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
What do the latest numbers reveal about Mexico’s real estate market? Are property prices on the rise, or are they stabilizing? Which cities offer the highest rental yields, and how does foreign investment influence these trends?
We’re constantly asked these questions because we’re deeply involved in this market. Through our work with developers, real estate agents, and clients who invest in Mexico, we’ve gained firsthand insights into these trends. Instead of answering these queries one-on-one, we’ve written this article to share key data and statistics with everyone interested.
Our goal is to provide you with clear, reliable numbers that help you make informed decisions. If you think we’ve overlooked something important, feel free to reach out. Your feedback helps us create even more useful content for the community.
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1) Tijuana leads Mexico's real estate growth with a 12.8% annual increase
Tijuana's real estate market is booming, with house prices jumping by 12.8% in early 2024.
This surge is fueled by strong domestic demand, as more Mexicans, especially in the north, enjoy better jobs and economic conditions, leading them to buy homes. Foreign buyers are also returning, further boosting demand and prices.
While Tijuana is at the forefront, other cities like Monterrey and Querétaro are also experiencing notable price hikes. Nationwide, the house price index in Mexico has risen by 9.64%, driven by both new and existing home sales.
Even after adjusting for inflation, Tijuana's growth remains impressive, with an 8.02% real increase. This highlights the city's unique position in the market.
In comparison, other regions are seeing growth, but Tijuana's numbers are unmatched, making it a standout in Mexico's real estate landscape.
Sources: Global Property Guide, BBVA Research
2) 82% of Mexicans strongly prefer buying property, highlighting a homeownership-driven culture
In Mexico, 82% of people prefer buying property, showing a strong homeownership culture.
This trend is fueled by the expanding middle class, which now makes up nearly half of all households. By 2030, an estimated 3.8 million more households will join this group, further boosting the demand for homes.
Historically, Mexico has always had high homeownership rates. Back in 2000, the rate peaked at 78.70%, reflecting the cultural importance of owning a home.
For many Mexicans, owning a home is not just about having a place to live; it's a symbol of stability and success. This mindset is deeply ingrained, making homeownership a top priority for most families.
The growing middle class is not just increasing in numbers but also in purchasing power, which means more people can afford to buy homes. This economic shift is a key driver behind the strong preference for homeownership.
As the middle class continues to grow, the demand for housing is expected to rise, further cementing the culture of homeownership in Mexico.
Sources: Global Property Guide, Trading Economics, Real Estate MX
We have made this infographic to give you a quick and clear snapshot of the property market in Mexico. It highlights key facts like rental prices, yields, and property costs both in city centers and outside, so you can easily compare opportunities. We’ve done some research and also included useful insights about the country’s economy, like GDP, population, and interest rates, to help you understand the bigger picture.
3) Mexico's residential real estate market is valued at USD 14.51 billion in 2024
The Mexican residential real estate market is valued at USD 14.51 billion in 2024.
This impressive figure is largely due to a compound annual growth rate (CAGR) of 4.14% from 2020 to 2029. People are flocking to Mexico, not just for vacations but to settle down, with many opting to buy second homes. This influx of new residents and long-term tourists has been a major driver of the market's growth.
In Mexico City, the demand for homes has pushed prices up, making it the most expensive market in the country. This surge in property values has played a crucial role in boosting the overall market value in 2024.
As more people discover the charm of living in Mexico, the real estate market continues to thrive. The steady rise in property prices reflects the growing interest and investment in Mexican homes.
With its vibrant culture and appealing lifestyle, Mexico is becoming a top choice for those looking to invest in real estate. The market's growth is a testament to the country's increasing popularity as a residential destination.
Sources: Mordor Intelligence, Mordor Intelligence, Mordor Intelligence
4) Used homes dominate sales, comprising 63.4%, while new builds account for only 36.6%
In 2023 and 2024, the Mexican housing market saw notable growth, with used homes dominating sales.
The value of homes across Mexico rose by 9.4% nationwide, driven by strong domestic demand. This surge was largely fueled by the expanding middle class, which now makes up nearly half of all households in the country. As more people looked to buy homes, the demand for existing properties naturally increased.
