Interested in Quintana Roo Short Term Rentals - All Inclusive Options?

Question

Answer

Hello KC Frank,Greetings! I'm a seasoned developer, investor, and realtor with over a decade of experience in the Riviera Maya. I’ve had some experience with all-inclusive Condo-Hotels in the region. While they might not provide the highest ROI, if you're looking for a more lifestyle-oriented investment, there are options available that offer full ownership with returns covering expenses and could provide cost-free vacations for you and your family.I would caution against most timeshares, private residence clubs, and fractional programs, as they often come with limitations and challenges in resale. Instead, I can share properties that have proven to be lucrative in the short-term rental market, including those benefiting from the new Mayan train and Tulum International Airport developments.If you're interested, I'll send you details on available all inclusive condo-hotel properties in Quintana Roo, along with price lists and availability. Feel free to expect a DM from me soon.Best wishes from the Mexican Caribbean,Seb.

Answer

@KC Frank Sounds that this kind of opportunities would work for your lifestyle but make sure you understand how much money you're going to make and what the rules are, as it might be way less than you think and also there are rules attached to your investment that are outside of your control. I've been investing in the area for years and always avoided them like the plague. Also, if it was me, I'd put my cash in a more profitable investment and stay at an all-inclusive resort "for free" using the profits of that more profitable investment. These resorts are cheap so I rather be the renter than the owner. Moroever, it'd be better from a lifestyle point of view as I can stay in a different one each time and so it would be way more exciting ans less boring.

Answer

@KC FrankSounds like it'll be for a large part a lifestyle purchase, which makes it easier. However, when it comes to cash flow and appreciation, there's something important to understand. In such a vacation market, cash flow and long term value oftentimes go hand in hand. It's not like in the US where you have the cash-flowing low appreciation Mid Western-style and the negative cash flow high appreciation Californian-style market. If there's no cash flow, there's not much long-term property value increase because very few of the kind of properties that you'd buy are primary homes and therefore they don't have that intrinsic value. This is especially true in a resort, in which no home would probably ever be a primary home. So, the long-term value is closely tied to the cash-flow potential.When it comes to the whole area, that ship has sailed in my opinion. Of course, I don't know what your time horizon is. The long term price trajectory will partly depend on whether the sargassum issue can be contained or whether it gets worse and on how much overbuilding eventually takes place.If you want to be in a resort, the resort is more important than the location in my opinion. Most people won't care if it takes 10 minutes longer to go to a resort if it is better. I tend to put my mouth where my money is so, if you don't want to be in a resort, I'd go for Playa del Carmen, which is easy access from the airport.Something important to understand is that your guests (and yourself) typically will have to pay to use the resort facilities. If they want to use the resort more than once or twice during their stay, it's probably gonna be cheaper for them to take the all-inclusive package. In theory, this could work if the resort is for example close to Playa del Carmen, your guests want to use it once or twice and go to town the rest of the town. Problem is I'm not sure how many people would do that since you typically have the resort lovers and the resort haters and people who want to enjoy Playa del Carmen typically want to be downtown and take advantage of the walkability. So, if I was to buy in a resort, I'd want proven cash flow at the very minimum.

Answer

All very helpful Mike. I appreciate the insight and see your point about the relationship between cash flow and appreciation. Thanks.KC

Answer

Howdy Mike and appreciate the reply.We invest in areas we want to visit and we visit our places relatively often. We'd like to find a place to call our own and don't care about visiting other places in Mexico. We've been to Mexico many times and would rather find a place to call our own. We typically pick a market, then run the numbers on what to expect from our investment in that market. We're more focused on long-term value than cash flow and are comfortable with negative cash flow at the beginning as long as the deal makes sense.Do you have any thoughts on the region I mentioned? Any hot areas and/or better performing towns in the region? We prefer to stick around Cancun airport as much as possible.Thanks!KC

Answer

Hi Seb. Appreciate the info. Please DM me with additional details. We're not as concerned with cash flow. We want something of our own there for visiting and are looking at the long-term returns. We do prefer adding our own design to places, but we understand many of those resorts/HOAs have uniform design in every unit.Thanks!KC