Authored by the expert who managed and guided the team behind the Mexico Property Pack
Yes, the analysis of Mexico City's property market is included in our pack
Are you considering investing in Mexico City's real estate market? Curious about the latest trends and what they mean for potential buyers like you? Want to know which neighborhoods are poised for growth and which ones to avoid?
We will lay down recent insights, providing you with a clear picture of the current market landscape. Here, no guesswork—only solid data to guide your property investment decisions.
Actually, we know this market inside and out. We keep tabs on it regularly, and all our discoveries are reflected in the most recent version of the Mexico Property Pack
This article gives you valuable insights, but remember, it’s not and will never be investment advice. We pull data from a range of sources to provide you with the most accurate picture possible, yet we can’t guarantee complete accuracy. Markets are difficult to predict. Make sure to do your own research and consult a professional before making any financial moves. Any risks or losses are your own responsibility.
1) Rental yields in Mexico City's tourist hotspots will fo down, as short-term rental rules tighten
Mexico City is tightening its grip on short-term rentals with new regulations.
Property owners now need to register with a Host Registry, which must be renewed every two years. This adds a layer of bureaucracy that could discourage some from entering the short-term rental market. Increased enforcement is expected to make some property owners think twice about participating.
Fines and penalties for non-compliance are on the rise, and those who don't follow the rules could face financial penalties. This might push some owners to reconsider their involvement in short-term rentals, potentially leading to fewer available properties and impacting rental yields.
With these new rules, some property owners might switch their short-term rentals to long-term leases. This shift could reduce the number of short-term rentals, leading to lower occupancy rates and decreased rental yields. We've seen similar trends in cities like Barcelona, where regulations led to a drop in short-term rental activity.
In tourist-heavy areas of Mexico, stricter regulations could mean a decline in rental yields. As the supply of short-term rentals decreases, the market dynamics could shift, affecting potential returns for property investors.
For those considering buying property in Mexico, it's crucial to understand how these changes might impact your investment. The evolving landscape of short-term rentals could influence your decision, especially if you're eyeing tourist hotspots.
Sources: Short Term Rentalz, Airbtics
2) Mexico City's residential real estate prices will surge as remote workers flock to urban amenities
Mexico City is becoming a hotspot for remote workers from the United States.
Between January and October 2023, the city issued over 9,500 permits to US nationals, almost doubling the 2019 numbers. This surge has led to a noticeable increase in long-term Airbnb rentals, with stays booked for over a month jumping by 30% from April to June compared to 2019.
The trend of remote work is here to stay, attracting more international buyers and expats to Mexico City. This growing interest, especially in popular neighborhoods, is likely to boost demand for properties, potentially driving up prices.
Urbanization and population growth in Mexico City are not slowing down, which means the demand for housing will keep rising. The city is also pouring resources into infrastructure projects, like better public transportation and road networks, making certain areas more appealing to buyers.
These improvements are expected to enhance connectivity and accessibility, which can increase property values. Real estate agents note that remote workers are drawn to urban living for its amenities and services, pushing up demand for residential properties in urban areas like Mexico City.
With these factors in play, Mexico City's residential real estate market is poised for moderate growth, driven by the influx of remote workers seeking the urban lifestyle.
Sources: Mexico Business News, Mexico Business News, Mordor Intelligence
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3) Foreign buyers in Mexico City's real estate market will surge as remote work lets more people live abroad
Remote work is making it easier for people to live abroad, and Mexico City is becoming a hotspot for foreign buyers.
In 2023, over 9,500 permits were issued to U.S. nationals in Mexico City, nearly doubling the number from 2019. This surge has led to a boom in long-term Airbnb rentals, with stays booked for over a month jumping by 30% compared to 2019. The city is buzzing with new faces, and the housing market is feeling the impact.
By 2025, around 32.6 million U.S. adults are expected to work entirely from home, up from 22 million in 2024. This shift means more people can pack up and live wherever they want, and Mexico City is catching their eye. The city is transforming, with a noticeable increase in long-term rentals catering to these remote workers.
Mexico's infrastructure is getting a boost, with better fiber-optic coverage attracting digital nomads. This makes even remote areas more appealing, but cities like Mexico City are seeing the biggest demand for housing. The city’s affordability compared to other global hotspots is a major draw for foreign buyers, especially those from the U.S. and Europe.
