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What will happen in Toluca’s real estate market? Will prices go up or down? Is Toluca becoming a new hotspot for foreign investors? How is Mexico’s government impacting real estate policies and taxes in 2025?
We’re constantly asked these questions because we’re deeply involved in this market. Through our work with notaries, real estate agents, and clients who buy properties in Toluca, we’ve gained firsthand insights.
That’s why we created this article: to provide clear answers, insightful analysis, and a well-rounded perspective on market predictions and forecasts.
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.
1) Rents in central Toluca will keep rising due to growing demand for urban living spaces
Rents in Toluca's central areas are on the rise as more people flock to urban living.
With Toluca de Lerdo's population growing by 47,970 people last year, the city is bustling with newcomers seeking homes. This surge, a 1.83% annual increase, means more folks are hunting for places to live, driving up demand and, consequently, rents.
Finding a rental in the heart of Toluca isn't easy. The National Low Income Housing Coalition points out a severe shortage of affordable rentals, especially for those with lower incomes. This scarcity is even more noticeable in central areas where everyone wants to be, pushing rents higher.
Property prices in central Toluca are also climbing. According to Properstar, the cost per square meter for homes and apartments is on the upswing. As these property values rise, landlords often hike rents to keep up with the market.
Living in central Toluca is becoming a hot commodity, and with limited rental options, prices are bound to keep climbing. The demand for urban spaces is not just a trend; it's a reality that's reshaping the rental landscape.
Sources: Properstar, World Population Review, National Low Income Housing Coalition
2) Foreign buyers will drive up competition and prices in Toluca’s high-end property market
The influx of foreign buyers in Toluca is shaking up the high-end property market.
In July 2024, international sales hit $318 million, while purchases soared to $444 million, showing a strong interest from countries like the United States, France, and Canada. This surge is making the market more competitive and driving up prices.
Foreign Direct Investment (FDI) in Mexico's real estate is booming, with Toluca being a major player. In 2023, FDI reached 2,700.4 million dollars, and Toluca played a big part in this. This shows how attractive Toluca has become for international buyers.
Housing prices in Toluca are climbing. As of January 2025, apartments are around MXN 26,074 per square meter, and houses are about MXN 16,503 per square meter. This rise is largely due to the increased demand from foreign buyers.
With more international interest, the competition in Toluca's high-end market is heating up. This is pushing prices higher, making it a hotspot for those looking to invest in luxury properties.
Sources: Global Property Guide, Creasoluciones, Economia.gob.mx, Properstar
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) Toluca’s property prices will keep rising due to more new residents and limited housing supply
Residential property prices in Toluca are on the rise due to more people moving in and not enough homes to go around.
In 2024, Toluca de Lerdo's population grew by 1.83%, reaching 2,674,000. This steady growth means more folks are calling Toluca home, which is pushing up the demand for housing.
Housing prices in Toluca jumped by 8% in the third quarter of 2024. This hike is mostly seen in expanding or rural areas, hinting at a tight housing market struggling to keep up with demand.
The SHF Index shows a 9.2% increase in housing prices across Mexico during the same period, and Toluca is following this trend closely.
Even without specific government reports, the ongoing population boom and rising prices suggest housing supply constraints are a real issue.
Reports like the SHF Index highlight that housing prices will keep climbing due to the classic low supply-high demand situation.
Sources: Macrotrends, Mexico Business News, World Population Review
4) Tech-savvy buyers will be drawn to new homes in Toluca as smart home technology becomes standard
In Mexico, smart home technology is booming.
Back in 2023, the smart home market in Mexico was valued at $8.23 billion, and it's expected to skyrocket to $25.5 billion by 2030. This surge is fueled by urbanization and a growing appetite for connected home gadgets. In Toluca, this trend is particularly noticeable as tech companies expand their offerings in urban areas.
Over 70% of Mexicans are familiar with smart home devices, and while initial adoption was slow, the tide is turning. People are drawn to the convenience, energy efficiency, and security these technologies offer. Advances in AI and machine learning have made smart homes even more user-friendly, enhancing automation and overall experience.
In Toluca, several factors are driving the smart home trend. Government incentives for energy-efficient tech and a rising GDP are boosting demand for connected devices. Buyers are increasingly prioritizing advanced home security systems, smart thermostats, and voice-controlled automation in their homes.
