BajaNomad

Buying property in Baja?

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JESSE - 6-13-2009 at 02:46 AM

Skip speculators. (if they have never lived in the property, chances are, they are.)

Buy direct from owners.

Dont pay 4 dollars for something thats worth 1.

If using a real estate agent, dont go with somebody thats been here less than ten years and has a very short record.

When buying, things like the position of the home, the trees around it, and previous history of the house matter. Trust me, old Mexicans homes have certain vibes, some are great, some will cost you dearly in many ways.

Keep into consideration how and where the town or city is growing. That nice quiet area might be in the middle of a huge commercial area in a few years.

DONT trust a salesperson only because he is american. Many times they do not know what they are selling, all they want is to sell. They dont understand legal problems, mortage problems, etc. If things go wrong, they can always skip town. Something a reliable local agent who has lived all of his life in town will most likely not do.

Finally, DO NOT BUY or GIVE MONEY to anybody based on plans, a drawing, etc. It is not a good way to do business in this nation, regardless of what many say.

"US based", "title insurance", and "american style" what ever it might be, are just words here in Mexico. Mexican courts of law are your only way to play, so understand the way things are done here, and forget about the illusion that a word that sounds comforting back home gives you here.

[Edited on 6-13-2009 by JESSE]

JESSE - 6-13-2009 at 02:57 AM

Forgot to mention: Its also very good to buy from norteamericanos who have actually lived in the house, or currently live there. Many people come here, live here for a few years, and for whatever reason, go back home. They will usually give you a good fair price, know all the little details about the property, and even better, they have lived there and can give you pretty good piece of mind because they have been with the property for a while with no problems.

CaboRon - 6-13-2009 at 06:05 AM

All excellent advice ...

Corky1 - 6-13-2009 at 06:31 AM

Jesse,
Could you clear up the meaning of this statement.

"When buying, things like the position of the home, the trees around it, and previous history of the house matter. Trust me, old Mexicans homes have certain vibes, some are great, some will cost you dearly in many ways."

Thanks, Corky

Paulclark - 6-13-2009 at 07:08 AM

Good points - couple other things - get a title report from a professional and use a reputable notary as he/she is the one who is verifying the legality of the transaction.
Never pay until you receive title in front of the notary or use a recognized, legitimate ecrow agent.
If using a real estate agent go with one with professional recognition. In Mexico they should be a member of AMPI which is recognized in the US and has the international designation of REALTOR - INTERNATIONAL.
Paul

shari - 6-13-2009 at 07:13 AM

Very good advice and especially about the "history" of the place etc. Knowing the town and position well is very important....particularly when dealing with things like wind and odors...like from fish plants, sewage outfalls, neigbours etc....speaking of neighbours, this too is really critical...do you want to live next to a crackhouse...or a guy who raises fighting c-cks...or a party animal...or a flophouse where the highway crews crash or the baseball team house (or bajagringo...I've seen his sound system!!!:lol:) probably not.

Also people who move to an area because it is unpopulated can be in for surprises...for example here, the west side called "Alaska" had no homes out here a few years back and people thought we were crazy for living out here in the freezing cold wind...people have now started building homes and will most likely sell them cause it will be too cold for them. What seems like a wonderful little place can be hell in 3 months of wind. The guy who built our place didnt think things out and put the front door facing the predominant winds...duh...so um...face your house downwind folks, and plan to build a wall.

Also a place may be haunted...have real bad vibes...bad karma..whatever. Talk to the neighbours and locals about a place. Also things like...some may say...they will be putting power and water out to this lot soon...uh huh...we still dont have water out at the point and I've heard this for 8 years...soon...dont hold your breath...we had to go find our own power poles and put em up so they would run a line out here.

Try to buy some surrounding lots if possible so you arent surprised by someone building a bar, huge mansion, fish plant or worse next to you...there are no zoning rules or building codes in many places.

Also dont be afraid to make a much lower offer...mexicanos often start real high thinking they just might get it...

I highly recommend renting or leasing for awhile before you buy so you get a feel for the community and do it in the worst weather season if you can.

buying in baja is not for the faint of heart...but with a little homework and trust in the right people, it can be a neat experience. You really CAN live like a king for cheap...find your paradise and live happily ever after...
no matter what Cabo Ron says.

longhairedbeatnik - 6-13-2009 at 08:30 AM

I am sorry if this offends some people but having had a friend get caught up in the Loreto Bay scam I have doubts about the safety of buying in Mexico. I have spent the last few days searching on the internet for other land purchase horror stories and there are plenty. From Eijdo land grabs to conflicting title claims, Mexico needs to get their title system into the 21st century.
I am sure I will get toasted here for these comments but you should rent or use your RV rather than buy in Baja.
When you have to defend your property from a number of fronts just for the pleasure of owning it, its not worth it. We all work hard for our retirement funds and risking those monies on a house of cards is not worth it. Buy an RV and drive it home when you leave. They will have to steal your RV to get it from you but at least you can insure that loss.

rpleger - 6-13-2009 at 08:32 AM

Don't forget to ask about flooding, as in Mulegé...

Udo - 6-13-2009 at 08:38 AM

After many years of evaluating both options...we bough the RV.
The lucky ones who own property free of encumberances are Osprey and Shari.
Quote:
Originally posted by longhairedbeatnik
'you should rent or use your RV rather than buy in Baja. '
When you have to defend your property from a number of fronts just for the pleasure of owning it, its not worth it. We all work hard for our retirement funds and risking those monies on a house of cards is not worth it. Buy an RV and drive it home when you leave. They will have to steal your RV to get it from you but at least you can insure that loss.

longhairedbeatnik - 6-13-2009 at 08:42 AM

I am sure Shari has said on this chat site that she is a now a Mexican national so she is on better footing than most here. The Mexican nationals get their complaints looked at faster and more often than non Mexicans and I am sure she will confirm this.
I will continue to use my camper van to travel and stay in Baja.

[Edited on 6-13-2009 by longhairedbeatnik]

[Edited on 6-13-2009 by longhairedbeatnik]

DianaT - 6-13-2009 at 08:45 AM

Quote:
Originally posted by shari


Also people who move to an area because it is unpopulated can be in for surprises...for example here, the west side called "Alaska" had no homes out here a few years back and people thought we were crazy for living out here in the freezing cold wind...people have now started building homes and will most likely sell them cause it will be too cold for them. What seems like a wonderful little place can be hell in 3 months of wind. The guy who built our place didnt think things out and put the front door facing the predominant winds...duh...so um...face your house downwind folks, and plan to build a wall.


Yes, some call our side of the hill Alaska and it is USUALLY cooler there in the summer which is what we really like. It can get VERY hot on the other side.

What we have found during the windy season is that it blows EVERYWHERE in Bahia Asuncion. Sometimes we are surprised when it is blowing harder on the warmer side of the hill. ---Lots of mini climates---it is usually different in our front yard than in the back. But I would agree that knowing the climate is important---imagine buying a home in Loreto in January and then moving there in August.

I would also suggest that when buying from a builder, be sure that not only does your builder have a good reputation, but that he follows the rules like paying Social Security etc.

Having major renovations or building a place using qualified builders, but ones who are not playing by the rules is risky. If something happens, you can become responsible for all that was not paid----and you may need to pay all the medical bills.

Learned this one from a close relative who went with the less expensive "good" builder---cost her more in the long run.

Just our 2 cents.
Diane

Don Alley - 6-13-2009 at 09:01 AM

Quote:
Originally posted by shari

Try to buy some surrounding lots if possible so you arent surprised by someone building a bar, huge mansion, fish plant or worse next to you...there are no zoning rules or building codes in many places.


A next door neighbor builds an apartment building in his back yard. With no setbacks. :rolleyes:

Or, perhaps worse, a neighbor moves and rents his house to a gringo drummer. Band practice nightly.:O:lol:

Or the guy across the street gets elected. Frequent meeting in the street, cars blocking the driveway, etc. :lol:

One of those things could happen Maybe all three.:lol::lol::lol:

Still beats Loreto Bay. Even the drummer must think so.:biggrin:

longlegsinlapaz - 6-13-2009 at 09:46 AM

Quote:
Originally posted by longhairedbeatnik
I am sorry if this offends some people but having had a friend get caught up in the Loreto Bay scam I have doubts about the safety of buying in Mexico. I have spent the last few days searching on the internet for other land purchase horror stories and there are plenty. From Eijdo land grabs to conflicting title claims, Mexico needs to get their title system into the 21st century.
I am sure I will get toasted here for these comments but you should rent or use your RV rather than buy in Baja.
When you have to defend your property from a number of fronts just for the pleasure of owning it, its not worth it. We all work hard for our retirement funds and risking those monies on a house of cards is not worth it. Buy an RV and drive it home when you leave. They will have to steal your RV to get it from you but at least you can insure that loss.


longhairedbeatnik, your words don't offend me, but they do tell me that you're speaking from only one fairly isolated vantage point of what's happening with your friends experience. In the overall scheme of things I believe that there are many more positive experiences with people buying titled land here, using a good Notario, making sure all their little duckies were lined up in a straight row with all their little beaks facing the same direction.

