The Baja California Travel & Living Webzine

Purchasing Your Dream Home in Mexico Part 1

by Linda Neil

This article is the first of two parts to be published in the Baja Insider. It is a comprehensive work by author Linda Neil and will answer many questions for those interesed in buying property in Mexico. Linda Neil has been in the real estate business in Mexico for more than 30 years. Her knowledge and credibility are well respected throughout the real estate industry here in Baja. She is one of the founding members of AMPI, the Mexican real estate association. Linda works as a buyers representative in your quest for the Baja Dream home.

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Mexico is an exciting place to live for those who are retiring, for those who are working from home on a computer link with their company, for those who are looking for a vacation home or an outstanding investment... above all, for those who dream of a better quality of life!

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Once the area is selected and a list of the AMPI companies operating there has been obtained - interview the owners and operators of the companies. Ask for references, ask for a professional resume. Interview carefully the persons that most impress you. The person you select should be familiar with area, with basic real estate principles... and should impress you with his or her honesty and drive to find what YOU are looking for. Once you have found the person you feel comfortable with, stick with him or her and let him do his job. The sales person who knows you aren't shopping around will generally work harder to find exactly what you are looking for. Remember, it is your money and your commitment. Do not be pressured by someone who is charming but who does not listen carefully enough to understand YOUR special needs.
 

Home... the word represents security and comfort for the majority. All too often the word, when used in conjunction with a purchase of property in Mexico creates stress, worry and, at times has been associated with financial loss. This needn't be the case. Procedures in searching titles and transferring property are similar to those of the United States and Canada. The buyer of a house, condominium or lot in Mexico must ask the same questions, and should receive answers similar to those received when buying a property elsewhere.

RULE NUMBER ONE:
SELECT THE COMMUNITY AND THE COMPANY THAT FITS YOU

In considering the purchase of something so important as a home it is necessary to have the right people representing the buyer and his interests. This can be accomplished by first selecting the general area where you think you'd like to live. A review of the local newspaper or telephone directory will give a listing of the real estate companies in the area. Through NAFTA agreements, the Association of Mexican Real Estate Professionals (AMPI), is now affiliated with the U.S. National Association of Realtors (NAR), the Canadian Real Estate Association (CREA), and the International Real Estate Association (FIABCI). These important national real estate organizations are working to achieve standardization of real estate practices and procedures throughout the world. The company you select to represent you in your Mexican property purchase should be a member of AMPI. Not only is the AMPI member company required to operate under a higher standard of care, and to adhere to a code of ethics, but also it may have access to an increasing number of the properties available for sale through computerized data bases.

RULE NUMBER TWO:
EXAMINE THE NEIGHBORHOOD

Once you have selected the right community, an agent with whom you feel comfortable, AND a possible property, check out the neighborhood. Is it new? Is it old? What will it look like in ten years? Are highways or other development projects planned for the future? Where are schools, churches, shopping facilities? Are there homeowner fees for maintenance of common areas? If so, how much are they and when are they paid? Are all the utilities in and paid for? What does the developer have left to do? What building restrictions are there? Are there covenants and conditions registered for the usage of the land?
In many parts of Mexico there is no enforcement of a master plan or building codes. This can affect the changing face of the neighborhood you have selected.

RULE NUMBER THREE:
BUDGET FOR YOUR PURCHASE, CHECK TITLE AND UNDERSTAND THE MEXICAN BANK TRUST (FIDEICOMISO)

CLOSING COSTS:

Closing Costs will range from 4% to 30% (yes, 30%!) of the total cost of your property. The higher the price of the property, the lower the percentage of total costs for closing. This is because certain expenses for permits and certificates are fixed, regardless of the value of the property. Costs of transfer include title search, transfer taxes, bank fees, government permits and notary fees. Your seller may assist in some of these; especially those related to title search and insurance. Be sure to get a written estimate so that you will not have unwelcome surprises at the date of transfer of title! While your real estate agent may know the procedure, his or her specialty is to identify the correct property for you and to negotiate advantageous terms for the purchase. The technicalities of the transfer; negotiations for permits, registrations and so forth are generally more objectively and thoroughly handled by a neutral third party who does not have a financial interest in the transaction.

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Linda Neil, Salvatierra 120 esq. con Madero,
La Paz, Baja California Sur, Mexico
Phone: 1-877-214-4950 Mexico: 01-800-627-5130 x102

Additional Resources

Owning a Condo in Mexico
11 Rules for Buying Property in Mexico
Buying Your Dream Home In Mexico Part 2