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What is happening in Mexico’s real estate market? Are prices going up or down? Is Mexico City still a hotspot for foreign investors? How is Mexico’s government impacting real estate policies and taxes in 2025?
These are the questions everyone is asking us every day—professionals, buyers, and sellers alike, from Cancún to Guadalajara and beyond. Perhaps you’re wondering the same thing.
We know this because we stay deeply connected with local professionals and people like you, diving into the Mexican real estate market every single day. That’s why we created this article: to provide clear answers, insightful analysis, and a well-rounded perspective on market trends and dynamics.
Our goal is simple: to ensure you feel informed and confident about the market without needing to look elsewhere. If you think we missed the mark or could do better, we’d love to hear your thoughts. Feel free to message us with your feedback or comments, and we’ll work hard to improve this content for you.
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1) Mexico's real estate sector anticipates a massive 652 billion pesos investment
Mexico's real estate sector is buzzing with activity, thanks to a massive 652 billion pesos investment on the horizon.
Foreign investors, especially from the U.S. and Canada, are pouring money into Mexico, with 2023 seeing a record $36.1 billion in foreign direct investment. This trend is expected to continue, making the real estate market even more attractive. The Mexican government is also stepping up, launching plans to build one million homes and develop 150 urban centers, which is a big deal for the economy and job creation.
Demand for homes and commercial spaces is on the rise. In the first quarter of 2024, the nationwide house price index jumped by 9.64% compared to the previous year. This surge is partly due to the booming tourism industry, which is driving up the need for vacation properties, especially in coastal areas.
For those eyeing a property in Mexico, it's worth noting that the government's initiatives are not just about numbers. They're reshaping urban landscapes and creating vibrant communities. This is a golden opportunity for investors looking to tap into a market that's both dynamic and promising.
Coastal cities are particularly hot right now, thanks to tourism. The demand for vacation homes is skyrocketing, making these areas prime spots for investment. If you're considering buying property, these regions offer a unique blend of lifestyle and investment potential.
With the government's backing and a steady flow of foreign investment, Mexico's real estate market is poised for growth. It's an exciting time for potential buyers and investors who want to be part of this thriving sector.
Sources: Tao Mexico, LATAM FDI, Rio Times Online
2) Demand for residential and vacation properties in Mexico’s tourist hotspots is booming
Residential and vacation properties in Mexico's tourist hotspots are in explosive demand.
In places like Cancun, Playa del Carmen, and Tulum, property prices have surged by up to 40%, highlighting a strong market. This boom is largely driven by international buyers, with over 1 million Americans now living in Mexico and more than 500,000 owning homes there.
The real estate market is thriving, with a noticeable increase in sales volume. This trend is fueled by a growing interest from foreign investors who are captivated by the allure of Mexico's beautiful coastal areas.
New developments are popping up everywhere, especially in Quintana Roo, where 5,000 new high-value homes are planned. This construction boom is supported by significant infrastructure improvements, including new highways and airports.
These enhancements are expected to draw even more tourists and residents, making these hotspots even more attractive. The combination of new homes and better infrastructure is a recipe for continued growth in the region.
For those considering a property purchase, the insider tip is to act quickly, as demand is only expected to rise. The market's current trajectory suggests that these areas will remain highly sought after.
Sources: Colibri Property, Caribe Luxury Homes
We did some research and made this infographic to help you quickly compare rental yields of the major cities in Mexico versus those in neighboring countries. It provides a clear view of how this country positions itself as a real estate investment destination, which might interest you if you’re planning to invest there.
3) Nearshoring foreign companies are driving unprecedented real estate demand in Mexico
Mexico is experiencing a real estate boom thanks to nearshoring.
Nearshoring, which involves moving business operations closer to home, has made Mexico a top choice due to its proximity to the United States. This trend has been a game-changer for the country's real estate market. In 2023, Mexico saw a record-breaking $36.1 billion in Foreign Direct Investment (FDI), primarily from the U.S., with a focus on the manufacturing sector.
By 2024, FDI in Mexico had surged to $59.449 billion, further fueling the demand for industrial and commercial properties. This influx of foreign companies has led to a significant need for industrial parks and warehouses. In fact, 6.7 million square meters of industrial space were expected to be developed, especially in strategic areas like the Northern states and the Bajío region, which have become key industrial hubs.