Yes, there are horror stories & they're widely publicized, so everyone hears about them. The successful transactions aren't publicized simply because they were successful.

Yes, bad things happen, but I sincerely believe they are truly in the minority. I personally only know of ONE couple who were scammed by local real estate agents who absconded with their funds & left them hanging without a closed purchase transaction. I know literally hundreds who have bought & closed on successful transactions. So I believe extensive advance research & staying on top of all phases of the transaction is a major key to completing a viable transaction.

Your blanket statement would be comparable to saying, "A Ford buyer got ripped off on his vehicle purchase, so ALL Ford purchasers will be ripped off too!"

Over the past 10 years, I personally have bought 3 different properties, all with prior title issued, all from Mexican sellers, I've gotten fideicomisios on those properties, have built casas & eventually sold the first two properties....with nary a legal glitch. I may be unique in the number of times I've personally "tested the system", but I'm certainly not unique in the overall total of successful property purchase transactions.

While the term "Buyer Beware!" certainly applies here, it also applies in the states as well.:bounce: I personally chose to research the hell out of things, follow the legal processes in place &
enjoy a successful transaction....rather than living out my days in fear of losing my property!

Your friend got sucked in by unscrupulous developers & she wasn't alone. IMHO, she & the other LB buyers bought with their hearts & left their heads in the car! I feel sorry for them all, but LB is NOT the "typical" Baja Purchase.

IMHO, your RV suggestion is only valid for travelers, vacationers or part-timers. Would YOU want to retire, live here full-time & live out the remainder of YOUR days in an RV?:?:

longlegsinlapaz - 6-13-2009 at 09:50 AM

Quote:
Originally posted by udowinkler
After many years of evaluating both options...we bough the RV.
The lucky ones who own property free of encumberances are Osprey and Shari.
Me thinks yer a master at UNDERSTATEMENT! There are literally thousands of people/gringos who own "unencumbered" property here! :yes:

shari - 6-13-2009 at 10:07 AM

while it is a good idea to fully check out a place before you buy/move there...I sure hate the idea of our lovely village filling up with RV's!!!

I love the houses our new foreign residents have built...love it when people buy a lot, build or fix up a house and actually live in it and contribute in a positive way to the village. Short term RV'ers would be OK but I am worried about the wonderful ocean views being cluttered up by trailers.

dtbushpilot - 6-13-2009 at 10:09 AM

We're on our third piece of Baja property with narry a hitch on any of them......dt

Donjulio - 6-13-2009 at 10:09 AM

I agree whole heartily with long legs. I know a lot of people who own homes/land/condos etc with zero problems. Someone mentioned AMPI above. It needs to be pointed out that being a member of AMPI or being involved in a major "Brand Name" real estate company means absolutely nothing here in Mexico.

Just do your homework and ask around and people that have lived in the area for years will tell you who you can trust and who you can't. I don't do general real estate and when people ask me who I recommend, there are only 3 in San Felipe that I would do business with. None of them are AMPI but 2 do work for one of the major brand name real estate companies.

I don't understand everyones continuous comments about Loretto Bay being a scam. This economy has done a lot of damage and has put a lot of builders and developers out of business not only in Mexico but all over the U.S. There were 9 developers in the U.S. (that I know of) that all built over 300 homes a year that went completely under last year. This is not a Mexico thing.

One of the thing that concerns me about about a lot of the responses on this forum is that everyone says don't buy, lease. I think if you research it, the good majority of problems that people run into here are on leased or eijdo land.

It has been said 100 times - do your homework and you will be ok.

JESSE - 6-13-2009 at 10:49 AM

Quote:
Originally posted by longhairedbeatnik
I am sorry if this offends some people but having had a friend get caught up in the Loreto Bay scam I have doubts about the safety of buying in Mexico. I have spent the last few days searching on the internet for other land purchase horror stories and there are plenty. From Eijdo land grabs to conflicting title claims, Mexico needs to get their title system into the 21st century.
I am sure I will get toasted here for these comments but you should rent or use your RV rather than buy in Baja.
When you have to defend your property from a number of fronts just for the pleasure of owning it, its not worth it. We all work hard for our retirement funds and risking those monies on a house of cards is not worth it. Buy an RV and drive it home when you leave. They will have to steal your RV to get it from you but at least you can insure that loss.


Its a legitimate concern, but remember. Millions of Mexicans buy and have bought homes over the years, and most donīt have the kind of problems you frequently see around with foreigner and baja.

Theres a reason for that.

JESSE - 6-13-2009 at 10:58 AM

Quote:
Originally posted by Corky1
Jesse,
Could you clear up the meaning of this statement.

"When buying, things like the position of the home, the trees around it, and previous history of the house matter. Trust me, old Mexicans homes have certain vibes, some are great, some will cost you dearly in many ways."

Thanks, Corky


A house that gets hit directly by sunlight all day can be a nightmare in electricity costs. Specially if its for business purposes. Big trees = less sunlight=lower utility bills.

Finally, i am no believer in supernatural things, but some old homes have weird vibes. I donīt know how to explain it, but you will know what i mean when you wake up in the middle of the night to go to the rest room and walk tru that long corridor across the house in total darkness.

In good ones, you will even be tempted to go outside and look at the stars.

In bad ones, you will think about calling the local priest next day to trow some holywater around:lol:

Bajahowodd - 6-13-2009 at 01:22 PM

I have to agree with one point made by Donjulio. That Loreto Bay is not a scam. The project was not envisioned for the purpose of stealing from people. It was obviously focused on a certain type of potential buyer, and designed its marketing toward that group. That folks may criticize the gringo enclave/ non-Mexican feel of the place, should understand that those are factors that appealed to those who invested. I would guess that the developers over-reached with their original plans. And, as pointed out, when financing dried-up world-wide, unless they were scrupulously prudent with their debt load, they were destined to fail.

yes i agree

eetdrt88 - 6-13-2009 at 01:56 PM

when considering moving into a new community,always examine closely who will b your neighbor,preferrably a guy with one of those garage fridges that r always full of ice cold beer and has a large flat screen tv with some type of sporting event on 24/7,sometimes if u are lucky he will have children that always want to play with your children which is like free babysitting and he may even have a wife that is a good cook and if you show up around dinner time youre always the guest of honor;D

BajaNuts - 6-13-2009 at 02:03 PM

I'm going to start another thread on "house karma"-
look for it-

Donjulio - 6-13-2009 at 02:28 PM

One important thing to remember also when looking for property here. If you are going to purchase in a development, make sure that if "nothing" else happens that you would be happy living there. When I show a client a development that includes amenities that are not in yet, I always ask them, "how would you feel or like living here if you never get that pool or those tennis courts or that golf course?".

If you keep in mind that what you see right now is what you get then there is little room for disappoint down the line. Lots of developers (and yes a lot of them have no idea what they are doing) have big dreams, strong vision and good intentions. Without the working capital to make it happen it fails.

Bajaboy - 6-13-2009 at 02:49 PM

The best quality about our place is our neighbors....they couldn't any better.

arrowhead - 6-13-2009 at 02:50 PM

Quote:
Originally posted by Bajahowodd
I have to agree with one point made by Donjulio. That Loreto Bay is not a scam. The project was not envisioned for the purpose of stealing from people.


Maybe there is some kind of definitional problem with the word "scam". On the other thread, the poster said:

Quote:

A letter or email arrived several weeks ago telling her the project was 70% complete and would she forward her payment to the company. She emailed for some pictures to show the work completed and was forwarded pictures of her home. She paid the payment due at that time. Two days ago,one of other homeowners sent here pictures of her house and it is less than 20% completed . The company sent her pictures of another home that looked like her floorplan and scammed her into making another payment.


That is a scam. The lady was scammed. There are no two ways about it. You'll just have to wrap your mind around the concept.

arrowhead - 6-13-2009 at 03:07 PM

This is funny. On the one hand, we have one real estate agent, Paulclark, who advises buyers to make sure their Realtor is a member of AMPI. On the other hand we have another real estate agent, Donjulio, who advises that AMPI means nothing. Neither is offering "advice". They are both doing marketing here.

Then Donjulio tells us he advises his clients to consider if they would still buy if none of the "planned" amenities are ever put in by the developer. The amenities are a major part of the marketing package the developer uses to induce people to buy his project, and the buyers are theorectically paying for those "amenities" in their purchase price. So that is like asking, "Gee whiz, is it OK if we just defraud you into buying this property by promising to provide amenities and then not deliver?"

I can guarantee you would never hear a real estate agent NOB ever saying anything like that.

