Realtors in Mexico are not licensed, governed or even experienced in real estate matters. They use the “Realtor” logo because their AMPI association has an agreement with the board of realtors.
Agents are buying franchise names, Realty Executives, Remax, Prudential, etc. they mean nothing and does not give a buyer any recourse. I only know of a few agents that ever had a license in the US, but have long been expired.
Title insurance is not recognized in Mexico and another marketing tactic to make Gringos feel warm and fuzzy. Good luck if you ever need to file a claim and collect. GE does not require title insurance on their loans.
It’s rare that the appraisal “Avalou” will come in at the same dollar amount as the purchase price. The agents will have a list of reasons and often compare it to the same as an assessment being less than a purchase price, with the exception of CA that has prop 13.
Agents will not offer the buyer to use an escrow company. For years they have been collecting the earnest money and then splitting it with the seller. Yup, it went into their pockets. I know many a buyer who lost $10K or more when the deal went south because they had no recourse.
You need an FM3 (Mexican green card) to enter into a contract and buy property in Mexico. But agents will tell you different. Why? Because without that you have no leg to stand on to take them to court when they take your money. Escrow has been a good thing. Agents use to offer a home for sale at a much higher price than the seller was asking and pocketing the difference. They still do if they can get away with it.
Mexicans pay about half of what the Gringos pay on most everything. Go shopping with a Mexican and you’ll see for yourself. Mexicans would never pay these high prices for homes here. But they laugh all the way to the bank when the Gringos do.
The Baja housing market is tied directly to the US housing market. If Gringos can’t sell in the States, they can’t buy in Baja. There are going to be a lot of empty condos and a lot of unfinished housing developments. I have already seen many new developments that have stopped work and the homes are not much more than shells.
GE financing is difficult to get and most of the loans do fall out when the appraisal is done. I am a broker for GE and it’s not as wonderful as it sounded to begin with. Also, a good percentage of applicants don’t meet the debt ratio guideline of 40% DTI.
For years this little town was virtually crime free aside from some petty theft of vacation homes. The “boom” has attracted thugs, obviously from CA as they are fluent in English and have shaved heads. Not typical of Mexicans. We now have reports of robberies at gun point, a woman was just murdered in a car jacking and an affluent American has been assaulted in his home twice by 5 armed men claiming to be policeman. Last year the chief of police was gunned down in front of his home and a few months ago 3 Rosarito policeman along with a civilian were beheaded. The drug cartel has set up house in the hillsides of Rosarito and obviously making their presence known.
Crime is increasing as the Americans have brought too much money into a poor area. These use to be predominately vacation homes, and the Americans who have lived here for many years have kept a low profile. But now the “Hummer” crowd has taken up residency and it’s attracting armed thugs far more agressive than the petty thieves stealing for a meal for the family. Guns are still illegal in Mexico, but we hear more and more about armed robberies while people are at home or in their cars.
Crime per capita is still far less than most places in the States. The primary concern here is that the US offers some assurance that the police will help you. You are not so lucky here, they often give victims the run around rarely go after the criminals.
So is Baja a good place to live? Well, we love it. If you are aware that you are NOT in CA. The people are great, the weather is awesome and the fresh seafood is wonderful. Don’t show off your “bling, bling”, get a couple of large barking dogs (Mexican banditos stay away from dogs), know what areas to stay clear of and keep a low profile. Enjoy the weather, the people and don’t let the news get you down. I wouldn’t recommend that you put your nestegg into property here. Don’t buy anything more than you may be willing to lose. You can enjoy oceanfront, or even great ocean view with beach access by buying a cheap home in a “campo” leased land. Leases are NOT 99 years, a legal lease in Mexico can run no longer than 10 years. Compare the prices, $400K for a home with a bank trust or a home for often less than $100K for a gated community. Eventually you will leave Mexico, either for medical or other reasons. It will be difficult to resell the expensive home. The cheaper one can always be resold or used for a vacation rental.
