Vallarta Real Estate Information 101
Published Sep 1, 2009 - (Updated Sep 8, 2015)
Updated and featured in Vallarta Lifestyles Magazine, Winter/Spring 2011 issue.
Purchasing real estate in Mexico may appear to be a daunting venture. To help demystify the process, we’ve created this CliffsNotes-style, jargon-free guide. Providing an informative overview of this multi-dimensional topic, it includes answers to a number of the frequently asked questions that repeatedly come our way.
Should I be working with a real estate agent?
Yes, you should, whether you are buying or selling. The process is not as simple or straightforward as it is in the USA and Canada, and there are potential obstacles that a guide can help you navigate through (unless you speak Spanish, you’re at an immediate disadvantage). They also have access to marketing tools, such as the MLS, that allows more extensive searching, that sellers are not privy to. Here's an article link that explains more.
Is there a RE association and are realtors licensed?
AMPI, the Mexican real estate association, has three chapters in Puerto Vallarta that provide traditional real estate services and also ensure that realtors are behaving according to the highest professional standards. There is no mandatory licensing currently for realtors in Mexico; however, in Puerto Vallarta AMPI has stepped in to fulfill a similar role as best they can. More information regarding the local real estate association can be found at www.vallartanayaritmls.com.
So how do I find out what's for sale in Vallarta and Riviera Nayarit?
They are a number of ways you can go about this.
- Work with a real estate agent. Find one you are comfortable with who can help explain what the different popular regions are and what they have to offer, what type of real estate is available and walk you through the purchase process. There's a list of agents in the Vallarta Real Estate Guide or online at www.mlsvallarta.com.
- Do your homework. Get to know the different regions around the bay. Each community is quite unique. The best place to get good information about the regions is at www.mlsvallarta.com. There's a "Regions" section with explanations about each one. Be sure to also check out the regions section as well inside the Search function - here you can visually see each region, sub-region and obtain information about each one. You'll want to be familiar with the regions and sub-regions before you start using the MLS Search.
- Review the "Resources" section of www.mlsvallarta.com, where there is a large collection of articles about real estate in Vallarta.
- Start using Multi-List Vallarta MLS Search. The Search function at www.mlsvallarta.com offers plenty of information on properties that are currently for sale in Vallarta and Nayarit. There is a “Quick Search” that is very easy to use and can take of most of your needs, or use the “Maps” version for more extensive searching. You will also find a wealth of information about real estate projects under the “Advanced” tab, with descriptions, images, pricing and current inventory.
What type of real estate will suit our needs?
There are a number of different types of vacation real estate, beginning with timeshare, then fractional and full-time ownership. With these, any of them could be a condominium, apartment, townhouse or a single family dwelling. What works best for you depends where you are in your life and what your current finances will allow. You can always more up or down, as your needs change, into something that would work better for you. Visit this article for more information about property types.
What Community would be suit our needs?
Vallarta and Nayarit offer myriad of options when it comes to where you may eventually choose to live. You can be on the beach, in the mountains, along a golf course or in a marina. You can be right in downtown Vallarta or one of the small towns situated further out. For more information regarding community options, visit our Community pages.
What is the MLS system in Vallarta?
There are few systems in the region providing MLS service, one of the first and the longest running in Mexico, which combines properties for sale by both individual homeowners and real estate developers that can be found at www.mlsvallarta.com, www.mlsnayarit.com. There is a second site that provides information just on real estate developments at www.vallartarealestateguide.com. The real estate association AMPI also has an MLS system, which can be viewed at www.vallartanayaritmls.com.
Can I actually own land in Mexico?
Yes. Although the restricted zone specified in the Mexican Constitution prohibits a foreigner from acquiring direct ownership of land within 100 kilometers along the border or 50 kilometers along the coast, you can obtain all the rights of ownership in the restricted zone via a bank trust known as a fideicomiso. Since Vallarta lies within this zone, you need to use a trust here if you are not Mexican, but for all intents and purposes, it’s just like getting title.
What’s a “trust”?