And by the way, WTF is a "title report" in Mexico? There are no title plants in Mexico. I know what a "title report" means in the US. It means that is the chain of title and all liens and claims for which the title insurance company is prepared to indemnify the buyer. But with no title insurance in Mexico, and thus no indemnification from anybody, what good is a Mexican title report?

longlegsinlapaz - 6-13-2009 at 03:10 PM

Quote:
Originally posted by Bajahowodd
I have to agree with one point made by Donjulio. That Loreto Bay is not a scam. The project was not envisioned for the purpose of stealing from people. It was obviously focused on a certain type of potential buyer, and designed its marketing toward that group. That folks may criticize the gringo enclave/ non-Mexican feel of the place, should understand that those are factors that appealed to those who invested. I would guess that the developers over-reached with their original plans. And, as pointed out, when financing dried-up world-wide, unless they were scrupulously prudent with their debt load, they were destined to fail.


IMHO, the initial premise of the development wasn't a scam. But the horrendous mismanagement of funds which evolved into sending pics of a 70% completed casa & passing it off to a client as their casa; while their actual casa is maybe 20% along, as "proof" to obtain additional funds....THAT to me IS A SCAM!:no: What would you call it?:?:

JESSE - 6-13-2009 at 03:14 PM

I would say a lot of the projects that go wrong here in Baja are not planned scams. But, money flows in and out very quickly around here because this area is full of people who come here only to make money. In the US, theres reputations to protect, etc. But here, many know they can come in, buy cheap, sell ridiculously high, and get out. I personally donīt trust foreign developments, because of what i said previously. They can get out, blame baja, the people, the mexican goverments, our laws, our courts, and go back home and keep working. Local developers may not be as flashy or present themselves as professional, but they live here, have a reputation to protect, and they have a track record. Here in Mexico we do know wich developers are honest, wich use shady materials to build their properties, etc etc

Cypress - 6-13-2009 at 03:22 PM

They had good intentions?:D How much $$ can we shake out of these idiots before they get wise to us?:tumble:

JESSE - 6-13-2009 at 03:24 PM

Quote:
Originally posted by arrowhead
This is funny. On the one hand, we have one real estate agent, Paulclark, who advises buyers to make sure their Realtor is a member of AMPI. On the other hand we have another real estate agent, Donjulio, who advises that AMPI means nothing. Neither is offering "advice". They are both doing marketing here.

Then Donjulio tells us he advises his clients to consider if they would still buy if none of the "planned" amenities are ever put in by the developer. The amenities are a major part of the marketing package the developer uses to induce people to buy his project, and the buyers are theorectically paying for those "amenities" in their purchase price. So that is like asking, "Gee whiz, is it OK if we just defraud you into buying this property by promising to provide amenities and then not deliver?"

I can guarantee you would never hear a real estate agent NOB ever saying anything like that.

And by the way, WTF is a "title report" in Mexico? There are no title plants in Mexico. I know what a "title report" means in the US. It means that is the chain of title and all liens and claims for which the title insurance company is prepared to indemnify the buyer. But with no title insurance in Mexico, and thus no indemnification from anybody, what good is a Mexican title report?


AMPI means nothing, several members are not considered "fair" people by the locals. Remember, Mexicans do not communicate in the same way americans or canadians do, we do not spread the word via email, or groups, etc. Here is word of mouth, little by little, neighboor to neighboor, it takes time and the bad input of many different people to create a bad or suspicious reputation.

Stay away from people claiming connections, know how, etc thats all bull.

Ask Mexicans, different Mexicans, and the same names and opinions will come out everytime so you can make your decision.

turtleandtoad - 6-13-2009 at 03:25 PM

I think Loreto Bay was doomed long before the economic turndown. Back when the Loreto Bay details was first released, I pointed out in my study on the developers plans for the infrastructure (water/sewer/etc) that, unless they got a jump start on it so that it would be in place (or at least the basic parts in place) before people started moving in, the whole house of cards would collapse.

I think the economy going into the dumps just speeded up the inevitable collapse.

I figured it would take a few years in courts with the good people of Loreto fighting for their right to the existing water supplies, the coastline getting polluted by the sewage breakdowns, and the increasingly frequent brown-outs, before it collapsed from bad planning. And by that time there wouldn't be any money to start building the infrastructure that they should have done right from the start.

But that's ancient history now.

BajaGringo - 6-17-2009 at 06:47 PM

Quote:
Originally posted by shari
do you want to live next to a crackhouse...or a guy who raises fighting c-cks...or a party animal...or a flophouse where the highway crews crash or the baseball team house (or bajagringo...I've seen his sound system!!!:lol:) probably not.


You mean some of you people have a problem with Steely Dan, Boston or Charly Garcia coming at you from next door with 1K watts RMS pushing it through some very large speakers?

I do take requests for what it's worth...

:lol: :lol: :lol:

bajaguy - 6-17-2009 at 07:10 PM

Quote:
Originally posted by BajaGringo
Quote:
Originally posted by shari
do you want to live next to a crackhouse...or a guy who raises fighting c-cks...or a party animal...or a flophouse where the highway crews crash or the baseball team house (or bajagringo...I've seen his sound system!!!:lol:) probably not.


You mean some of you people have a problem with Steely Dan, Boston or Charly Garcia coming at you from next door with 1K watts RMS pushing it through some very large speakers?

I do take requests for what it's worth...

:lol: :lol: :lol:






How about "Silent Night"??????:lol:

Woooosh - 6-17-2009 at 07:23 PM

Quote:
Originally posted by BajaNuts
I'm going to start another thread on "house karma"-
look for it-


who has the first dogma comment? How many years, beers, cheers and tears for a house to go from haunted to "good vibe"?

MitchMan - 6-18-2009 at 10:37 AM

Follow up on turtleandtoad's comment:

Not sure, but I think the problem with big Mexican residential developments like Loreto Bay is that the developers spend a bunch on well thought-out marketing and fail to get the construction financing required to complete the project. Instead, they start with meager insufficient startup capital, start selling the promises outlined in the prospectus, get a rediculous unprotected down payment from a buyer, use that money to continue some construction and pay for ongoing current operating expenses (including high salaries for the developer) and hope to get more deposits to continue construction. It is nothing short of a ponzi scheme.

If you travel up and down the baja coast, you will see many, many uncompleted projects, both large and small. That has been the case for decades. Not a new problem.

I think the wise thing to do is to buy your own lot (not ejido property) and have a new place constructed out of cinder block..especially now as costs (due to current slow down in real estate activity) have gone down (exchange rate buys 30% more today than for the last ten years, there is plenty of available local construction workers since they have stopped working on big projects).

Construction materials cost is about the same in Mexico as in the US (for the materials used in cinder block construction), but labor is lower due to the exchange rate and due to labor availability. Mexican contractors will quote the same old $85 USD per sq foot of construction that they have for the last few years, but they are not reflecting the lower labor cost of today in the $85 US dollars quote which is over 75% of the $85, so do some tough bargaining. It costs about $20 to $25 per square foot for basic construction materials costs, the rest of the per sq foot cost is direct hands on labor and the contractors fee. Direct hands on labor should run about $20 per sq foot, the rest is the contractor's fee for his administrative management of the project and not for any actual construction labor hours. Do the math, the constractor is making a bundle.

I advise paying for the expensive title insurance provided by American companies on Mexican real estate. It is expensive, Stewart Title charges approximately $1,800 for a Mexican Lawyer to do the title search (and they go way back in time in the their search and to many different sources for title info) and then about $700 for the actual policy.

Hey, you can have a nice new basic 1,000 sq ft house constructed for $70,000 to $85,000 USD plus the cost of the land. I advise my friends and family not to buy in a "resort project" on the beach and get stuck with a monthly association fee of over $200 per month for life, but to look for property 1/2 to 1 mile from the water in the town of Loreto on land that has city services (underground water & sewer, above ground electricity & phone, concrete sidewalks and paved streets). That land sells for $80 to $120 USD per sq meter. Do the math.

By the way, AMPI means little in real experiencial terms. The fact is that Baja real estate agents and brokers are neither licensed nor tested by any government or municipal agencies, have no code of ethics that are sworn to, practiced or enforced, nor are they subject to any educational requirements or continuing education. Anyone can sell real estate. The only thing that matters is getting a sales commission.

[Edited on 6-18-2009 by MitchMan]

Pollen - 6-18-2009 at 11:12 AM

I agree with MitchMan on LB.

Far more went into the niche marketing and publicity than into the real research and infrastructure that would fulfill the eco-promises.

I wonder how the Homeowners are going to pay to keep all the watering, maintenance, trash collection, security going.

How long before the sand and dirt from the dead dry golf course are blowing down the unpaved streets, and silting up the "canals"? What are they going to do with the unfinished skeleton towers?

longlegsinlapaz - 6-18-2009 at 11:15 AM

Quote:
Originally posted by MitchMan
Follow up on turtleandtoad's comment:

Not sure, but I think the problem with big Mexican residential developments like Loreto Bay is that the developers spend a bunch on well thought-out marketing and fail to get the construction financing required to complete the project. Instead, they start with meager insufficient startup capital, start selling the promises outlined in the prospectus, get a rediculous unprotected down payment from a buyer, use that money to continue some construction and pay for ongoing current operating expenses (including high salaries for the developer) and hope to get more deposits to continue construction. It is nothing short of a ponzi scheme.

