Looking to buy STR in Mexico

[Akshar Deri]

I am looking to buy STR in Mexico and I heard you cannot buy properties 54 miles from the coast. In that case, would you buy something on the beach for STR? Has anyone figured out logistics such as cleaning/maintaining property and such in Mexico? I have properties in Atlanta GA (LTR) and this is my first venture outside of USA. After reading some posts, it seems Tulum is one of the best places to buy STR properties. Any help/suggestions would be appropriate. Also, does anyone know any reliable broker that I can contact for that?

[Steve K.]

@Mike Lambert As I'm sure you know, using the listing agent as a buyer is standard practice in some parts of the world like Australia where most buyers don't have their own separate representation. However they have a completely different structure there where legalities are handled separately, by a conveyancer - one for the buyer and one for the seller (they use different conveyancers in order to avoid conflicts of interest and agents simply facilitate the deal but are not involved in the legalities). Americans are typically not used to this arrangement and in many states dual agency is actually illegal (for good reason because there is an inherent conflict of interest). It's my understanding that there are no licensing agencies for real estate agents in Mexico and also no central regulatory board. Some areas like Puerto Vallarta I know have loose board associations and even private MLS systems, but nothing quite like our National Association of Realtors in the states that establishes standards in ethics and best practices as well as controls the MLS. Therefore dual agency disclosure, designated agency, full disclosure, confidentiality, imputed knowledge and notice, implied knowledge, fiduciary duty, loyalty, and vicarious liability are foreign concepts there. Of course with no regulatory board in place and no rules around dual agency or disclosure, the conflict of interest is a very real factor to consider. There's nothing preventing listing agents from making misleading statements to benefit themselves or the seller. For this reason, I would not recommend anyone use the listing agent as a buyer, as they will obviously only steer buyers to their own listings and have their own interests in mind first, the seller's interests second, and the buyer's a distant third. It's human nature for the listing agent to want to get the deal to the closing table at all costs and get paid their commission. They're obviously not going to bring anything to the buyers attention that would jeopardize the deal. With no licensing and regulatory body in place to enforce rules, it's 100% caveat emptor. I'd recommend having a 100% dedicated buyer's agent and also a good Spanish-speaking lawyer to review everything. Also all legal documents are in Spanish, and there aren't standard state-approved forms and contracts that agents are required to use like in the states or neutral conveyancers handling the legalities like in Australia, so contracts vary from agent to agent and everyone has to cover their own butt. I've heard of agents presenting one set of documents in English and a separate set of different documents in Spanish to get signed. Only the Spanish version is legally binding of course. Mexico is not a place I would put trust in the listing agent to fairly represent me as a buyer while also serving the interests of a seller while also managing their own conflict of interest at the same time. This isn't exclusive to Mexico by the way, I would recommend anyone looking to buy in the states to have their own representation as well. Using the listing agent just puts the buyer at a huge disadvantage throughout the transaction. These arrangements also often result in lawsuits which is why they are illegal in some states and many listing agents will not work with unrepresented buyers under any circumstances.