Investing on a Second Home or Vacation Rental Property

ventanamagazine.com
Author: Roger Vales & Diego Garcia

 One of the key decision-making factors when considering and investment in a foreign country is to have someone you can rely on to solve all of the different aspects of owning a property while you are hundreds or thousands of miles away. This is when Property Managers come into the picture.

Property management is the operation of real estate, the range of functions that a manager does, include but are not limited to: maintenance, provision of services, supervision of staff employed for services, payment of outgoings, payment of property taxes , together with negotiations with tenants and prospective tenants and the collection of rents.

Finding a good property manager could be the difference of you truly enjoying your second home or vacation rental property or having a very disappointing experience. Imagine coming to your beautiful new condo on the beach in Mexico and dealing with receiving furniture, installing satellite tv or cable, internet and not being able to communicate with providers because you do not speak Spanish or having to wait for hours when you could be at the beach relaxing.

If you do not have someone taking care of your property, on your second visit to your condo to hopefully relax because your first trip you worked more than you would have wanted to, you find that there is mold everywhere, your plants are dead, and you have no hot water, so you spend your “vacation” working and fixing problems so maybe, just maybe on your next trip you will be able to relax and enjoy.

Once you have a property manager with the local knowledge you will not only feel more comfortable with going forward with your investment, but will also have the peace of mind that you will not need to deal with any of the problems yourself, and when you arrive to your house you will find it in pristine condition. Additional benefits of having a property manager could be having a housekeeping service during your stay, concierge services, airport pick up, etc.

If you are using your property for vacation rentals most property management companies provide the service of offering your property in the vacation rental market, but not all of them have the infrastructure to aggressively market your property and provide hotel like services to the vacation rental guests. Although renting your property could be just to have some money in return to pay the expenses, paying the mortgage or making a business out of it, it is important to consider the infrastructure behind the property management company to truly understand their capabilities and therefore make a wise decision.

Having a property manager will also help to increase the value of your Real Estate, because a well maintained property with an attractive vacation rental record will make it a strong candidate for an easy sale.

Guideline for a Successful Real Estate Acquisition

 ventanamagazine.com
 Author: Linda Neil


Buying property in any country can be stressful. A property investment in Mexico can be just as safe and secure as in the U.S. or Canada, if it’s done correctly.

Here are some guidelines for success in a real estate acquisition in Mexico:

1. Be sure the agent you select to represent you is a real estate professional. He or she should be a member of AMPI, the Mexican National Real Estate Association. Ask for references, check them out. Be satisfied the person representing you is experienced in Mexican transactions.

2. Insist that the person representing you, represent ONLY you, the buyer, and not also the seller unless you understand, agree to and sign an agency disclosure agreement.

3. Consider only the purchase of PRIVATE property. Ejidal property is often offered at a far lower price but it cannot legally be sold or promised to be sold until it becomes private property.

4. Be certain that you and your agent are dealing ONLY with the owner of record or his or her legitimate power of attorney. Insist upon receiving a copy of the seller’s deed as a condition of your offer. If you and /or your agent don’t understand Spanish, get it translated.

5.. Avoid costly and time consuming litigation, insist upon including a binding arbitration clause in your contracts with the seller and other parties involved.

6. Get a title investigation and buy title insurance for the full amount of your purchase price. While the initial search may seem expensive for some areas, the title policy transfers risk to the insurance company, and minimizes yours as the buyer.

7. Think carefully about how you acquire title in order to avoid or minimize probate and transfer costs in the future.

8. Closing costs may run from 13% to 20% of the cost of a $50,000. dollars property. The multimillion-dollar property will be about 3.5% of purchase price. Certain costs are fixed regardless of value. Be sure to budget for closing costs and get a full estimate in writing from the company supervising your transfer.

9. The major portion of your payment for the property should be held in escrow until the deed has been signed by the seller and, if applicable, the bank trustee (if a fideicomiso).

10. INSIST upon receiving a registered title document for your property. If the seller is financing the property, sign a document protecting his interests in the event of your default. Be SURE you know the amount which is declared in your deed and understand the tax implications of same.

11. Use an experienced neutral third party to supervise the transfer of title to you.

Mark Your Calendars for the 2014 Maz International Week

by Maureen Dietrich

 6 Mar 14  

mazmessenger.com

Events take place in different parts of Mazatlán and many are free.

The programme for the Third Annual Mazatlán International Week was announced today at a press conference given by Sinaloa Secretary of Tourism Francisco Córdova Celaya. The week celebrating relations among Mazatlecans and foreign residents and tourists will run March 17 through March 23 with an impressive array of events not often seen in Mazatlán.

A consortium of local businesses, civil associations and Sectur have been planning the annual event since May of last year and, according to Simon Lynds of MazatlanMyCity, they expect 5,000 people to attend the various events, exceeding last year’s attendance of 4,000.

Each of the seven events are planned in different locations throughout the municipality and many are free.
Mark your calendars and get out and mingle! Here is the programme:

March 17: The Spectacular III Concert “Blues n’ BBQ” At the Mazatlán Convention Center, a night of music presented by the Mazatlán Music Lovers Club from 3:30pm to 7:00pm. Tickets are 500 pesos and include a buffet and first drink. Reserved tables for 10 are available. 600 tickets have already been sold for this event, so reserve yours now by phoning (669) 913-4456

March 18: Open Air Cinema Night Free movie (seats provided) in front of the Art Museum in Centro Historico. Although the film is being kept secret, it will be a classic Mexican movie with English subtitles. For your listening pleasure, the musical group “Black Birds” playing Beatles music will perform before the movie begins. The evening begins at 6pm, ending at 10pm. Admission free

March 19: Ranch Fiesta An authentic Mexican fiesta at Rancho Los Limones approximately 20 minutes from Mazatlán in La Noria from noon to 5pm. The beautiful hacienda boasts a small mezcal industry and is situated among agave fields. Tickets include Mexican food, traditional drinks, dancing and a performance by Canadian singer/songwriter, Cheryl Gaudet. Tickets are 350 pesos and include transportation, meal and drinks. 250 tickets have already been sold to this event, so if you´d like to go, get your tickets soon by calling (669) 911-1872 or (669) 991-8653.

March 20: Rodeo Fest A fun family afternoon at the Plaza de Toros bull ring with Eduardo Funtanet and his dancing horses, and a mixture of Mexican and American rodeo games from 3pm to 7pm. After the rodeo will be a musical performance by Canadian singers Tanya Carrum and Brent Mcathey. Local non-profit associations will be selling food and drinks to benefit various charities. Admission is free

March 21: Spring Equinox  The annual spring equinox celebration beginning 9am is held at the “Las Labradas” archeological site featuring dancing, rituals and cleansing ceremonies. Two packages are offered. Package one includes transportation, entrance fee and access bracelet. Package two includes transportation, entrance fee, access bracelet, guide, meal and drinks. To reserve contact Sinaloa Advertures at 191-2005

March 22: Golden Zone Street Party The party runs from 10am to 6pm on the cordoned-off street of Las Garzas between Av. Camarón Sábalo and Av. Gaviotas. Featuring an art exhibition from 10am to 2pm and a classic car show from 2pm to 6pm, accompanied by live music from the bands “Ebano” and “Fairly Honest John.” Artists wishing to exhibit at the street party (no cost) or enter their classic car in the show can contact Roger Culbertson at cell phone 044(669)155-5504. Admission is free

March 23: Beach Fest A beach party at the Club Marina Mazatlán (a popular event last year) from noon to 6pm. Several bands will be playing for your listening and dancing pleasure and beer is only 10 pesos with your 50 peso admission fee.

If you need more information about the 2014 Mazatlán International Week, please contact Sectur at 01-800-746-2639.