If you travel up and down the baja coast, you will see many, many uncompleted projects, both large and small. That has been the case for decades. Not a new problem.

I think the wise thing to do is to buy your own lot (not ejido property) and have a new place constructed out of cinder block..especially now as costs (due to current slow down in real estate activity) have gone down (exchange rate buys 30% more today than for the last ten years, there is plenty of available local construction workers since they have stopped working on big projects).

Construction materials cost is about the same in Mexico as in the US (for the materials used in cinder block construction), but labor is lower due to the exchange rate and due to labor availability. Mexican contractors will quote the same old $85 USD per sq foot of construction that they have for the last few years, but they are not reflecting the lower labor cost of today in the $85 US dollars quote which is over 75% of the $85, so do some tough bargaining. It costs about $20 to $25 per square foot for basic construction materials costs, the rest of the per sq foot cost is direct hands on labor and the contractors fee. Direct hands on labor should run about $20 per sq foot, the rest is the contractor's fee for his administrative management of the project and not for any actual construction labor hours. Do the math, the constractor is making a bundle.

I advise paying for the expensive title insurance provided by American companies on Mexican real estate. It is expensive, Stewart Title charges approximately $1,800 for a Mexican Lawyer to do the title search (and they go way back in time in the their search and to many different sources for title info) and then about $700 for the actual policy.

Hey, you can have a nice new basic 1,000 sq ft house constructed for $70,000 to $85,000 USD plus the cost of the land. I advise my friends and family not to buy in a "resort project" on the beach and get stuck with a monthly association fee of over $200 per month for life, but to look for property 1/2 to 1 mile from the water in the town of Loreto on land that has city services (underground water & sewer, above ground electricity & phone, concrete sidewalks and paved streets). That land sells for $80 to $120 USD per sq meter. Do the math.

By the way, AMPI means little in real experiencial terms. The fact is that Baja real estate agents and brokers are neither licensed nor tested by any government or municipal agencies, have no code of ethics that are sworn to, practiced or enforced, nor are they subject to any educational requirements or continuing education. Anyone can sell real estate. The only thing that matters is getting a sales commission.

[Edited on 6-18-2009 by MitchMan]


I disagree with your statement, which I highlighted above. If the contractor is paying Seguro Social as required by law that SOMEONE pay, then Seguro Social adds a healthy roughly 40% of the overall labor costs & is built into the square meter price. Yes, the contractor has a built-in fee/commission/his profit margin, and that's typically 20-30%. But your failure to address Seguro Social inflates what actually ends up in the contractors' pocket.

MitchMan - 6-18-2009 at 01:32 PM

Very excellent point, longlegsinlapaz.

Actually, the payroll taxes are 42%, a little bit higher than what you wrote. I must admit, I do not have actualy knowledge of whether or not the majority of the labor provided by contractors (especially the ones doing smaller jobs) are in fact paying all the required payroll taxes. I am skeptical, however.

Using the numbers that I cited above, the 42% payroll taxes would reduce the contractor's take. However, using numbers in my example on my previous post, if you do the math, that would leave the contractor 37% to 43% for his fee of the $85 USD per sq ft of construction, not 20-30% as you mentioned.

The salient point is that the $85 per sq ft that contractors are quoting today is the same that they have been quoting last year and the year before when the exchange rate was $10 to $11 pesos per dollar and hence are not reflecting the $14.4 rate of today. I seriously doubt that they are passing on the rate differential to their employees. They aren't reflecting it to us foreigners when they quote the same per sq foot rate as last year when the US dollar was weaker, why would I believe that they are passing the differential to their employees (or "subcontractors" if you know what I mean).

Cypress - 6-18-2009 at 01:57 PM

Loreto Bay? Good intentons or a major rip-off? Depends upon whether or not you like to play golf on a 2 acre course, sorta like running around in circles. Goofy golf anyone? Not able to park your car at your casa? No problemo! You need the exercise. Hope your car will still be there when you get back to where you left it.:spingrin:

turtleandtoad - 6-18-2009 at 02:28 PM

I haven't been following the LB project recently. Did they even break ground on the RO water plant, the sewage treatment plant, the aeration pond (where the were going to get water for the golf course) or the power distribution yard for handling the new High Tension lines that they were going to bring in?

Last I heard, as far as the RO water plant, they had already floated the idea of tapping the existing water table by pumping from some wells near the mountains instead of the RO plant. A cop out if I ever heard one.

Skeet/Loreto - 6-18-2009 at 03:27 PM

To the Original Post Jesse gave the true Picture about buying Property in Baja.

Many years ago I formed a mexican Corp. so that I could actual control Rancho Sonrisa. Later I used that Corp. to buy and sell property in Baja Sur.
I used a Notoria in La Paz, used other officals in Loreto for at least 18 Properties. NEVER HAD ANY PROBLEMS.

I strongly urge anyone who wants to buy property to learn Spanish, if Slang, get to know the Mesicano People you are dealing with, talk to neighbors and others in the area. It is a Grand experience!!

Do Not Judge anything in the Future about property by the happenings at Loreto Bay. It was a Scam from the "Getgo". The peop[le who bought into it just suffered a Lack of Knowldge and Trusted the wrong people.

Up until the Punta Bando debackle,I did not know of anyone who had lost Property in Baja Sur. That has all changed.

I think that anyone who is so scared of all things should stay out of Baja,they will never be happy with their Minds so aganist everything and everybody.

Baja and its People are Great, The Sea of Cortez is Great.

Buy your House but just do some research before you do so.

Skeet/Loreto

k-rico - 6-18-2009 at 03:50 PM

Quote:
Originally posted by Skeet/Loreto
To the Original Post Jesse gave the true Picture about buying Property in Baja.

Many years ago I formed a mexican Corp. so that I could actual control Rancho Sonrisa. Later I used that Corp. to buy and sell property in Baja Sur.
I used a Notoria in La Paz, used other officals in Loreto for at least 18 Properties. NEVER HAD ANY PROBLEMS.

I strongly urge anyone who wants to buy property to learn Spanish, if Slang, get to know the Mesicano People you are dealing with, talk to neighbors and others in the area. It is a Grand experience!!

Do Not Judge anything in the Future about property by the happenings at Loreto Bay. It was a Scam from the "Getgo". The peop[le who bought into it just suffered a Lack of Knowldge and Trusted the wrong people.

Up until the Punta Bando debackle,I did not know of anyone who had lost Property in Baja Sur. That has all changed.

I think that anyone who is so scared of all things should stay out of Baja,they will never be happy with their Minds so aganist everything and everybody.

Baja and its People are Great, The Sea of Cortez is Great.

Buy your House but just do some research before you do so.

Skeet/Loreto


Exactly, I bought a new house in Baja in 2004 from a developer. The house hadn't been built yet. Instead of knowing Spanish I hired a bilingual Mexican lawyer who specialized in real estate transactions for $500. He knew about the developer, the history of the land, and how the developer came to own the land. I followed his advice, he made mods to the contract that the developer agreed with, and he was with me at all meetings with the developer, at the walkthrough when I accepted the property (the lawyer negotiated some improvements that I wanted and the developer agreed to), and at the Notario when the deal was closed. Everything went without a hitch.

Also, the lawyer also got all the documents translated for me.

[Edited on 6-18-2009 by k-rico]

DENNIS - 6-18-2009 at 05:07 PM

Quote:
Originally posted by Skeet/Loreto
Baja and its People are Great, The Sea of Cortez is Great.





The government sucks.

oldlady - 6-19-2009 at 06:57 AM

Is it pick on Dennis time again? I have a problem with his post too....he limits the adjective to Mexico.

oldlady - 6-19-2009 at 07:13 AM

That's your opinion Caboron (expressed ad nauseum ) based on limited data and experience.

Returning to the original subject....

IMHO, there is also no substitute for an honest assessment of one's self. Know what you want, be honest with yourself about your tolerance for risk, inconvenience, cultural differences, etc. Not unlike what is just as common north of the border, those who become unhappy with their decision about investment in Mexico didn't really crystallize their expectations when they began.

[Edited on 6-19-2009 by oldlady]

k-rico - 6-19-2009 at 07:30 AM

Quote:
Originally posted by DENNIS
Quote:
Originally posted by Skeet/Loreto
Baja and its People are Great, The Sea of Cortez is Great.





The government sucks.


Depends upon what's important to you. The mayor of TJ seems to be doing a fine job. There are massive street repair projects all over the city, new parks are being built, and the violence SEEMS to be lessening. I've been living in playas for three years and there has been continual city and private investment in the community. It's definitely on the upswing. I know, I live here. I made what for me was a large and because it's TJ perhaps risky investment and therefore am watching and reading about what's going on a daily basis.

