We changed the way we display properties for sale in Baja California Sur at our BCS real estate properties page. In the last 20 years, the value of Baja California Sur coastal land has increased from $20 a square meter to over $2,000 a square meter (1 square meter equals approx. 10 square feet). The proximity of Baja to the U.S., and California in general, has triggered a booming real estate market with no end in sight. The Baja Peninsula, with its pristine blue skies, fresh air and sparkling turquoise waters, promises land investment opportunities unequaled in the U.S. since the 1950’s.

Check out the properties we have on display! There are some exceptional deals available.

What seems to be on the mind of everyone I’ve talked to is how the slowdown north of the border will influence our local market. Many areas of the United States have been affected by a fall-out in key real estate markets, triggered by the abuse of subprime and other adjustable-rate mortgages. Borrowers either bought or refinanced homes with subprime loans that offered artificially low introductory rates. Now facing re-pricing, borrowers are experiencing their payments doubling or are having to pay off large balloon payments, just as their homes values are declining.

So how is that affecting Baja California’s market? First, Baja California’s real estate market has been driven primarily as “cash-only” – mortgage financing yet to become really popular or necessary for many purchasers. Most realtors I spoke to said that less than 10% of their sales involve financing, except for new product developments, which may offer short-term financing. So, Baja California doesn’t have to worry about a subprime meltdown; it doesn’t exist here.

What has proven to be the primary reason for the turndown north of the border has actually protected our local market, because of the fact that financing is still difficult to get in Baja California. Realtors report that it still takes too long to obtain approved financing and not enough has been done to improve the overall application process. There are good brokers, and there are not-so-good brokers, and finding the right one can make a world of difference. But it still is not working as efficiently as all would like to see it.

Second, the people caught up in this subprime meltdown got there because they couldn’t afford the terms of a regular mortgage or even the down payment. This has never been, nor will it be any time soon, the profile of the typical Baja California homebuyer. Americans who have the money to buy a second home still have that money – this turn in the market has not affected them to any great extent.”

Baja California Sur

Demographic experts anticipate that southern Baja will experience explosive growth for the next eighteen years, and that La Paz will become increasingly desirable for those who are looking for affordable alternatives to Los Cabos. There are several reasons why this real estate boom is occurring in Baja California Sur:

• SECURITY: Changes in Mexican constitutional law now allows ownership of property in the protected beach zones through a secure real estate trust instrument called a Fideicomiso.
• AFFORDABILITY: A favorable cost of purchase of beach front property as compared to alternatives in the United States or abroad, as well as minimal property tax liability, and low cost of living, make Mexico’s Baja very attractive for foreign investment.
• CONNECTIVITY: Changes in telecommunications such as the internet, cell phones, and satellite television, make it possible for foreigners to maintain a level of communication with friends, family, or work, as well as entertainment services.

Slowly but surely, acre by acre, Mexico’s Baja Peninsula is becoming an American colony. ”For Sale” signs are sprouting all over the 800-mile-long peninsula, offering thousands of beachfront properties. Americans are snapping them up. They have already created communities where the dollar is the local currency, English the main language and Americans the new immigrants transforming an old culture. ”Everything’s for sale, every lot you can imagine,” said Alfonso Gavito, director of a cultural institute in La Paz, the capital of Baja California Sur, a state with 400,000 citizens and some of the last undeveloped beaches in North America. ”It’s like 20 years of changes have happened in three months.” This new land rush, involving billions of dollars, tens of thousands of Americans, and hundreds of miles of coastline, is gaining speed despite the fact that Mexico’s Constitution bars foreigners from directly owning land by the sea. Continue reading ‘Claims in a Baja Land Rush’