Real estate developers are teaming up with tech companies to integrate smart home features into new builds. These partnerships are delivering seamless automation solutions, making smart homes a hit with tech-savvy buyers. Consumer testimonials highlight the convenience and security of smart homes, further swaying potential buyers.
With nearly 80% of Mexico's population living in urban areas, there's a strong demand for connected home tech among city dwellers, including those in Toluca. The global shift towards smart living, driven by a desire for enhanced security, cost savings, and convenience, is making smart home technology a standard feature in new residential developments.
Sources: NextMSC, LightNow Blog, WEDC, Paces Funding
5) Foreign investment in Toluca's residential properties will grow as international buyers look to diversify their portfolios
Toluca is becoming a hotspot for foreign investment in residential properties.
One big reason is the surge in foreign direct investment in Mexico, which hit over $36 billion in 2023. This boom is thanks to Mexico's strategic location and economic stability, making it a prime spot for international buyers looking to diversify their portfolios.
Another draw is the favorable exchange rates for foreign investors. Since January 2022, the Mexican peso has appreciated by nearly 22% against the US dollar. This means international buyers can get more bang for their buck, making Mexico an attractive option for those seeking stable and promising markets.
Mexico's real estate market is also on the rise, catching the eye of global investors. In early 2024, the nationwide house price index in Mexico jumped by 9.64%, driven by strong domestic demand and the return of remote workers. This trend suggests a growing interest in Mexican real estate, which could easily extend to cities like Toluca.
Toluca's proximity to Mexico City and its international airport makes it highly accessible, offering foreign investors a convenient gateway to explore opportunities in the region. This accessibility is a key factor in attracting international interest.
With these factors in play, it's no wonder that Toluca is poised to see a rise in foreign investment in residential properties as international buyers seek to diversify their portfolios.
Sources: Mexico News Daily, Santander Trade, The Latin Investor
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6) Interest in Toluca's eco-friendly properties will grow among foreign buyers as sustainability gains global importance
Foreign buyers are showing a growing interest in eco-friendly developments in Toluca.
Globally, there's a big push for sustainable housing, and it's not just a trend. The market for green buildings is expected to skyrocket, growing from $137.91 billion in 2023 to $417.92 billion by 2032. This boom is fueled by a mix of environmental awareness and new regulations popping up everywhere.
In Mexico, it's not just about wanting to be green; it's becoming a must-have. Surveys reveal that buyers and tenants are increasingly prioritizing sustainability. Properties that are energy-efficient and sustainably designed are in high demand, mirroring the global shift towards cutting down carbon emissions.
Mexico is stepping up its game with potential incentives for sustainable construction. This aligns with the country's broader goals to slash its carbon footprint. For foreign buyers who care about the environment, Toluca is becoming a hot spot for sustainable living.
As sustainability becomes a global priority, foreign buyers are likely to flock to Toluca's eco-friendly developments. The city's commitment to green living is making it an attractive option for those looking to invest in properties that align with their values.
With the world moving towards greener pastures, Toluca stands out as a promising destination for eco-conscious investors.
Sources: Webwire, Credence Research
7) Property prices in Metepec will rise significantly as affluent families choose it for suburban living
Metepec is becoming a hotspot for affluent families looking for suburban living.
After the COVID-19 pandemic, there's been a noticeable shift towards larger homes and greener spaces, and Metepec fits the bill perfectly. Families are drawn to its spacious environment, offering a peaceful retreat from the hustle and bustle of city life.
The Toluca Valley, where Metepec is located, is experiencing economic growth and infrastructure development, which is pushing property values up. With the nearby city of Toluca already seeing a rise in property prices, it's a clear sign that Metepec is on a similar path. The upcoming "El Insurgente" interurban train will soon make the commute between Toluca and Mexico City a breeze, adding to Metepec's appeal.
Metepec is also upping its game with new amenities like private schools, shopping centers, and healthcare facilities, all designed with affluent families in mind. This makes it an even more attractive option for those who want comfort and security without sacrificing proximity to urban conveniences.
Real estate market reports and demographic studies show a trend of affluent families moving to suburban areas like Metepec. They're seeking a more relaxed lifestyle and better educational opportunities for their kids, making Metepec a top choice.
With all these factors in play, it's no wonder that property prices in Metepec are expected to rise as more families discover its charm.
