BajaNomad

Mexico Feels Pinch of US Housing Slump

tigerdog - 6-2-2007 at 04:04 AM

There's an interesting article by Bloomberg News in the Bahia de Banderas News about the effect of the US housing slump on Mexico's economy. Heck, if it keeps up the USA won't have to worry about illegal immigration in the USA-- they'll all have to go back home because they aren't getting work. The article doesn't present a hopeful picture for Mexico's economy.

Mexico Feels Pinch of US Housing Slump

The U.S. housing slump is squeezing Mexican migrant workers from Los Angeles to New York, where permits for new home construction are down 20 percent this year, according to the U.S. Census Bureau. That is reducing the pace of money transfers, the second-biggest source of dollars in Mexico after oil exports, and turning the peso into a laggard among Latin American currencies.

Read the whole thing at the link above.

Diver - 6-2-2007 at 04:27 AM

Seems like any housing employment slump in the US will be offset by new construction in Mexico. Maybe they WILL go home !?!?

http://www.cnbc.com/id/18980644

"It's also the "other" US-Mexican border story. Debate the immigration issue all you want, but the increased visitation and investment by Americans in Mexico is well on its way to fueling an estimated 7.2 billion dollars in investment in the Sea of Cortes area in the next two years. And this isn't just visit and leave..."

.

tigerdog - 6-2-2007 at 09:41 AM

Yeah, but (there's always a yeahbut, lol)...

It's "Timing timing timing". Consider that at least in northern Baja and in Puerto Penasco, Sonora the brakes have been put on in terms of real estate sales-- and I mean SLAMMED, not gently applied-- and the picture changes. Check out this article for what I think is a more realistic picture. That CNN article is unfortunately either behind the times or someone is pimping for the real estate market in Mexico. ;D

http://www.sandiegometro.com/2007/may/connection.php

"Beachfront land prices along Baja’s coast rapidly escalated. But so what? As long as construction could continue, the land price was well within the return on investment formulas and demand was high — very high — sustaining the escalation of land and home/condo prices.

The unsophisticated and inexperienced Mexican developers are now the ones seeking bail-out formulas. They are beginning to hurt, as the market is no longer “open a project and buyers will pour in.” Now comes the hard work, requiring lots of know-how and intestinal fortitude, along with some deep pockets. The days of selling 40-plus homes over a weekend at one project are gone, at least for the foreseeable future."

Of course he also goes on to say "So it is altogether possible that Baja can create its own upward timing cycle through wise marketing and smart business plans. It may be time to dispel the “U.S. sneeze law,” at least on this subject."

But the overall data so far over the past several months doesn't indicate that.

When you add in how hard the US middle class is being squeezed, along with the fact that the use of home equity as an ATM machine has largely screeched to a halt, well all those developers building as fast as they can in Baja may have to put some things on hold for awhile.

As for those wealthy baby boomers everyone is always talking about, well to paraphrase Mark Twain: "Everyone talks about the baby boomers but no one does anything about them." HA HA. (OK, maybe I need another cup of coffee) :rolleyes:

Mexitron - 6-2-2007 at 09:49 AM

I remember the early nineties recession--the number of Mexicans who went home due to lack of work outweighed any Immigration Dept.effort to do the same.

CaboRon - 6-3-2007 at 07:39 AM

Isn't this how it is supposed to work. Tempory workers leave when the job is done. How did we lose this concept? And how is it that Mexicans are allowed to work in the US while we are deported for doing less in Baja CAlifornia. :no:

QuePasaBaja - 6-21-2007 at 03:20 PM

Quote:
Originally posted by CaboRon
Isn't this how it is supposed to work. Temporary workers leave when the job is done. How did we lose this concept? And how is it that Mexicans are allowed to work in the US while we are deported for doing less in Baja California. :no:



Because they do not Trust foreigners. That is the reason that you can never hold an office in Mexico. Even my son, who was born in Tijuana, will never be able to hold office here. He is the son of a foreigner, and can not be trusted.

Thats just the way they think.