- Insist on a comparative market analysis of the” solds” and a list of the competition on the market for any villa or condo you are considering buying. Don’t take no for an answer.
Although it is true that historically there has been a history of not recording true sales prices in the Mexican public registry, this doesn’t have to continue, and it is illegal. You, as a buyer have the right to information before you spend your money.
Information of sold data: price, sell date, area, and if there is a mortgage, is important. Traditionally, seller financing commands a higher sales price.
Some agencies do not show any properties for sale but their own.
If you ask for the comparative market analysis and a list of what is available in the areas you like, you should find more than one office’s information, or this is a red flag.
Insist on comparisons of what features the sold properties have versus the one you are considering buying. Opinion is cheap and thought requires work.
- Be careful about which agent you choose. Mexico does not require education or fiduciary standards for persons selling real estate. At the present time, anyone, national or foreigner can write up a sales contract for you to sign and receive a commission, whether his work is correct or not.
Foreigners should have permission to work from the government and be able to give you a copy of their RFC or registration in the tax authority, which shows they are a business.
Anyone trying to sell you something or acting as your agent tries to talk you out of professional advice, this is a red flag.
- Insist upon the purchase funds being put into an escrow account. There is no reason for you to use an account of the broker (which is prohibited by our AMPI chapters in the Bay of Banderas), or to use the notary or any private individual.
Don’t be talked into the idea that the cost of an escrow account is too expensive or a waste of money. Reputable escrow companies provide a Do Not Proceed with any purchase until you obtain local professional advice; badly needed service at reasonable fees. There are reputable escrow companies you can use in Mexico.
- Do not proceed with any purchase until you obtain local professional advice. Unless you are a national and understand Mexican real estate law and taxes, or you are a foreigner who is fluent in the language and understand the Mexican real estate and tax law, you are not capable of representing yourself. There are knowledgeable real estate agents, attorneys, and accountants available.
There are no formally approved real estate contracts, and no disclosure regulations for you to depend upon. You have to be aware and become good at asking questions and using good judgement.
You have a great opportunity right now to find a wonderful deal on a villa or condominium in our market of Puerto Vallarta, Bucerias and La Cruz, Punta Mita and many points in between. If you take sound steps in the process, you will be very fortunate and happy, for many reasons, to own a home here.
This article is based upon Flex MLS reporting, legal opinions, current practices and my personal experiences in the Puerto Vallarta-Bahia de Banderas areas. I recommend that each potential buyer or seller of Mexican real estate conduct his own due diligence and review. If you have any other questions, contact me through my website.Harriet Murray