Are Mexico property prices going up in 2025?

Last updated on June 17, 2025

Authored by the expert who managed and guided the team behind the Mexico Property Pack

Everything you need to know before buying real estate is included in our Mexico Property Pack

Property prices in Mexico are experiencing robust growth as we reach mid-2025, with nationwide residential prices up 9.2% year-on-year and certain cities like Guadalajara seeing even stronger gains. This comprehensive analysis examines current price trends, regional variations, and future projections to help you make informed investment decisions in Mexico's dynamic real estate market.

If you want to go deeper, you can check our pack of documents related to the real estate market in Mexico, based on reliable facts and data, not opinions or rumors.

Quick Summary:

Mexico's residential property market is showing strong momentum in 2025, with average prices reaching MXN 60,839 per square meter for new developments and annual growth rates near 9%.

While most major cities are experiencing healthy appreciation, particularly Tijuana (12.8% growth) and Guadalajara (16.8% recent growth), investors should watch for localized oversupply issues in tourist areas like Tulum and consider the impact of high interest rates at 9.5%.

Key Metric	Current Value	Year-over-Year Change
Average Price New Homes	MXN 60,839/sqm (USD 3,003)	+9.6%
Average Price Second-hand	MXN 44,396/sqm (USD 2,191)	+8.9%
National Price Index	269.184 (2010=100)	+9.2%
Average Home Price	MXN 1,734,535	+8.7%
Social Housing Growth	MXN 10,660/sqm	+12.06%

This article is for informational purposes only and should not be considered financial advice. Readers are advised to consult with a qualified professional before making any investment decisions. We do not assume any liability for actions taken based on the information provided.

Who is the author of this content?

THE LATINVESTOR

A team specialized in real estate investing in LATAM countries

We are a team of financial experts, legal professionals, developers, and local real estate specialists dedicated to helping people like you avoid mistakes when investing in real estate in a foreign place, particularly in Mexico. If you'd like to learn more about us, you can check our presentation page.

How this content was created 🔎📝

At THE LATINVESTOR, we explore the Mexican real estate market every day. Our team doesn't just analyze data from a distance—we're actively engaging with local realtors, investors, and property managers in cities like Mexico City, Guadalajara, and Cancun. This hands-on approach allows us to gain a deep understanding of the market from the inside out.

These observations are originally based on what we've learned through these conversations and our observations. But it was not enough. To back them up, we also needed to rely on trusted resources

We prioritize accuracy and authority. Trends lacking solid data or expert validation were excluded.

Trustworthiness is central to our work. Every source and citation is clearly listed, ensuring transparency. A writing AI-powered tool was used solely to refine readability and engagement.

To make the information accessible, our team designed custom infographics that clarify key points. We hope you will like them! All illustrations and media were created in-house and added manually.

What are the current average property prices in Mexico as of June 2025?

Mexico's residential property market shows significant price variations across different segments and locations as we reach mid-2025.

Nationwide, new residential developments average MXN 60,839 per square meter (approximately USD 3,003), while second-hand properties are more affordable at MXN 44,396 per square meter (USD 2,191). The average home price across Mexico stands at 1,734,535 pesos, reflecting the diverse range of properties available.

Major cities command premium prices compared to the national average. Mexico City leads with USD 2,531 per square meter, followed closely by Monterrey at USD 2,329 per square meter and Guadalajara at USD 2,299 per square meter.

These metropolitan areas continue to attract both domestic and international buyers due to their economic opportunities and infrastructure development. The price gap between new and existing properties provides opportunities for different buyer segments, with second-hand homes offering better value for budget-conscious purchasers.

It's something we develop in our Mexico property pack.

How much have property prices increased in Mexico over the past 12 months?

The Mexican residential property market has demonstrated strong growth momentum throughout 2024 and into 2025.

Overall, the nationwide residential property index rose by 9.2% year-on-year as of Q4 2024, with mortgaged dwellings specifically showing an 8.7% annual increase. This growth has been broad-based across different property segments.

Property Segment	Annual Growth Rate	Price Range (MXN/sqm)
Economic/Social Housing	+10.8%	10,660
New Developments	+9.6%	60,839
Second-Hand Properties	+8.9%	44,396
Luxury Segment	+7.01%	101,145
Single-Family Homes	+10%	Varies by location
Overall Market Average	+9.2%	52,617 (average)

The consistent growth across all segments indicates a healthy market driven by genuine demand rather than speculation. Economic and social housing has outperformed other segments, reflecting strong demand from first-time buyers and government support programs.

Which Mexican cities are experiencing the fastest property price growth in 2025?

Several Mexican cities are standing out as hotspots for property price appreciation in 2025.

Tijuana leads the pack with an impressive 12.8% annual price surge, driven by its strategic location on the U.S. border and growing industrial sector. Guadalajara has emerged as another star performer, recording the highest percentage increase among major Latin American cities in recent years at 16.8%, with prices up 48% since 2017.

Mexico City's prime neighborhoods including Polanco, Roma, and Santa Fe have seen extraordinary growth of up to 30% over five years, though the citywide average increase is a more moderate 5% annually. Monterrey has also shown solid performance with a 39% increase over five years.

