Our market is not volatile as some people would expect. We are more in ¨pause¨ while everyone is watching for who the buyers and sellers will be 2020 and 2021.
The majority of our 2,022 active listings are not subject to mortgages. This is key to understanding that our typical seller is not highly leveraged and has paid cash for his property. Carrying costs then are very low compared to the US or Canada where mortgages can be 90% of the value of the property.
A seller paying on a mortgage in addition to expenses of HOA fees, utilities, maintenance, will be more motivated to sell in uncertain times, because of the fear that they will not be able to afford to keep the property. Fear of big price drops come when there is too much cost associated with keeping the real estate. This is a characteristic of the USA in particular, and to a lesser amount, Canada.
Banderas Bay Real Estate Market Report
Year to Date Sales Activity January 1, 2020 to May 11, 2020
Current Active Listings of Condos, Land, Homes: 2,022 Properties
Active Condos: 1309
Active Homes: 472
Active Land: 241
– 193 with sales volume of $68,917.926 USD
– average sales price of $357,088 USD
– DOM of 296 days, % off list = 94.3%
– 77 sold with sales volume of $20,968,220 USD
– average sales price of $272,315 USD
– DOM of 290 days, % off list = 93.5%
– 10 sold with sales volume of $1,716,230 USD
– average sales price of $171,230 USD
– DOM of 302 days, % off list = 90.3%
We continue to sell more condos than any other real estate category which we list and report. The average condo sales price continues to rise slowly. Commercial real estate has not been a major part of our database. Our observation is that commercial real estate in this area is not listed and are private sales.
Home sale average price is lower than the average condo sale. Average sales price throughout the majority of communities in the Bay are lower than the reporting of homes in San Pancho, Sayulita, and Punta de Mita. These 7 homes sales are higher than anywhere else in our market.
This difference in average home sales prices indicate to us that SALES throughout our area are to locals and foreigners who are spending less than $300,000 USD.
Riviera Nayarit Real Estate Market Stats:
Investments in homes in Sayulita average $568,333 USD with a 344 DOM on the market and % off list of 93.5%.
San Pancho average sales price is $1,095,000 USD with 330 DOM and % off list is 89.9%.
Punta de Mita reports an average sales price of $1,925,000 USD with a 421 DOM and % off list of 78.1%
Total reported solds as of this date are 280 properties from an inventory of 2,022 actives or 13%. We should be careful about having an oversupply of inventory, which typically forces averages sales prices downward.
Traditionally, builders in our market do not do feasibility or absorption reports. In a tourism and second home market, it is not as easy to evaluate the factors which indicate how much should be brought to market to sell. We have over a dozen new projects, condos coming into our market as we speak. Construction is not stopping, and permits are continuing to be issued.
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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