[Edited on 6-19-2009 by k-rico]

Pescador - 6-19-2009 at 08:48 AM

Jesse did a great job of hitting the nail on the head. Any major project has profit as it one and only goal of development and all of the little things like social structure, water, property displacement, and hiring workers are just little annoyances to be overcome in the achievement of the major goal. Small development of one or two places is a completely different animal. It is usually done by someone local and generally fits in with the overall scheme of things. When Jose and Joselina decide to sell a property, they may well live there, everyone knows way too much information about the kind of people they are and consequently no way would they risk being made a social outcast by cheating someone. The local builders operate under the same controls and while they may be agonizingly slow, they will do the best they are capable of doing and you can readily see examples of their work around town. Instead of gated communities, either in reality or imagined, where everyone is kept completely isolated, communities are allowed to develop at a more natural pace with a more natural mixture of both worlds where people become friends or at least know each other. Places like Loreto Bay just furthered the separation and continued the class distinction and erected barriers to understanding and communication. Its pretty easy to see why the locals sit on one side of the fence and complain about the rich Norteamericanos taking up the good land and resources and the Norteamericanos sitting on the other side of the fence complaining about having to pay over 100 pesos a day to get someone to clean the house and wondering why those people never learn to speak english.

k-rico - 6-19-2009 at 09:20 AM

Pescador,

I agree except you seem to be equating gated communities with gringo communities. Not always true. I live in a private gated community of over 100 houses all built within several years. I know of one other gringo owner, everybody else I've met are Mexicans. I've also seen a list of owners. At the time I was the only owner with a non-latino last name.

But I live in Tijuana where there is a substantial middle class, and some of the owners are retired mexican-americans who have moved back to "their country".

Another aspect that's important here and I think elsewhere in Mexico is the security gated communities offer. When I tell other locals where I live the first thing they say is "Oh, good security". And, the houses are now selling for 20% more than they were 4 years ago, albeit slower. People pay for security.

For many reasons, buying into a private gated community is a good bet. But paying US prices for a house in Mexico, that is, prices Mexicans cannot afford, is not wise. You're really limiting the number of potential buyers if you need or want to sell.

I'm a big believer in "When in Rome, do as the Romans do."

[Edited on 6-19-2009 by k-rico]

Skeet/Loreto - 6-19-2009 at 04:01 PM

Another good way to "Maintain " Property in Baja Sur is through a Lease. If doing so be sure to register the Lease at the Local Municpal. Keep in mind that most improvements go with the property unless detailed in that lease.

A good part of living in Baja is the interaction you have with the People. Learning a new Culture is great. If you have children it is fantastic to watch them learn from a different Culture.
I have a friend whose daughter grew up from 3 years old through the school system and is now an Executive V-P for a large Company in the states.

Good Luck

Thump!

Skeet/Loreto

toneart - 6-19-2009 at 04:14 PM

Quote:
Originally posted by oldlady
Is it pick on Dennis time again? I have a problem with his post too....he limits the adjective to Mexico.


Uh, that's a verb, Old Lady. Dennis is a man of action. :P:lol:

oldlady - 6-19-2009 at 04:18 PM

Right you are, toneart ...realized the error but too lazy to edit.
I'll let Dennis speak for himself on the innuendo.;)

DianaT - 6-19-2009 at 04:35 PM

Quote:
Originally posted by oldlady

IMHO, there is also no substitute for an honest assessment of one's self. Know what you want, be honest with yourself about your tolerance for risk, inconvenience, cultural differences, etc. Not unlike what is just as common north of the border, those who become unhappy with their decision about investment in Mexico didn't really crystallize their expectations when they began.

[Edited on 6-19-2009 by oldlady]


Very well said, and I might add that flexibility is high on the list of what is important because no matter how prepared one is, once there, their expectations need to be flexible

Diane

A simple principle....

djh - 6-19-2009 at 07:04 PM

that I've always tried to live by:

Say what you mean
MEAN what you say
and DO what you say you'll do
ESPECIALLY if someone is depending on you.

I find myself in a shrinking minority nowadays on this point~ and I imagine some of my Nomad amigos feel the same...

MY POINT????

Did LBC DO what they SAID they would do???

Talk is cheap, eh? But do you know WHY talk is cheap???

A: Simple economics: SUPPLY is so much greater than DEMAND...

djh

arrowhead - 6-20-2009 at 12:52 AM

Quote:
Originally posted by k-rico

Another aspect that's important here and I think elsewhere in Mexico is the security gated communities offer. When I tell other locals where I live the first thing they say is "Oh, good security".


When good security is the strongest selling point of where you live, it's time to move.

To Rent Or To Buy, That Is The Question

CaboRon - 6-20-2009 at 05:33 AM

Renting vs Buying Property in Mexico
Posted on 18 June 2009, LatinWorld

By Patrick Connelly

It is, ultimately, the point where the process of living in Mexico
diverges into two distinct paths. The question of whether to rent or to
buy - to purchase that cliff top villa on the Pacific or just rent a
nice place in the nearby town - plagues many a prospective buyer in the
U.S. and Canada. The decision has more variables in it than a college
calculus class, but here are a few things to take into consideration if
you are having the same quandary.

1. Renting keeps your options open

If you are like me and have a total fear of commitment (relationships,
locations, etc. etc.) then renting is perfect for you. Well, that and
if you are just not totally sure on living abroad for long periods of
time or permanently, or don't fancy investing money in a property in
another country. Renting can be a great option for the certain type of
person, especially those new to Mexico. Buying or building a house ties
you down to that property. Renting does not. Simple as that. If you
find out that you hate Mexico and want nothing more than to stay in the
U.S., it is much easier to cancel or see out a lease than it is to sell
a home. And if you want to travel around Mexico or Latin America for an
extended period of time, it is usually easy to sublet your rented
property to recoup some of the losses.

2. Buying a house is an investment

While the global recession has driven down home prices in Mexico in
recent months, owning a home south of the border is still a great long
term investment. The Mexican economy hasn't been hit as hard as the
U.S. has and the situation north of the border will recover in time. In
fact, many real estate professionals are predicting a strong buyer's
market in the coming months in hotspots like Puerto Vallarta and Cancun.
With a bit of shrewd cunning great deals can be found these days and
when the markets bounce back - and they will - owning a property in
Mexico suddenly becomes a very, very valuable commodity.

3. There is far less of a financial investment when renting

Well, duh. Financially speaking, it is definitely the "safer"
of the two options. While you certainly get more bang for your buck in
Mexico than you do in the U.S., buying a home is still a major financial
investment.

4. YOU own the house and deal with no one else

Anyone that has dealt with landlords knows it can be a real headache.
Its no different in Mexico. The fact that you do not own your rental
property and have to answer to a higher up may lead to squabbles over
anything from redecorating to rent to leases. Choosing a good rental
management company can prevent conflict if you want to rent.

On the other hand, when you own a house, you decide what goes in it,
what additions will be put on, etc. etc. You are your landlord.

5. More choices when buying

Odds are, you will find a property for sale in Mexico that matches your
desires before a rental. There are just more options out there to
choose from. Rentals are only ultra popular in certain areas frequented
by vacationing tourists, while good homes for sale exist everywhere.

The choice ultimately comes down to you. Owning a home in Mexico can be
the experience of a lifetime, but it isn't for everyone. My advice
would be to rent a house for a few months in your desired
location….get to know the culture, climate, and lifestyle. If you
fall in love with it, jump in. If you hate it, simply back out or try a
different region of Mexico. This is by far the smartest approach to
take - many a gringo have made impulse buys after a two week vacation in
Cancun or Cabos and ended up with a house they later realize they
don't want.

toocoldincanada - 7-30-2016 at 07:45 AM

From Mitchman

"Not sure, but I think the problem with big Mexican residential developments like Loreto Bay is that the developers spend a bunch on well thought-out marketing and fail to get the construction financing required to complete the project. Instead, they start with meager insufficient startup capital, start selling the promises outlined in the prospectus, get a rediculous unprotected down payment from a buyer, use that money to continue some construction and pay for ongoing current operating expenses (including high salaries for the developer) and hope to get more deposits to continue construction. It is nothing short of a ponzi scheme."

Hi I am new to this forum. so apologies if I am out of line. I am building in a new development in Canada. It is being built by the same people that did Loret. Bay. They are following the same pattern. $$ seems to be going to advertising and the construction is painfully slow. My husband went into a lumber store and found out that none of the trades are being paid. It does look like a PONZIE scheme.
Is there any one who can tell me more on how these people operate? if you lived through it, what would you have done differently before the developer pulled out?

[Edited on 7-30-2016 by toocoldincanada]

mtgoat666 - 7-30-2016 at 08:24 AM

Quote: Originally posted by toocoldincanada  
From Mitchman

"Not sure, but I think the problem with big Mexican residential developments like Loreto Bay is that the developers spend a bunch on well thought-out marketing and fail to get the construction financing required to complete the project. Instead, they start with meager insufficient startup capital, start selling the promises outlined in the prospectus, get a rediculous unprotected down payment from a buyer, use that money to continue some construction and pay for ongoing current operating expenses (including high salaries for the developer) and hope to get more deposits to continue construction. It is nothing short of a ponzi scheme."

