I have worked as a consultant for many American and Canadian buyers in Mexico. Here are some ideas. I know the original post is about a year old, but nevertheless hope its useful.
- Research market on existing, already built homes and condos in your are of interest. There`s value to be discovered.
- Research and learn more about developer's past projects. Inquire about their track record.
- Hire a an independent local attorney. Review the legal structure of the project, has it been fully approved by the Municipality? Are all individual units assigned a property tax number? Are they using financing? and If not, seriously look with a magnifying glass as the project may be undercapitalized. What kind of contract will you be signing and will it be recorded? Is it a fideicomiso? These are just basic questions.
- In Baja, I saw clients with great deals and exits and I saw horror stories as well. It all boils down to deep due diligence and assessing your risk accordingly with the expectations.
- Undercapitalized developments are easy to spot. Ghost developments are too, such as developments that would out right refuse recording an actual public deed and instead offer just a private contract. An example is the infamous Trump development in Rosario that never was. They had marketing, a sales booth and everything else was smoke and mirrors. No developer, no builder, no title to the land, no financing, nothing in public record. They took millions, with many investors paying the full amount upfront.
Hope this helps!
