BajaNomad
Not logged in [Login - Register]

Go To Bottom
Printable Version  
Author: Subject: Property Values?
Ricky
Junior Nomad
*




Posts: 48
Registered: 4-7-2014
Member Is Offline


[*] posted on 5-11-2020 at 08:36 PM
Property Values?


Thinking about purchasing a condo in the Rosarito area before the current crisis. Now, I love Baja, and chomping at the bit to return. BUT what does the group here think of the pre - closure prices vs the current market? I’m sure prices should drop, but by how much? 10%, 25% 50%? Inquiring mind. Thanks in advance!
View user's profile
RFClark
Nomad
**




Posts: 196
Registered: 8-27-2015
Member Is Offline


[*] posted on 5-11-2020 at 08:51 PM


Prices will probably increase this fall not go down. There seems to be a lot of interest.
View user's profile
mtgoat666
Platinum Nomad
********




Posts: 13008
Registered: 9-16-2006
Location: San Diego
Member Is Offline

Mood: Very stable genius!

[*] posted on 5-11-2020 at 10:41 PM


Quote: Originally posted by lencho  
Quote: Originally posted by RFClark  
There seems to be a lot of interest.

That surprises me in face of the current uncertainty; where are you seeing this interest? Are you in real estate?


economy is in dumps, usa unemployment is at 25%,... mexico seems to be in same boat as usa,... y'all be dreaming if you think demand will be there to sustain prices!
economy will take years to recover




Make America DECENT Again!

Resist!

View user's profile
mtgoat666
Platinum Nomad
********




Posts: 13008
Registered: 9-16-2006
Location: San Diego
Member Is Offline

Mood: Very stable genius!

[*] posted on 5-11-2020 at 10:43 PM


Quote: Originally posted by Ricky  
Thinking about purchasing a condo in the Rosarito area before the current crisis. Now, I love Baja, and chomping at the bit to return. BUT what does the group here think of the pre - closure prices vs the current market? I’m sure prices should drop, but by how much? 10%, 25% 50%? Inquiring mind. Thanks in advance!


who knows???

it's mexico, property title is very nebulous (a crap shoot), do not invest more than you can afford to lose!




Make America DECENT Again!

Resist!

View user's profile
Don Pisto
Nomad
**




Posts: 224
Registered: 8-1-2018
Member Is Offline


[*] posted on 5-11-2020 at 11:02 PM


rent something and wait it out......nothing but uncertainty out there
View user's profile
RFClark
Nomad
**




Posts: 196
Registered: 8-27-2015
Member Is Offline


[*] posted on 5-11-2020 at 11:10 PM


Personally, I think that people are planning to get out of the U.S. before the end of the year. South of San Felipe there have been a number of beach houses with offers recently. During and just before the lockdown.
View user's profile
chuckie
Select Nomad
*******




Posts: 6036
Registered: 2-20-2012
Location: Kansas Prairies
Member Is Offline

Mood: Weary

[*] posted on 5-12-2020 at 03:58 AM


What PT Barnum said.....
View user's profile
BajaMama
Senior Nomad
***




Posts: 747
Registered: 10-4-2015
Location: Pleasanton/Punta Chivato
Member Is Offline

Mood: Got Baja fever!!

[*] posted on 5-12-2020 at 06:52 AM


If I recall correctly, in the Punta Chivato area prices tanked in the mid to late 2000s as a result of the great recession. It always seemed to me that Baja had more tourists/temporary-permanent residents prior to 2007 but never really recovered. There were so many little shops that never re-opened in Mulegé and there seemed to be more people overall. Maybe Americans just drifted further south? I am wondering the same. What will happen to property values in BCS and Baja as a result of covid 19? Will the lack of HQ medical care in the face of a deadly virus be a deal breaker for older Americans wanting to spend time in Baja?
View user's profile
wilderone
Elite Nomad
******




Posts: 3468
Registered: 2-9-2004
Member Is Offline


[*] posted on 5-12-2020 at 07:27 AM


Check out the listings online - see how long they've been on the market. There are local realtors you can talk with to get their opinion. If you've got a few months, check the number of listings now, and compare a month from now - compare with new listings, and see if the prices came down. If a unit has been on the market for a year, probably willing to negotiate. Also might be some long term rentals available instead (Las Gaviotas?). Consider that once you buy, that's your primary go-to destination. If you like Baja generally, you might want to roam - not spend all your time in Rosarito. Airbnb rentals are popular - some seasonal homeowners like a house-sitter for months at a time. Thing is, there are options without incurring the full financial responsibility. Or buy a trailer of some sort - park it for a couple months at a time somewhere.
View user's profile
Lee
Ultra Nomad
*****


Avatar


Posts: 2854
Registered: 10-2-2006
Location: San Clemente, CA
Member Is Offline


[*] posted on 5-12-2020 at 10:45 AM


Quote: Originally posted by Ricky  
Thinking about purchasing a condo in the Rosarito area before the current crisis. Now, I love Baja, and chomping at the bit to return. BUT what does the group here think of the pre - closure prices vs the current market? I’m sure prices should drop, but by how much? 10%, 25% 50%? Inquiring mind. Thanks in advance!