Hi I am new to this forum. so apologies if I am out of line. I am building in a new development in Canada. It is being built by the same people that did Loret. Bay. They are following the same pattern. $$ seems to be going to advertising and the construction is painfully slow. My husband went into a lumber store and found out that none of the trades are being paid. It does look like a PONZIE scheme.
Is there any one who can tell me more on how these people operate? if you lived through it, what would you have done differently before the developer pulled out?

[Edited on 7-30-2016 by toocoldincanada]


When you pay money in advance of construction, you are the only person holding risk. If the developer fails, he does not lose money, only you lose money.
Better way to pay for new construction is to pay based on percent complete.
Or do like me, I prefer to buy places already built (I.e. 'Used" houses).

It is especially risky to pay moneys in advance in Mexico. Just don't do it!



toocoldincanada - 8-2-2016 at 09:31 AM

hi mtgoat666,
I do get it that paying $$ in advance is a risk. Thank you for your response. We are in contact with our lawyer.
What I am looking for is anyone who Knows any of the L*reto B** scam that could share with me what happened there. It is a dangerous game that is being played right now.
Thanks in advance.

gnukid - 8-2-2016 at 01:14 PM

Use search on baja nomad for "Loreto Bay Resort" and click next page link of results to go back to 2003-2011 to read the horror stories. I understand many units are complete after many starts and stops and funding and management problems, and now it is a beautiful place to visit though sometimes hard to get to by plane.

Lee - 8-2-2016 at 01:16 PM

Quote: Originally posted by toocoldincanada  
hi mtgoat666,
I do get it that paying $$ in advance is a risk. Thank you for your response. We are in contact with our lawyer.
What I am looking for is anyone who Knows any of the L*reto B** scam that could share with me what happened there. It is a dangerous game that is being played right now.
Thanks in advance.


If you can get others in the development to join you, have your attorney file a class action lawsuit -- freeze the assets of the developers.

Don't invest any more money if you haven't thought of that already.

bajagrouper - 8-2-2016 at 01:59 PM

Quote: Originally posted by toocoldincanada  
hi mtgoat666,
I do get it that paying $$ in advance is a risk. Thank you for your response. We are in contact with our lawyer.
What I am looking for is anyone who Knows any of the L*reto B** scam that could share with me what happened there. It is a dangerous game that is being played right now.
Thanks in advance.


Paying in advance, How many people was it that paid over 70 million dollars for the Trump Towers Baja scam?

huesos - 8-12-2016 at 08:03 PM

Correct me if I am wrong but I think that it is clear that I must have a fidelcomiso formed on any piece of land that I buy in Baja under Mexican federal law. As part of this process, does the bank not do the title search using their own legal team? I am sure that prior to even thinking about doing a land purchase, I will still want to consult a lawyer known to me as experienced and competent in real estate transactions. I have talked to any number of land selling operations in my area that tell me' you can pay us directly' and in doing so take me for an idiot.

BajaBlanca - 8-13-2016 at 08:16 AM

I have never heard of a bank doing a title search.

They are simply the guardians of the fidecomiso.

They don't even send a reminder that fees are due.

gnukid - 8-13-2016 at 09:33 AM

The Notorio that process the sale does a title search.

A sale to a foreigner in baja without a fidocomiso can occur within a corporation where real estate holding is a designated function.

Money is transferred to the seller directly from the buyer in the presence of the notorio. First thing to do is go see a notorio.

A lawyer can help but you should be clear about what actions they are responsible for if any, they can also cause more problems.

Most real estate transactions in Mexico occur directly between seller and buyer and Notorio and do not involve "bank agents" "title agents" "real estate agents" or "lawyers" who do not seem to have defined fiduciary responsibilities nor liabilities.

chippy - 8-13-2016 at 10:35 AM

I think gnu means notario. Most notarios (not all) are lawyers.

title fraud

huesos - 8-13-2016 at 01:44 PM

So what you are saying is that the bank has no responsibility in assuring that the fidelcomiso is issued on a property with valid title. In essence, they would be establishing a legal trust on top of a bogus transaction. This makes absolutely no sense in Mexico or any where in the world.

chuckie - 8-13-2016 at 01:47 PM

Correcto....

gnukid - 8-13-2016 at 11:34 PM

The Notario, (appointed by governor?) has responsibility to check history on the property, but a Notario office may be represented by family (children) of the actual assigned Notario (lawyer) handling cases while the lawyer is not there, ever.

A fidicomiso is a financial tool for beneficiary of a trust commonly used in baja for foreigners to buy homes in the restricted zone. It could be used for other purposes. In the case of foreigners buying homes it's sort of a gimmick to gift money to another party (appointed by governor?) The office apparently does not check or do anything, ever and may not have correct info about you or the home or the amount due.

[Edited on 8-14-2016 by gnukid]

bajaguy - 8-14-2016 at 06:07 AM

You are attempting to use logic and "north of the border" thinking in this issue.

The bank doesn't care. All it wants is the money from the set up and annual fees. If the property transaction is bogus, the bank made money off of the deal.
Quote: Originally posted by huesos  
So what you are saying is that the bank has no responsibility in assuring that the fidelcomiso is issued on a property with valid title. In essence, they would be establishing a legal trust on top of a bogus transaction. This makes absolutely no sense in Mexico or any where in the world.

DENNIS - 8-14-2016 at 07:02 AM

Quote: Originally posted by huesos  
So what you are saying is that the bank has no responsibility in assuring that the fidelcomiso is issued on a property with valid title. In essence, they would be establishing a legal trust on top of a bogus transaction. This makes absolutely no sense in Mexico or any where in the world.


This was at the heart of the Punta Banda expropriation debacle. It's way down on the list of "senseless in Mexico."

wilderone - 8-14-2016 at 07:58 AM

Re: "... the L*reto B** scam that could share with me what happened there."
As I recall, their pitch was cloaked in ethereal phrases to create a "you can have this dream" mentality. They PROMISED. They promised a club house where you could take classes, little doors in the windows of condos where bakery goods would be delivered, a wine cellar, the golf course, a desalination plant, a aquaduct to kayak in, a community vegetable garden. To finance ALL this, they sold lots which paid for the initial construction of some of the homes - their homes got built first in the "founders" neighborhood. However, this finance scheme would never be enough to cover administration and consultants' salaries, the common area improvements as well. The materials and labor all came from far away. Did they understand at the get-go how this worked and what it would cost? Don't think so - they siad they had a brainstorming meeting and came up with their plan. They promised housing for the construction workers. Didn't happen. They said a portion of each lot sold would go into a trust to benefit the town of Loreto. This occurred to an extent, but a large portion of the money was wasted or self-serving. E.g., big money spent on a study to develop the coast of Baja CA in "their" way. What caca, what egotism. Money spent on a refuse management system that was actually owned by Butterfield.
LB people did. not. understand. Baja CA or its people or what would fit. They said, incredibly, that LB would be an "authentic" Mexican town. How can this be, when it is brand new. Butterfield, et al took a trip to the ruins of the southwest to get ideas on design. (!!??) Like the indigenous' adobes of Utah are just the same as Californio rancheros. They first said it would be Mexican Colonial. Hmmm - different era, different history - doesn't fit. "Authentic" Baja CA town with no church, no taco stands, no restaurants, no panaderia, no Mexicans. Just another development akin to Civita in Arizona (?) which Butterfield touted to his credit (when, in fact, if you research this, his name is nowhere mentioned).
They hired an architectural consultant who developed some personal issue with a local woman, another consultant from some Inuit village in Alaska whose claim to fame was to develop a theatre group (not sure what he brought to the LB table). I think the finance officer quit. In short, their "team" was certainly not helpful to furthering construction of sold homes.
It was inevitable that without massive inflow of funds to develop the common area improvements, there would be a shortfall. So they invited Citibank to the party who lent them funds for Citibank's first "sustainable" development project. Woe is them. I'm sure LB wooed Citibank with the same pie-in-sky promises. They sold off some of their property to FONATUR I believe for additional capital. As time went on and promises were not fulfilled, they bailed, leaving the wreckage in their wake for someone else to clean up. There simply was not enough money to pay themselves, the laborers, give the tours to prospective buyers on the subsidized trips (they subsidized an airline to fly them in I believe), keep putting out the fancy literature and flying around the SW giving presentations AND actually build homes. I went to one of the presentations which was held at one of the most expensive restaurants in San Diego - the food served was first rate. They flew to Scottsdale, Canada, San Francisco.
I'm sure they did not know what Mexican law affected the LB project as far as the Marine Preserve, labor laws and utilities were concerned. They promised a desal plant, but ended up using water from the aquifer. They had a nice drawing of the desal plant to show people.
For another development project in Canada, there is little you can do to insulate yourself from exploitation if you pay large sums up front, unless local law dictates certain consumer rights. If they are in violation of consumer rights laws, then you will have some teeth in the matter. In California, only 10% can be paid upfront. Subsequent payments on a schedule as the building is being completed. If it wasn't completed, then no money is paid. As for common area improvements as part of the package that you expect, that is just a gamble. Butterfield is a dreamer without solid building credentials. He may have been involved for many years, but his true successes are few and far between. He'll drag out some tidbit of something he was involved in and state in glorious terms that he was responsible for whatever success occurred. There's that Sustainable Canadian Trust - whatever that is - acquiring large tracts of land that they want to put houses on. They use words to put a spin on same-old.
The other guy - forget his name - started arbitraging Canadian bonds or something after the LB debacle, is/was a board member of the Cancer Ctr in Arizona - his claim to fame was being on the board to develop the Arizona football stadium - he loves spending other people's money. Have no idea why he was a principal of LB development.
If you can honestly say to yourself that you don't want what Butterfield has sold you, then get out now before THEY walk. Just get out - I would have NO faith in what Butterfield has told you. Go to the newspaper and tell them the LB story. Demand your money back and find something else that is already built.
I had 6 inches of a paper trail on LB - I detested what they were doing - but when I got laid off, it all went in the trash.

