BUYING PROPERTY IN MEXICO AS A CANADIAN. How to buy property in Mexico as a foreigner.

hey everybody darren borrows here today i'm in Ixtapa Mexico and I'm here with my good friend Ron Chabot today we're here talking about properties in Mexico and how if you want to be able to buy a property in Mexico whether that's a vacation property or something you want to be able to rent out or live in yourself Ron's gonna walk us through the process on how he was able to do that before we get into it with Ron if you don't mind just hit that like button to help the YouTube algorithm you can also subscribe to my channel and feel free to share this video with other people who might be interested in buying property down here in Mexico with that I want to say Ron thanks so much for being here taking some time your busy day but if you're her like schedule yet I did squeeze you in let's start first if you can give everyone a little bit of an introduction on who you are and then what you do or what you did when you're working and I'll put in my little two cents when I can and tell us a little bit about yourself and what you do hey my name's Ron chable born in Arbor field Saskatchewan and moved to the Alberta and in the 80s started a business up I was in the retail music business did that for 32 years find me but a few you know a few shackles together and decided that when we sold our business that we wanted to come down to Mexico here we traveled here throughout the years on all-inclusive vacations you know a couple of weeks out of the year kind of thing fell in love with Mexico and we always thought we'd like to buy a property down here eventually and that's kind of yeah ended up here let's talk about the specifics on this deal because as you mentioned you or you came down here to vacation and then I'm assuming that's when you started looking at you know property here as well and why did you choose Ixtapa what was the what was the draw for this location specifically well what happened is we had we travel with some friends and he was kind of going through the brochures and he he's one that actually picked the place and we'd never been here so we we'd been to all the other the other spots you know Manson and I poke all those places so we thought yeah this would be nice it was we knew it was a smaller kind of a smaller town and you know we're okay with that so after you came here or while you were visiting here is that when you started looking at property yeah you know we'd we just didn't have any transportation other than our legs so we did a lot of walking but we've seen probably oh maybe eight or nine properties kind of thing you know some of the two weeks that we were here but we kept walking past this one it was built it was probably three-quarters empty or or more but at least we knew that the thing was finished so were you looking with a realtor here or were you just kind of like walking around and at first we just we were just walking around yeah bliss and did they like places had kind of sale centers here like were you walking into that or talking to people and you were just kind of tossing things out on your own or there wasn't somebody guiding you not you didn't have a realtor or they did have a sales team here we really kind of had our hearts set on this like once we seen that you know everything else that we seemed it was just more traditional Mexican and and we wanted something like a home away from our home so after you decided on this complex what was what was the next step there then you started looking at individual units or got interesting all right tell us more so we looked at the boat we probably looked at I don't know just about every unit in here and there's 40 40 over 44 of them so we probably looked at 30 of them anyways yeah and and there they were all very similar we had looked at some different units and that when we were with these realtors but like there I guess the realtor down here is pretty much in you can be a real I could be a realtor yeah I did a little bit of research prior to us talking today and you don't need a real estate license or it's not yeah anyone can say that there our realtor essentially so these were people that were hired by the Builder I'm guessing yes to then be the representatives to sell off the the individual unit exactly but as it turned out there was there was two sets of sales teams here there was one that the bank had and then there was the one that the Builder had and I guess what had happened is the Builder and the bank ended up kind of parting company because the Builder didn't sell all the units that he thought he was going to ran out of money the bank was already in on both projects and so they decided that we'll finish it will take a certain amount of Units you take your units that you have and then we'll just make sure we sell sell everything off and everybody can go their own way eventually what happened is the sales team for the bank ended up the bank decided hey we better do this together right because that's exactly what happened it was got confusing for everyone so then they got it down to one sales team and I think we were kind of in just kind of as that was all happening because of because within probably the next time we came down those guys were gone I'm guessing they were still sort of representing wolf but builder more so because once that was once that was complete than they would exit I guess and go back to whatever they were from yeah and that that was very confusing for us you know and we're like all of a sudden you started getting a little bit leery whoa what's going on here hey come it was never really kind of explained to us that way was there a difference in in bank owned units versus the one price-wise here was the thing some of the units had air conditioners let's say you know the Builder had kind of cut every corner so what he did is you know there'd be just like wires sticking out of the out of the reciprocals right like there was no light switches there was no air conditioning so the price was less but it was reflective of those things exactly but then you had to come in and kind of finish the unit's right I think of now seven years later and I look at some of the properties and I mean you can buy a property totally done furnished everything right there's not too many buildings I think that are like this that I've seen down here so I think we were just in on something that was kind of unique yeah a unique situation but also probably a beneficial situation in terms of price point yes yeah because when it's finished when it's furnished when it's you're paying for all that which which you do you know when you start with something that is bare but you can save money by shopping around and fixturing it right whereas if we get the guy down here to do it I think there's a little protein oh they call it back time what's that oh it's Pro FEMA a little tip all right that was an opportunity really yeah you to be able to pick it up at a slight may a slight or maybe large discount of what something else would be in comparison and then add your personal touch to it what you wanted to do anyway so I mean that would have reflected some lot of the price like you said so you decide on the one you ended up buying then we're sitting in right now and what's then the process once you decide okay this is the unit that we wanted to buy then we had to agree on the price and we put in a an offer to purchase it and we did that back in Canada because by this time we had gone back oh yeah it was just a sheet of paper that said this is the price in USD and that was it is that what currency were doing it was those dollars that's what they asked for what's the timeline on on them accepting like all is it relatively just quick no it was just yeah okay but