Colli Real Estate

A buyer's market in Puerto Vallarta, Mexico

By: Jim Scherrer

Fifty years ago, before John Huston brought Richard Burton, Ava Gardner and Deborah Kerr in Puerto Vallarta, Mexico to film "Night of the Iguana" was a small town Vallarta Mexican fishing dream nestled in the foothills Sierra Madre along the shores of Banderas Bay on the Pacific Ocean. Although the population was then only a few thousand native friends, the climate and beautiful scenery is so incredibly welcoming as Liz Taylor and Richard Burton fell in love with the people (and others!) and I bought a pair of "escape" houses on a hill overlooking the city.

After Vallarta John Huston led the world in 1963 as a beautiful paradise only two or three hours of most major American cities, the quiet fishing village, the gradual but steady increase in size to about 100,000 in 1990. Since 1990, most experienced Vallarta explosive growth as the pre-boomers began retiring baby boomers and began to prepare for retirement. Today, PV is home to around 350,000, approximately 50,000 are foreigners from the United States and Canada.

With the large influx of tourists and retired Americans in the construction of many opportunities employment and related services. As the area grew and prospered, Mexicans migrated to neighboring states to PV in the job search and related fields improving living standards. Naturally, with all of the local economy based on tourism and migration of retirees from North America, the entire infrastructure roads, electricity distribution, water treatment plant, etc. are adapted to current standards, good restaurants, shopping centers with air conditioning, tennis courts, golf courses, etc sprung up everywhere, the big box stores "came to town, the language barrier be uncommon in English, and all other services that are used when available.

Early and mid 90s, as the growth was remarkable and the Pre-Boomer waves began to migrate south new construction of homes and condos in Vallarta began slowly. In 2000, strong demand for new homes and apartments became quite clear, and developers have begun come to the city. With the growing demand, the current governing PAN party in Mexico, under the leadership of President Fox and now Calderon (both graduated from Harvard!) with their pro-foreign investment philosophies and FONATUR, the Mexican Foundation for tourism development, has provided new incentives to promote growth and encourage expansion of this resort along the Mexican Riviera.

With the strong demand for new housing, local government and citizens as a welcome, and developers who want to make money, came to the assault of new construction to meet the offer of the equation! During the first decade of the new millennium, the plots privileged in the sea around Banderas Bay and some of the best slopes of the Sierra Madre have been captured by greedy developers. The finance and planning began in earnest, as tower cranes have been erected around the city. Within a few years a number of rounds of condominiums have been built hundreds of condominium complexes appeared smaller, and many millions of new homes have been built in order to meet current demands and future American retirees.

What would take all these developers and speculators off guard: first, in March 2008, the mortgage crisis hit the United States, followed by the worst recession (and corresponding 40% fall in most markets) that most of us have ever seen followed by the media frenzy communication associated with the drug war along the US-Mexico border, and finally, the much hyped fear of swine flu Mexico, which took place during April and May 2009. The trifecta of a negative event provided the perfect storm of disaster Virtual Vallarta local economy, thanks in large part of the new construction will slow to a snail's pace or an impasse with some of the projects left unfinished or suspended indefinitely, the new project, many plans to sleep on the drawing table and a surplus of more than 7,000 new condos on the market.

Note that the drug war occurs approximately Border Town 800 miles of Vallarta and about the same distance as from New York to Atlanta or St. Louis. (Want to avoid going to Atlanta, if anything happened to New York?) The incidence Swine flu: we were in PV The time series of quarantine from April to May 2009 and has never seen someone sneezes, much less any type of contract against the flu! During these two months of quarantine at the end of season seven "high" from November to May, after which the local economy was devastated by the economy world had it not perhaps up to 100 cruise ships that have abandoned their plans to tie in Vallarta. Note that there were 9,000 cases of confirmed influenza pigs in the United States and Mexico around 5000, mainly in Mexico City which is 500 miles of Vallarta, and less than a handful of H1N1 cases had been reported and confirmed in Vallarta. (See the setup update swine influenza PV)

So what does all this mentioned Doom and gloom does and how it can affect you? Well, that offers a unique opportunity once a unique opportunity to capitalize on the speculators who have invested too much at the wrong time, an opportunity to capitalize on the misfortunes of others!

There are many re-sale, where prices have fallen by up to 25%, however, have not seen many changes in condominium development in New price list for last year. What we saw is that developers are now willing to negotiate as much as 25-35% in the price list then a year ago, nal 5-10% of its price list. These developers are willing to unload their inventory closer to its cost, as we are willing to continue their development plans. You ask: "Why are so eager to do so in an economy so terrible? Well, simply because the Mexican peso was devalued by 30% during the last year and now developers can pay their employees at work and buy their building materials like steel and concrete costs considerably reduced and when the economy turns around, she'll be back in the advantageous position ready to pocket handsome profits they had anticipated the initial stages of construction.

Although seizures are practically nonexistent in Mexico, because until the last five years, nearly all purchases were made on the property of effective of all, many owners of second homes and "Getaway" villas in the record that due to the loss of their retirement savings are in cash bound and the need to liquidate their retirement dream properties. Add to them the more than 7,000 villas, unsold new and fully understand why this is market to a buyer in good faith in Vallarta today. The current supply of beautiful villas and condos far exceeds demand, and if you have money (or credit!) For the left, now is the time to enjoy the situation.

If you also have been hurt by the market is in stock, and saw a 40% your IRA or 401k savings evaporate, it can be considered mortgages available in Mexico. Mortgage companies in PV, as MexLend and MortgagesInMexico are easy to handle and provide up to 30-year mortgages at fixed rates of less than 8% in any place with 20-50% deposit. This concept should be particularly attractive to Canadians, as in the opinion of the writer, the Canadian dollar, most likely appreciate against the U.S. dollar and the Mexican peso in the short term, namely, Canadians will have their purchase price lower than their wild strengthened over time!

They owned property in Vallarta for more than a quarter century, we can say categorically that we have never seen a better time to buying property along the Mexican Riviera and serious doubts that we'll never see him again in our lifetime. The choice is enormous, the availability of credit is great, and sellers are desperate, that is, Puerto Vallarta has come for the Pickin 'for investors, and retirement of the Baby Boomer! So if you dream of owning a piece of heaven, and do not feel too much like a criminal taking advantage of someone else misfortune, Come On Down and play in this exceptional buyers market!

About the Author

Jim Scherrer has owned property in Puerto Vallarta, Mexico for 26 years and resided there for the past twelve years. The mission of his series of 59 articles pertaining to retirement in Puerto Vallarta is to reveal the recent changes that have occurred in Vallarta while dispelling the misconceptions about living conditions in Mexico. For the full series of articles regarding travel to and retirement in Vallarta as well as pertinent Puerto Vallarta links, please visit us at Puerto Vallarta real estate buyers‘ Agents

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