Real Estate picking up

It would appear that the local market may have finally hit the bottom and is picking up again. There seems to have been quite a few sales in the past couple of weeks including a few that were on the market for years. I know two people who are currently looking and another that is coming down in a few weeks with the intent to buy.

Thoughts?

Yea it is better up north. Seattle was up 11% year to year. Where people want
to live (location location location) is booming in many areas. I believe we may
have hit bottom on the affordable side locally but expensive homes are still a
dime a dozen down here.

Z

Friends dropped by last night and said they just listed their property as they wanted to buy something with more space, and there were some killer deals out there (here). Come to think of it, we're doing the same thing.

Yes I know of several houses that just sold. Theprice was right and they sold fast.

Yep, that's what happens when the markets hits bottom and things get priced right for the current conditions. Now if the lake would fill up, the cartel guys behave themselves and the US/CDN economy stays on track we might see another slow rise in this area over the next 7 years or so.

It would be interesting to know the demographics of these transactions.

I hear the market in Guadalajara is alive and well. Our maestro is building two high end houses on spec there right now. He says that market is very good.

We can expect the real estate markets to gradually heat up over the next 5 years and on. Changes are coming with all the Baby Boomers becoming eligible for retirement. INM lowered the bar for permanent residency. Have over $130,000 in a savings or investment account and you're in. There are millions of ordinary people who worked hard and saved during the middle class boom of the 1960's, 1970's, and 1980's and then inherited $$ from their parents whose incomes also boomed during the 1950's-1980's. For those who saved or ran small businesses, these folks are ready for comfortable retirements. Women going into the workplace also boosted household income and savings to levels higher than typical retirees already in Mexico. People born after the Boomers missed those 3 good decades for workers, coming onto the work scene during the no-growth Reagan and post Reagan years of no growth for ordinary people's income. The folks born in 1948, beginning the peak of Baby Boomers are eligible for full benefits in 2015, and the wave continues to roll for another 16 years until the end of the Boom with the 1964 born Boomers. Real estate sales in vacation or retirement areas should increase for years as the savers retire and start to use their free time spending.

Friends sold their beautiful smaller home two weeks ago...after reducing the price by $40,00.
Took two years of effort, and they said they'd reduce it even further depending on an offer.
Thankfully the new buyers recognized a bargain when they saw one, and paid the new price.
No, they haven't remained in the area..said bye bye after ten years here.
Another friend has been trying to sell for two years, reduced the price three times, all she get are lookie-lookies, and curious neighbors.
I know five others who're looking for buyers...and they'll be taking big hits on their prices.

CanuckBob wrote:Yep, that's what happens when the markets hits bottom and things get priced right for the current conditions. Now if the lake would fill up, the cartel guys behave themselves and the US/CDN economy stays on track we might see another slow rise in this area over the next 7 years or so.

Amen! Got my fingers crossed!

There may be a few generations in the US who will never ever buy a house again, anywhere. That burst bubble affected millions of families very deeply financially and emotionally.

Add to that the expectation that buyers in Mexico pay all cash. Throw in the fear factors related to the narco business, local crime, the stricter INM and vehicle rules, police corruption and the slowness to re-sell properties here, and I don't see a lot of people rushing down as buyers; renters maybe.

Friends of mine who own here are worried that their children when they inherit the property will be subject to enormous capital gains since they won't have permanente status and not being able to obtain it. These are people who bought over 10 years ago when the sales prices were registed very very low. Another example of a sudden change of rules, Mexican style.

One way to prevent the kids to pay a huge amount of money is to sell the house and rent afterwards or buy a house with a deed that reflect the amount paid rather than what they use to put on the deeds.
Ten years ago our realtor explained to us that the value on the deed was some "calculated value by the city" which of course is all BS . I looked at what we "bought " the house for which is less than half what we really paid for so good luck to our heirs..

Let's get really cold about the "enormous capital gains" falling on our heirs. I mean, ice cold.

The heirs did nothing whatsoever to earn any amount derived from the sale of any Mexican property they inherit, so they aren't losing a thing. In fact, they're getting a windfall, even after taxes. Lucky them.

Good point Gringal.

It has been pretty common for sellers to put a low value on the deed to avoid paying capital gains. However, the buyer gets stuck when he/she sells later, since the taxman wants this seller to cover the difference. OUCH.

Unless your are Permanente , Inmigrado or naturalized that means lots of money less for the heirs or the sellers.It is the musical chair game byexcellence, eventually some one has no chair when the music stops.

We were advised to put the exact amount we paid on our deed to avoid any problems down the road.
We would hope that our kids would keep our Mexican place as a revenue generator and get away place. Or better yet, one of them may retire early like we did and move on in.

I'm wondering what the inheritance tax situation is here?

Nosnow wrote:Friends sold their beautiful smaller home two weeks ago...after reducing the price by $40,00.
Took two years of effort, and they said they'd reduce it even further depending on an offer.
Thankfully the new buyers recognized a bargain when they saw one, and paid the new price.
No, they haven't remained in the area..said bye bye after ten years here.
Another friend has been trying to sell for two years, reduced the price three times, all she get are lookie-lookies, and curious neighbors.
I know five others who're looking for buyers...and they'll be taking big hits on their prices.

It can get discouraging as there are so many lookyloos compared to "really" interested serious buyers out there. We figured that in 8 months we have had just a tad over 100 people looking. Even the ones who spend time, like a half hour to 40 minutes looking and come back 3 times don't buy. One of the biggest problems here is that Realtors cannot screen potential buyers like NOB. You'll get people coming to look at a 425 K house who can only afford 350 K. It was not a pleasant experience compared to the 3 times we sold NOB. The only pleasant experience is that we got close to asking.

And all of the above with monthly ads in Ojo del Lago and 2 times a month with ads for open houses.

CheenaGringo wrote:It would be interesting to know the demographics of these transactions.

Roughly 70% + American, 25% Canadian and 5% Mexican from the figures I saw last year.

gringal wrote:I'm wondering what the inheritance tax situation is here?

There isn't any....other than the ISR (Impuestos Sobre la Renta), when sold or transferred, if not exempt. That's why it is important to have your children delineated in your direct deed as heirs. Also, to avoid lengthy probate.

johninajijic wrote: The only pleasant experience is that we got close to asking.

Congratulations!!!

Rosa Venus wrote:

johninajijic wrote: The only pleasant experience is that we got close to asking.

Congratulations!!!

And a lot of people on this board thought you were asking too much....so much for the "depressed market", in your case, at least.

johninajijic wrote: The only pleasant experience is that we got close to asking..

Curious: what was your FIRST asking price and what was your FINAL asking price?

Sideways wrote:

johninajijic wrote: The only pleasant experience is that we got close to asking..

Curious: what was your FIRST asking price and what was your FINAL asking price?

Knowing John and his opinion of his house's value/worth...he probably kept raising the price.