Moving to Mexico? It's different. Do your homework.

mexconnect.com 
J. Brad Grieve

I have determined a list of the best recommendations for any buyer purchasing in a foreign country.

What has struck me a few times this past year have been some of the minor last minute conflicts that could have been resolved easily and earlier. Sometimes these conflicts are the result of miscommunications, ignorance or misunderstandings. It is sometimes difficult to decipher answers and understand whether the answer is the whole truth or a convenient and/or incomplete truth.

After investigating some of these cases for clients, I have determined a list of the best recommendations for any buyer purchasing in a foreign country.

Do your research

 

Understand the impact of the move you are considering and the practical side of your dreams to spend your retirement years in the sun. This is often done by talking with family, friends and acquaintances. However, more and more people are investigating sources on the Internet. Remember to qualify the source of everything you read on the Internet. I have found the best sources of information to be Internet magazines, which have content edited by a second person (editor).

Do your due diligence

 

Compare the house you want to other homes in the area or that are of similar size (land and construction).

Understand the differences between your "dream home" and the other "comparable" homes. Whether you are buying a previously owned house "as is" or new house with warrantees, be sure about the condition of the house you are purchasing - see clearly and decide wisely. This may require the counsel of an inspector or engineer.

While performing a comparative market analysis, I have seen similar sized properties that have varied in price more than can be accounted for in terms of location, chattels, amenities and quality of construction.

Use plenty of common sense

 

If it looks like horse, walks like a horse, sounds like a horse and acts like a horse, then likely it is a horse.

Too often I have seen buyers make decisions without using common sense. Buyers sometimes do not ask the normal questions for fear of embarrassment or because of a relaxed mood. Although they understand they are in a different country and assume everything is different, they sometimes do things that would not do at home. There have been cases such as purchasing a property after accepting a promise of a future deed.

Keep a healthy skeptical mind

 

Sometimes, I have heard clients tell me that their agent, the seller or builder had "promised" something that they later failed to carry out. Remember, the builders/developers and the agents only get paid if they sell you something. And that list may include the taxi driver, the waiter, hotel or B&B manager, and others who have referred you along the way. I am not saying all the aforementioned people are corrupt or interested only in their commission and not your well being. But understanding an individuals' motivation will help you keep their relationship and the quality of their answers and advice in perspective.

If you need evidence of a verbal agreement, write a letter of agreement, letter of intention or letter confirming a verbal agreement and send it to the other party and a friend or legal counsel. If there is a problem, remember the Mexican court will not recognize an e-mail alone.

There have been cases of a person buying land with the understanding that the developer or real estate company will manifest the construction onto the deed at a later date that seems to drag on and on. Sometimes the blunder is not discovered until the homeowner tries to sell the property.

In conclusion, enjoy the process of purchasing your dream home in a foreign country. Be wary, be smart, but never let skepticism rule your life. Too much skepticism can make you unhappy and keep you from moving forward with anything. And you could miss out on the excitement and adventure most of us have found here at Lake Chapala.

Foreign Associations Included in DIF Council

by Maureen Dietrich on 9 Jan 14
mazmessenger.com

Newly installed Board of Trustees for Mazatlán’s DIF office.

For the first time in the history of Mazatlán’s municipal Desarrollo Integran de la Familia (DIF, or Family Services in English), local foreign charitable organizations will form part of the board of trustees.

At the DIF swearing-in ceremony yesterday DIF president Sylvia Treviño Salinas, wife of Mayor Carlos Felton, said her office is armed with a marvelous, passionate team to form a strong base for families, with particular attention to teenagers and children.

Among the 14 charities forming the board of trustees are local foreign associations Friends of Mexico A.C (represented by President Steven Backman), Vecinos con Cariño A.C. (represented by President Rudy Villalobos) and The Vineyard Church (represented by Fred Collom). 

(from Press Release and information from Iván Pico, Municipal liaison with the foreign community)

Retiring In Mexico Or Abroad Might Not Be A Bad Idea

FinancialSamurai.com

Balandra Bay, La Paz

When you think of Mexico what do you think of? I think of hot summers, tequila, salsa, and friendly people to name a few. I just got back from a 10 day business trip to Mexico to better understand their lifestyle as I might want to live there one day. I also wanted to learn more about US / Mexican relations from a local’s perspective. We hear a lot of rhetoric about immigration control from our politicians and I wanted to hear for myself why someone would want to risk so much to come to the United States illegally.

Until this year, I had only been to Cancun and Playa Del Carmen for vacation. This time I visited two very sleepy towns called Loreto and La Paz on the east coast of the Baja California Sur peninsula. The idea was to visit places that were not built up for tourists like Cabo or Puerto Vallarta. Loreto’s population has grown quickly percentage-wise, but their total population is still only 7,000, or 1/3rd the size of UC Berkeley’s student body.

WELCOME TO LORETO, MEXICO

What struck me most about Loreto was its beauty. I chartered a private boat to take me across the Sea of Cortez to Coronado Island where dive master Lupe led me 100 feet down to explore the deep blue. Over 80 feet of visibility allowed us to see sting rays, lobsters, turtles, moray eels, and numerous varieties of tropical fish. The water was 85 degrees, a full 32 degrees warmer than the water in Monterrey Bay, California where I dove last month. Diving without a wet suit is like striking gold!

During the 30 minute boat ride to Coronado, I asked Lupe about his background. He said he came to Loreto 15 years ago from the Pacific side of Baja California Sur. He’s married to an American woman who shares his love for the ocean. When they are not leading diving excursions, they are taking visitors out kayaking. When they aren’t diving or kayaking, they’re going deep sea fishing. Lupe was full of life and told me he loved every minute living in Loreto.

I asked him how often he visits his wife’s side of the family. “Never,” he said. Perplexed, I asked him why not.

“It’s impossible to get a visa,” Lupe responded. “I’ve got to first apply at the visa center far away in Tijuana.

Then I’ve got to pray the immigration officer is not in a grumpy mood. If by some miracle I get approved, I’ve got to then drive to Tijuana, park the car, and fly to Seattle. Forget it.”

“So even though your wife is American, they still make it difficult for you to come in?” I asked.

“Yes, that’s the way it is,” Lupe responded.

Up until then, I never fully understood the asymmetric rules of moving across borders between the United States and Mexico. There’s no need for Americans to get a visa to go to Mexico. I just brought my passport and went. Meanwhile, Mexicans have to jump through so many hurdles just to have a chance to come to our country. My appreciation for living in the United States went up several notches after this exchange.

Diving at Coronado Island, Loreto

 

THE ECONOMICS OF LIVING IN MEXICO

 

I asked Lupe whether he and other Mexicans resented American tourists for their freedom to move about so freely. “No, we don’t resent Americans. We welcome their dollars into our sleepy town,” Lupe replied.

“What we do resent is Americans buying up nice properties and making things expensive for the rest of us. When I arrived 15 years ago, the piece of property I wanted to buy cost $3,000. I had no money so I just rented. 15 years later, the same piece of property now sells for $50,000-$80,000! I hope to one day save enough money to buy a home that I can leave to my daughters.”

It’s hard to believe real estate values went up 20X in such a short period. But it’s also hard to believe that one could buy a humble home for just $3,000 in the first place as well. I went on to ask him how much one needs to make to have a great life supporting a family of four.

“You can live a wonderful life raising two kids and taking care of your spouse on $2,000 a month. $2,000 a month is actually more than enough. I know this because I take visitors diving three times a week on average, earning $150-$200 per trip after expenses. Rent is about $700 a month for a three bedroom apartment. Food is maybe $300 a month. The ocean is free. Health care is cheap. I’ve got more than enough left over to care for my family.”

My mind immediately started making plans for getting an apartment down in Loreto for a couple months a year during maximum visibility diving season. Being able to live and work from anywhere in the world is the biggest benefit of having an online business.