Big names like Tesla, Kia, and Daikin are making substantial investments in Mexico. Tesla, for instance, is planning to build a "gigafactory" in Nuevo León, which has not only increased the demand for industrial space but also sparked a construction boom, creating thousands of new jobs in regions like Nuevo León and Querétaro.
These developments are transforming the landscape, with the Northern states and Bajío region becoming hotspots for industrial growth. The demand for real estate in these areas is unprecedented, driven by the influx of foreign companies eager to capitalize on Mexico's strategic location and growing economy.
For potential property buyers, this means a vibrant market with opportunities in both residential and commercial sectors. The nearshoring trend is reshaping Mexico's real estate scene, making it an exciting time to invest in the country.
Sources: Mexico News Daily, Mexico News Daily, NAIOP
4) Sustainable real estate in Mexico is booming due to rising environmental awareness
Sustainable real estate is booming in Mexico, driven by a surge in environmental awareness.
In 2023, Mexico's real estate market saw a big jump in eco-friendly developments. Take GP Vivienda, for instance; they used 50,000 m³ of ECOPact green concrete in Monterrey, cutting CO₂ emissions by 30%. This isn't just a one-off; it's part of a larger trend where developers are increasingly opting for sustainable materials.
People are now more inclined to choose green homes, with 78% of consumers preferring eco-friendly options. This shift is evident in the rising sales of sustainable building materials like Holcim's ECOPact, which is becoming a staple in housing projects across the country. It's not just about the materials; it's about a lifestyle change that more and more people are embracing.
There's a growing demand for properties with green certifications and renewable energy systems. The green building market in Mexico is expected to see significant growth by 2028. This is partly due to government incentives, such as the "Mexican New Housing" project, which encourages energy-efficient building practices. These initiatives are making it easier for developers to go green, and buyers are responding positively.
In cities like Monterrey and Mexico City, developers are integrating solar panels and rainwater harvesting systems into new builds. These features not only reduce environmental impact but also offer long-term savings on utility bills, making them attractive to buyers. Renewable energy systems are becoming a key selling point for new properties.
As more people become aware of the benefits of sustainable living, the demand for eco-friendly homes is likely to keep rising. This trend is reshaping the real estate landscape in Mexico, making it a hot spot for sustainable development. Government policies and consumer preferences are aligning to create a perfect storm for green real estate.
Sources: Holcim, T21, Mitigation Action
5) Virtual tours and automated buying are transforming real estate practices in Mexico
In Mexico, virtual tours and automated buying are reshaping real estate.
By 2023, over half of adults had tried virtual tours, and a striking 67% of home buyers were on the lookout for listings that included them. This isn't just a passing fad; it's a clear sign that digital tools are becoming crucial in real estate. Imagine browsing homes from your couch, getting a feel for the space without stepping outside.
Listings with virtual tours are a hot commodity, receiving 87% more views than those without. Homes with these tours not only attract more eyes but also sell for about 9% more. For sellers, this means properties move 31% faster, making virtual tours a must-have for agents and developers looking to close deals quickly.
The Mexican real estate market is also seeing a boom in online property sales. In 2023, sales hit $25.73 billion, and they're expected to grow to $37.86 billion by 2028. This growth highlights the shift towards online transactions, driven by the ease and accessibility of digital platforms. Buyers appreciate the convenience of exploring properties and making decisions without the hassle of traditional methods.
Virtual tours are not just a novelty; they're becoming a standard expectation. Buyers want to see every corner of a home before making a decision, and sellers who offer this feature are reaping the benefits. The efficiency and speed of these transactions are changing the game, making the buying process smoother and more appealing.
As the market evolves, those in the real estate industry need to adapt. Embracing these digital tools is no longer optional; it's essential for staying competitive. The future of real estate in Mexico is digital, and those who leverage these technologies will lead the way.
Sources: PhotoUp, Global Angle
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6) Demand for eco-certified properties with renewable energy systems is surging across Mexico
Demand for eco-certified properties with renewable energy systems is skyrocketing across Mexico.
