As the high season in Puerto Vallarta begins to taper down, so, for the most part, does the peak period for the real estate market. Looking back over this past season many realtors have commented that it did not live up to their expectations - they did not meet their numbers of the previous season in 2014-15. There were a few that did well, some exceptionally, but for the most part, they were a minority.
So what happened?
- Whenever an election takes place, especially an American presidential election, people tend to hold off making any large purchases such as real estate. They are distracted, concerned, and want to see it settled and who will be the next president before making any big decisions. This election has been on the minds of many Americans, especially one which has so far proven to be quite controversial.
- For Canadians and Mexicans, their ability to buy has been hampered by the fact that real estate is sold in the Vallarta region in U.S. dollars. And in 2015 both the Canadian and Mexican currencies suffered large losses when compared to the USD. It meant in many cases that real estate was 50% more expensive for them than it was a couple of years ago, even though prices (in USD) hadn’t really appreciated very much, if at all. I cover this more in this article.
- And the rental trend continues, with many choosing to rent over buying. There is a large inventory and variety of properties to choose from, at what have been reasonable rates.
So what can we expect looking forward?
- The U.S. election will be over and settled by the end of this year. This will allow people to once again to begin thinking seriously about where they’d like a second- or retirement home. People who were interested this past year didn't stop wanting to buy, their buying decision was just delayed.
- Both the Canadian and Mexican currencies have bounced back some. Whether this will continue is uncertain, but if at least if they remained more consistent with the USD that would bring more confidence into the marketplace.
- On any downturn in the Vallarta real estate market, recovery is usually led first by an interest in rentals. Slowly these renters turn into buyers as they realise they want a place of their own, with spend more time, or perhaps move full time to Puerto Vallarta. Perhaps we’ll see that shift beginning to appear next year.
- Another trend that realtors mention is buyers saying they are tired of the uncertainty and fluctuations of the stock markets. That it seems to be due for a correction and they’d rather take some of their investments out and move them into real estate. And there certainly are some very good deals and pricing right now in the market for those wishing to diversify and/or reallocate.
- What is taking place in Europe regarding migrants and terrorism attacks is horrible, and it will, unfortunately, influence people’s decisions regarding travel and real estate purchasing. Their unfortunate loss could be Mexico’s gain.
So although 2105 didn’t meet up to everyone’s hopes, many are of the opinion that the 2015/16 season will be much better, even topping 2014.