Mexico City offers a vibrant lifestyle at a fraction of the cost of other major cities. Its affordability is a key factor for those looking to stretch their dollars or euros further. The city’s charm, combined with its cost-effectiveness, is hard to resist for many looking to relocate.
As more people embrace remote work, Mexico City is poised to see even more foreign interest. The city is evolving, and the real estate market is adapting to meet the needs of this new wave of international residents.
Sources: Mexico Business News, SuperSaaS Blog
4) Infrastructure upgrades in Mexico City's outskirts will go up their appeal to property investors
Mexico City's outskirts are becoming a hot spot for property investors thanks to major infrastructure upgrades.
The city has rolled out a massive US$1.13 billion infrastructure program to boost urban living and the economy. This investment is a game-changer, making these areas much more appealing to investors looking for growth opportunities.
With these improvements, property values are on the rise. In 2024, the nationwide house price index jumped by 9.64%, fueled by strong local demand and the return of international buyers. This uptick shows that areas with new infrastructure are becoming prime real estate, offering better returns.
Transportation is getting a major facelift too. Projects like the rehabilitation and extension of Metro Line No. 12 and the "El Insurgente" Interurban Train are underway. These upgrades aim to cut down travel times and boost connectivity, making the outskirts more accessible and appealing for both residents and businesses.
Improved transport links are a magnet for property investors. They not only make life easier for locals but also enhance the overall attractiveness of these areas, drawing in more interest and investment.
As these projects progress, the peripheral zones of Mexico City are set to become even more desirable, offering a blend of convenience and opportunity that investors can't ignore.
Sources: Mexico City Unveils US$1.13 Billion Infrastructure Plan for 2024, 21 strong forecasts for real estate in Mexico (2025), Mexico City updates progress on ongoing projects
5) Mexico City's aging population will go up demand for accessible and senior-friendly housing options
Life expectancy in Mexico is increasing, meaning more people are living longer.
By 2030, 30.5 million Mexicans will be over 60, making up a significant portion of the population. This shift is especially evident in urban areas like Mexico City, where the need for senior-friendly housing is on the rise.
Older adults often seek homes that are accessible and safe, with services like healthcare and transportation. However, the current housing market in Mexico City hasn't fully met these needs, leaving a noticeable gap.
Globally, aging populations lead to a higher demand for senior-friendly housing, and Mexico City is no exception. The Mexican government is starting initiatives to support this type of housing, showing the importance of addressing these needs.
Investing in properties that cater to seniors could be a smart move, given the growing demand for accessible housing in Mexico City. This trend is not just a local phenomenon but part of a larger global shift.
As more people age, the demand for homes that offer specialized services and accessibility will likely continue to grow, making it a promising area for investment.
Sources: Worldometers, MIT DSpace, AARP International
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6) Environmental efforts to enhance Mexico City's air quality will go up urban living's appeal
Mexico City is becoming a more attractive place to live thanks to improvements in air quality.
The city has been working hard to reduce air pollution, and the Air Quality Index (AQI) now often shows moderate to good levels. This is largely due to several environmental initiatives aimed at cleaning up the air.
One standout project is "Calle Verde," which is all about adding green spaces and planting trees. Not only does this help cut down pollution, but it also makes the city more beautiful and enjoyable. Plus, the city has been upgrading public transport, like adding new cable bus lines, to reduce the need for cars and further clean the air.
These efforts are paying off economically too. People are willing to pay more for homes in areas with better air quality, which is driving up property values. This trend shows a growing interest in urban living spaces that offer a healthier environment.
Mexico City's involvement in international programs like Breathe Cities underscores its dedication to creating a cleaner and more appealing urban space. These initiatives are not just about the environment; they're about making the city a better place to live.
Sources: AQI Dashboard, C40 Case Studies, Cambridge Journal, Clean Air Fund
7) Urban living will surge in Mexico City as demand for suburban single-family homes plummets
Mexico City is becoming a magnet for urban dwellers, with its population growing by 223,900 in just two years.
With a US$1.13 billion infrastructure boost in 2024, the city is transforming its public transport and roads, making city life more appealing. These upgrades are not just about convenience; they’re about making the city more accessible and connected.
People are increasingly drawn to the vibrant urban lifestyle, especially with the rise of remote work. This trend is attracting international buyers and expatriates who are keen on properties with modern and eco-friendly features.
Central areas are seeing a boom in demand for apartments and condos, while suburban single-family homes are losing their charm. In 2024, a mere 2% of property sales were in the economic segment, highlighting a shift towards pricier urban properties.