Foreign buyers, especially from the U.S. and Canada, have also played a significant role in this trend. Many of these buyers prefer established neighborhoods and homes with character, which are often found in the used home market. This preference has further boosted the demand for existing homes.
Historically, there has been a strong demand for residential properties in Mexico, with a clear preference for used homes over new builds. This is evident as used homes make up 63.4% of sales, leaving new builds at just 36.6%.
These trends highlight the appeal of used homes, which offer a sense of community and history that new builds often lack. The combination of domestic and foreign interest has solidified the position of used homes in the market.
Sources: The Rio Times, Global Property Guide
5) Commercial banks are tightening their hold on Mexico’s housing finance by dominating mortgage lending
Commercial banks are now the dominant force in Mexico's mortgage lending.
These banks have a solid foundation, primarily because they rely heavily on short-term deposits and sell parts of their mortgage credit portfolios. This strategy gives them ample resources to lend, especially targeting medium and high-income families, highlighting their strong market presence.
The top three banks in Mexico control over half of all bank assets, which grants them significant power and influence over the mortgage market. This dominance allows them to maintain a firm grip on housing finance.
Since the financial crisis before 2007, commercial banks have made a strong comeback, increasing their involvement in mortgage lending. This resurgence has helped them regain and solidify their market dominance.
The mortgage market has been on the rise, with a noticeable increase in both the amount and number of loans in 2024. This growth is largely driven by commercial banks, further strengthening their hold on the housing finance sector.
In essence, commercial banks have become the main players in Mexico's mortgage lending scene, tightening their grip on housing finance through strategic financial maneuvers and market influence.
Sources: OECD Report, BBVA Research Report
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6) Real estate fraud attempts rose by 58% in 2024
The number of real estate fraud attempts increased by 58% in 2024.
Platforms like Propiedades.com have been busy, detecting and blocking about 3,800 fraud attempts in just the first 10 months of 2024. This is a big jump from the 2,400 cases they saw during the same time in 2023. The surge is mainly because more people are looking to rent, giving fraudsters more chances to strike.
Most of these scams, around 80%, target rental properties, especially apartments with rents between $7,000 and $14,000 a month. These places are in high demand, making them perfect targets for fraud. Cities like Ciudad de México, Estado de México, Guadalajara, Monterrey, Mérida, and Guanajuato are seeing more of these scams.
In Ciudad de México, certain neighborhoods are more at risk. Areas like Narvarte, Roma Norte, Del Valle, Condesa, Centro, Polanco IV Sección, Portales, and Santa María la Ribera are particularly vulnerable to these fraud attempts.
Fraudsters are getting smarter, using the high demand for rentals to their advantage. They often target popular neighborhoods where people are eager to find a place, making it easier to trick them.
As a potential buyer or renter, it's crucial to stay informed and cautious. Knowing which areas are most affected can help you avoid falling victim to these scams.
Sources: Publimetro, Alfa Poniente, El Economista
7) Economic and social housing prices rose by 10.8%, surpassing the 8.6% increase in residential properties
In the third quarter of 2024, economic and social housing prices in Mexico surged by 10.8%, outpacing the 8.6% increase in residential properties.
This trend highlights a growing demand for affordable housing options as more people seek cost-effective living solutions. Economic and social housing cater to a broader segment, including those with lower incomes, which naturally drives up demand and prices.
Government policies and incentives have likely contributed to this rise. By making it more attractive for developers to invest in these types of housing, the market adjusts to increased demand, pushing prices higher.
For potential buyers, this means that investing in economic and social housing could be a smart move, given the current market dynamics. These properties are not only in demand but also supported by favorable government policies.
Understanding these trends is crucial for anyone considering a property purchase in Mexico. The Sociedad Hipotecaria Federal (SHF) data underscores the importance of staying informed about market shifts.
As the market evolves, keeping an eye on these developments can help you make informed decisions. Economic and social housing prices are rising faster than residential properties, indicating a significant shift in the housing landscape.
Sources: Milenio
8) Baja California Sur home prices surged to 2.260 million pesos, a 14.7% annual increase
The housing market in Baja California Sur is on fire, with home prices soaring to 2.260 million pesos (US $121,200), marking a 14.7% annual jump.
