Buying property in Mexico. New or resale?

When buying real estate in Mexico, first of all, you have to choose between the primary and secondary markets. We have studied the pros and cons of both options. This article is based on the opinion of our lawyer, current practice and our experience in Mexico, on the Riviera Maya.

The purchase of the property on the secondary market

This is the easiest and fastest way to buy a property in Mexico and take ownership. There is quite a large selection on the secondary market, so you can get exactly what you need. At the same time, there are key advantages of such a purchase:

1. You can immediately see what you are buying. There is no need to imagine what it will look like from a plan, photo, or presentation. You can view an apartment or house in a ready-made state, evaluate all its advantages and disadvantages, understand what you want to redo, and how much it will cost you.

2. There is no need to wait for the completion of construction, commissioning, or receipt of Escritura (certificate of ownership). You can, as soon as the transaction is completed, immediately move into your apartment or start renting it out.

3. Very often, "last-minute" real estate options that can be purchased at a discount are "thrown out" on the market. This is a very urgent purchase, the discount can range from 10% to 40%, but you need to make a quick decision

Of course, buying on the secondary market has its drawbacks. It's up to you to decide how significant they are:

1. If the object is three to five years old or even older, you might need to invest an additional budget into repairs and fixing. However, there are couple of options. If the owner lived in an apartment or house, it is unlikely that the budget will be too large. On the contrary, if the property was rented out, especially for a long time, then be sure to review it carefully and evaluate the possible expenses for restoration and renovation.

2. The property may be under arrest or in dispute, but you will not be told about it. Of course, at the current level of transaction support, this is not so critical. A good broker will always be able to check the object through the main Mexican registries. So, if you spend a little time and money on the services of such a specialist, you can easily avoid such a problem. Thus, we always recommend checking the property before buying.

The purchase of properties at the construction stage

The second option to acquire your future home is also quite common among all transactions on the Mexican market. For more than 5 years, construction companies have delivered more and more new objects for any budget. These are large villas on the beach, and duplex penthouses in condominiums, condos and small studios. At the same time, almost any object is already delivered fully finished, with furniture, plumbing and even part of the household appliances. Of course, as with buying on the secondary market, there are a number of nuances. First of all, consider the advantages:

1. You are the first owner of an apartment or house, so you can decide for yourself what type of decorations and finishing will be inside. You can determine what will be the missing furniture or appliances, as well as plumbing and flooring.

2. Pre-sale properties is an investment in construction. To attract more investors, the developer often offers discounts to pre-sale buyers. We can definitely say that at the construction stage, housing will always be cheaper than after the commissioning.

3. You have the option not to pay the whole amount at once, and split it into proportionate parts and pay for all the construction in the form of installments. The initial Deposit can be 20-30 percent of the total cost. Developers usually don't charge interest on installments if you pay on fixed periods of time. In addition, the last part of the money you pay only after receiving the finished property.

However, there are disadvantages to buying a home under construction:

1. You buy only on the floor plan without seeing the finishes, layout or external appearance of the building. In the best case, you can see a drawn photo or showroom. Of course, the final result almost always corresponds to the stated layout, but there are exceptions. Sometimes the finished property may differ from what you were offered at the initial stage of construction.

2. You may not be lucky if your future home is being rented, and neighboring houses or buildings are not yet completed. This will cause some inconvenience – life on the construction site is not the most pleasant.

3. Until the building is completed and officially registered as a condominium corporation, you will not be able to obtain an Escritura (certificate of ownership) and, legally, will not be the owner. Nominally you are the owner with all the rights, you can live in an apartment, rent it out, you can even sell it (under certain conditions), but the ownership rights at this point will only be evidenced by the contract of sale. Official registration and all related procedures depend only on the developer. You can't influence it in any way. There are condos whose owners have been waiting for two or three years for a certificate of ownership.

4. The unstable terms and dependence on the developer is also a negative factor. As a rule, construction takes from 1 to 3 years, depending on the object and the intensity of work. However, if the developer has problems with sales, the construction may be delayed, or even stop for an indefinite time. Therefore, you should always pay attention to past projects, experience and quality of previously built houses.

5. Almost all realtors are interested in selling you a new object from the developer. In this case, the realtor does not have any trouble with registration and verification of real estate, as all this is taken over by the developer. But this is where their responsibility ends, and in case of any difficulties, you are left alone with the developer, and, after the object is delivered, with the maintenance services when concluding contracts for electricity, water, and so on. Only the most responsible realtors accompany you till commissioning of the object. Such support, of course, does not guarantee quick delivery or better real estate. But at least you have one ally.

There is a third option for buying a finished object, and it can be attributed to both the secondary and primary markets – this is buying from those who invested during the construction phase. These people specialize in investing in construction in order to sell the house to the final buyer immediately after delivery. Of course, this increases the cost – it is unlikely that you will be sold at the same price as the developer. Also added concerns with the renewal of the documents. But at the same time, you do not risk your money and immediately get real estate.

As everywhere, there are nuances. Resellers do not care what repairs are made there, they can save on building materials, finishes, appliances or furniture. Therefore, you should carefully inspect the property and keep this fact in mind.

Whichever option you choose, before you decide to buy something, it is best to consult with a qualified lawyer and an experienced real estate agent, so as not to fix something that is difficult to fix. Every potential buyer should be careful, take their time and decide exactly what to invest in. Then the process will not take much effort and will not cause problems. And we will help you with this - https://realcaribbeanestate.com/