Americans visiting Mexico are rejoicing at the exchange rate. During the second week of February 2016, it was hovering around 18.5 pesos to the dollar. People are getting great deals on meals, souvenirs and hotel rooms. If Americans are thinking about purchasing real estate, now is a great time to buy.
Many thinking about retiring full or part time to Mexico will be receiving their incomes in US dollars and this transfers into a substantially lower cost of living. This alone can be enough incentive to relocate, but with the current exchange rate this could provide extra motivation to invest. There is an estimated one million US expats living in Mexico.
With more than 70 million American baby boomers expected to retire in the next two decades, many without adequate pensions or health care plans, some experts predict a vast migration to warmer and less expensive climates. Typically they purchase a property 10 to 15 years before retirement, use it as a vacation home and/or rental income, and then they eventually move there for most of the year. Developers are increasingly taking advantage of the trend, building gated communities, condominiums and golf courses.
Homes for sale in Banderas Bay are listed in US dollars. This is usually the procedure for investment properties and homes located in tourist areas of Mexico. There are adjustments made in accordance to the dollar’s value, so you are likely to find a good deal. The real savings come in the cost of your lifestyle and everyday living expenses which is less expensive.
According to Collier’s International Global Investor Outlook for 2016, real estate continues to grow in its appeal and remains a positive investment. More than half of the respondents with multi-asset portfolios said that they would increase their real estate allocations during the next 11 months of 2016. The outlook projects a five percent increase in Mexican investments.
Mexico is in a better position to withstand the beating in commodities prices because its economy is based on manufacturing and consumer demand from the US, the destination for 80 percent of its exports. Mexico also has an increasingly strong, private consumer and favorable demographics.
Moving to Mexico won’t create a price panacea. It is especially true if you buy lots of goods imported from the US. However, you will see a significant amount of savings, especially if you are savvy.