Mexican Housing Boom’s While USA Housing Swoons
In an interesting twist, as the United States housing market is hitting the dip after a huge run up, the Mexican real estate market is taking off. The combination of new lending rules, a history of self financed homes, and a shortage of 6 million dwellings in the country is providing the spark for the emergence of a new mortgage market.
This is music to the ears of pension funds such as CALPERS who are investing nearly 300 million in the mortgage market south of the border. A young mortgage market combined with an expanding housing market will provide room to grow and invest in while the United States gets it’s legs underneath itself and with lots of investment dollars looking for a home, Mexico is in the perfect storm for rapid growth and investment.
The trend could even slow emigration from Mexico, by generating millions in jobs and personal savings as a fresh supply of loans gives many their first chance to own a house.
President Felipe Calderon has set a national goal of a million new mortgages a year by 2010. On Monday, he unveils a set of measures to ensure growth continues, with plans to boost Mexico’s small resale market and combat the urban sprawl that has begun to carpet valleys with hundreds of thousands of matchbox rowhomes.
Behind the boom are six years of economic growth and stability, and a national shortage of 6 million dwellings. While interest rates are falling, just 6 percent of Mexico’s 25.7 million homes are financed with mortgages — compared to about 67 percent in the U.S. Most Mexicans still inherit their homes, buy them with cash, or build them by hand. via The Associated Press
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Comment by buy house in Utah on 23 January 2008:
I think that it is awesome that the great people of Mexico can finally have a chance to have their dreams come true without having to leave their country. I think that there real estate market will have a great impact on the confidence of the peopleand they will realize that they truly are blessed right where they are.
Comment by vanessa on 24 January 2008:
Wow I would love to buy property in Mexico. We probably have something to learn from a country of people that saves their money and buys homes for cash. 6% buy with borrowed money that is AMAZING.
Pingback by Mexican and Canadian Real Estate Faring Quite Well - Real Estate News - Banks.com on 11 February 2008:
[...] to The Real Estate Bloggers, Mexico is seeing a boost in its market because of several factors, including new lending rules and [...]
Pingback by Baja's Best Bargains Blog : Mexican and Canadian Real Estate Faring Well on 13 February 2008:
[...] per se, the markets of Canada and Mexico are absolutely flourishing! According to The Real Estate Bloggers, Mexico is seeing a boost in its market because of several factors, including new lending rules and [...]
Comment by Jim Spencer on 8 May 2008:
I have worked this market for the last year and it offers huge potential but there are drawbacks. The public registry needs to be modernized and elimination of the transfer tax along with other fees charged by the notario publico would increase the number of buyers substantially. I think as more retirees consider a move to Mexico we will see more lenders entering this market and better programs emerge. Scotia Bank, Deutsche Bank, Citi and HSBC all either have new products here or are looking to roll programs out soon. Elimination of the restricted zone, which would in return eliminate the need for a bank trust would also do wonders to increase the development. I worked for IMI Group which had an incredible Mexico mortgage product but the current credit crunch in the US ended up affecting their ability to finance loans. Still there are plenty of viable options. You can visit wwwmexicomortgageloansinfo to learn more.