Aug 2, 2007, 9:34 AM
Post #6 of 10
I wouldn't own a condo in Mexico - period. That's just my opinion and here are the reasons:
Re: [raquet] Good place to buy house items in Mazatlan
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1. You have no say in the management of the building. Your bank that holds the trust is the only legal representative at meetings to determine how the building will be governed. This little know fact is now being used to lock out "foreigners" from the decision making process in many condo projects.
2. Many condos carry no insurance for the building. Can you afford to lose your entire investment should a catastrophe strike?
3. Any renovations you want to do will be much more difficult than if you own a home.
4. Currently many condominiums are priced much higher on a per sq ft basis than home where you own the land as well. In theory, the reverse should be true and is in most markets up north.
5. Monthly dues are normally very low for a reason. The is no capital improvement fund and so when it comes time to repair a build due to age or storms, you will find yourself a large bill. For example, if the building has 6 units and it costs 6,000 to paint the building, you pay $600. Don't kid yourself, beach erosion has caused significant problems for many complexes in Mazatlan. One development lost their pool and clubhouse. It will now cost more than $250,000 to replace and that cost is being shared by the 18 units in the complex - should they decide to rebuild.
6. The documentation for the building can be very complicated. Especially if a bank holds a note on the property or the owner is also the management company. Two friends of ours just found out that when they purchased their condo, the bank note for their unit wasn't paid off by the management. They still owe $45,000 even though they paid the full asking price.
7. Most condos in the US have a set of CCR's based on state or national standards. Many condos here don't and that can cause problems down the road.
I know some savvy real estate friends in Mazatlan and they all view condos as a very poor investment right now. Their is a huge supply and more being built every day. In one older complex, more than 30 units are for sale and there have been very few sales in the past 6 months.
Marlene is right, consider a small house as an option.
(This post was edited by ncferret on Aug 2, 2007, 9:36 AM)