Lupe explained the reason why so many Mexicans want to move to America is so they can earn US wages and send money back home to their families. The problem is that wages for such immigrants tend to border on minimum wage territory. Meanwhile, the work usually isn’t very pleasant either.

Lupe and I looked around the beauty of our dive spot and he said, “Why be a slave in America when you can live free here?”

Horseback riding, Cabo

 

DREAMS OF A BETTER LIFE

 

It’s easy to take our lives for granted. We always seem to want more than we have. Why else do hoards of Americans visit Mexico for vacation every year? There are an estimated 1 million Americans currently living in Mexico as retirees. At the same time, why do over 140,000 Mexicans legally immigrate to the US every year? There’s an estimated 6 million illegal Mexican immigrants in the US as well.

The one common denominator is money. Americans who don’t have enough to retire comfortably in the US go to Mexico. Mexicans who want to make more come to America to send money back home to loved ones or try striking it rich on their own. These are very simplistic assumptions, but there’s no denying the importance of money in people’s decisions to change their surroundings.

It’s very tempting to become a “snowbird,” an American who comes to Mexico in the fall and leaves in the Spring to retain American retirement benefits. Flights are cheap and under two hours away. My biggest concerns are feeling isolated and bored after a while since these sleepy towns have very little going on. I’m holding off on the potential of living abroad for several more years because my preferred retirement destination is Hawaii. A Hawaiian lifestyle equivalent to a $2,000/month Mexican lifestyle will probably cost anywhere from $10,000 – $20,000 a month. If I fail to achieve my passive income goals within the next five years, Mexico might just be the ticket!

Foreign Community Donates Benches in Plazuela Machado

by Maureen Dietrich on 18 Dec 13
mazmessenger.com

Janice and Peter Stratychuk share a joke with Mayor Higuera at the inauguration ceremony.

Mazatlán Mayor Alejandro Higuera and Raúl Rico, director of the Instituto de Cultura y Arte de Mazatlán (Cultura), were guests last night at an inauguration ceremony in the Plazuela Machado of eight benches donated to the city by members of the Mazatlán foreign community.

Henri Jarrat, co-ordinator of the project, explained that in association with the director of Cultura various North Americans donated the eight benches each with a plaque representing the arts such as theater, music and ballet.

Each bench, designed and constructed by local businesses, cost 12,000 pesos, said Rico.

The idea arose following the erection of a bench by Cultura in front of the Angela Peralta Theater in honour of now deceased American resident Jackie Peterson, a staunch patron of the local arts scene, said Jarrat.

At the inauguration, United States Consul in Mazatlán Luis Ramírez presented Mayor Higuera with a recognition plaque for his support of cultural events during his three terms of office benefitting the American community, Mazatlecans and the community at large.

 (from Noroeste)

Why US baby boomers are retiring in Latin America

Places such as Mexico, Panama, Costa Rica, and Colombia attract record numbers of American seniors as they look for good – and affordable – places to live. 

 

By Daniel B. Wood, Staff writer December 1, 2013

csmonitor.com 

• 

  Courtesy of Christian Gonzales/CIMA Coffee Farms

  
  

Los Angeles — After 20 years in the US military, James Cummiskey was divorced and looking for a change. Relenting to his buddy's request, he flew to Medellín, Colombia, for a visit. He looked, he saw, and, by dinner time, he decided to stay. Permanently.

"After four to five hours, I was immediately captured by everything I saw," says the ex-marine, who has lived in 35 countries. He spent the next four months selling two homes, three vehicles, two motorcycles, and one airplane. He put the money aside and decided to retire early.

Now he lives in a posh section of the mountain city of 3.8 million, surrounded by lush vistas. He married a Colombian woman, started a coffee export business, and seems to get goose bumps every time he thinks about his new life. "I tell you honestly I have had more fun here in the past four years than in the previous 50," he says.

 

Mr. Cummiskey’s story is being repeated thousands of times – minus perhaps the sale of a personal plane – as more and more Americans retire to countries all over Latin America. Lured by sun-dappled landscapes and cheap living costs, they are settling in culturally vibrant towns in central Mexico, beach communities in Costa Rica, high-rise enclaves in Panama, and mountain retreats in Nicaragua.

Even Medellín, once the drug and murder capital of the world, has transformed itself into something of an urban showcase, attracting baby boomers to a place where cocaine kingpin Pablo Escobar used to carry out his ruthless craft.

Though the phenomenon of Americans retiring in Latin America began 25 years ago, it has accelerated in the past five to 10 years. Call the region America's new "Sun Belt."

"Thirty five years ago, this idea was truly on the far fringe – that if you thought about retiring out of the US, you were labeled 'renegade' or 'strange' or 'weird,' or 'over-adventurous,' " says Jennifer Stevens, editor of International Living magazine. "Now it is much more acceptable, desirable, and even normal to do this. It's a huge trend."

The exodus south is being driven by a confluence of factors. The baby boom generation – the largest in history – is reaching retirement age, and millions are looking for places to spend the next phase of their lives. As the most educated, well-traveled, and adventurous generation in history, many of these boomers are deciding to retire outside the country – including in Latin America.

They're also looking for places that will allow them to stretch their 401(k)s after they lost a lot of money in the last stock market collapse. With the US economy remaining so tentative, and health-care costs so aggressive, retirees want to live where they can afford greens fees and where a trip to the emergency room won't bankrupt them.

"A lot of people are saying, 'I'm tired of worrying about my retirement years,' so they are beginning to ask questions and go in search of great deals ... and they are finding them," says Kathleen Peddicord, founder of the Live and Invest Overseas publishing group and author of "How To Retire Overseas: Everything You Need to Know to Live Well (for Less) Abroad." She says that many are taking advantage of what she calls the "perception gap" – the idea that countries such as Colombia and Nicaragua are still thought of as countries with huge problems of drug violence even though the violence has largely been erased. One other factor: In the age of Skype and FaceTime, meaningful contact with children and friends, no matter where one retires, is now only a finger tap away.

While living in Latin America isn't for everyone – crime, cultural differences, and even phone connections can be problematic – is it any wonder that Naples, Fla., and Flagstaff, Ariz., are no longer America's only leisure-years Shangri-Las?

•   •   •

Jeanne Mendez was drawn by the views of three volcanoes and the "gentle pace of life." After her husband died in 2004, Ms. Mendez went on a yoga retreat held on the shores of Lake Atitlán in Guatemala. She ended up building a circular home in Santa Cruz, a village that borders the expansive 50-mile lake.

Mendez, who for 20-plus years worked in finance in New York City and then for Microsoft in Seattle, now has to board a small boat to get groceries from a local market, which is part of the charm. "For a person who used Excel spreadsheets for every decision," she says, "it was an unusual decision [to move here], but it was a powerful urge for me."

Mendez represents another dimension of the surge of Americans southward: Many of them are settling in countries other than the usual haunts. For years, Americans have been retiring in Panama, Costa Rica, and parts of Mexico. Many still are. But now a growing number are also exploring Honduras, Nicaragua, Guatemala, and other countries not often mentioned in retirement brochures.

What makes Guatemala attractive to retirees, for instance, is not only its enviable views but its cheap costs, even relative to other Central American countries. A house that would go for half a million dollars in Costa Rica or Panama can be found or built in Guatemala for $250,000, according to Armand Boissy, a real estate agent and developer who has lived in the Lake Atitlán area for the past 25 years.

Patricia and David Bibb, both artists in their 60s, decided to settle near Lake Atitlán after searching for places in Belize, Honduras, and other parts of Guatemala. "It was as beautiful as Hawaii," says Ms. Bibb, who has lived in North Palm Beach, Fla., and Georgia.