In recent years, 78% of consumers have started prioritizing environmental sustainability, with many actively changing their lifestyles to embrace greener choices. This shift is driving a surge in interest for eco-friendly homes. Imagine living in a house that not only saves you money on energy bills but also contributes to a healthier planet.
The Mexican government is playing a big role in this green wave. They've announced plans to add 93,924 MW of renewable energy capacity over the next 15 years, including solar and wind power. This kind of support is encouraging developers to focus on sustainable real estate projects, making it easier for you to find a home that aligns with your values.
Real estate in Mexico is catching on to this trend, with many developers setting goals for environmental sustainability. By 2025, they're aligning with international standards, which means more options for eco-certified properties. This isn't just a local trend; it's part of a global push towards net zero targets, making your investment future-proof.
Imagine owning a property that not only meets your needs but also contributes to a global movement. With the government's backing and consumer demand, the market for sustainable homes is only going to grow. It's an exciting time to be part of this change.
So, if you're considering buying a property in Mexico, now's the time to think green. With the right choice, you can enjoy a modern, sustainable lifestyle while also making a positive impact on the environment.
Sources: S&P Global, Deloitte
7) Housing reforms like rent caps are reshaping Mexico City’s rental market
Mexico City has introduced housing reforms with rent caps that are changing the rental market landscape.
Before these changes, rental prices were skyrocketing, with some areas seeing increases up to three times the annual inflation rate, making it tough for locals to keep up. Now, with rent control laws in place, landlords can only raise rents by the previous year's inflation rate, which has stabilized rental prices and made life a bit easier for tenants.
These reforms mean tenants can enjoy more predictable and manageable rent costs, leading to greater satisfaction and affordability. The city also requires landlords to register all rental agreements, pushing for a more transparent market. This could mean more long-term rental options as landlords are encouraged to offer stable housing.
However, there's a flip side. Some worry that these regulations might scare off investors, potentially affecting the future supply of new housing. This could mean fewer new residential properties popping up in the future, which might be a concern for those looking to buy.
Despite these concerns, the reforms have brought a sense of relief to many renters who now find it easier to plan their finances without the fear of sudden rent hikes. The changes are part of a broader effort to make housing more accessible and affordable in a city where the cost of living has been a growing issue.
For those considering buying property, it's worth noting that these reforms are reshaping the market dynamics, potentially influencing property values and investment opportunities. While the long-term effects are still unfolding, the current landscape offers a more stable environment for renters and potential buyers alike.
Sources: Mexico City establishes Maximum Rent Increases and a New Law, Mexico City's new rent control law could discourage residential investment, Survey finds over 80% of expats 'very satisfied' with life in Mexico
8) Mexico's mortgage market is experiencing a strong revival
Mexico's mortgage market is roaring back to life, and it's an exciting time for potential homebuyers.
In the first half of 2024, there was an 11.4% jump in mortgage loans, showing that more Mexicans are eager to own homes. This uptick in mortgage approvals signals a vibrant market with increasing opportunities for buyers.
New housing developments are popping up everywhere, thanks to a 10.1% boost in Construction GDP in the second quarter of 2024. This means more homes are being built, offering a wider range of choices for those looking to settle down in Mexico.
The government is also stepping up with plans to build one million new homes, which is set to fuel the residential real estate market even further. This initiative not only benefits buyers but also creates a supportive atmosphere for lenders.
With these developments, Mexico is becoming a hotspot for real estate investment, attracting both local and international buyers. The combination of increased mortgage approvals, new housing projects, and government support is creating a dynamic and promising market.
For anyone considering buying property in Mexico, now is a great time to explore the options and take advantage of the favorable conditions. The market's revival is a testament to the country's growing economy and the opportunities it presents for homeownership.
Sources: BBVA Research, The Rio Times
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.
9) The Mexican government is heavily investing in affordable housing projects
The Mexican government is making a huge financial commitment to affordable housing.
In the 2025 budget, a whopping MXN$835.7 billion is earmarked for priority social programs, including housing. This isn't just about numbers; it's a clear sign that the government is serious about tackling housing issues. One of the standout initiatives is the "Mi Casa, Tu Casa" program, which aims to provide homes that are both socially and environmentally sustainable. This program encourages developers to create spaces that not only house people but also promote community interaction and environmental care.
