Posted on 05/08/2005 3:34:47 PM PDT by BurbankKarl
How does a new house for $65,000 sound? Petty good, especially since a typical home in the San Fernando Valley now costs more than half a million bucks. OK, there is a catch. This bargain is near Rosarito, Mexico.
But now a Granada Hills-based real estate company is making it a little easier to tap into that market through a partnership with a unit of a big international conglomerate.
The arrangement between Fidelity Realty Group Inc. and Construmex, a unit of Cemex Inc. USA, enables clients to use the equity in their homes here to build, complete or buy a home in Mexico.
Joe Fernandez, president and chief executive officer of Fidelity, said that his company handles all the paperwork and then the client buys the building materials from Construmex, which delivers it to the job site. The price is whatever the going rate is in Mexico where the house is.
But those materials will cost a lot less than here and land is cheaper, too.
Like here, land and home costs vary with the coastal areas more expensive. But a two- to three-bedroom home averages between $25,000 to $30,000 in inland communities, Fernandez said.
He's targeting the Latino market because that is 98 percent of his business, but anyone can use the program.
"Lots of my clients send money back home to build or fix their (relatives') homes but it sometimes gets used for other emergencies," he said.
Doing the transaction on this side of the border ensures that the money is invested in real estate.
Fernandez said that the client has the responsibility of finding a contractor and making sure the project proceeds according to plan.
Gustavo Sanchez, Construmex marketing manager, said the company also provides blueprints and designs and clients can see a computer model of their house.
"It has a lot of potential. We are opening a new opportunity for people who want to build a house in Mexico," he said of the partnership.
Fernandez also cautions that buying a home in Mexico is a lot different than here since that country doesn't regulate the real estate industry.
Three are also some other differences, according to the Web site Mexonline.com.
Foreigners can own property in the interior but the Mexican constitution prohibits foreigners from directly owning real estate in what's called the restricted zone -- land within about 62 miles of the border and 31 miles from the coast. The latter is attractive because beachfront property there is cheaper than here.
So to build and live on the coast foreigners can participate in a fideicomiso, or real estate trust.
It's similar to trusts set up in the United States, but a Mexican bank must be designated as the trustee and, as such, has title to the property and is the owner of record. This enabled foreigners, as beneficiaries of the trusts, to enjoy unrestricted use of land located in the restricted zone without violating the law.
The players in this transaction are a real estate company, the buyer's lawyer, a bank and a public notary.
And foreigners must apply for a permit from the Ministry of Foreign Affairs.
"There's no question about it that the Mexican government, even before the passage of NAFTA (the North American Free Trade Agreement), has been trying to bring in more foreign investment," said Chula Vista attorney Dennis Peyton, who is writing the third edition of his book "How to Buy Property in Mexico."
Peyton also represented more than 200 people who in 2000 lost some homes and parcels in a land dispute south of Ensenada.
But that is the exception rather than the rule, he said.
Some American developers have taken note.
Palm Springs-based Soblar Investment last month began construction of Playa de Paraiso, an eight-story, 160-unit luxury condominium complex on the Sea of Cortez in San Felipe.
Half the units have already been sold even though they won't be finished for two years. A marina is also being built near the project.
Eric Garcia, director of sales at Playa del Paraiso, said that nearly all the buyers are Americans. Prices range from $180,000 to $650,000.
And values are rising, there, too.
"I don't have to tell you if we're looking at boats how valuable these things are," he said.
The biggest problem is not mentioned. The Mexican government can and will steal anything, from anybody, anytime they want.
Anybody that buys real estate in Mexico is taking a serious risk of loosing it all.
And our government will not? Via emanate domain, taxes, environmental laws, Federal-state-local codes, we don't really have much in the way of private property rights any more either.
If ya can't beat 'em, join 'em!
This might be nice if this weren't 5 minutes away from Tijuana. The chief of police and the Baja California chief in charge of stolen automobiles were recently murdered in a rain of gunfire there.
In the past week, two businessmen were kidnapped by a gang of people dressed in black, beat up, killed, and dumped along the side of the road. The mayor of Tijuana owns the sports book - the only one allowed under "law". There are rumors he has been in with the big drug gangs.
Crime is everywhere, but the shear frequency and magnitude of the stuff going on in this place so close to the US has been greatly underreported. Maybe Rosarita has some runaway brides we can read about in the newspapers.
At least in Mexico, you can bribe your way out of trouble....maybe even bribe your home back....
If you are not a Mexican citizen, they can confiscate your property with shenanigans at any time.
sounds like Van Nuys to me.
In that assasination of the Automobile Theft Division head, over 50 bullet casings were recovered from the scene.
Not to mention you can and will be pulled at over at roadblocks manned by machine gun toting federales. They will make you get out then search the vehicle and you hope and pray they dont find so much as a empty shell casing. This is a common occurence all over baja especially around rosarita and Ensenada and you never know if it is the real federales or criminals.
(Denny Crane: "Sometimes you can only look for answers from God and failing that... and Fox News".)
el problema, senor:
about ten years ago american owners of mexican real estate found out the hard way about mexican laws.
their sea front land was confiscated and returned to peasants.
si.
the verification of the history of the ownership of land is unproblemmatic. on the east coast you hire a lawyer to research the land. on the west coast you buy an insurance policy.
not so in mexico. there are no uniform procedures for verifying previous ownership. only corruption.
(Denny Crane: "Sometimes you can only look for answers from God and failing that... and Fox News".)
yeah, that's napoleonic law for you,
and a narco-police state to boot.
i remember about 15 years ago in the los angeles times a feature article on a lower middle class mexican family. they'd pulled themselves up the hard way, and finally were purchasing a used home.
meanwhile, the wealthy owner took their money, but wouldn't give them the deed.
the mexican judge sided with the owner.
so, the family was out of their house and money.
Look, you have to figure that any country that specifically prohibits you from owning land within 32 miles of the coast IN THE CONSTITUTION and has such a blatant disregard for US law, is not the place where a gringo wants to live or hold his resources!
(Denny Crane: "Sometimes you can only look for answers from God and failing that... and Fox News".)
If the problem were solved by a little cash here, a little cash there, bribery, there wouldn't be much of a problem. In the US there is this romantic view of how logical bribing the Mexican police is. Sometimes it doesn't work that way.
The issue is it's a total crap shoot. If the guys pulling you over had a bad week, or you seem like you are from a rival gang, or have just done business with a rival gang, or are wearing a fancy watch, they don't like you. And guess what; it's kind of funny watching you suffer.
My retirement plan: Buy a coldwater flat in Juarez and a donkey and rent the donkey out to nightclubs. Folks- you gotta have a plan.
Disclaimer: Opinions posted on Free Republic are those of the individual posters and do not necessarily represent the opinion of Free Republic or its management. All materials posted herein are protected by copyright law and the exemption for fair use of copyrighted works.