The couple renovated an existing home, doing some of the work themselves, since he is a master woodworker and she is a ceramic artist. They have three grown children and three grandchildren in the United States whom they see four or five times a year. But they have no plans of returning. "We consider this our last home," says Ms. Bibb with finality.

To a certain extent, the move south by Americans is just part of a larger trend of retirees settling in places all around the world – from France to Thailand to craggy New Zealand. When Ms. Peddicord launched the Live and Invest Overseas publishing group in 2008, she had 10,000 subscribers the first year. Now she has more than 200,000.

But Latin America is drawing a particularly large number of expatriates, both because of its proximity to the US and because of the relative inexpensiveness of many parts of the region. While no one knows the precise number of retirees living in the area, signs suggest it is substantial – and growing:

•The number of Americans receiving Social Security checks in Central America and the Caribbean – one gauge of how many people live outside the US – rose 26 percent between 2005 and 2012, to 28,126, according to the Social Security Administration. It jumped 112 percent in Panama and 32 percent in Costa Rica.

•The number collecting US Social Security checks in South America increased 48 percent over the same seven-year period, to 22,019. It rose 87 percent in Colombia and 47 percent in Ecuador.

•Mexican officials estimate that more than 1 million US-born citizens now live in Mexico – up from 360,000 in 2000.

"There are 20,000 Americans just here in Lake Chapala and more in Guadalajara," says Thomas Heller, a real estate agent who grew up in Washington State and married a woman from Mexico he met while studying there.

The Mexican states of Jalisco, Guanajuato, and Baja California have traditionally served as destinations both for tourists and retired Americans. But Mexico City has become a magnet for American migrants, too, as security and quality of life have improved in the city.

In Jalisco, the number of US citizens over age 55 more than doubled between 1990 and 2000, increasing from 2,480 to 5,918. The number has expanded far more dramatically over the past decade. "We have the best weather in the world, Wal-Mart, Home Depot, and very good medical care," says Bruce Newby, the president of the American Society in Guadalajara, Jalisco's capital city.

Mr. Newby, a lawyer who grew up in Indiana and later lived in California, first came to Jalisco to visit a friend who had moved there. He soon decided to relocate himself.

"The restaurants are wonderful, cheap, and very good," says Newby, sounding like a one-man chamber of commerce.

Newby won't get any arguments from Diane Golz. When she and her husband were first considering retiring, they bought numerous books and did extensive research on where to settle outside the US. The couple from Georgia finally decided on the Guadalajara area, buying a house near Lake Chapala, in part because it was so close: They could simply put their dog in the car and drive down from Atlanta. Now the two of them can also easily fly to visit their children in other parts of the US.

Besides, says Ms. Golz, the food here "is not at all like Taco Bell."

•   •   •

While many people are moving to Latin America permanently, others are choosing to live there a few months of the year. For these people – mainly "snowbirds" – the region has become the new Florida.

Take Jay and Kathleen Snyder. Grandparents of six, they now divide their time between Landgrove, Vt., and Granada, Nicaragua. In 2005, after 40 years of running an inn in Vermont, the couple decided they wanted a change and a little more sun.

"It was as though I could hear a voice saying, 'Go south, old man,' " says Mr. Snyder. He visited Nicaragua and enrolled in a Spanish-immersion program.

The Snyders are now doing in Nicaragua what they've long done in Vermont: beckoning others to come stay. They made an offer on a piece of land in Granada and, finding out no such thing as a rental-management program existed, built a set of condos and started one themselves.

"If it works for me, I figured, it'll work for others just like me," he says. "Something like, build it ... and the retirees will come."

The transition has not always been easy. Snyder has been unnerved at times by Nicaragua's political vicissitudes. In 2001, when he made his first trip to the country, the real estate market was booming. By 2005, it had slowed considerably. A pullback ensued after Daniel Ortega, the former firebrand Marxist who now espouses a mixture of Socialism and free enterprise, was elected president in 2006. But the fears subsided, and his condominiums kept selling.

Nicaragua also may not be the place for people expecting Trump Tower living conditions. Many deliveries Snyder gets are still by burro and cart. The architecture is what he calls "original." But that's what Snyder likes about living there: a rustic existence that echoes life from another century. "This isn't a place like Costa Rica, where huge developers and resorts have come in and done their own thing," he says.

It's not just retirees who are taking advantage of the appeal of Latin American countries. Kent Davis, who grew up in Hawaii, moved to Panama when he was 27. Now, six years later, he calls his life in the country "fantastic." Mr. Davis, the founder of the real estate firm Panama Equity, says homes there aren't necessarily any cheaper than they are where his mother lives in Richmond, Va. But the cost of doctors, dentists, and car repairs is about one-fourth what it is in the US.

The lifestyle is vibrant, too, even for young people. He attributes part of that to the diverse expatriate community – one made up of people not just from the US, but also from Colombia, Venezuela, and Canada. The migrants busy themselves with activities ranging from book clubs to singing groups to scuba diving.

Young expats, he says, like to surf and barbecue. Retirees tend to go to restaurants and tap into a growing, if nascent, arts scene. They might volunteer to teach math, English, or basic computer skills. "Nobody leaves here because they are bored," he says.

One reason so many American expats are settling in Panama is the incentives. While governments throughout much of Latin America are now trying to lure Americans, Panama's was among the first and most aggressive to target US baby boomers. A series of laws over recent administrations created the pensionado program, offering foreigners lifelong residence in Panama if they prove they receive a monthly pension of more than $1,000. Foreign-earned pensions are not taxed by the Panamanian government.

In addition, so-called jubilados (retirees) receive a one-time exemption of duties on the importation of household goods and a wide array of benefits. This includes 50 percent off entertainment; 30 percent off bus, boat, and train fares; 25 percent off monthly energy bills; as much as 50 percent off hotel stays; and 15 percent off hospital bills in some cases. It's one of the best retirement programs in the world, according to International Living magazine, which rated Panama at the top of its annual "global retirement index" six years in a row.

"I had to look for a place where I could afford to retire, and actually retire and not have to keep working," says Clyde Coles, a 26-year veteran firefighter from Corpus Christi, Texas, who injured his neck in the job and couldn't carry out his duties anymore.

His solution: a tiny beachfront town about 90 minutes outside Panama City, where he and his wife purchased an older home on an acre of land. They live on about $2,500 a month. For the couple, the biggest draws were Panama's lower cost of living, its retirement benefits, and good health care at a fraction of the cost in the US.

Inexpensive but good quality medical care is a major reason many retirees are settling in parts of Latin America. Many talk of trips to the doctor that cost only $15 and of medical treatments that cost one-third of what they do in the US. Many countries also allow foreigners to enroll in their national health-care programs.
Andy and Fran Browne of Charlotte, N.C., both lost their jobs during the 2008 recession and were swamped by their private health insurance policies, which were costing them $1,800 a month. (They were still too young to be eligible for Medicare.)

A planned Memorial Day vacation to Costa Rica turned into a reconnaissance mission. The couple moved there a year later, eventually settling in the beachfront community of Playa Hermosa on the northwest coast.

The Brownes now rent a four-bedroom home that offers them tangerine sunsets over the Pacific. "By coming to Costa Rica our burn rate was extended 20 to 25 years," says Mr. Browne, referring to how long their retirement money will last.

Terry Zach, a retired media specialist at a San Francisco advertising agency, moved south for similar reasons. Facing retirement 14 years ago, he realized that he and his partner, who had no medical insurance, couldn't afford any place they wanted to go in the US.

So when his partner saw an article about Boquete, a town in Panama's highlands resembling Boulder, Colo., the two were intrigued. From the moment they arrived, "we knew this was it," says Mr. Zach. The small-town feel combined with the breathtaking nature and easy access to most modern conveniences, such as shopping malls and good hospitals, made it a simple decision.