Tourist and coastal areas present a mixed picture. While Playa del Carmen and Cancun continue to experience strong demand for luxury and eco-friendly developments, Tulum is facing oversupply issues that have stalled price growth. Buyers should carefully evaluate local market conditions in these tourist destinations.

The variation in growth rates across different cities reflects local economic conditions, infrastructure development, and supply-demand dynamics unique to each market.

What property types are seeing the biggest price increases in Mexico?

Different property types in Mexico are experiencing varied levels of price appreciation, with some segments significantly outperforming others.

Popular or social housing has emerged as the fastest-growing segment, with prices jumping 12.06% year-on-year to reach MXN 10,660 per square meter by Q4 2024. This remarkable growth reflects strong demand from Mexico's expanding middle class and government support for affordable housing initiatives.

Single-family homes have also performed exceptionally well, recording over 10% annual price increases in Q3 2023. The luxury segment, while growing more moderately at 7.01% annually, still commands premium prices at MXN 101,145 per square meter.

Condominiums and apartments in urban centers and tourist destinations remain popular, though performance varies significantly by location. In oversupplied markets like Tulum, condo prices have stagnated or even declined, while in major cities they continue to appreciate steadily.

The strong performance of affordable housing segments suggests that Mexico's property market growth is being driven by genuine housing needs rather than speculative investment, which bodes well for long-term market stability.

Get fresh and reliable information about the market in Mexico

Don't base significant investment decisions on outdated data. Get updated and accurate information with our guide.

How have Mexican property prices changed over the past 5 and 10 years?

Mexico's property market has shown remarkable resilience and growth over both medium and long-term periods.

Over the past five years, major cities have experienced substantial appreciation. Guadalajara leads with an impressive 48% increase, making it the top performer in Latin America. Monterrey follows with a 39% gain, while Mexico City has seen a more moderate but still healthy 25% increase. The average home price in Mexico City specifically rose 36% between 2019 and 2024.

The ten-year perspective reveals even more dramatic growth. Mexico's Nominal Residential Property Price Index has surged from 121.363 in 2015 to 269.184 in 2024, representing more than a doubling of property values over the decade. This translates to an average annual growth rate of approximately 8.3%.

This sustained long-term growth demonstrates the Mexican property market's ability to deliver consistent returns despite various economic cycles and challenges. The performance significantly outpaces inflation and most other investment options available in the country.

These historical trends provide confidence in the market's fundamental strength and suggest that property investment in Mexico can be a reliable wealth-building strategy over time.

What are the property price forecasts for Mexico over the next 5, 10, and 20 years?

Property market projections for Mexico indicate continued growth, though at more moderate rates than recent years.

For the immediate future (2025-2028), analysts expect a compound annual growth rate of 4.81% for residential real estate, which would bring the market volume to 4.44 trillion MXN by 2028. Looking further ahead to 2033, the market is projected to grow at a slightly lower CAGR of 4.09%, reaching a total value of USD 237.1 billion.

Long-term projections extending to 2045 remain positive, supported by fundamental drivers including continued urbanization, a growing middle class, and sustained foreign investment interest. However, experts caution that affordability constraints may moderate growth rates, particularly for lower and middle-income segments.

These forecasts suggest that while the explosive growth of recent years may moderate, Mexican property remains a solid long-term investment. The projected growth rates still exceed expected inflation, offering real returns for property investors.

It's something we explore in depth in our Mexico property pack.

How is inflation affecting Mexican property prices in 2025?

Inflation continues to play a significant role in Mexico's property market dynamics as of June 2025.

Persistent inflation is actually supporting property price growth, as real estate is increasingly viewed as an effective hedge against currency devaluation. This has driven both domestic and international investors to allocate more capital to property investments, further fueling price increases.

However, the relationship between inflation and property prices is complex. While property values are rising, high interest rates set by Banxico at 9.5% are increasing borrowing costs, which could moderate future price growth. The real interest rate remains elevated at 6.8%, making mortgages expensive for many buyers.

The key concern is that property prices are rising faster than real wages, creating affordability challenges for average Mexican buyers. This divergence between income growth and property appreciation may eventually limit demand from domestic buyers, though foreign investment continues to provide support.

For investors, the inflationary environment reinforces property's role as a store of value, but careful consideration of financing costs and rental yields is essential for maximizing returns.

What impact is peso depreciation having on foreign investment in Mexican real estate?

The peso's depreciation against major currencies is creating significant opportunities for foreign property investors in 2025.

For U.S. and Canadian buyers, the weaker peso has substantially increased their purchasing power, making Mexican properties more affordable in dollar or Canadian dollar terms. This currency advantage is particularly pronounced in tourist destinations and border cities where many properties are marketed to international buyers.

In dollar-denominated markets like Baja California Sur, the strong dollar provides clear benefits for foreign buyers, though sellers may face complications with capital gains calculations and valuations. The currency volatility has also led to increased inventory in some areas as domestic sellers look to capitalize on favorable exchange rates.

