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Tuesday October 17 2017
Real Estate Trends in San Miguel de Allende
Author:
Judy Newell - 2010


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San Miguel de Allende has been ranked as one of the top ten most desired cities in the world to retire in by several international publications. So, what’s happening with real estate in this colonial jewel?

Here’s the latest from three experts’ points of view: Eric Chazaro, real estate developer of Rancho Los Labradores and an owner of Mexican Charm Group Real Estate; Larry Castriotta, an owner of Select Real Estate and a leading realtor in the city; and John Hendricks, the founder of SMARÉ, the newly-formed real estate association of San Miguel and an owner of Coldwell Banker Real Estate.


Interview with Eric Chazaro, broker/owner of Mexican Charm Group Real Estate and developer of Rancho Los Labradores.

How do you think that baby boomers and retirees will affect the San Miguel real estate market?

The baby boomer generation, both foreign born and Mexican, will make a big difference in San Miguel because they are looking for a better lifestyle at a comfortable price. They are making thoughtful purchases of homes that they feel will be the last home of their lifetime. Some baby boomers are delaying their retirement because of stock market losses, but the smarter ones are investing here now.

As a developer, I currently see that the biggest percentage of the foreign market is coming to San Miguel to live here permanently, and the national market is purchasing weekend homes that will become retirement homes in the future. As people become more security conscious, the gated communities with 24-hour security will gain more market share.

Banks are now beginning to make loans for new constructions in certified developments – those that comply with specifications such as being a gated community with the infrastructure completed. Scotia Bank has a program for Mexican nationals and for foreigners holding an FM3 visa with proof of income. Previously loans were made only on resale properties or completed spec homes.

What new trends are developing in the San Miguel housing market?

San Miguel has the only facility now operating in Mexico as an assisted living community - Cielito Lindo, which is a part of Villas de Labradores. Cielito Lindo received very good press on the ABC television network and several large U.S. newspapers as the pioneer of the assisted living concept in Mexico.

The Villas are smaller homes in the $136,000 to $168,000 price range that offer extended services to residents such as assistance with meals, dressing and physical activities. There will be 165 villas in the full development and they can be purchased as a residence or as a rental investment. Villa owners and renters receive first priority to move into Cielito Lindo, which now has a waiting list for residency.

Cielito Lindo offers 24-hour caregivers and nurses, an onsite medical director who is a specialist in geriatrics and internal medicine, a nutritionist, and an activity program for residents with cognitive disorders. Staff members speak English and it is the only project offering this specialized service to resident foreigners.

Long-term medical care and assisted living costs a lot less in Mexico than in the United States. Whereas this type of assisted living costs $7500 per month in the U.S., it is only $1750 per month at Cielito Lindo.


Interview with Larry Castriotta, broker/owner of Select Real Estate.

How does the real estate market in San Miguel compare to that in the United States?

Our market principally differs because there is no mortgage pressure here - nearly all real estate is a cash purchase. The market has dropped somewhat, but nothing in comparison to the US markets; home prices listed by Select are down by about 5% from their all-time high. There is increasing traffic and in another year to 18 months, the market will be back to its previous sales levels.

The current market is a good time to buy as there are good values out there. And the good news is that the recently started networking group, SMARÉ, is leading the way to a more co-operative atmosphere among the real estate agencies. Hopefully this will soon lead to an MLS for San Miguel that will allow us all to provide better and more efficient service to our clients.

The biggest increases in our market are coming from Mexican nationals and Canadians. More Mexicans are buying vacation and weekend homes here, and Canadians are mostly part-time residents. The U.S. market is not as strong as in previous years, but many think that the stock market has bottomed out and buyers will be returning soon. The most popular home price amongst buyers today is in the $300,000 to $350,000 range.

What do you see as the main differences between buyers of historic central properties and newer developments?

The gated communities that are well planned, with good amenities, are selling well. Others that are not so well planned are falling short. There are development properties available in all price ranges and with a variety of services from turnkey, furnished move-in mansions to assisted living villas. We have some very high-end developments, in the several million-dollar price ranges, a gated golf community, and several equestrian oriented developments.

The historic center offers the most stable part of the market, and there are very few lots available in this area. The restored colonial homes in excellent conditions and good locations are selling in the seven figures. There is one on the market now for more than $5 million dollars, but frankly there are not many of these that ever become available.

Even though the resale market is currently stronger than the new-home market, the trend is likely to change in the next five to ten years, as empty nesters begin looking for developments that reflect their lifestyle.


Interview with John Henricks, founder of SMARÉ and broker/owner of Coldwell Banker Real Estate.

Tell us about SMARÉ.

When I moved to San Miguel from Sonoma County, California, I had 25 years experience as a realtor. I found that there was a void here, as agents weren’t working together for the benefit of both buyers and sellers. In May of 2009, I founded the organization SMARÉ – San Miguel de Allende Real Estate. We started out with eight agents and in only 10 months have 60 to 70 active members who meet every Wednesday morning.

The purpose of the organization is to open up the market, allowing all agents in all agencies to be able to sell an exclusive listing. This is a common marketing method in the U.S. We hold open houses, strictly for agents, to preview the properties, and each week we have a “BOP” review - where 15 or 20 agents who have previewed a property meet together to determine its fair market price. Agents have direct knowledge to offer these listings to their pre-qualified clients. The next step, starting a MLS – multiple listing service – will begin in the next three to four months.

What is your view of the future of real estate in San Miguel?

About 2 ½ years ago an emotional market existed here. People visited San Miguel, fell in love with the city and purchased a property on impulse. It was the time of the highest property values. Now clients think more about a purchase and carefully consider what they can afford. Many of our foreign buyers only live here part of the year and retirees are looking for a lower price range as they are on a fixed income. One of our largest growth markets is to Mexican nationals, particularly from Monterrey, Guanajuato and Mexico City.



Judy Newell has been a professional writer for more than 30 years, starting with United Press International. She pioneered travel to the Galapagos Islands and lived in Ecuador for 17 years. She’s now a permanent resident of the colonial heritage city San Miguel de Allende, where she owns Perfect Journeys, a custom travel company, and writes a weekly travel column for Atencion San Miguel, the English-language newspaper. Her travel articles have been published in prestigious magazines and newspapers worldwide. Contact her at: judynewell@perfectjourneys.net

 

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