There’s no question that Coronavirus (COVID-19) is having a negative impact on millions of people worldwide. This is a truly unprecedented event, and the world has never experienced anything quite like it. The pandemic’s impact is being felt by families, hospitals, companies… And of course, by our pocketbooks! Not only are many jobs and paychecks on hold, but the stock market has taken a massive hit. Yet, there is always a silver lining… If you are in the right position and more than now, it is a good time to buy property in Mexico.
Mexico Real Estate and Currency Exchange Rates
As a Canadian living in Mexico, I remain aware of exchange rates, both CAD to MXN peso and USD to MXN peso. Our clients are a good mix, with the majority being Canadian or American. We’ve seen drastic drops in the value of the peso over the last month. From February 24 to March 24, 2020, the value of the peso fell from $14.41 per Canadian dollar to $17.34 pesos per dollar. In American currency? Forget about it! Over the same period, the peso dropped from $19.05 to $25.44 MXN pesos to a single US Dollar; an all-time low.
So, what does all of this mean to someone who is looking to buy real estate in Mexico, when most properties are priced in US Dollars? For one thing, most developers working on new projects are Mexican, and their budgets are calculated in pesos. How does this help you as a buyer? If a developer sold a condo for $250,000 USD one month ago, they would have received $4.763M pesos. Selling the same unit today, to receive the same $4.763M pesos, the sale price would equate to only $187,205 USD. So as a buyer, it COULD equate to $63,000 USD in savings. Who wouldn’t LOVE to get a 25% discount when buying a property? Not bad, in my opinion… Not bad at all. You may be wondering, can foreigners buy property in Mexico? The answer is YES!
Of course, the MXN peso won’t stay down for long and the forecast is still predicting it will experience a strong 2021. In fact, the International Monetary Fund (IMF) predicts that Latin America’s combined economy will grow by around 3.4 percent next year. And Alejandro Werner, who serves as current IMF Director for the region, told the AP he expects “a relatively rapid economic recovery in the second half of 2020, and especially in 2021,” adding that “the recovery will be faster than after the Great Depression of 1929, or the financial crisis of 2008.”
Finally, it’s important to note that Canadians who buy property in Mexico are always looking at how many US Dollars they can afford, since most of the properties for sale here are offered in US currency. And since the Canadian Dollar has also taken a big hit against the US Dollar over the last month, making an offer in pesos can yield considerable savings. Not sure how? Ask one of our experts to walk you through it!
And remember, when you buy property in Mexico, you don’t peso much!