Too many variables. Are you planning to f/t? How well do you know the area? 2nd home? Have you written off the rest of Baja?

My advice: rent, house sit, hang out in Rosarito. Do not buy right now. Baja RE is effected by RE up North. No one knows how all the BS right now will play out. If anything, I'd say prices will come down, may be way down, before going up.

Resale, in my opinion, is an iffy situation. Unless you're in for the long haul, getting your money out could take a long, long time.




US Marines: providing enemies of America an opportunity to die for their country since 1775.

God Bless Chesty Puller
View user's profile
sd
Nomad
**




Posts: 473
Registered: 3-19-2008
Member Is Offline


[*] posted on 5-12-2020 at 11:17 AM


California -

Depression Era level of unemployment.

Deferred mortgage payments. Deferred rent payments.

Failure of restaurants and business is just starting.

Open ended Pandemic.

We will see large reduction of values here, and it follows to Baja. Yours is not an investment, but a lifestyle choice. If you stay a minimum of 6 months a year, go enjoy if you can afford to. Renting would be the best start.
View user's profile
ncampion
Super Nomad
****




Posts: 1231
Registered: 4-15-2006
Location: Loreto
Member Is Offline

Mood: Retired and Loving it

[*] posted on 5-12-2020 at 12:01 PM


Don't think I could give away my house in Loreto right now or in the foreseeable future.



Living Large in Loreto. Off-grid and happy.
View user's profile
BajaNomad
Super Administrator
Thread Moved
5-12-2020 at 02:00 PM
thebajarunner
Elite Nomad
******




Posts: 3401
Registered: 9-8-2003
Location: Oakdale, CA
Member Is Offline

Mood: muy amable

[*] posted on 5-12-2020 at 02:17 PM


Last time we had a big economic downturn I pursued several possible deals in Baja.
Strangely, even with a serious down market, and values seeming to plummet, the asking prices went up for lots of stuff I was looking at.
There was quite a bit of discussion on this board about the illogical trends of pricing, given the slack times.

I am no expert in Mexican real estate. Owned a lot in La Mision years ago, but when I discovered the the ejido issues were so complex I gave it to a good friend down there. Happy to make him happy.

As always, in tough times, "cash talks" But I would not count on a major downturn in prices if history holds. Even in a slack market with little sales, prices tend to stay up in Baja.

I have been involved in major residential development in Central Cal for forty years, and right now, even in hard times, we are not cutting prices, and we are selling a couple houses a week.

Bottom line is real simple.....?quien sabe?? Who Knows??!!
View user's profile
Lee
Ultra Nomad
*****


Avatar


Posts: 2854
Registered: 10-2-2006
Location: San Clemente, CA
Member Is Offline


[*] posted on 5-12-2020 at 04:03 PM


Quote: Originally posted by thebajarunner  
Last time we had a big economic downturn I pursued several possible deals in Baja.
Strangely, even with a serious down market, and values seeming to plummet, the asking prices went up for lots of stuff I was looking at.


Prior to '08, Todos Santos' market was a feeding frenzy. Cash in hand buyers lining up. Then it dropped off drastically. No one was buying in the same way. Still, prices didn't drop. Remained the same and even appreciated.

Don't know the percentage of cash vs. mortgage buyers. I believe most buyers in the Todos area are p/t and buying a second home. Think most sellers know these buyers have cash.





US Marines: providing enemies of America an opportunity to die for their country since 1775.

God Bless Chesty Puller
View user's profile
BajaMama
Senior Nomad
***




Posts: 747
Registered: 10-4-2015
Location: Pleasanton/Punta Chivato
Member Is Offline

Mood: Got Baja fever!!

[*] posted on 5-13-2020 at 12:50 PM


It will be interesting to watch. We will either re-build or buy an existing home in 2-5 years. Hope to spend 3-6 months a year. That's the current plan anyway.....
View user's profile
Alm
Ultra Nomad
*****




Posts: 2368
Registered: 5-10-2011
Member Is Offline


[*] posted on 5-13-2020 at 01:48 PM


Quote: Originally posted by Lee  

Prior to '08, Todos Santos' market was a feeding frenzy. Cash in hand buyers lining up. Then it dropped off drastically. No one was buying in the same way. Still, prices didn't drop. Remained the same and even appreciated.

I remember selling my condo in Canada in 2011, well after the crisis.

Prices went up to pre-2008 levels but nobody was buying. Sales volumes were lower than at the bottom of 2008. Home is sitting on the market 9 months - this is a heck of a time in a big city, you take it off the market and re-list next year. If you can wait.

Those who couldn't wait, lowered the price. Occasionally an attractive property was causing a bidding war but mostly it was competition of sellers. Often several condos on sale in a low-rise building, one drops the price and 5 others drop lower yet. On the average, detached homes dropped by 1%, condos by 7-8% and there was a huge disparity btw the majority who didn't drop (and didn't sell for a year or two), and those who sold with 15-20% drop. With renovations, realtors commission and if there was mortgage in the picture, those who bought less than 5 years earlier had lost ~30-60K. Cash buyers fared better.