wilderone - 8-14-2016 at 08:15 AM

There's a very long message thread on Loreto Bay from back in the day on this forum, if it's still available in archives, that brings up most of the issues.

pacificobob - 8-14-2016 at 09:35 AM

don't confuse having a title searched, with actual title insurance. i know lots of gringo owners who have purchased property without buying title insurance. a questionable move in my opinion. there are folks in my area who, after years of ownership are being challenged as to the rightful ownership of their property.

valid title

huesos - 8-14-2016 at 10:21 AM

Who sells title insurance? If you buy it, who does the research? I've seen the office of something called Baja Title. The authorities on this thread seem to indicate that there is no way to authenticate anything regarding legal ownership. This smells like bull.

DENNIS - 8-14-2016 at 10:34 AM


Legitimate title insurance is unavailable here. As is malpractice insurance for a doctor. They don't need it since you can't sue them for their effups.
Things are a bit different here.






.

[Edited on 8-14-2016 by DENNIS]

gnukid - 8-14-2016 at 11:04 AM

You can do your own title research or go with someone like the Notario who knows how since you are paying them to do it. See for yourself what the history of the ownership is. Is the property owned by the seller? This is why most transactions in Mexico are direct from seller to buyer, the less people involved the less potential for problems. The more people you call saying you have money to spend the more chance someone will steal it. I would not be involved with any corporate developments, real estate agents (no such agency exists in baja nor fiduciary responsibility so you are paying for an imagined agent), nor so called helpful lawyers (are they lawyers, do they ever do any legal work, do you have any proof). Go interview a few Notarios (who are actually lawyers who process title transactions) and find one you trust and ask every question. The interview is free. Then proceed to find a home they can verify is owned by the person selling it.If you can't verify yo are talking to the seller walk away. The seller has to show current registered titled, no debts on the property, all taxes and utilities etc. paid in full with stamped proof by each office, notario, ayuntamiento, electrical, water, hacienda. Is there a business registered to the house? That could be bad. Then go slowly forward and delay if any problems or paper is incomplete. You don't pay the Notario or bank fidicomiso until the process is done or half when they start paperwork and half when complete. The research is free and should be presented by the seller to the buyer to confirm. There are also local paper pushers who can be helpful but who knows if they are really doing what they are supposed to unless you go with them every step of the way. Paper pushers could be the source of the problem. It makes more sense that you go yourself to see the location of local offices and see the actual process with your eyes and hold the papers in your hands.

JoeJustJoe - 8-14-2016 at 12:21 PM

Quote: Originally posted by DENNIS  
Quote: Originally posted by huesos  
So what you are saying is that the bank has no responsibility in assuring that the fidelcomiso is issued on a property with valid title. In essence, they would be establishing a legal trust on top of a bogus transaction. This makes absolutely no sense in Mexico or any where in the world.


This was at the heart of the Punta Banda expropriation debacle. It's way down on the list of "senseless in Mexico."



Dennis other quote: "Legitimate title insurance is unavailable here."

Dennis do you have any legitimate links that could back up your ridiculous statement that there is "no legitimate title insurance here" I take it you are talking about all of Mexico or at least all of Baja.

To make you statement true, I guess all the American ex-pats that owned property in Punda Banda, had title insurance, and the title insurance didn't work for them?

I think I know where Dennis gets his erroneous information from but I doubt he actually researched the information himself.

The other side of the coin are ex-pats claiming "title insurance" in Mexico is cure-all when Americans are buying title insurance......it's not!

I would say the truth lies somewhere in the middle, regarding title insurance in Mexico. It's not completely worthless as Dennis is hinting at, nor is it a cure-all.

I would say title insurance is like other insurance polices, the answer is in the "fine print" be sure to read the fine print and the EXCLUSIONS of the title insurance policy.



[Edited on 8-14-2016 by JoeJustJoe]

mtnpop - 8-14-2016 at 12:27 PM

Seems that most of BAJA is in the Federal Restricted Zone.. If you buy a house on a leased lot no fideicomiso is required..as you don't own the dirt.. so to speak..
The structure is not listed on the fideicomiso but a copy of the fideicomiso is required when you go to pay the property taxes the first time...
Notarios are usually a lifetime appointment and handed down to family. Also sometimes the notario hires someone to handle things while they hold public office or play golf or whatever...
Stewart Title has offices in BAJA but no clue what they do for you or what their charges are.. When we had our house for sale we received a note from them wanting to handle the sale.. We did not pursue that one. Facilitators as some call them charge up to $1000 US to handle the paperwork thru the process at the Notario.. Most Notario's we have talked with are only fluent in Spanish. The fideicomisos we have look and read similar to the old "Abstract" as used still in some states.. big thick book. We received a condensed version along with the big book of horrors... Lots of crazy charges that can total up to $7000US or so.
I have understood that you can also negotiate the annual bank charge but doubt that works... Interaciones in LaPaz is not a bank,, just an office with a couple of punkins collecting the $$$ that go we do not know where.. Seems like a big cash cow for someone...
Any changes in ownership, death, divorce, etc will incur more charges in the 4 figures to update the fideicomiso to current
This will probably stir up a lot of comment as it seems that not all experiences by nomads have been the same..

DENNIS - 8-14-2016 at 03:53 PM

Well, joe just dimwit..... I won't even begin to verify my statement that something doesn't exist. I'll leave it to you to verify that it does. Refer to one known case of title insurance success.

Remember to predicate your reply on my operative word..."legitimate." That means verifiable and reliable.
I have no idea who in PB had what. You ask them. It's part of your blockhead quest.

Who the eff left the gate open in off topic to allow this creep to mingle in public?

chuckie - 8-14-2016 at 03:58 PM

:biggrin::biggrin::biggrin:

SFandH - 8-14-2016 at 04:00 PM

I spoke to a Mexican attorney in TJ about title insurance when I was thinking about buying and his opinion was that I'd spend all my money fighting them when they didn't pay the claim.

His opinion.

He has a point, what are you going to do when they tell you to get lost?

Take them to a Mexican court? :lol:

[Edited on 8-14-2016 by SFandH]

JoeJustJoe - 8-14-2016 at 04:14 PM

Dennis wrote: Legitimate title insurance is unavailable here.

As is malpractice insurance for a doctor. They don't need it since you can't sue them for their effups. Things are a bit different here.
__________________________________

Again, this is completely WRONG! Both statements are wrong. (I;m only talking about real estate)

Is there anybody here that could correct Dennis, since I have seen many post claiming buying Mexican title insurance is a magic bullet, and does protect American real estate buyers in Mexico?

I don't think title insurance is a cure-all, but it's not unavailable like Dennis is trying to claim, without proof, nor do I think a real estate lawsuit is a waste of time for a couple of reasons.

Maybe, if nobody responds and corrects Dennis, I'll be back tomorrow and give my opinion and correct a lot of bad information I'm reading on this thread.

Lee - 8-14-2016 at 05:53 PM

I've written this before. I've bought land in Todos and got a title search and insurance from Stewart Title out of NYC. Their people worked with a notario in Todos. It was a nightmare in terms of emails and phone calls ignored, and Mexican bureaucracy. But got the coverage and closed. I would not have closed without Stewart onboard.

