Baja Realtors are bullish in Baja as we enter the summer buying season. This spring the Rosarito market was a little softer than last year. However, the last week of May is starting to bring more prospective home, raw land and condo investors. I say investors because many buyers are just that: buying multiple properties for speculation. Especially pre-sale condominiums that have doubled or tripled in value before construction is completed.
Baja mexico In San Felipe there was no spring nor even winter slow down-that market is simply hot, hot, and hot! The amount of U.S. realtors in town now appears to outnumber retirees. That obviously is not the case; it just looks that way to me because I like to drink and so do most realtors and developers.
Al’s Back Alley Bar and the Beachcomber are the favorite realty watering holes. On any given night the buzz at these haunts is all about real estate, real estate and more real estate. I can only handle so much of realtor talk. It reminds me of when I was a long distance runner and all my friends could only talk training and injuries hours on end - borriing!
What I have observed is that the Realtors and Developers in San Felipe are friendlier, more kickback and less “cutthroat” than the folks in Rosarito. Rosarito seems to stimulate disaccord and bad mouthing of one another. Perhaps it is Rosarito’s proximity to the border (a half hour) that provides easy access of overly ambitious U.S. realtors.
Ensenada realtors don’t have much to be cut throat about because there still is not a significant market for foreign buyers in Ensenada. There is buyer interest but not enough inventory, especially condo developments. Ensenada has been slow in developing gated communities and condo inventory for the foreign buyer.
The real buzz in Ensenada real estate is about the wine country. Just 20 minutes northeast of downtown is the Valle de Guadalupe – Napa Sonoma 50 years ago. The area is home to world class winemakers who are winning gold medals for their efforts in competition with U.S. and European vintners. The area attracts winemakers from all over the world who want to exploit the ideal climate, soil conditions, water and –most of all - the reasonably low land prices.
An acre of wine grapes in Napa-Sonoma is over a million per. In the Valle de Guadalupe $80,000.00 per acre. If you can find acreage with mature vines already planted, you’re in luck. Most planted acreage has been bought by L.A. Cetto, Domecq, Monte Xanic and a hand full of others. Most investors are buying raw land priced from twenty five to eighty five thousand dollars. They are considering the 5 to 7 year maturation period for cultivating decent wine producing vines.
ensenada wine countryThe annual wine festival which starts earlier and ends later every year – now June through September, brings tens of thousands of tourists to enjoy dance, music, good food and great wines every weekend. In addition, the unobstructed starlight and the valley’s warm summer nights captivate more wine lovers into living here.
Thanks to Stewart and First American, title insurance is becoming more of a standard among developers where once it was the exception. Fidelity Title can also serve Mexico but have all but disappeared in terms of promoting their product.
The risk to investors who secure title insurance is no longer one of title disputes. The study process, title companies require, practically eliminates the loss of property because of errors or omissions in title transfer. If title is subject to indemnification, U.S. courts enforce same; since it is a U.S. company serving an American citizen or other foreigners.
If you consider only properties that are title insurable you have eliminated a major threat to your investment but another risk exists for folks who buy homes or condos unfinished. The risk is incompletion of infrastructure and or habitat. Performance bonds in Mexico are very expensive and rarely in place.
Insist that your realtor provide due diligence on the developer’s history and that construction goals are being met in a reasonable time frame. The real estate bargains of a lifetime can be yours in Baja.