This lasted 2 or 3 years, until 2014. If your time horizon is 10 years or longer you'll probably get your money back.

[Edited on 5-16-2020 by Alm]
View user's profile
Hook
Select Nomad
*******




Posts: 8715
Registered: 3-13-2004
Location: Sonora
Member Is Offline

Mood: Inquisitive

[*] posted on 5-14-2020 at 08:20 AM


The ASKING prices in San Carlos Sonora, after the 2008 downturn, stayed flat or continued to rise, slightly; much to the surprise of many of us.

I concluded there were a couple factors involved in this. Maybe some conclusions can be drawn from this for other areas.

Probably the foremost reason had two related factors.

One, the sellers purchase of the home was not financed; they paid cash for it, probably before the run-up in prices of the early 2000s. So, no mortgage payments to service.

And, two, real estate in Mexico is actually very cheap to hold onto, while you wait to get your price. Even combining the cost of a fideicomiso, property taxes, utilities and maybe a gardener, it's dirt cheap to hold onto property, compared to the US. So, there isnt a monetary incentive to lower your asking price. The house isn't costing you that much to hold onto.

And, since the vast majority of homeowners in THIS area, still owned a home in the US or Canada, they always had a place to retreat to. They didnt have to have the cash from the sale of the 2nd home, to continue living elsewhere. And that second home in Mexico was still a fun, cheap place to vacation. A further reduction in strong motivation to sell.

All that SEEMED to change by about 2010. I say SEEMED, because, it was (and still is) difficult to get hard and fast statistics on what a home ACTUALLY ENDED UP SELLING FOR. While an MLS of sorts was created by the real estate agents in town, it never listed (and still doesnt, I dont believe) WHAT A HOME ACTUALLY SOLD FOR. You had to get that by word of mouth from friends, neighbors, friendly RE agents, etc. An outside shopping buyer might have trouble getting that info.

Naturally, if homes were actually being sold at a large discount to the asking price, that isn't something that real estate agents would want to reveal. They are mostly employed by sellers and their commission is based on the selling price, of course. If a buyer was unaware that most homes were actually selling for 60% of the posted asking price, they might offer full asking price. Or maybe only 10% less.

Indeed, word on the street from about 2010-2014 was never offer more than 60% of the asking price. In many cases, it worked.

Now, a strong motivating factor to sell was coming into play. In a retirement area like San Carlos, people seem to come here in 10 year waves. It started in the 70s, and accelerated rapidly in the 80s and 90s and early 2000s. Even right around the 2008 downturn, there were a large number of persons who retired (myself included) and moved to San Carlos. That certainly helped prop up RE values, during that downturn.

Corresponding to this are people who are growing too old to be away from their health care systems in the US and Canada. Age takes it's toll. So, there seemed to be a corresponding exodus at those ten year intervals. Some who retired before age 60, might actually stay for TWO ten year intervals (or a portion of the second period).

But the horrific news stories of the cartel violence and the collusion by many levels of the Mexican government, began to really take its toll on potential buyers around 2014, or so. This was coupled with the aging baby boomers starting to return home in greater numbers than the Gen X people could replace them.

This downturn, due to the virus, could easily exceed the "Great Recession". I would not be buying right now, unless you are getting RE at a deep discount to the asking price. One never knows the level of desperation to sell in a sellers mind. Health reason? Travel restrictions? Cartel violence? Increase in property crime, due to incompetent policing?

Unless a property is very unique in some way, I think offering no more than 60% still makes sense. Especially in properties (like many in BCS) that require a flight or a multi-day drive on a single lane road to get to. Who knows what the airlines are going to do after all this? Who knows what routes they will cut out?

View user's profile
Ricky
Junior Nomad
*




Posts: 48
Registered: 4-7-2014
Member Is Offline


[*] posted on 5-14-2020 at 11:28 PM


Thanks to everyone for their insight!
View user's profile

  Go To Top

 






All Content Copyright � 1997- Q87 International; All Rights Reserved.
Powered by XMB; XMB Forum Software © 2001-2014 The XMB Group�






"If it were lush and rich, one could understand the pull, but it is fierce and hostile and sullen. The stone mountains pile up to the sky and there is little fresh water. But we know we must go back if we live, and we don't know why." - Steinbeck, Log from the Sea of Cortez

"People don't care how much you know, until they know how much you care." - Ivan R. Misner, Ph.D

"You can easily judge the character of others by how they treat those who they think can do nothing for them or to them." - Malcolm Forbes

"Let others lead small lives, but not you. Let others argue over small things, but not you. Let others cry over small hurts, but not you. Let others leave their future in someone else's hands, but not you." - Jim Rohn







Thank you to Baja Bound Mexico Insurance Services for your long-term support of the BajaNomad.com Forums site.







Emergency Baja Contacts Include:

Desert Hawks; El Rosario-based ambulance transport; Emergency #: (616) 103-0262