REAL ESTATE MARKET CONDITIONS IN MEXICO
There is no doubt that the real estate market in Mexico is highly influenced by conditions in the US. Yet, there are those who insist that even with its heavy reliance on the US for trade, Mexico and real estate in Mexico is able to stand on its own two feet. In most areas of Mexico, property taxes are still holding at about 0.1%.

Even with the surge in real estate development in Baja California Sur, property tax rates are still in the 0.1% to 0.2% range. Stateside in California, by comparison, the maximum amount of tax on real estate is limited to 1% of the full cash value, ten times higher than in Mexico. Meanwhile, Mexican real estate is valued at approximately one third of similar US properties, despite the countries being so near. And proximity is key: the relative value and appeal of property in Mexico comes down to the three key factors: location, amenities, and accessibility to the United States. There is more "value" in Mexico when comparing property prices to other "sunshine" destinations, not only to Americans, but to Canadian and European investors as well. These features, combined with Mexico's lower land prices, construction and utilities costs make Mexico one of the top real estate investment hot spots. For decades many of the people worldwide who have enjoyed vacationing in Mexico are now looking at purchasing property in Mexico as the natural next step.

Economically, Mexico is healthier than you might expect. Mexico is actually classified at the top of the list of countries ranked by economic wealth, with an "upper-middle" average income rating. With the strong presence of a number of American multi-nationals (with trade links all over the world) in Mexico, and although heavily aligned to the US economy, the situation at the moment is very steady. While areas such as Mexico City have proved to be very popular with both foreign companies and foreign investors, the area is fast running out of affordable land. This has caused the property market to mushroom outwards from Mexico City, bringing many regions into play. In Baja California Sur alone, real estate is booming. The top ten locations are (in alphabetical order): Buena Vista, Cabo San Lucas, El Pescadero, La Paz, La Ventana, Loreto, Los Frailes, Mulege, San Jose del Cabo and Todos Santos. Since the Mexican government has put foreign investment in tourism and real estate development high on its list of priorities and have been encouraging foreign investment, real estate property investors with an eye on Mexico are poised to take advantage and snap up some of the prime sites available. Whether the investment is a "maquiladora," a tourist development involving the construction of hotels or condominiums, or simply the construction of summer homes by foreigners, the Mexican government is maintaining its "open door" policy for foreign investment.