[headline h=”1″]A Condo or a House?[/headline]
When planning to purchase real estate in Puerto Vallarta there are many things to consider. The obvious starting point is determining what you can afford or at least be willing to spend. Over 90% of property purchases in Puerto Vallarta is conducted in cash through a wire transfer from your bank. (Cash does not mean carting down suitcases of greenbacks as some actually think.)
The different areas around Vallarta have different price points, too. If you have $250,000 on hand and want to buy in Vallarta’s Romantic Zone, for example, your better options are more likely condos versus houses and smaller older ones versus newer larger ones and probably not on the beach yet likely within a few blocks. There are some new developments that could work in that price range, too, and there are a number of fixer-upper houses should you be so inclined to go that route.
Mortgages have been readily available to Canadians and Americans for several years so the percentage paying cash only is slowly diminishing as more buyers choose to leverage their investment through a loan. Many who pay with “cash” do so by borrowing against their existing home equity. Some will seek financing from the seller as a bridge loan although this is the least enticing all round; however, there are times it makes good sense.
As getting a Mexican mortgage at reasonable rates is a real possibility opens up other purchasing opportunities and considerations. With that same $250,000, you could consider borrowing several hundred thousand dollars in addition to it thereby enabling you to get that larger condo you prefer on the beach.
It’s important to factor in closing costs, too, as they are the responsibility of the buyer. These vary in a variety of ways but a reasonable expectation would be 5% of the sales price. Some costs are fixed while others are dependent on the property value and whether or not you’re getting a loan. Generally, the higher the property value the greater the closing costs as a whole however the lower they will be as a percentage. With my flat-fee services, you’ll likely qualify for a rebate off the closing costs by several thousand dollars.
Once you’ve figured a price range you’re comfortable with including if borrowing is an option, you can start to determine which of the local communities work well for you along with the type and size of dwelling desired: a house or a condo?
Many buyers have never lived in a condo environment before and some find such an idea rather repulsive at first take but later discover it’s actually an attractive alternative. Not only in practical terms of getting more bang for the buck but for other good reasons such as how much easier a condo can be kept locked up and maintained during periods of absence.
Houses work well for those moving here full time or have service people arranged to check in and water plants, dust, etc. during periods of absence. There are numerous property management companies that provide many services, from simple tasks such as bill payments to providing maid and gardening services to rental services. If generating a rental income factors into your plans, be it a condo or a house or even a B&B, a general rule of thumb is closer to the beach the more likely it’ll be rented and the more rent that can be commanded.
Searching properties for sale will go a long way to educating yourself of not only what’s available in what areas and at what price ranges, but in determining which features are important and those less so. Not only in choosing between a house or a condo but rustic versus modern, hillside views versus flat ground with minimal steps to climb, a pool or no pool. Knowing and conveying what’s important will ensure my search of properties on your behalf match your desires.
Next: Upon an Accepted Offer
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[headline h=”3″]The Concise Guide to Buying Property in Mexico[/headline]
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1. Introduction
2. Before the Purchase
3. Upon an Accepted Offer
4. After the Sale
5. FAQ
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