The two now live well on about $2,000 a month. They helped start an English-speaking Rotary Club, a community theater, and a service offering free neutering to cats and dogs.

"We couldn't live like this in the US," Zach says.

•   •   •

Retiring outside the US certainly isn't everyone's idea of utopia. One of the biggest obstacles is a simple one: managing expectations. Some people think living in Ecuador, Panama, or Mexico will be the same as living in the US, only cheaper. It isn't.

As Zach notes, many countries in the region operate at a different rhythm. A less-frenetic pace can be good for retirees. But it can also mean slower service at a restaurant, notorious bureaucratic delays in getting land titles or driver's licenses, and scheduled dates with plumbers or carpenters that never happen.

"Mañana doesn't mean tomorrow," says Zach. "It means not today."

Americans are used to good roads, first-rate telephone and Internet service, and reasonable customer service. Moving south can be jarring. "The streets are bad and poorly maintained, there are no lights or signage, and parking spaces are nonexistent," says Cummiskey of urban life in Medellín.

Crime is a predominant concern. While levels of violence vary widely across the region – and the vast majority of expats settle in communities that are considered safe – retirees caution that it's important to know when and where to travel. Some thieves prey on foreigners. Drug violence remains a concern in parts of Mexico and other countries.

Mr. Coles, the retired firefighter, says that even though Panama is safer than Mexico and Ecuador, violent crime still exists and one has to take precautions. The judicial system, he adds, is notoriously inefficient and ineffective.

Sara Laing can sympathize with that. Eight years ago, she bought 17 acres of unspoiled land on a mountaintop in Santa Rosa de Copán, a city in western Honduras. Ms. Laing, a savvy world traveler who had lived in 20 countries as a volunteer and mental-health professional, moved because she had tired of retirement life in Sarasota, Fla., which mostly consisted of going to concerts and theater productions.
"I wasn't living life," she says. "I was just watching it."

In Santa Rosa de Copán, she teaches English and other classes at two village schools and enjoys her veranda, which offers stunning views of the woodlands.

But one day two men with guns tied up a man who cares for her home and then ransacked the house while she hid in a closet. The incident, combined with the distance she lives from her grandchildren and the inability to live in Honduras on her Social Security income of $760 a month, is prompting her to return to the US.

"I am sad," she says, "because I love it here, and I do think it is one of the most beautiful countries. I want to see it flourish."

Language can be another barrier. Many Americans have settled in areas with large expat communities or ones that cater to outsiders, and they can get along without learning Spanish. Newby, for instance, says that most of the American retirees he knows in Mexico's state of Jalisco don't speak Spanish fluently.

"They don't need to," he says. Most people "retire here because the weather is great, not because they studied Spanish in college."

For others, learning the native tongue and local customs can take time, but is usually worth the effort. "In your daily life, you can go a long time without speaking Spanish, but it's much easier if you do," says Joel Moskowitz, a lawyer from Malibu, Calif., who, with his wife, Anna, moved to Roatán, one of the Bay Islands that is part of Honduras.

Still, for all the challenges of retiring in America's new Sun Belt, many expats see the advantages far surpassing the disadvantages. Consider Cummiskey and his fondness for Medellín.

He likes the city's predictable climate. He likes the shopping malls, the antique stores, the nightclubs. He likes the vegetation and the views. But, most important, he likes the people.

"They have one of the highest poverty rates in the world and yet the people are not at all depressed," he says. "They are completely happy all the time and that is very, very cool and appealing to me."

New 2014 Tax Laws for Mexico that Affect Expats and Foreigners

yucalandia.com

Nov. 29, 2013

Here’s a summary of the changes in Mexican tax laws affecting foreigners for 2014.    This report comes from Lic. Spencer McMullen, a fine attorney in Jalisco,  who specializes in legal issues affecting expats.   You can contact Lic. McMullen at Chapala Law.

On 11/29/2013 Lic. McMullen reports:

“Very extensive reforms have been made to Mexico´s tax laws and have been finalized in November, 2013. These become effective on January 1, 2014, which does not give people or businesses a lot of time to prepare. This short lead time may cause problems for some people. First, all the appointment times at our local SAT offices in Jalisco (SAT = Mexico’s tax department) are filled for quite a while, and second, some of the changes affect banks and businesses quite a bit. I think it’s going to be a messy transition as many will be unable to comply in time with only 2 weeks left until the government goes on vacation and returns January 2nd when the new laws take effect and even then there may be delays of weeks for people to be able to get appointments at the tax office to set themselves up or make changes.

There are new IVA sales taxes.

It’s now going be 16% nationally (whereas it’s been about 11% in the border areas), and it will include taxes on soda, chewing gum, and   pet food   throughout Mexico.   Those weren’t included in the past.   So,  people with pets should stock up at Costco before the new year.     Dog shelters will be especially hard hit.     For people driving back from up north after Christmas, or coming back from nationalizing their vehicles at the border, they’ll want to fill up their tanks near the border,   where the gas tax will still be 11% until the end of the year.

Will anything change at customs (Aduana)?

Yes, temporary importation of certain goods will also start being taxed. That could open the door in the future for a tax on the temporary importation of vehicles. Not yet, though.

The mandatory use of customs agents for any value of goods to be imported has been eliminated. The use of an agent will be optional, which is a good thing because they’ll have to be more competitive in terms of rates and quality of service.

Also, customs is going to be checking the value of imported goods more closely and communicating with the countries where merchandise is leaving, to check declared values. People may be more likely to get caught if their car nationalization pedimento say the car is worth just $10,000 pesos, while it clearly is worth much more.

What about new banking regulations?

Starting in 2007, there had been a tax on large cash deposits: 2% on the amounts of deposits exceeding $15,000 pesos, which was increased in 2010 to 3% on amounts exceeding 15,000 pesos.

Those taxes have now been eliminated.

But … banks are now required to report to SAT any deposits over $15,000 pesos, and any payment of credit card debt of $20,000 pesos made at a time. SAT may also audit you and compare your credit card expenditures to your declared income. They can then contact you to explain these transactions within a certain time frame. If you don’t respond within that time frame (say, 20 days), they could establish liens and levies. And, of course, you wouldn’t respond if the address they have for you is old.

All of this means that it is very important for people to make sure their bank has up-to-date home addresses and email addresses. This is especially true for snowbirds. It also means that snowbirds will need to check their email frequently while they’re out of Mexico.

Also, banks will require people to have an RFC (tax ID number) in order to open a bank account. They have enabled the ability to get an RFC number online, but people first need a CURP number which has to be processed through immigration (INM). (Editor’s note: If you already have Residente Temporal or Residente Permanente, you have been issued a CURP number.) With offices closing for several weeks for the holidays, people may have problems in getting CURPs in January and may have to wait until February to open the account.

Anything new for businesses?

Yes, the current process for small business reporting (REPECO) will be eliminated. Currently, small businesses report their gross earnings every two months. For January, that will still be the case in order to report earnings for the November – December months. After that, there will be more paperwork. The process will come through the regular tax system. This means that earnings will need to be reported, and so will deductions, and facturas (invoices) – just like big businesses do today.

As before, the tax rates continue to fall between 2% and 35%. Note that there will be more paperwork, requiring a greater mastery of Spanish. My office will help people by getting them set up and familiar with the new system.

Another change is the elimination of the business IETU tax (single-rate flat tax started in 2007). 

Non-profits will start being required to be authorized by the SAT to receive donations,     which would allow them to continue preferential tax treatment.    That’s obviously going to be critical for them.    They should probably start that process immediately, and try to get their major contributors to donate before January 1st.