Foreign investment has become a crucial support for Mexico's property market, helping to offset reduced domestic demand caused by high interest rates. Areas popular with expatriates and retirees, such as Playa del Carmen, San Miguel de Allende, and Puerto Vallarta, continue to see strong foreign buyer activity.

However, investors should consider currency risk in their long-term planning, as future peso appreciation could impact returns when converting back to their home currency.

infographics comparison property prices Mexico

We made this infographic to show you how property prices in Mexico compare to other big cities across the region. It breaks down the average price per square meter in city centers, so you can see how cities stack up. It's an easy way to spot where you might get the best value for your money. We hope you like it.

How did the June 2024 presidential elections affect property market stability?

The June 2024 presidential elections have introduced new dynamics into Mexico's property market.

Claudia Sheinbaum's landslide victory and the Morena party's overwhelming mandate initially increased market volatility and borrowing costs. Investor concerns centered on potential constitutional changes and the possibility of Mexico shifting toward a one-party state, creating short-term uncertainty in financial markets.

The uncertainty surrounding the new government's fiscal policy and its approach to supporting state oil company Pemex has kept many investors cautious. This political uncertainty has contributed to maintaining high interest rates and has dampened some institutional investment in the property sector.

However, the residential property market has shown resilience, with prices continuing their upward trajectory despite political headwinds. Foreign buyers, particularly those purchasing vacation homes or retirement properties, appear less concerned about domestic political changes.

As we move through 2025, markets are gradually adapting to the new political reality, though investors await clearer policy directions from the Sheinbaum administration before making major capital commitments.

Are there signs of a property bubble in any Mexican markets?

While Mexico's overall property market appears healthy, certain locations show warning signs of overheating.

Mexico City shows no clear bubble indicators, though affordability concerns are mounting as prices consistently outpace income growth, particularly in central neighborhoods. The market remains supported by genuine demand from a growing population and limited supply in desirable areas.

Tulum presents the clearest case of market overheating, with an oversupplied condo market leading to crashed rental yields
Many developers in Tulum are struggling financially or declaring bankruptcy
Only luxury villas in Tulum maintain strong performance, while the broader market stagnates
Other tourist markets like Playa del Carmen show high inventory levels but maintain price stability
Major cities including Guadalajara, Monterrey, and Tijuana display robust but sustainable growth patterns

Most analysts agree that Mexico's property market growth is supported by real demand drivers including urbanization, a growing middle class, and foreign investment rather than speculative activity. This fundamental demand provides a buffer against a nationwide bubble scenario.

What economic indicators are influencing Mexico's property market outlook?

Several key economic indicators are shaping Mexico's property market trajectory in 2025.

GDP growth projections have moderated significantly, with forecasts ranging from just 0.6% to 1.5% for 2025, down from stronger growth in previous years. This economic slowdown could dampen property demand from domestic buyers, though the market has shown resilience despite slower economic growth.

Interest rates remain a critical factor, with Banxico maintaining rates at 9.5% and real rates at 6.8%. These elevated borrowing costs are limiting credit growth and making mortgages expensive, particularly affecting first-time buyers and middle-income purchasers.

However, positive factors include continued urbanization driving housing demand in major cities, and the nearshoring trend bringing industrial investment that supports broader economic growth. Employment in urban areas remains relatively stable, providing fundamental support for housing demand.

The market benefits from Mexico's young demographic profile and growing middle class, which continue to create new household formation and housing demand despite economic headwinds.

For deeper insights into these economic factors, check our Mexico property pack.

How does Mexico's property market compare to other Latin American countries?

Mexico's property market stands out as one of the strongest performers in Latin America.

City/Country	Price per sqm (USD)	2023-24 Growth (%)	5-Year Change (%)
Mexico City	2,531	9.4	25
Monterrey	2,329	—	39
Guadalajara	2,299	16.8	48
Bogotá (Colombia)	1,051	-5.1	-28.6
São Paulo (Brazil)	2,119	—	-24.4
Santiago (Chile)	2,915	—	-9.9
Buenos Aires (Argentina)	1,875	—	-15.2

Mexico ranks as the second-fastest growing property market in Latin America with 9.4% annual growth, trailing only Colombia's 10.9% increase. However, unlike other markets showing price declines over five years, Mexican cities have maintained consistent appreciation.

Price levels in major Mexican cities exceed most South American counterparts except Montevideo and Santiago, reflecting Mexico's economic stability and attractiveness to international investors. The market's resilience contrasts sharply with the significant price declines seen in Brazilian and Argentine markets over the past five years.

Conclusion

Yes, property prices in Mexico are going up significantly. The residential market shows robust growth with a 9.2% annual increase nationwide and even stronger performance in cities like Tijuana (12.8%) and Guadalajara (16.8%). While some tourist areas face oversupply challenges, the overall market trajectory remains firmly positive.

This growth is supported by fundamental factors including urbanization, foreign investment attracted by peso depreciation, and Mexico's young demographic profile. Though high interest rates and political uncertainty pose some challenges, property continues to serve as an effective inflation hedge and long-term investment vehicle in Mexico's dynamic economy.