As more people opt for city living, the demand for suburban homes is dwindling. This trend is reshaping the real estate market, with urban areas becoming the preferred choice for many.
Sources: World Population Review, Mexico Business News, The Rio Times
8) Sustainable living will go up demand for eco-friendly homes in Mexico City
The desire for sustainable living is driving demand for eco-friendly residential developments in Mexico City.
In 2023, a survey revealed that 78% of consumers in Mexico prioritized environmental sustainability, showing a growing concern about climate change. This shift is a major reason why more people are looking for sustainable housing options.
The Mexican government is on board too, actively promoting sustainable building practices. They plan to construct one million homes and develop 150 urban centers, which will likely boost the demand for eco-friendly residential developments. Mexico City's Second Climate Action Program (PACCM) is also in play, focusing on energy efficiency and resource management to support sustainable projects.
Media coverage is highlighting the benefits of eco-friendly housing, like long-term cost savings and health benefits. This increased awareness is pushing more consumers toward sustainable housing options. Reports suggest that eco-friendly homes are a smart investment because they offer reduced utility costs and lower maintenance needs.
People are catching on to the fact that eco-friendly homes can save money in the long run. Lower utility bills and less maintenance make these homes attractive to buyers. The buzz around these benefits is making sustainable housing more popular.
As more folks in Mexico City become aware of these advantages, the demand for sustainable living spaces is only expected to grow. The combination of government initiatives and consumer interest is setting the stage for a boom in eco-friendly residential developments.
Source: C40
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9) Foreign buyers from Asia will flood Mexico City transforming its international investment landscape
Mexico City is becoming a major attraction for foreign property investors, especially from Asia.
In 2023, the city saw a remarkable influx of foreign direct investment, surpassing $12 billion, which is the highest it has ever been. This surge is part of a broader trend, with Mexico's overall FDI increasing by 27% to $36.1 billion in the same year. The city's appeal is growing, thanks in part to improved air travel connections.
Direct flights between Mexico City and Asia are on the rise, making it easier for investors to visit and explore opportunities. For example, China Southern Airlines resumed direct flights to Mexico City from Shenzhen in April 2024, offering twice-weekly services. This development underscores Mexico's strategic position as a gateway to the Americas, enhancing its attractiveness to Asian investors.
Asian investors are increasingly interested in Latin American real estate, and Mexico City is a prime target. This interest is expected to boost property values, particularly in urban and tech-centric areas. The city's economic stability and business-friendly environment are key factors drawing in these investors.
Asian real estate firms are also expanding their presence in Mexico, capitalizing on the country's robust economy. This expansion is a testament to Mexico's growing reputation as a favorable investment destination. The influx of Asian capital is likely to diversify the international investment landscape in Mexico City.
With these developments, Mexico City is poised to see a rise in foreign buyers from Asia, further diversifying its real estate market. The city's strategic location and economic resilience make it an attractive option for international investors looking to tap into new markets.
Sources: Statista, Hindustan Times, Mexico News Daily
10) Millennials and Gen Z will flood Mexico City driving a surge in demand for smaller affordable housing
Mexico City is becoming a hotspot for millennials and Gen Z due to its vibrant job market and educational opportunities.
With over 900,000 students enrolled in higher education during the 2023/2024 academic year, the city is a magnet for young people eager to advance their careers. The bustling economy, ranking 15th globally in GDP, adds to its allure, drawing in young professionals who crave the urban lifestyle.
Millennials and Gen Z are flocking to Mexico City for its vibrant communities and amenities. Social media buzz and surveys reveal their preference for city life, where everything from trendy cafes to cultural hotspots is within reach.
But there's a catch: the cost of housing. Over the last two decades, prices have quadrupled, making spacious homes a luxury. This has led to a surge in demand for smaller, more affordable living spaces.
Economic constraints are pushing younger generations towards co-living and shared housing as practical solutions. These arrangements offer a way to enjoy city life without breaking the bank.
As more young people move to urban areas, Mexico City's population is set to become younger, reshaping the housing market to meet their needs.
Sources: World Population Review, Statista, Mayors Migration Council, Population Stat
11) Foreign buyers will flood Mexico City for investment driven by favorable exchange rates and economic stability
Foreign buyers are increasingly eyeing Mexico City for investment opportunities.
One major reason is the favorable exchange rate. Since January 2022, the Mexican peso has appreciated by nearly 22% against the US dollar, making investments in Mexico City more appealing. This shift means that foreign investors can get more value for their money, a crucial factor when considering property purchases.