New Electronic Factura Requirements:

The most controversial of the new business regulations is probably the requirement for electronic facturas and the elimination of paper facturas . The new rules also require giving all employees online facturas (CFDI) rather than paper facturas when they get paid, in order to be able to deduct their wages. That system may not be ready by January 1st, by either the SAT or the businesses, so that’s going to create a lot of problems.

What about tax changes for investors and real estate owners?

Mexico has caught up to many other countries and will tax capital gains on the sale of stock at a rate of 10% as well as tax dividends at the same rate of 10%.

For real estate sales there will be a maximum capital gains tax exemption pegged using the UDI index (investment units) with a new limit of 700,000 which equates to about 3,500,000 pesos so any gains over that amount from a sale will be taxed, the prior limit was 1,500,000 UDIs with that exemption waived if someone could prove they lived in the home for the preceding 5 year period.

Mexico Publishes 'Manual on Consular Notification and Access'

Monday, December 2, 2013

● The manual is designed to provide more information on Mexico’s international commitments regarding the right of foreign citizens to contact their consulates.

The Mexican Foreign Ministry and other government agencies presented a Manual on Consular Notification and Access to provide more information to Mexican institutions, civil society organizations and citizens of other countries on Mexico’s international commitments concerning the rights of foreign citizens to communicate with and have access to their consular officials.

The manual consists of several sections which serve as a guide for officials in complying with the obligations of the Mexican government in various areas such as arrests of foreigners, custody proceedings for minors, deaths, accidents of ships and aircraft, as well as consular access and notification in cases where it is required.

At the presentation ceremony, the head of the Foreign Ministry’s Legal Department, Max Diener, said the manual is invaluable for helping the authorities responsible for complying with the Vienna Convention on Consular Relations concerning consular access.

The Undersecretary for Multilateral Affairs and Human Rights, Ambassador Juan Manuel Gómez Robledo, said the manual is the result of a major effort by the Mexican government to strengthen the rights of foreign citizens who are arrested or are in custody, which will be effective in contributing to respect for their human rights.

The presentation was attended by officials from the agencies involved in protecting the rights of foreigners, including officials from the Ministries of Interior, Defense and Navy, and the Attorney General's Office. The ceremony was also attended by members of the consular and diplomatic corps accredited in Mexico.

● "Manual sobre Acceso y Notificación Consulares," Primera edición, 2013, Secretaría de Relaciones Exteriores (mostly in Spanish)

——————————

Press release, Ministry of Foreign Affairs (SRE), Nov. 27, 2013, Mexico, DF; translation by SRE

Shopping at a Spanish Market: Fruit and Vegetable Vocabulary

 dummies.com

When you’re going shopping at a Spanish market for fresh fruits and vegetables, knowing the Spanish vocabulary for the foods you’re buying can make your shopping endeavors much easier. Following are the Spanish words for some common frutas y verduras (fruits and vegetables).

 

Fruits

 

Spanish markets carry a host of fresh fruits, ripe for the choosing. Following are the names of fruits you find at the market.

• la cereza (lah seh-reh-sah) (cherry)
• la ciruela (lah see-ro-eh-lah) (plum)
• el durazno (ehl doo-rahs-noh) (peach)
• la fresa (la freh-sah) (strawberry [Mexico, Central America, and Spain])
• la frutilla (lah froo-tee-yah) (strawberry [from Colombia to the South Pole])
• la guayaba (lah gooah-yah-bvah) (guava)
• el higo (ehl ee-goh) (fig)
• la lima (lah lee-mah) (lime)
• el limón (ehl lee-mohn) (lemon)
• el mango (ehl mahn-goh) (mango)
• la manzana (lah mahn-sah-nah) (apple)
• el melocotón (ehl meh-loh-koh-tohn) (peach [in Spain])
• el melón (ehl meh-lohn) (melon)
• la mora (lah moh-rah) (blackberry)
• la naranja (lah nah-rahn-Hah) (orange)
• la papaya (lah pah-pah-yah) (papaya)
• la pera (lah peh-rah) (pear)
• el plátano (ehl plah-tah-noh) (banana)
• el pomelo (ehl poh-meh-loh) (grapefruit [in Mexico])
• la sandía (lah sahn-deeah) (watermelon)
• la toronja (lah toh-rohn-Ha) (grapefruit [in Mexico])
• la tuna (lah too-nah) (prickly pear)
• la uva (lah oo-bvah) (grape)

 

Vegetables

 

Fresh vegetables are always good. You can easily find the following:

Credit: Ed Carey/Cole Group/PhotoDisc

 

A variety of fresh vegetables are available at Spanish markets.

 

• las acelgas (lahs ah-sehl-gahs) (swiss chard)
• el aguacate (ehl ah-gooah-kah-teh) (avocado)
• el ají (el ah-Hee) (hot pepper [South America])
• el ajo (ehl ah-Hoh) (garlic)
• el brócoli (ehl bvroh-koh-lee) (broccoli)
• la calabacita (lah kah-lah-bvah-see-tah) (zucchini [Mexico])
• la calabaza (lah kah-lah-bvah-sah) (pumpkin [Central America and Mexico])
• las cebollas (lahs seh-bvoh-yahs) (onions)
• el chile (chee-leh) (hot pepper [Mexico and Guatemala])
• el chile morrón (ehl chee-leh moh-rrohn) (sweet pepper [Mexico])
• la col (lah kohl) (cabbage [Mexico])
• la coliflor (lah koh-lee-flohr) (cauliflower)
• la espinaca (lah ehs-pee-nah-kah) (spinach)
• la lechuga (lah leh-choo-gah) (lettuce)
• las papas (lahs pah-pahs) (potatoes); patatas (pah-tah-tahs) in Spain
• la palta (lah pahl-tah) (avocado [South America])
• el pimentón (ehl pee-mehn-tohn) (sweet pepper [Argentina, Chile, and Uruguay])
• el repollo (ehl reh-poh-yoh) (cabbage [Argentina and Chile])
• la zanahoria (lah sah-nah-oh-reeah) (carrot)
• el zapallito (ehl sah-pah-yee-toh) (zucchini [Uruguay and Argentina])
• el zapallo (ehl sah-pah-yoh) (pumpkin [South America])

Mexico New Immigration Law and why you should act now

theyucantantimes.com

What do you know about Mexico’s new Immigration law that Mexico former President Felipe Calderon signed on May 2011, regarding foreigners living in Mexico?

 

This law is important for those foreigners that already live in Mexico and equally as important to those who are thinking about moving or spending a significant amount of time in Mexico.

 

The law reduces the time a foreigner has to have a temporary permit to reside in Mexico, thus providing a shorter path to residency and citizenship on a full time basis. One of the main advantages of this is only having to endure the annual renewal of the temporary permit which, although only once a year, it is time consuming and costly.

 

As those of us that have been in the temporary permit process for up to 7 years to gain residency know, reducing this time period makes it a lot more attractive to want to be here in Mexico.

 

OWN REAL ESTATE WITH NO BANK TRUST!

 

So, what are the other advantages of becoming a citizen much quicker? A citizen has the same ownership rights to holding title to property in the restricted zone (as you may know, foreigners can only acquire property under a land trust within this zone that encompasses area of roughly 100 miles from the US border and 60 mile inland from any coast). Also, like Mexican citizens, foreign residents are exempt to capital gains on residential property sales that met the conditions of Hacienda (the Mexican IRS or Revenue Canada). Since one of the main considerations in moving to Mexico for a foreigner to own property there, this is a big plus to early residency.

 

Also note that in a historic move, the lower house of the Mexican Congress voted to loosen restrictions on foreigners buying property in coastal zones. The proposal would change Article 27 of the constitution, which prohibits foreigners from owning property within 31 miles from the coast and 62 miles from the country’s borders. This law forces foreign buyers to use real-estate Mexican bank trusts known as fideicomiso to purchase and handle the property in restrcted zone.

