Tulum, Puerto Vallarta, or . . . Someplace Else?

[Paul Primrose]

Hi. I'm Paul, and I just signed up for Biggerpockets because after years of living frugally and working hard (and a sizable bit of luck), my wife and I are able to seriously consider investing in (read: buy with cash) a winter getaway / retirement spot. I'm trying to head into the process with my eyes wide open, and yet . . . it snowed here today, we're both working from home, and I've been distracted by internet real estate sites and pretty, pretty condo listings. 

We both want to continue working our jobs -- me for 5 years or so, she for another 10 at least. We've done some research and really think Mexico will be the place due to travel time and costs. We'd like to rent (and hopefully cover mgmt. costs and obviously even profit) when we're not using it, which would be 15 - 20 days out of the year, max, until retirement happens. 

I'd love to hear pros and cons of Mexico destinations, particularly Tulum and Puerto Vallarta, or any other suggestions. We don't need something right on the beach, but close enough to hike or bike to the beach would be cool (hey Tulum!), and walking or biking to a local food market will be important. Bangin' nightlife and Instagram types are low on our priority list (there goes Tulum!). We're both outdoorsy and avid cyclists, and we have two kiddos in grade school. Our budget is higher than what someone might expect, but I'd rather not disclose those specifics here. 

Thanks in advance for your advice and insight. 

[Mike Lambert]

Hi Paul,

I’ve been investing in Mexico for as few years now, starting in the Riviera Maya and working on a development in Puerto Vallarta right now.

I understand that this is first and foremost a lifestyle decision so only you can know which one is best for you after spending time in both places. Both are places you can rent in the meantime. However, Don’t hesitate to reach out to me if you have specific questions.

As you probably know, Mexico is the main foreign retirement destination for Americans and Canadians, who are moving there in ever bigger numbers. Like you, they’re attracted by the much lower cost of living but also the weather or the country’s beauty and culture and the proximity and easy access. Add to this that they still have their Costco and/or other Wal Marts and can socialize with plenty other North American retirees so they can still feel at home.

Your plan makes total sense. Instead of waiting for retirement and buying then, you can just buy today for much less money and you can get the property pay for itself through rentals and you can use the property for your holidays.

And, if you happen to change your retirement plans in the meantime, no worries you can sell for a nice profit and will have made some great rental income along the way, which will allow you to buy a nice place in your new destination of choice. Indeed, both the Riviera Maya and Puerto Vallarta are two of the very best international retirement and holiday destinations when it comes to capital gains and rental income.

The development I’m working on in Puerto Vallarta will be great for people in your situation because our buyers in a similar situation will not only be able to buy today for much less than in the future, we will also offer them financing while they’re still working, which they normally can’t get in Mexico and certainly not at a decent interest rate. So they win on both sides: they pay less today because 1) the price is much lower and 2) they get financing.

Mind you this isn’t going to work for you because it’ll take as while before I can bring that product to market. I also provide financing for condos I’m about to put on the market very shortly in the Riviera Maya but that won’t help you either because they’re in Playa del Carmen instead of Tulum. These examples however show you that there are deals to be found if you do your homework. You don’t need to buy retail.

While investing in Mexico has plenty of positives, it carries some specific risks and it’s important you know what you’re doing. Otherwise, your dream retirement project could become a nightmare. Don’t hesitate to reach out if you want to learn from my own experience or if you have questions on specific deals you might come across.

Finally, if you’re shelter in place, why don’t you take the opportunity to start learning Spanish if you don’t speak it yet. While you can easily get by in both places with English, speaking the language will make your life there even better and you’ll be able to use your newly acquired language skills in so many other countries!

Not too many people here have experience buying and investing in Mexico so feel free to reach out if you think I can be of any further help.