Real Estate Professional with STR in Mexico up to chat?

Question

Hey all, are there any real estate professionals who own an STR in Mexico and would willing to chat for 30?

I’ve qualified as real estate professional since 2021 and just found a potentially good opportunity to acquire a property in Mexico that would make for either a solid STR and/or eventually our forever home.

I’m completely new to acquiring a foreign property- how to finance, what purchase process looks like, how foreign STR is taxed, does real estate professional status matter, etc.

I’d really appreciate talking with someone who has done/is doing this- REP with STR in Mexico- to learn about your experience.

Thanks so much in advance! Happy to share some of the multi family market research I have been doing US in return.

John Malone · Answer

@Julian Martinez correct, no accelerated depreciation!

Alex F. · Answer

Hi - I'd be glad to chat.  My wife and I went with new construction in Mexico.  It is a 3-bedroom condo in Isla Mujeres.  The process was a bit different than here in the USA, but we are very happy with it.  https://bit.ly/3SEqbhg

I'd be glad to chat about the experience of purchasing there.

Emily Anderson · Answer

Hi Julian, Indeed, I was also considering Mexico for STRs, but I decided to pass on for the same reason. I was interested in Puerto Vallarta, mainly because I had seen the numbers for this municipality in a YouTube video

Julian Martinez · Answer

Hey Tej- I confirmed with my accountant and financial planner, bonus depreciation doesn't apply to foreign STR. Makes sense when thinking about it- the US offers that as an incentive for investing on US soil, I don't think the govt wants to actively encourage foreign investment by giving us a domestic benefit. So in my case, it made the math not work out, so I passed up on the opportunity to buy in La Paz, Mexico.

Tejaswi Redkar · Answer

Hello @Julian Martinez,

Were you able to figure out if bonus depreciation can be applied to a foreign STR? I have a foreign STR and was looking at doing a cost segregation study and apply bonus depreciation.

Thanks

Tej

Julian Martinez · Answer

@Michael Baum - thank you for looping in Mike!

@Mike Lambert - that would be great and much appreciated. Will drop you a note.

In talking with my CPA, the biggest downside is that I lose the chance for bonus depreciation, so I'm left with the slow, steady 30 year depreciation schedule on that property. But he's admittedly not well versed in the matter, so I'd love to chat with you.

Mike Lambert · Answer

@Julian Martinez, happy to chat and answer your questions. Feel free to send me a DM to organize.

Michael Baum · Answer

Hey @Julian Martinez, try @Mike Lambert. He knows a lot about the Mexican marketplace.