Mexico's economy is another draw. With a GDP growth of 3.1% in 2023, the country has shown resilience. Although growth might slow slightly, the strong labor market and rising investments continue to support economic stability. For investors, this means a reliable environment for potential returns.
The real estate sector in Mexico City is buzzing with foreign interest. The city's growing tech sector and strategic location near the U.S. market make it a hotspot for emerging market opportunities. This has led to increased property values, attracting investors looking for higher returns.
Mexico City offers a unique blend of cultural richness and modern amenities, making it not just a financial investment but a lifestyle choice. The city's vibrant neighborhoods and diverse culinary scene add to its appeal, drawing in those who seek both profit and experience.
With these factors in play, it's no wonder that Mexico City is becoming a top choice for foreign investors. The combination of economic stability, favorable exchange rates, and a thriving real estate market creates a compelling case for investment.
Sources: Statista, OECD, Rio Times
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12) Young professionals flooding Mexico City will go up demand for co-living spaces and shared housing models
Mexico City is buzzing with young professionals flocking in from the United States.
Since early 2023, the city has become a hotspot for remote workers, with over 9,500 permits issued to US nationals. This influx has reshaped the housing scene, making long-term Airbnb rentals a popular choice. As more people arrive, the demand for housing has naturally pushed up rental prices. For example, average monthly rent jumped from US$880 in 2020 to US$1,080 in 2023, making traditional housing options less affordable for many.
With these rising costs, young professionals are looking for alternatives that offer both affordability and flexibility. Enter co-living spaces and shared housing models, which have become the go-to solution. These setups are not just about saving money; they offer a community vibe that appeals to millennials and Gen Z. The CoLiving industry in Mexico is expected to hit 550 billion pesos annually, thanks to this growing trend.
Co-living spaces provide more than just a roof over your head. They offer a sense of community and belonging, which is a big draw for younger generations. This shift is not just about finding a place to live; it's about creating a lifestyle that balances work and social life. As more young professionals move to Mexico City, the demand for these innovative living arrangements will only increase.
For those considering a move, it's worth noting that co-living spaces often come with perks like shared amenities and networking opportunities. This makes them an attractive option for those who want to integrate quickly into the local scene. As the city continues to evolve, these shared housing models are set to become a staple in the urban landscape.
Sources: Mexico Business News, A-001 Blog, PropTech Connect
13) High-rise apartments in Mexico City will soar in demand for their cutting-edge amenities and top-notch security
Mexico City is experiencing a boom in urbanization and population growth, driving demand for modern living spaces.
With crime rates on the rise, especially theft and robbery, residents are prioritizing security. High-rise apartments, known for their enhanced security features, are becoming a popular choice for those seeking safety.
The real estate market is buzzing with new high-rise developments, focusing on tech-smart and energy-efficient designs that attract modern buyers. These buildings often include amenities like gyms and pools, which are highly sought after.
Consumer surveys highlight a strong preference for modern amenities, making high-rise apartments even more appealing. The convenience and lifestyle they offer are unmatched in the current market.
As we move through 2023 and 2024, this trend is expected to continue, with high-rise apartments becoming increasingly desirable for their modern features and security.
These developments are not just about luxury; they represent a shift towards safer and more sustainable living in a bustling city.
Sources: Statista, Harvard Gazette, Statista
14) Virtual reality will transform Mexico City home-buying as buyers tour properties remotely
Virtual reality is changing how people buy homes in Mexico City.
Thanks to VR, you can now tour a property without leaving your couch, making the home-buying process much more efficient. This means fewer physical tours are needed, especially in the early stages of searching for a home.
In Mexico, the internet and smartphones are everywhere. As of January 2024, 83.2% of the population is online, and 97.3% have mobile connections. This connectivity makes it easy for people to use VR to check out homes, whether they're locals or international buyers.
International buyers, especially Americans, are loving this. With over 500,000 Americans owning homes in Mexico, VR makes it simple to explore properties from afar. This tech is a hit in other big cities too, where it's made real estate showings a breeze.
VR is not just a novelty; it's a tool that's revolutionizing international real estate investment. Companies are using advanced virtual tours to make the process smoother and more appealing.
So, if you're thinking about buying a property in Mexico City, VR could be your new best friend, offering a convenient and immersive way to explore your options.
Sources: Datareportal, AZ Big Media