 

IF YOU MARRY A MEXICAN NATIONAL YOU BECOME A RESIDENT IN TWO YEARS

 

Examining the new law, another underlying theme in the changes to quicker and easier residency for foreigners comes to light. As mentioned about the time period for temporary permits has been significantly reduced but another of the changes warrants a look also. The new law states that a foreigner that marries a Mexican citizen and lives in Mexico together for a two year period can acquire residency.

 

 I married my Mexican wife 10 years ago at which time it made no difference and I had to go through the entire temporary permit process. This change is significant in that it promotes intercultural relationships as a means to enhance the probability of a couple to stay together and in Mexico.

 

It was not that long ago those Mexican citizens, especially women, were marrying US citizens to gain citizenship in the US in a pre-arranged agreement that was using financially based without any intention of longevity of the relationship. It is especially amusing to me that these trends have reversed themselves in this day and age and even more why.

 

Let´s first look at why the Mexican wanted to go to the US and become citizens and why there were willing to take this path to achieve it. Most were looking for the opportunity to have a better lifestyle using the money they made get it. Now why is it, the foreigners are coming to Mexico? Most are looking for a better lifestyle using the money that they have to get it. The reasons are not so different and the results are even more similar.

 

 

The Mexican government knows that while the US is making it harder for illegal persons to enter and stay in the US, extending a welcoming hand to the foreigners that are escaping the over burdened and lack luster economic situation in the US is a plus for the Mexican economy. In the 90´s the second largest contributor to the Gross National Profit (GNP) in Mexico was the money being sent to Mexico from the Mexican citizens in the US. As the US economy has continued to tumble down, a large number of these citizens are returning to Mexico. The lost revenue from those who are returning can be replaced with revenue from the millions of foreigners that will relocate south of the border over the next ten years.

 

HIGH FINANCE FACTS

 

In reviewing the economics of the 1.5 million or so foreigners that currently reside or spend most of their time in Mexico, we see some amazing financial statistics. On average, the foreigners bring approximately $150,000 – $250,000 cash to buy property and spend around $2500 per month on living expenses. As the expression goes, you do the math. This equals about $225,000,000,000 to $375,000,000,000 in cash revenue and $3,750,000,000 a month in recurring revenue. Staggering isn´t it?

 

Even better look at the future of estimates of 5-6 million foreigners jumping the border south and the numbers blow your mind. Let´s see if my calculator will go that high. Taking the low end of the cash income scale we are looking at $750,000,000,000 at $150,000 coming with each of the 5 million welcome residents to be for Mexico. On a monthly basis, the income is a whopping $12,500,000,000 A MONTH!

 

 

CARL SAGAN MATH CLASS “BILLIONS AND BILLIONS”

 

A bit of history on the GNP picture for the US and Mexico is all telling as to why the trend is favoring the south. According to NationMaster.com the GNP for the US in 2000 was $10,533,000,000,000 and grew to $11,628,000,000,000 in 2010. Correspondingly, this site lists the GNP for Mexico at $578,000,000,000 in 2000 and at $1,014,514,000,000 in 2010. This is a 10.4% increase in the US GNP and a 75.4% increase in the Mexico GNP over 10 years.  I actually checked these numbers 5 times as they seem unreasonable and wrong so feel free to surf the site and see for yourself.

 

Now let´s put the foreign investment into Mexico in perspective a bit. Assuming that 25% of the cash revenue came in during the 10 year period from 2000 to 2010 the contribution to the GNP increase is $75,000,000,000 of the $436,000,000,000 or 17.2%. At an annual GNP of $1,014,524,000,000 the $150,000,000,000 in annual income ($12,500,000,000 a month times 12 months) amounts to 14.8% contribution each year.

 

The estimates of 5 million new foreigners bringing $750,000,000,000 in cash to Mexico over the next 10 years will boost the GNP by 73.9% alone with the $1,500,000,000,000 in annual recurring revenue causing the GNP to grow 147.9%. Keep in mind this only an estimate but based on the impact that the national debt crisis is having on reducing spending and its potential affect on programs like Social Security and Medicare, my guess is that many of the 88 million or so ¨Baby Boomers¨ may not wait to see how they are affected.

Okay enough with the big numbers and one can argue that my estimates are high for the 5 million coming with an average of $150,000 each and spending $2500 per month (you are probably right here as a percentage of them only stay part of the year). So to be conservative, cut all this by 50% and you get an approximate 37% bump in GNP over 10 years from the cash being brought in and a 74% growth due to the annual recurring income from living expenses. Whatever the numbers are that you would believe it is easy to see the rationale behind making it easier and quicker to capture the foreigners, entice them to invest more (due to the absence of capital gains on resale’s) and keep them here longer by marrying them into the local culture.

 

IF I ONLY WOULD HAVE DONE IT BACK THEN!

SOUNDS FAMILIAR?

 

The intent of all this is to say that the Mexican government, people and economy are focused on growth, expansion and positive motion targeting a pent up market that is hungry for a better lifestyle in a more relaxed atmosphere at a much more affordable cost. Those of you that are fence sitting on whether you should come down to Paradise in Mexico do and need even more of a push than all this information should be aware that the US government has been trying to pass a bill for many years that will heavily tax your assets and wealth just prior to leaving the Good Ole US to try an block this outflow of money which has been coined as ¨Capital Flight¨. Even though this bill has been put on hold there is a move afoot to revive it and get it signed into law quietly so you will only know about it when it is too late.

 

So continue to sit on that fence and stare southward while we are here reaping the real benefits of a better lifestyle or jump down and take action. Either way, the shift in the trend on which way to migrate for many of you will go on with or without you. It seems that US government is doing all they can do to aggravate the situation while the Mexico is being progressive in providing a solution. In conclusion; the Mexican government, the Mexican people and the Mexican economy welcome you with open arms and a desire to help you but they can only do so much and the rest is up to you.

 

 

Foreigners feel Confident and Sure as they Invest in Mexico

Monday, November 18, 2013

Foreigners feel Confident and Sure as they Invest in Mexico
Presidency of the Republic

Mexican President Enrique Peña Nieto inaugurated the new Nissan A2 Automotive complex in Aguascalientes, during which he declared that Mexico is a country that creates certainty for foreign investment.

Investments like this, he said, prove that "Mexico is a reliable country for domestic and foreign investment, and it is still proving to the world that it is a country where its labor force, Mexican workers, have guaranteed ability, training and skills to make this condition a force of competitiveness for our country."

"This shows that there is confidence in our country," he added, because companies "are confident that Mexico will develop in the coming years, particularly because it has been proven that Mexican manpower is the best in the world."

He declared that this new Nissan plant, built in just 19 months, creates 3,000 direct jobs and nearly 10,000 indirect jobs, "and also accredits us in the world's eyes as a space and a country to invest in."

He reported that by the first half of this year, "Cumulative foreign direct investment was nearly US$24 billion, a record in Mexico's history."

He expressed the importance of Mexico becoming, "A platform for growth and expansion for new investments that decide to come to our country," because, "In the end, this means benefits for Mexicans because they encourage development and wealth creation, and promote employment and areas of opportunity for more Mexicans."

"That is why it is important for Mexico to attract investment, both domestic and foreign," he said.

During a dialogue with workers of the automotive company, prior to the opening ceremony, the president declared that just as they work to manufacture parts that will be exported throughout the world, the government is "creating the conditions to make Mexico a better country for all Mexicans."

The president noted that Mexico is now the eighth largest vehicle producer worldwide, and the fourth largest automobile exporter. He expressed his confidence that the current condition will improve, "and that we will move up from being the eighth to the seventh largest vehicle producer in the next few years." He added that the automotive industry in Mexico creates over 600,000 direct jobs annually.

