carmen are always well above the regional average, which is already high compared to other popular beach destinations and hit 90 percent last spring. Of course, high annual occupancy rates ultimately equal high return on investment when you're talking about owning vacation rentals.
Last year in Playa, occupancy rose to the highest point in years by mid-summer as reserves rose by more than 20 percent and this year occupancy rates are already high throughout the entire state of Quintana Roo, which is home to Playa, as well as the vacation hotspots of Cozumel, Puerto Aventuras and Tulum. In addition, the fact that demand for vacation rentals is still far outpacing supply virtually guarantees that Riviera Maya real estate will not depreciate and that occupancy rates will stay well above what you could expect to see in other popular beach destinations.
What & Where to Buy
The first thing most people say is that they want easy access to the beach, which is great news because most of downtown Playa del Carmen is situated within 10 minutes or less of the Mexican Caribbean Sea! To stay in this part of town, ask your real estate investment advisor to show you investment properties that are on the beach side of the 307 highway.
You will also need to decide if you want a turnkey vacation home like a luxury condo or would prefer to invest in a standalone vacation home, which typically requires more time and money, but can also offer a larger return when you buy smart. On the other hand, if undeveloped land is what you seek, the Riviera Maya also offers plenty of options to buy land in the path of growth not far from downtown Playa del Carmen, where the price of land is poised to offer extraordinary return on investment in the coming years.
If you want to stick with developments that lie in or near Playa proper, the exclusive upscale neighborhood of Playacar on the south side offers a wide selection of gorgeous homes and luxury condos, but don’t forget to look in downtown Playa del Carmen itself, which offers the unique opportunity to invest in luxury condos that double as turnkey vacation rentals, which maximizes your return on investment and takes all the stress out of owning and operating a vacation home rental.
Top Questions to Ask Before You Invest
- How much is the maintenance fee?
- Management fees?
- What are the property’s biggest challenges?
- How old is the investment property?
- How is it marketed?
- Services and amenities?
- Parking and security?
- Is it a great location?
Generally speaking, look for investment properties that charge maintenance and management fees that don’t eat up most of the property’s projected income, and compare that to what other comparable developments nearby have reported to get an idea of what to expect in any given neighborhood within the city or its surrounding areas. When considering whether to invest in new construction, raw land or an existing development, keep an open mind and consider your needs when it comes to return on investment and how quickly you need to start seeing profits.
As for marketing the property, it’s important to understand that today’s market for vacation rentals is highly competitive, so it’s probably not a good idea to attempt to handle this on your own. Instead, look for a reputable property management company who can handle the day-to-day demands of renting to guests. This will also maximize your return on investment and guarantee that everyone who stays in your vacation home enjoys a high-quality experience.
As for location, beachfront is not essential, but easy beach access is definitely a must-have. Look for investment properties that are just a few minutes from the beach and that also offer a wide variety of different services and amenities. Guests prefer spacious luxury condos that are within walking distance of shops, restaurants and entertainment, but also provide easy access to the beach, either on foot or via a free shuttle service. Parking, 24-hour security, a professional concierge, on-site spa, pool, fitness facility, bar and restaurant are also always a plus.
Do you have other questions about real estate investing in Playa or elsewhere in Mexico? Post them in the comments!
Read 4 Secrets to Playa del Carmen Real Estate Investment to see more of our insider tips and expertise about buying property in Mexico’s Riviera Maya!