It is December, and it finally cooled down two weeks ago. November was abnormally warm this year. Is this global warming? I am not sure I just know that my sweat meter was working overtime in the first three weeks of November when it should have cooled down in the 3rd week of October.
The market here is showing signs of slowing down as well. I attended my first Broker meeting on October 31st and the sales for 2023 so far are half of what we sold in 2022. Now in a normal economic reality of Demand and Supply we should see prices falling, however in this vacation fueled market where people do not have to buy, we have run into these circumstances that are stopping/slowing a dip in pricing across the board.
1. People who own here usually have at least one other home someplace in the world and the cost of carrying a home here is lower than their home country, so the following are reasons on why they hold to their pricing.
- Property taxes are crazy low.
- 99.9% of properties are purchased without a mortgage so the increase in mortgage rates in the USA and Canada does affect the owners as 99.9% do not have a mortgage here.
- A large number of owners rent their homes when they are not here, so they bring in income to cover costs plus an income.
- The Federal Government here is holding up construction of several buildings by not issuing their building permits. This is partially due to Covid that shut down this Federal office for a couple of years and now what I have been told is that there are over 3000 permit applications to deal with plus it has become a political football between political entities within the Federal Mexican Political Theater.
In my opinion the prices after Covid went up too quickly and too fast and that cut off a large part of the demand here.
Now we are seeing some price reductions but those are normally homes/condos that are not in AAA locations and there is most likely a need to sell by the owner.
Now the Million Pesos question is: will we a see a wholesale price decrease due to a drop in demand? I believe that prices will not drop across the board due to the reasons mentioned in point 1. This market will remain until the mortgage and inflation crisis in the rest of the world corrects itself because simply most owners do not have to sell.
Ok let´s change the topic. I want to talk about the Rincón De Guayabitos, Nayarit area. If you do not know this area it is about sixty kilometers north of the PV Airport on the 200 Highway. Now this old highway is only one lane for both directions. One hour is not bad however the highway is busy most of the time so in my experience, it has taken sometime up to three hours to make this journey due to slow and heavy traffic both ways on the windy roads.
Now, the new toll road that was opened last year from just past Bucerias has now cut this drive to Rincón De Guayabitos to 30 minutes so about 45 minutes from the PV airport. The toll cost is under $400 pesos.
I believe this new road will increase the interest in this area as prices are lower than PV and its surrounding areas.
There are no condos for sale in this area on the MLS, however I have been in this town a few times this summer and there is condo building being built and there are existing condo buildings. So, condos are largely sold privately or by agencies that are not part of our real estate association.
There are however several homes for sale in this area on the MLS, contact me to learn about current opportunities.
Again, this area largely stays off our MLS radar, but there are homes, existing condos and pre-construction condos for sale but will take some investigation by your realtor to identify what is available.
This is what I needed to tell you for December of 2023. If you need some help I am around and I will do whatever I can to protect your interest in any purchase or sale.
Adios Amigos!!
Gerard
gerard@gerardallardpv.com
+52 322 149 2045