He declared that in order to consolidate Mexico's automotive industry, the government is promoting four policies:

• Strengthen our domestic market, with more credits for the purchase of new vehicles, and regulating the importation of used cars that are not in optimal conditions for being sold in the domestic market.
• Build a business environment that will increase productivity in the automotive sector. Through the Integral Proauto program, "We seek to create added value chains and a supply chain to strengthen the automotive industry in our country."
• Encourage technological development and innovation for this and other industries in the country.
• Gain access to new export markets, by consolidating participation in destinations such as North America, but also through the Pacific Alliance and the Trans-Pacific Partnership Agreement with South American countries, America and the Asian region where efforts are being made to expand the presence of domestic production.

----------
Press release, Presidency of the Republic, Nov. 12, 2013, Mexico, DF; Presidency of the Republic translation

5 Mexico Real Estate Tips for Expats

agendatotal.com
by: Martin Cowell

Mexico is a haven for expats as exotic location are topped with great infrastructural development. The people, weather and government are equally warm and welcoming. The country with its diverse offering is quite appealing to foreigners who willingly make it their home. Many Americans and Canadians have already booked their piece of heaven by the beachside and many are following the suit. Estimates claim that in areas like Cancun, Playa del Carmen or Puerto Vallarta, the number of expats comes to about 50,000.

Mexico is an expat friendly country. Millions of Americans, Canadians and Europeans live and work in Mexico.  With certain guidelines followed one can find the best deal just like these expats did. While making a choice it is but obvious that one would like to have neighbors from home. Therefore it is important to hire the right agent who understands the need and criteria of the buyer. A good agent will never try to impose his choices on the buyers rather try his/her level best to bring out options which meet the criteria of the buyer. An agent who is well versed with the area, its demography, economy and a good network is your best bet in a foreign country such as Mexico.

The buyer should take interest in the region’s expat situation as in how they socialize. It is important as it increases the interaction as well breeds familiarity among all. It is likely that not all expats will live next to each other. Hence knowing each other personally will be beneficial in times of need. Also the agent should be able to provide information regarding the same. An expat community can be your biggest support system as well as your reliable source of information.

Mexico is a beautiful country and every location is exotic. There is the beach, the mountains, lakes, golf courses and the jungle. There will be expat community in each of these locations and especially around the main attractions. The buyer should therefore be sure regarding the preference of location. Also the agent should be specifically told about the priority list so that there is no mixing up. Most expats come to Mexico for its beaches and the lifestyle it offers. So the agent should propose beach side areas which checks most of your requirements. Areas such as Akumal and Tulum which are still in the development phase and not yet crowded can be an Expats preferred option.

One fact which all buyers should keep in mind is that ‘Sale Currency’ or the currency in which the prices are quoted doesn’t require much importance. It is a common understanding that prices in dollars reflect foreigner interest but this is not the case always. Therefore the best thing to do in such a situation is to enquire. There is simply no harm in asking and if the buyer is satisfied with the service received, he/she can go ahead with their plans.

Lastly it is important for the buyer to know how flexible or rigid he/she is in terms of choices. This should be shared with the agent as well so that there is no wastage of time and energy in fruitless searches. Some might prefer living next door to an expat while might like to maintain some distance. There might be buyers who are fine with everything as long as expats are in the vicinity. Therefore because carrying out any search the buyer should sit down and make a list of things he/she wants around their dream property.

Differences in Mexican and American Real Estate Law

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Ah! The bliss of enjoying a beautiful sunset off the porch of your beach home, with a margarita or Tecate in your hand! First, however, you have to navigate the legal system.

Buying and selling real estate in Mexico can be fun and rewarding as long as you understand certain fundamental differences. Don't expect it to be like back home. I was always surprised by people who expected Mexico to have the same money and stamp system as the U.S.!

Below are some of the biggest real estate differences:

1. Houses are sold as is. In the U.S., you can have a house inspected and if something major (and sometimes minor) shows up, can demand that it is fixed, or call the deal off. In Mexico, there is no such guarantee and no legal mechanism to protect you, if your house ends up being a disaster. Do your own inspection and ask questions. When was the house built? Wiring and plumbing can be years behind the U.S. codes. What shape is the roof in? Replacing a roof on a colonial house can be extremely expensive. Look for signs of water damage on the walls. If possible look at the roof from outside. Where does the water supply for the house come from? If it is the city, how does the city's system do during dry seasons? Is there a backup water system (such as a cistern) in case of no city water? If there is wood in the house, such as doors, door frames or beams, are they termite free? In general, Mexican homes need ongoing, annual upkeep.


2. In general, there is no title insurance. There is a title search done, however, by the realtor and/or notary before drawing up a new title. There are companies that tell you they can sell you title insurance but it is not needed.


3. There are few mortgages to be had. Again, there are American companies offering mortgages for beach properties, but they are fairly expensive. Most deals are either cash or financed by the seller.


4. There are no escrow companies. Escrow companies hold your earnest money while papers are being finalized for closing. Without this service, handing over earnest money or commissions to realtors prior to closing is very risky. Many realty businesses have set up their own accounts to act as escrow accounts. Check with your realtor to see if he or she offers this service. An alternative to an escrow account, is to draw up a Buy/Sell Agreement in the U.S., clearly stating monies paid and what is going to happen. In the event of a disagreement, state what action will occur (negotiation? litigation?) and in what state.


5. There is a false market for buying and selling in Mexico, that everyone agrees to more or less. In general, actual value of Mexican property is less than the foreign dollar price. It works like this: An American buys in dollars. During the time that American owns the home, the peso might devalue, which effectively erodes the purchase price of his home. By selling in dollars to another foreigner, however, this protects the investment. Mostly this system works, but occasionally it can bite a seller in the "nalgas." If you are aware of this "false market," however, you can avoid potential pitfalls.


6. There is very little regulation of realtors or real estate agents in Mexico. Sonora is currently the only state to offer regulation, however, everyone who is selling real estate in Sonora is not currently licensed. Ask for referrals from happy buyers. Don't just assume that a charming realtor who speaks great English, is giving you a straight deal. By knowing the basic steps of acquiring a title, you can demonstrate to a realtor that you aren't to be fooled.

Three Different Ways to Hold Title in Mexico

The first two are legal, the third is not

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Before you get to lie on the beach, there's still more leg work to do.

There are two ways to legally buy property in Mexico. There is a third way that was used in the past, before Mexico reformed its laws about foreigners owning property. It is illegal and doesn't protect your financial investment.

1. If you own property in the restricted zone, the property may be held in trust by a bank, with yourself listed as the main beneficiary. The restricted zone is 60 miles from any Mexican border and 30 miles from the coast. The rights of the trust state that you may do whatever you want to your property, just as though you were the titled owner. For more on trusts, scan down a few more modules.


2. Own property directly in your name as long as it's not in the restricted zone or ejido land. Many people live in beautiful inland cities such as San Miguel de Allende. You can title the property directly in your name, and you can also have a trust created for the property. When you own property in Mexico, you have all the rights as any other Mexican citizen. If you ask the American government to convene on your behalf for your property, the Mexican government can take the property away. It's written into their Reform Law. You can't own agriculture land, supposedly, but there are some exceptions made. Ejido land, by the way, is communal property owned by a type of commune. Some ejidos can now sell their property, but be sure to check with a lawyer to be sure.


3. The third way that people have bought property is called "prestanombre," or borrow-a-name. It is illegal. Many decades ago, before the real estate laws were reformed, the only way a foreigner could own property was to title it in a Mexican's name. The Mexican always honored the agreement, because they are gracious, accommodating people. The problem was that they started to catch on to the free gift, when the owner died. So the heirs lost out. Or the heirs had to fight in court to get their property or literally buy back the property from the prestanombre. Times have changed. Don't use a prestanombre no matter what.