Friday, June 30, 2006

Patzcuaro Real Estate

I had never owned a house before moving to Mexico, so this was a big deal for me and my family. Because I've been working in non-profits for the last decade, I also didn't have a lot of money to spend. Although, lucky for me, I had really good credit, most US-based lenders were only doing mortgages in beach resort areas in Mexico and not in Michoacan when I wanted to buy.

I met with three different real estate companies, including Mexatua. I saw houses that were right in the center of town, ones in the middle of nowhere, vacant lots, abandoned houses and a few places that were ready for move in immediately.

Prices varied from a few hundred thousand pesos ($10,000 USD) up to $1.6 million US dollars. I really didn't know what I was looking for until I actually found it.

After 5 days of solid property scoping, my sister-in-law and I came across a small lot (300 m2 or about 3000 sq ft) with a dilapidated house on it. It was right off of the small plaza (Plaza Chica) and we loved the colonial lay-out and the quiet narrow street.

Having gone through the process, I would advise the following:

1. Meet with lots of different real estate agents to get a feel for what's on the market. Remember that all prices are negotiable, but it's good to see different asking prices and different types of properties. I never thought I'd get involved in a remodel, but I eventually realized that was the best bang for my buck.

2. Once you have a feel of the market, decide what your goal for the property is: winter or summer home, investment property, retirement home, etc...I originally thought that I would build a B&B and live on part of the land and rent out the rest. I quickly realized that properties of that size were really out of my price range, and that building a house for my family (and then renting space at a B&B for guests) was much more do-able.

3. Based on your goal, decide what the most important features are: location, parking, lot size, street traffic, view, flexibility, etc...Since I now live full time in my house in Patzcuaro, I have found that being 2 blocks from the market (I go shopping for food most days), on a quiet street (our street has only local traffic and is blocked on one side), in the center of town (we get lots of friends stopping by while they're running errands) has been ideal. I wouldn't trade it for anything. That said, the next time around I would have invested in a spare bedroom as we have a lot of house guests and it's hard to accommodate them.

4. Now that you have a list of the most important features, go back and see your top properties again. It's great to have a second pair of eyes with you - a friend, a partner, an architect, etc. If you're like me (and I think most people), buying a house is much like falling in love - and is a very emotional experience. It's good to have someone grounding with you to make sure you're not just buying based on your gut.

5. Once you have a short list of 1-3 properties, make an old fashioned pros and cons list. At this point in my search, I was deciding between two properties that were just two blocks apart from each other. One perfect for a storefront, the other perfect for a home. It wasn't really until I made a pros and cons list did I realize that having a beautiful home was what my family and I were really after, and the business plan could wait until later.

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