More Reasons to Buy Mexican Real Estate
As though you needed more reasons to buy Mexican real estate. Most buyers consider a change of lifestyle or warm weather, white sandy beaches and turquoise waters, and friendly, hospitable locals as the principal reasons to buy Mexican real estate. Here’s another one: substantial increase in the resale value of property.
Seasoned real estate investors and lenders know that the two key components in the increase in real estate values are population growth and a good economy. Population growth will promote the purchase of real estate, mostly by young families. Of course, if the economy is healthy buyers will have the confidence required to make their purchase. However, population growth remains the key determinant factor to anticipate an increase or decrease in the value of property.
A picture, or as in this case a graph, is an eloquent demonstration of a fact. Below are two population graphs, one for the United States (Canada’s is identical) and the second is for Mexico. These graphs represent the population of the respective country divided by gender and age groups. As you can note, the U.S. graph shows a top-heavy age demographic for the age groups of 30 and older whereas Mexico is the inverse. To describe this in another manner; if these graphs were pyramids Mexico’s would be the traditional pyramid with the foundation (younger age groups) broad and large and its point (older age groups) narrow, and the U.S. graph would be an inverted pyramid where the top would be broad and large and the bottom narrow. This means the U.S. population is getting older. On the other hand, Mexico has a youthful population, particularly for the age groups of 25 to 40 which are traditionally the group that potential new buyers are derived from.
This explains why Canada plans on welcoming 465,000 new permanent residents in 2023, 485,000 in 2024, and 500,000 in 2025. The U.S. is expecting to see a slight increase in population by 0.3 percent per year over the next 20 years primarily from net immigration.
An added benefit of this aging demographic in Canada and the U.S. is that as most of the population nears retirement age, they will seek warmer climates and economically viable areas to live. Mexico is already a prime destination for retirees from the rest of North America who usually purchase properties with cash having sold or downgraded their living accommodations. In the coming years, this is expected to grow substantially. Mexican real estate sales in general are anticipated to grow by 1% in 2023. The fastest growing market in Mexico is the vacation market since in 2022 it grew 15% and is estimated that next year will grow by 10-15%.
In summary, as the Canadian and U.S. populations grow older and look to move south while the younger Mexican population continues to grow, we can anticipate a considerable increase in the interest in real estate purchases thereby driving up property values in Mexico – just one more reason why you should buy Mexican real estate.