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N.Y. Times Article On Living And Buying Real Estate In Mexico

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 This 20-year-old house, with its six fireplaces and sloping brick ceilings, is in Rosarito, about 30 kilometers (19 miles) southwest of Tijuana. In local parlance, it is at "KM 40," 40 kilometers (or about 25 miles) down the Ensenada highway from the American border in the Mexican state of Baja California.

   This 5,000-square-foot house is in a 20-home gated community called Rosamar. At the back is a grand lawn overlooking the Pacific Ocean, a large patio (with fireplace) and a circular meditation pit dug into a hillside. In the summer, dolphins can be seen swimming by; in February, on occasion, there are whales. Mexico's Coronado Islands are in the distance.

   Many of the rooms on the main floor have arched cupola ceilings made from brick made by artisans from Guadalajara. Off the entrance foyer, to the right, is a library. Beyond that room is a 500-square-foot artists' studio with a grand piano. On the other side of the entrance foyer is the dining room and an oceanfront terrace. The kitchen has Mexican-style tiles and cabinets. The living room has several seating areas, a large fireplace, a pool table and, of course, more views. Here and there are sunlit nooks appropriate for reading and/or dozing.

   Upstairs, the master bedroom has wooden plank floors and a double entry into an en-suite bathroom with a Jacuzzi and midnight-blue tiles; there's also a 600-square-foot outdoor terrace with 180-degree views up and down the Baja coastline. The house has a second bedroom on the top floor, as well as a bedroom and bathroom below the library.

  Rosamar is one of several communities on the Ensenada highway near Tijuana and Rosarito, many of them gated and catering to Americans and other foreign buyers. The development has a pool, Jacuzzi and tennis courts for community use. The nearest border crossing is to San Ysidro, Calif., from Tijuana, about 45 minutes away; a five-year $129 pass called a Sensor Enabled Neural Threat Recognition and Identification card, or Sentri, is sold by the American Customs and Border Protection agency to reduce border waits by around 10 to 20 minutes.

MARKET OVERVIEW

   In recent years, with Mexico's well-reported crime problem, prices in the Tijuana area have dropped around 10 to 15 percent.

   "About two and a half years ago, it was booming," said Pam Chisholm, owner of Discover Baja Real Estate in Rosarito. "A lot of the sellers jacked their prices up so high, thinking they had a goldmine. They're coming down to reality now, and they're pricing them better."

   David Biondolillo, president of Baja 123 Mexican Real Estate, said that the negative coverage of local crime had begun to recede, helping prices stabilize.

   "It was brutal a year ago," Mr. Biondolillo said. "Now the market that should have been here all along is starting to come back. We just had the best two months in the last three years."

   Real estate agents in the area are quick to point out that most communities along the oceanfront have their own security forces, and that they all feel safe living and working around Tijuana and Rosarito. (Tijuana has implemented a police reform program over the last year, with plans to hire 150 new officers in 2010.) Oceanfront homes in the area range from $500,000 to $1 million, said Diane Gibbs, owner of Gibbs and Associates in Rosarito Beach, the listing agent for the property featured here. Houses within view of the ocean, but built behind the oceanfront properties, begin around $300,000, she said.

   There are a number of condominium developments along the coastline, including a complex called La Jolla Real just south of Rosarito. There, Mr. Biondolillo said, he has recently sold 10 units, with prices ranging from the low $200,000s to the $600,000s. Larger units can sell for as much as $1 million, he said.

   Inland, prices come down significantly, starting around $100,000. There, "you won't hear the water," Ms. Gibbs said, but you can probably see it.

WHO BUYS IN TIJUANA AND ROSARITO

   Most of the buyers near the ocean are Americans, typically from California, though vacation home-seekers from Texas and Chicago are not uncommon. In addition, Mr. Biondolillo said, Canadians have arrived, thanks in part to their currency's performance against the dollar (and the peso).

BUYING BASICS

   Americans buying property in Mexico first need a tourist visa, which is in turn required to obtain an FM3, a permit to live in Mexico that must be renewed annually. An FM3 can be obtained at a Mexican Consulate in the United States, of which there are over two dozen, or an immigration office in Mexico; bank statements, copies of passports and a fee of about $150 are required. (After five years, foreigners can apply for an FM2, a more permanent form of residency. The step after that is Mexican citizenship.)

   When a property sale is initiated, foreigners typically submit their funds to an escrow company, Ms. Gibbs said. The money is held there until the sale is final and approved by government officials. (Escrow fees can run as high as $1,000, Mr. Biondolillo said.) After that, the money is transferred to the seller, and the title to the buyer. Baja Mexico is within a restricted zone, foreign buyers are typically required to set up 50-year trusts, called fideicomisos, with Mexican banks; the cost is about $500 per year, Ms. Chisholm said. The trusts can be renewed in perpetuity. Title insurance can be acquired through American companies like Stewart and First American.

   Buyers pay a 2 percent transfer tax at the time of sale, Mr. Biondolillo said. Annual property tax is typically quite low, he added - $150 to $200 for a $300,000 property. Notary, survey and appraisal fees, as well as a certificate of no liens, make up an additional 4 percent of the purchase price, Ms. Gibbs said.

Published Wednesday, January 6, 2010 1:50 PM by Kanoa Biondolillo

Comments

# re: N.Y. Times Article On Living And Buying Real Estate In Mexico

Monday, January 11, 2010 1:10 PM by adventuremike

I would love to one day buy property in Baja California. Baja is one of the most beautiful places in Mexico. My preference in location is La Paz. Nice Blog.

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