Because of the restriction mentioned above, a buyer can request a Mexican bank of his choice to act as a trustee on his behalf. The fideicomiso (trust) can be established for a maximum term of 50 years and can be automatically renewed for another 50-year period. The title is transferable to any other party. The bank becomes the legal owner of the property for the exclusive use of the buyer/beneficiary, who has all the benefits of a direct owner.
What other ways can I find information about real estate in this area?
There are a number of print publications. Two of the more popular one’s are the Vallarta Real Estate Guide (free distribution all over town) and Vallarta Lifestyles (hotel rooms, newsstands and advertising clients), or check online at www.mlsvallarta.com, www.mlsnayarit.com, www.vallartarealestateguide.com or www.virtualvallarta.com.
What are the closing costs involved?
Whenever a real estate purchase takes place in Mexico, a number of additional closing costs are involved and should be taken into account. These can vary in amount and complexity, depending on the type of transaction and whether a trust is involved, and are determined by the notary office of your choice, along with the real estate agency handling the transaction.
How much are property taxes and other regular home expenses?
Property taxes are low compared to the USA and Canada; however, condos charge additional fees, such as homeowners’ association and master homeowners’ association charges. Utilities are reasonably priced, and household staff, such as maid, chef and butler, is extremely affordable.
Is financing available?
Yes. This process is easier than ever, and interest rates are lower than in the past. Many banks currently have English-speaking divisions, and many realtors are bilingual. Established realtors often have their own mortgage broker who can pre-qualify purchasers.
What are the advantages and disadvantages of condo living?
- When it’s time to leave, you simply lock the door, making it more secure than a private home.
- Sharing maintenance costs with the other residents lowers monthly expenses. Condos often offer a better view if you live on a higher floor.
- Because 80 percent of the product inventory in Vallarta is condos, there are properties available at all price points, with a wide variety of locations and styles to choose from.
- Sharing your costs means living in close proximity to others.
- Decisions about the property are made by group majority and may not reflect your preference.
- Homeowners’ association meetings can be challenging, particularly for those who’ve never lived in a condo.
What is the role of the homeowners’ association (HOA)?
The HOA is responsible for maintaining and administering the common areas of any project or development. They collect maintenance fees from the owners, provide reserve funds, pay the bills and work with a board made up of homeowners. A well-run association can keep your costs down, but it’s a good idea to find out how it’s functioning in any property you may be interested in. This is something that is too often overlooked when prospective purchasers are considering a property.
Are maintenance fees consistent in all developments?
What the condo fee covers varies from project to project, so research thoroughly before purchasing to find out exactly what the fees include.
What are the advantages of buying pre-sale vs. re-sale?
When purchasing a re-sale property, you know exactly what you’re getting; however, if it’s an older home or condo, it may require maintenance or upgrading or may be missing the stylish amenities a new unit may offer. Pre-sale purchases often involve purchasing over floor plans, models and artist renditions, which may leave some aspects up for contention later. Sometimes, though, it turns out even better than the buyer expected, but not always! Also, in challenging economic times, a developer may cut back on quality of finishing, in order to save money. But with a pre-sale property, you get the advantages of sometimes better pricing and stylish, new amenities. And it’s new, so serious maintenance should not be needed for some time.
A Short Questionnaire to Help Focus Your Housing Search
- Do you want to be close to town or do you want to get away from it all? More people are moving toward developments for social and security reasons and because they relish a sense of community.
- Do you want a condo, a villa or home? All options are readily available, so consider the pros and cons of each.
- Amenities? If amenities and activities such as golf, surfing, shopping are important, find out where the ones you’re most likely to frequent are located and investigate the housing options within reasonable proximity.
- Is having a view important? The Puerto Vallarta area offers river, ocean and jungle views, with prime properties offering all three.
- Which floor is best when purchasing a condo? All floors have their pros and cons. Talk to others to live in condos and find out their preferences, especially if you’re coming from a single-family dwelling.
- Will this property be primarily used by adults or entire families? Some developments cater more to adults, while others have beach clubs and children’s activity programs and are suited for the entire family.
- Do you need quick access to medical facilities? There are some excellent hospital throughout the area. Make sure you know their location before viewing properties if this is an essential amenity.