General Information For Buying Real Estate In San Miguel de Allende, Mexico

Why buy San Miguel de Allende Mexico real estate?

San Miguel de Allende  has become a popular location to own a second home or vacation property. Many people from around the world -- and especially the United States and Canada -- are actively buying real estate in San Miguel. In recent years San Miguel become an attractive place to invest. You might know at least one person who has recently visited San Miguel or who has made a real estate investment in the country of Mexico. There are several reasons behind this trend:

1) The prices of San Miguel properties are often favorable in comparison with other destinations. And, with more and more people discovering Mexico, many experts believe the long-term investment prospects remain attractive. 

2) San Miguel’s culture and services are increasingly welcoming of foreigners. While Spanish remains the primary language in San Miguel, it is also true that more and more people speak English, enabling Americans and Canadians to have a more comfortable experience.

3) Over 70 million people in the United States are now over 50 years old. This segment of the population is prone to seek vacation homes, retirement locations and real estate investments.  As more and more people invest in San Miguel, additional services and infrastructure are coming up to support this trend. As this occurs, it will make San Miguel even more appealing to new investors, and therefore values should increase.

4) The long-term future of San Miguel looks promising. As a UNESCO World Heritage Site, the city itself is becoming stronger economically and the opportunity for long-term real estate appreciation in San Miguel continues to be favorable.

5) San Miguel’s natural beauty, climate and cost of living is attractive to many from the United States, Canada and other foreign locations. For decades many people have enjoyed vacationing in San Miguel. Purchasing property is the natural next step.

6) Over 1 million Americans now live full time in Mexico. Along with residents who have moved from other countries, this large population has proved the safety and viability of life in Mexico.

7) San Miguel offers an array of interesting and fun things to do. From hot springs, hot air baloon rides, horseback riding, hiking, bicycle riding to golf and tennis, most people are excited at the numerous types of recreation to be found here. And, of course, many people find that San Miguel is the perfect destination for simple rest and relaxation.

8) There is a large inventory of homes, villas, and land, plus a growing selection of developments with extensive amenities. This provides a steady supply of properties for interested buyers and investors in the San Miguel area.

Recently nominated as the 4th Best City In The World by Travel + Leisure magazine, it is no surprise that San Miguel provides an increasingly attractive location for Mexicans, Americans, Canadians and other foreigners. Most local experts believe that San Miguel Mexico real estate will continue to provide an attractive opportunity for both investment and enjoyment for decades to come.

General Buying Tips:

When it comes to purchasing real estate in San Miguel, the process of making an offer is very similar to how one makes an offer in the United States or Canada. However, the escrow and title process is different. Due to Mexico’s low standards requirements for entering the real estate profession there exists a variety of self-proclaimed real estate “agents” and professionals.  Buyer beware!

It is worth noting that there is no Multiple Listing Service in San Miguel at this time. All in all, you should only work with the highest quality professionals in all categories of the purchasing process, including brokers/agents, mortgage, legal, financing and title. Although it is quite common these days for foreigners to purchase San Miguel real estate, it never hurts to do a little background checking to ensure you are working with highly qualified professionals.

General Investing Information

Mexico’s economy is currently undergoing significant growth and improvement. In 1982, following it’s inability to support its escalating foreign debt, Mexico made changes in its infrastructure in order to encourage more foreign investment. Most notable of these changes was Mexico’s stance on foreign ownership.

Foreign ownership of Mexican companies, formerly limited to 49 percent, was raised to 100 percent for many businesses. This includes real estate development companies, hotel companies, etc. This change was important because many companies no longer need prior consent from the Foreign Investment Commission as well as a requirement to have Mexican investment partners.

Mexico’s economy is great for foreign investors. It offers a solid communications infrastructure, ample energy supplies, low labor costs, and skilled trainable labor resources all in close proximity to the world’s largest market.

In addition, the Mexican government has dedicated time and money to developing new tourist destinations with modern facilities and infrastructure in order to promote the tourism industry.

• A real estate company
• The buyer's lawyer
• A bank
• A public notary(Notario)

All four are helpful in their respective areas in assisting with real estate transactions.

Because of the similarities of real estate transactions in general, it is easy to assume that the basic terms and principles which are familiar in the United States also hold true in Mexico. This assumption becomes easier to make when United States real estate terminology is adopted for transactions in Mexico. Much of the paperwork is similar, if not exactly the same, as that used in the US. Although there are many aspects of Mexican real estate transactions that are identical to procedures carried out in the United States, there are many aspects that are completely different. As a rule, a foreigner should assume nothing.

Mexican real estate transactions are not carried out in the same manner as United States real estate transactions. The buyer must retain professionals to assist in the transaction. Mexico has yet to regulate real estate transactions. Real estate agents and brokers are not legally licensed in Mexico. Consequently, a foreign buyer cannot always depend on the normal safeguards that would be applied to real estate transactions in the United States. The old saying "let the buyer beware" is very appropriate. Anyone can set up a real estate company in Mexico. There are no special requirements or brokerage licenses to obtain. A would-be real estate agent merely has to establish a Mexican corporation, obtain a work visa, and he is in business.

There are good reasons why the real estate industry in the United States is highly regulated. Until the real estate industry is regulated in Mexico, there will always be some real estate companies who prefer that buyers know as little as possible about real estate transactions. After all, a buyer cannot ask questions if he does not have any knowledge of the laws.

Currently there is nothing similar to a Real Estate Commissioner or a Department of Real Estate in Mexico. Some states are beginning to look at some kind of real estate legislation, but it might be some time before this is a reality. The American Embassy and the American consulates in Mexico are good places to start when trying to determine if a real estate company is reputable. Some of the real estate companies have established quite a reputation for themselves at some of the Consulates.

A Mexican attorney should be involved to draw up contracts and to review the conditions and terms of sale. Additionally, an attorney can do a title search and point out any problems or alternatives a buyer may have. The buyer should always have his or her own attorney rather than using the attorney of the seller or some attorney used by a real estate company free of charge. As the old saying goes, you get what you pay for, and usually if someone's services are offered free of charge you are probably paying for them in some other way. Legally, only a licensed Mexican attorney should provide advice on the law. If an attorney is licensed in Mexico he should be able to produce a "cédula profesional." This document is a registered license to practice law in Mexico and includes a photo of the attorney and his signature. To be sure that an attorney is licensed in Mexico, a foreign buyer should ask to see the attorney's license, or have the attorney's license number included in a retainer agreement before employing any services.

Besides formalizing your real estate transaction, an attorney can be very helpful in saving you money. This is because attorneys are involved in many different transactions and have contacts with banks, notaries, and the Mexican government on a regular basis. Because of this they are aware of the most competitive cost and fees involved in a transaction and can make sure that the buyer is given the best possible prices. An attorney can also inform the buyer regarding his or her legal options and by doing so can make sure that no opportunities are missed: tax planning considerations, closing costs which should be paid by the seller. Very often one piece of good advice can save the buyer thousands of dollars in tax savings or other savings when the buyer eventually sells the property.

When looking for an attorney it is important to remember that any Mexican attorney can normally handle a real estate transaction. The buyer is not limited to only the local attorneys where the property is located. This means that all such transactions are carried out the same way regardless of where the property is located.