According to the Sociedad Hipotecaria Federal (SHF), Baja California Sur consistently boasts the highest housing prices in Mexico. Back in 2023, the median home price was already at 2,107,000 pesos, which was 14.3% higher than the national median. This upward trend has only continued into 2024, making the region a hot spot for real estate.
The SHF report for the second quarter of 2024 reveals that Baja California Sur also leads the country with the highest credit index for mortgages. La Paz stands out as the municipality with the top credit index, closely followed by Los Cabos and Tijuana. This high demand, coupled with a limited supply, is a recipe for rising prices.
Foreign buyers are showing significant interest in the area, further driving up property values. The allure of Baja California Sur's stunning landscapes and vibrant culture makes it a prime destination for international investors looking to own a piece of paradise.
With such a competitive market, potential buyers should be prepared for a fast-paced environment. The combination of high demand and limited availability means that properties can get snapped up quickly, often at premium prices.
Sources: Diario El Independiente, Mexperience, Tribuna de México
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.
9) The average home price in Mexico reached 1,734,535 pesos, indicating dynamic market activity
The nationwide average home price in Mexico has hit 1,734,535 pesos, indicating a bustling housing market.
This figure, reported for the first half of 2024, reflects the average cost of homes across the country. The data comes from the Sociedad Hipotecaria Federal (SHF), which uses its Index of Housing Prices to track these numbers. This index is crucial for understanding regional price variations, showing an average price of 1,724,535 pesos and a median price of 1,490,000 pesos. Such a range highlights how factors like location and size play a role in the market's dynamism.
Interestingly, the SHF index also revealed a 9.7% increase in average home prices during the first three months of 2024 compared to the same period in 2023. This uptick is tied to more property appraisals and rising prices for both new and used homes in various areas.
For potential buyers, this means that the market is not only active but also competitive, with prices reflecting the demand and supply dynamics in different regions. Whether you're looking at bustling urban centers or serene countryside locales, understanding these trends can help you make informed decisions.
As you consider purchasing a property, keep in mind that these statistics are more than just numbers; they represent the evolving landscape of the Mexican housing market. The SHF's data provides a snapshot of how the market is shifting, offering valuable insights for anyone looking to invest in real estate.
Sources: Vinte Blog, SHF
10) Mexico’s residential real estate market is projected to hit USD 17.78 billion by 2029, growing at 4.14%
Mexico's residential real estate market is set to reach USD 17.78 billion by 2029, growing at a steady pace of 4.14% annually.
In the first quarter of 2024, house prices in Mexico jumped by 9.64% compared to the previous year, showcasing the market's resilience. This follows a trend of consistent price increases throughout 2023, indicating a strong and stable housing demand. Such growth is fueled by both new residents and tourists who are increasingly choosing to stay longer or buy second homes in Mexico.
The rising middle class, which now makes up nearly half of all Mexican households, is a significant driver of this market expansion. This demographic is expected to grow even more, with millions more households projected to join the middle class by 2030. This shift is creating a robust demand for housing, as more people seek to upgrade their living situations.
Foreign buyers, especially from the United States and Canada, are also playing a crucial role in this growth. With over a million Americans living in Mexico, many of whom own homes, the country is becoming increasingly attractive to international buyers. This influx of foreign interest is bolstering the market and adding to the demand for residential properties.
Mexico's appeal as a destination for both living and investment is undeniable. The combination of a growing middle class and the return of foreign buyers is creating a perfect storm for the real estate market. As more people discover the benefits of living in Mexico, the demand for housing is expected to continue its upward trajectory.
With these factors in play, the Mexican housing market is poised for significant growth in the coming years. The steady increase in house prices and the expanding middle class are clear indicators of a thriving market. As more people choose to call Mexico home, the real estate sector is set to flourish.
Sources: Mordor Intelligence, Global Property Guide
While this article provides thoughtful analysis and insights based on credible and carefully selected sources, it is not, and should never be considered, financial advice. We put significant effort into researching, aggregating, and analyzing data to present you with an informed perspective. However, every analysis reflects subjective choices, such as the selection of sources and methodologies, and no single piece can encompass the full complexity of the market. Always conduct your own research, seek professional advice, and make decisions based on your own judgment. Any financial risks or losses remain your responsibility.