Public-private partnerships are another key strategy. By teaming up with private developers, the government is combining financing, expertise, and innovative design to build more affordable homes. This collaboration means more homes can be built quickly and sustainably, addressing the housing shortage more effectively.
These efforts are part of a broader strategy to address the housing crisis in Mexico. The focus is not just on quantity but also on quality, ensuring that new homes are built to last and meet modern standards. The government's approach is comprehensive, involving various stakeholders to ensure that the housing projects are successful and sustainable in the long run.
For those considering buying property in Mexico, this is an exciting time. The government's investment in affordable housing could lead to more options and potentially better prices. It's a move that could reshape the housing market, making it more accessible to a wider range of people.
Sources: The Yucatan Times, Mexico Historico
10) Mexico’s luxury real estate market is growing rapidly
Mexico's luxury real estate market is booming, with rising sales and prices in hotspots like Cancun, Playa del Carmen, and Tulum.
These popular tourist areas are seeing a surge in demand, which is pushing property prices higher. It's not just local interest; foreign investors are playing a big role too.
In 2023, foreign direct investment in Mexico hit a record $36.1 billion, largely from the U.S. and Canada. This is thanks to relaxed regulations that make it easier for international buyers to jump in.
There's also a growing number of high-net-worth individuals, especially Americans, who are choosing to live in Mexico. Over 500,000 Americans now own homes in the country, drawn to coastal and retirement spots like Puerto Vallarta and San Miguel de Allende.
These areas offer not just beautiful scenery but also a lifestyle that appeals to those looking for a mix of relaxation and adventure. The influx of wealthy residents is transforming these regions into vibrant communities with upscale amenities.
With more people looking to invest in luxury properties, the market is set to keep expanding, offering opportunities for both investors and those seeking a new home in paradise.
Sources: Primerus, BBVA Research, HAR
11) Mexico’s secondary cities are attracting investors with lower costs and significant growth potential
Investors are flocking to Mexico’s secondary cities for lower costs and massive growth potential.
In 2023, property prices in Mexico surged by nearly 15%, with Mexico City leading as the priciest market. This spike has made secondary cities like Guadalajara and Monterrey more appealing due to their lower property costs. These cities are not just cheaper; they are also becoming more connected and efficient.
Guadalajara and Monterrey have seen significant infrastructure improvements, enhancing transportation and public services. These upgrades make them attractive to investors eyeing growth opportunities. Local governments are also rolling out the red carpet for foreign investors with tax incentives and streamlined processes, easing market entry.
Secondary cities offer higher rental yields compared to major urban centers. With property costs up to 40% lower, investors find better returns on investment here. The economic growth and population increase in these cities further boost their appeal.
Guadalajara and Monterrey are not just about affordability; they are vibrant hubs of economic activity. The combination of lower costs and growth potential makes them a magnet for investors. As these cities continue to expand, they offer a promising landscape for those looking to invest in real estate.
Sources: Mordor Intelligence, World Bank Group
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12) Some real estate firms in Mexico now accept Bitcoin and other cryptocurrencies
In Mexico, some real estate companies now accept Bitcoin and other cryptocurrencies for buying property.
Imagine buying a luxury condo in Tulum with Bitcoin—that's exactly what a woman from Peru did, spending 5.78 Bitcoin, or $248,000 USD. This isn't just a one-off; it's a sign that using digital currencies for big purchases is becoming more common in Mexico.
In places like the Riviera Maya, cryptocurrency transactions are gaining traction because they cut out traditional exchange fees and taxes, making them more appealing. This trend is especially noticeable in popular tourist areas where international buyers are active.
By 2023, around 8.1 million people in Mexico were using cryptocurrencies, and this number is expected to grow. This rise in users is making digital currencies a viable option for various transactions, including real estate.
The Mexican government has also stepped in, establishing regulations for cryptocurrency transactions. This move adds a layer of security and legitimacy, encouraging more people to consider using digital currencies for property deals.
Sources: The Agency Los Cabos, The Agency Riviera Maya, Stratview Research
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.