when you submitted the offer like did they get back to you within 24 hours 48 hours like like with quick yeah within a day we had our first out so once you had an accepted offer then you had to come down to Mexico again - did you have - could you have done it no we had to we had did yeah we had to be here a little bit tough because it's all in Spanish right you know we got it translated and we ended up our administrator here now Francisco that's fun to say he really helped us along so he was working then for kind of the Builder in the bank as well he was the administrator here and so he was local lives here does all that and then they had the sales team which were Canadians right yes that's right Canadians so the three of them were kind of working work together they were doing sales elements is that what they were doing and then he was kind of helping with translation and administration and dealing with other authorities and the note and Inara before you go on can you buy a property here how did you buy the property in your personal name or how does it you why you can't go personal or you can or mexico corporation from what i read today - there's a restricted area from for foreigners and if you're buying within the restricted area which i think is a hundred miles of the border and 15 miles of the coast and you can't buy in your personal name you have to buy in a trust and that is that what you guys did yes we did essentially the bank then acts on your behalf they purchased the property in a trust and you're the beneficiary of that trust and you are the only person that can have sole access to this property but essentially the bank is acting on your behalf that is that works and we can pass it down to our children you sure you don't want to pass it to me I mean so it's 100 year lease the bank is acting on your behalf owning the property per se they lease it back to you for 99 years you can pass it to anybody the increase in value that you get to benefit from debt essentially not the bank and how does the notary work they're acting on your behalf and on the bank's behalf where you got a notary that's operating separately or you do no no I think we we use the same notary and the fees are somewhere and then I think it was 2 to 3 percent of the value so it's not a flat rate fee here no it's based on the purchase price of the property or purchasing is what your legal fees essentially gonna be so what was the purchase price if I can ask this one we we bought it for by the time we were done with everything it was I mean furnished the whole thing was about a hundred and eighty six thousand can 186 thousand 150 meters from the beach two-bedroom two-bathroom about 1,100 square feet furnished everything done and ready well here they count your balcony and everything else so it's about 1,800 square feet so after the notary signs all the documents then essentially you have access to the property yes yeah and I mean as far as getting the documentation that you are there the owner took us probably a year a year why is that everything has to be funneled through Mexico City so I mean you got all the Mexico you know all the paperwork goes to Mexico City so they're they're backlogged then it's just and I mean you know for us it was hey we got access we could we could you know do what we want to it we bought all our furniture everything moved in and hey after a while I just wanted I don't know I'll get it when I get it but there's a major financial institution operating like you know essentially acting as the trust so you there's certain security either for sure but people get a little nervous right because when it doesn't this is different than what we do exactly right so all I'm gonna take them to get the whole building sold do you think another four years five years and you did you have to pay condo fees you pay college fees yep yeah maintenance fees there it runs you know the maintenance fees were forty four thousand pesos which is three hundred two hundred eighty I don't know whatever that works out dude what would you say all in your expenses are here on a monthly totally it cut you know our we're probably looking at about five hundred and fifty bucks I'm Canadian come on come on yeah you can't mortgage shared Kenya I don't know you can but it's not really most people don't do because the interest rates are too high I don't think he can mortgage as a foreigner so you bought it all in cash essentially at that point right so you don't really have any other expenses on it beyond your your five hundred and fifty bucks a month now everything in here you said Pratt minus one unit is pretty much everything's sold you want a couple in here now you guys come down here five months of the years four to five months pending on our situation but you know this year it's five months out what's the going rental rate of a unit probably similar to yours and this complex some of the owners here that are renting are getting 32 to 35 hundred a month he's getting to 35 averaging out to about what 1700 a month throughout the whole year 1700 a month at a purchase price of 186 it's pretty close to what we call the 1% rule so that's that's gonna cash flow well I mean even if you had a mortgage that's gonna cash it well obviously you don't have a mortgage but even at that 1700 a month that's about 20 grand a year collecting in revenue 20 thousand a year at 186 thousand dollar investment that's about a 11 or 12 percent return on an annual basis and takes you about eight years to pay that off completely it's a solid investment here and you guys are using yours yes so you don't have the benefit of renting it out but the nice thing to know is if you weren't here you could still rent it and it would be a great property and what's the value of those there stuff that's sold in here similar to what yours is right now yeah some there's been some unit cell for 4.3 million pesos pesos which is about 360s I like that 350 360 thousand Canadian dollars so you've essentially doubled your money in seven years yeah on the value and you guys come down here and enjoy it everyone if you rent it out would I mean there's no cash flows in your if you rent it I think it's really interesting just that the differences and the system here versus the system at home and I think there's but there's still a tremendous opportunity to either take advantage of coming down here and buying a place and spending your winters here or you know buying something down here and using as a rental property it looks like it works both ways depending on you know if you're buying the right place at the right time well thanks so much for taking the time my pleasure if you liked what Ron had to say and are interested in investing in properties down here if you can go ahead and hit that like button you can also subscribe to my channel and please feel free to leave comments questions below for me I will definitely answer those questions with that I'll say thank you guys so much for tuning in I wish you the best of success in your real estate investing journey and I look forward to hearing about your success stories very soon thanks so much everybody have a great day that's the luego

Channel: Darren Voros

Views: 39,147

Keywords: buying property in mexico as a canadian, buying property in mexico as an american, investing in mexico real estate, how to buy property in mexico, real estate investing for beginners canada, real estate investing 101, real estate investing in canada, vacation rentals in mexico, buying a vacation rental mexico, mexican real estate, tips for buying real estate in mexico, financing for foreigners in mexico, buying real estate in mexico, canadian snowbirds, darren voros, darren, voros

Id: E0DCFoPo1wY

Length: 13min 52sec (832 seconds)

Published: Fri Apr 10 2020