SFandH - 8-14-2016 at 05:57 PM

Just curious, did you buy land that was previously part of an Ejido?

pacificobob - 8-15-2016 at 09:20 AM

Quote: Originally posted by huesos  
Who sells title insurance? If you buy it, who does the research? I've seen the office of something called Baja Title. The authorities on this thread seem to indicate that there is no way to authenticate anything regarding legal ownership. This smells like bull.

my title insurance is through an american title company. i don't recall the name. i would need to get into the files to find it. been a while

pacificobob - 8-15-2016 at 09:37 AM

Quote: Originally posted by Lee  
I've written this before. I've bought land in Todos and got a title search and insurance from Stewart Title out of NYC. Their people worked with a notario in Todos. It was a nightmare in terms of emails and phone calls ignored, and Mexican bureaucracy. But got the coverage and closed. I would not have closed without Stewart onboard.


yes, i now recall i used stewart title too when i bought in pesky. my experience was just about as you described yours.

Udo - 8-15-2016 at 09:42 AM

My opinion also.

But go ahead and spend the money if that makes you feel better.
Quote: Originally posted by SFandH  


Take them to a Mexican court? :lol:

[Edited on 8-14-2016 by SFandH]

JoeJustJoe - 8-15-2016 at 09:58 AM

Quote: Originally posted by SFandH  
I spoke to a Mexican attorney in TJ about title insurance when I was thinking about buying and his opinion was that I'd spend all my money fighting them when they didn't pay the claim.

His opinion.

He has a point, what are you going to do when they tell you to get lost?

Take them to a Mexican court? :lol:



S&H Green Stamps also wrote: Just curious, did you buy land that was previously part of an Ejido?

That's kinda a weird thing to say, " I'd spend all my money fighting them when they didn't pay the claim."

You buy title insurance as a preventative measure, so you don't end up in court having somebody trying to take your property from over a title issue.

No he doesn't have a point, and you're implying the same thing as Dennis said, where lawsuits in Mexico are a waste of time.

Real Estate lawsuits, or going through the process to fight and protect your rights to your Mexican home is rarely a waste of time, because if you win, you get to keep your property, and if you're looking for a judgement from a big companies like a Steward Title, subsidiary they do have deep pockets. So you never know, if you could be successful.

You bring up an interesting point probably by mistake, and that's the "Ejido."

I would bet that Lee, didn't buy his property that was previously part of an "Ejido" because many title insurance companies in Baja, would exclude title insurance on Ejido land. This is why I said to read the fine print, and see what the title insurance company excludes from their policy.



[Edited on 8-15-2016 by JoeJustJoe]

Udo - 8-15-2016 at 10:26 AM

I could be out of line on this one...but didn't most land in Mexico start out as an EJIDO?

Then, after the EJIDO sells it to someone, the title process begins?

IF the EJIDO sale process was not properly recorded in the Mexican courts (as had been the case in many cases), someday some smart attorney will find out and void the original sale for improper recording, as was in the case where (on the mainland waterfront property that even the president of Mexico signed off on it) numerous foreigners as well as Mexicans lost title to their property.

Title Insurance

J.P. - 8-15-2016 at 11:49 AM

Title Insurance in Mexico by a so called American Company is Worthless. Even in the U.S. all title insurance does is say that there isn't a cloud on the title at the day of the sale. The little catch phrase on the policy claiming the insurer used Due Diligence in their search releases the the insurer from being held responsible for mistakes.

Udo - 8-15-2016 at 11:55 AM

This comes from a person who lives in Baja.:bounce:
Quote: Originally posted by J.P.  
Title Insurance in Mexico by a so called American Company is Worthless. Even in the U.S. all title insurance does is say that there isn't a cloud on the title at the day of the sale. The little catch phrase on the policy claiming the insurer used Due Diligence in their search releases the the insurer from being held responsible for mistakes.

DENNIS - 8-15-2016 at 12:47 PM

Quote: Originally posted by Udo  
I could be out of line on this one...but didn't most land in Mexico start out as an EJIDO?

Then, after the EJIDO sells it to someone, the title process begins?

IF the EJIDO sale process was not properly recorded in the Mexican courts (as had been the case in many cases), someday some smart attorney will find out and void the original sale for improper recording, as was in the case where (on the mainland waterfront property that even the president of Mexico signed off on it) numerous foreigners as well as Mexicans lost title to their property.



Not all by any means. Ejidos were for the most part unused land at the time of land reform...a gift from a socialist government to people who insisted on a fair share....or else.
Privatization is more recent:

https://www.jstor.org/stable/3631677?seq=1#page_scan_tab_con...









.



[Edited on 8-15-2016 by DENNIS]

DENNIS - 8-15-2016 at 01:22 PM


Ejido.

http://www.mexicolaw.com/LawInfo02.htm





.

[Edited on 8-15-2016 by DENNIS]

JoeJustJoe - 8-15-2016 at 02:03 PM

Actually the "ejido" traces way back to the Aztecs, but the socialist concept kept going out of favor, as rich Mexican landowner throughout history kept legally stealing land, and enslaving the indigenous people, and first Mexicans, and getting the poor people, or peasants to work the land for pretty much free by putting them in debt, and offering them a slave wage or giving them a scrap of meat if they were really lucky.

The Mexican revolution in the early 1900's was in large part a revolt by the Mexican peasants lead by Emiliano Zapata, in the north and Pancho Villa, in the south. It wasn't until years later that there was a large transfer of wealth from greedy rich landowners, to the poor Mexican people. Revolutions are good, and the ejido was one of the spoils of civil war.

Under the ejido system, the Mexican workers could farm the land, live on it, enjoy it, pass it to their children, rent parts of it to third parties, but they could never own it or sell it.

There is some criticism of the ejido, because they say if you could never own the land you will not work it that hard, or expand the farm. But looking back, is having large farming operations better for the people? No I don't think so, I rather buy from a small farmer, but large farms are better for only the bottom line.

Of course the good days will only last so long, relatively speaking while looking at the Mexican economy and how the average Mexican lives.

The "ejido" was attacked again, and weakened in the 80's by a combination of neoliberal( conservative American style capitalism) NAFTA, where the United States, and world trade organizations, got their puppet, Harvard-trained President Carlos Salinas de Gortari, to modify the Mexican Constitution, and allow for privatizing of government controlled industries, for example what Carlos Slim did with Mexican telecommunications. Carlos Salinas de Gortari, also pushed through bills that allowed foreigners and ability to buy foreign land ejido land thought a long process that's a paper work nightmare.

In the meantime the poor Mexicans farmers, were pretty much put out of work because of NAFTA, and is the reason why so many undocumented Mexican workers decided to come to the US, and the ones who didn't come, are probably farming for the Mexican cartels today.

So a lot of problems with ejido land, and real estate title issues, traces back to the the meddling of the US, trade agreements, and Mexican greedy landlords.



[Edited on 8-15-2016 by JoeJustJoe]

DENNIS - 8-15-2016 at 04:10 PM
Quote: Originally posted by JoeJustJoe  
Actually the "ejido" traces way back to the Aztecs,

======================

Verify that. ohhh... youcan't?

DENNIS - 8-15-2016 at 04:14 PM

Quote: Originally posted by JoeJustJoe  
The Mexican revolution in the early 1900's was in large part a revolt by the Mexican peasants lead by Emiliano Zapata, in the north and Pancho Villa, in the south.


Just wanted to quote this before someone else told you how stooped and uneducated you are....and always will be.






.

[Edited on 8-15-2016 by DENNIS]

tiotomasbcs - 8-15-2016 at 06:52 PM

Oh yeah, Villa was very popular in the south and Zapata was killed in his Cadillac in Chihuahua. YKYKYKYUK! And Benito Juarez opened the first Spanish Bank ..... love it?!

tiotomasbcs - 8-15-2016 at 06:59 PM

JAAAJAAAJAAAJAA. Profe Joe, just No! The Ejido is our new Mxi Real Estate Cco thanks to Gortari and now they are endeavoring to sell anything such as dirt and rocks...huge scar where Tres Santos has bought rocks for their crazy scheme.. dinero$$$ ?!!

tiotomasbcs - 8-15-2016 at 07:07 PM

La Tierra es para Quien lo Trabaja--Zapata beautiful words from the Revolucion. Sadly... and from Mmiguel Hidalgo Costilla--Respeto Al Der3cho Ajeno es La Paz,,, again...beautiful words that fall short in todays times... just livin in the moment. Tio America looks as bad if not worse, OOoops! My Bad... Benito Juarez spoke of peace being Respect. First Indian President.











[Edited on 8-16-2016 by tiotomasbcs]

CaboMagic - 8-15-2016 at 08:57 PM

Definitely don't know all about these subjects - what I do know am happy to share:

1. Tommy's grandfather was an officer in the Revolution - in lieu of payment for his service he was given a choice of many land parcels. He selected a mountain top parcel in Baja Norte to build homes for all of his family members.

2. Re: Ejido property - in the CSL area in 1993/4 the local ejido council voted to allow sales of certain ejido parcels... the first of which was the property now known as Villa Serena. The ejido council President is the father of one of our first crew members.

Obviously as in all things, ymmv and your understanding and experience/s are likely to be different depending upon many factors -- all of which are often described on this board in great detail.

Peace happiness and success to all to ones individual definitions. LG
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