Sources: Wikipedia, ASEAN UP, Statista
8) Property prices in flood-prone areas of Toluca will drop moderately as climate change effects become clearer
Flooding in Mexico has been on the rise, with events like Tropical Storm Eta affecting over 100,000 people.
In Toluca, this means that areas prone to flooding might become less attractive to property buyers. Property prices in these areas are often overvalued compared to their actual flood risk, as highlighted by a 2023 study in *Nature Climate Change*.
As awareness of these risks grows, property values in flood-prone areas like Toluca could decline. This is because buyers are becoming more cautious about investing in areas with potential flood risks.
Insurance companies are also reacting to these climate-related risks. They're adjusting their valuations, which means higher premiums or even refusal of coverage for properties in risky areas.
This shift can have a big impact on property values. Potential buyers might be put off by the increased costs and risks of owning property in flood-prone areas.
So, if you're considering buying property in Toluca, it's important to be aware of these factors. Climate change is making its mark on the real estate market, and it's crucial to consider how it might affect your investment.
Sources: Disasters Charter, Bradley
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) Rental yields in Toluca will rise as more people opt to rent because of increasing property prices
Property prices in Toluca are climbing, making it a hot topic for potential buyers.
As these prices rise, landlords are finding they can charge higher rents to offset their costs. This is great news for those looking to invest in rental properties. With more people moving to Toluca, the city's population is growing, which means increased demand for rentals.
In 2020, Toluca's population was recorded at 910,608, and it's been steadily increasing. This growth is a key factor in the rental market, as more people means more potential tenants. The younger crowd, especially those aged 15 to 24, is a big part of this trend. They often prefer renting over buying, especially when property prices are high.
For investors, this is a golden opportunity. The younger demographic is not just large; they are also more inclined to rent, which boosts the demand for rental properties. This demand is likely to keep rental yields on the rise.
As more people choose to rent, landlords can expect better returns on their investments. The combination of a growing population and a preference for renting among younger people is setting the stage for a lucrative rental market in Toluca.
So, if you're considering buying property in Toluca, now might be the perfect time to dive into the rental market. With rising property prices and a strong demand for rentals, the potential for increased rental yields is promising.
Sources: Economía.gob.mx, ATTOM Data, Talk of the Cities
10) Rental yields in Toluca's outskirts will drop as more affordable housing is built
In 2023 and 2024, affordable housing projects in Toluca's outskirts surged.
Take the mixed-use project at 10063 Riverside Drive in Toluca Lake, for instance. It features 37 apartments, with four units set aside for extremely low-income residents. This is just one example of how the area is seeing a boost in affordable housing options.
With these new developments, tenants are leaning towards newer and more budget-friendly housing. This shift is causing a dip in demand for older, pricier rentals, which is impacting rental yields.
Reports are also pointing out an oversupply in the rental market due to the rapid completion of these projects. More units mean more competition, which usually leads to lower rental prices.
As a result, rental yields in the outskirts of Toluca are expected to decline. The influx of affordable housing is putting pressure on prices, making it a renter's market.
For potential buyers, this means more affordable options are becoming available, but it also suggests that investing in rental properties might not be as lucrative as before.
Sources: Urbanize LA, Urbanize LA, ATTOM Data Solutions
11) Properties in Zinacantepec will become more appealing due to new infrastructure and urban development plans
The Zinacantepec region is becoming increasingly appealing due to key infrastructure improvements and urban development projects.
One major highlight is the Mexico-Toluca Interurban Train (TIMT), which includes the Zinacantepec-Lerma section. This project is in its final phase and is expected to be operational by September 2024. Once completed, this new train line will significantly boost connectivity, making it much easier for people to travel to and from the region.
The TIMT project features a 57.8 km electrified double railroad track with five intermediate stations, including facilities in Zinacantepec. This will not only cut down travel times but also make commuting more convenient for both residents and visitors. Improved transportation links like these often lead to rising property values, as seen in other regions with similar developments.
Additionally, Zinacantepec has seen a notable population increase, growing from 121,850 in 2000 to 203,872 in 2020. This surge indicates a strong demand for housing and amenities. The government's infrastructure plan for 2024 also includes modern developments, such as sustainable waste management and public space enhancements, which will improve urban living conditions.
These improvements are expected to support the development of modern housing with better amenities, making the area more attractive to both residents and investors. When public transit systems are enhanced, areas typically become more appealing, drawing in more people and boosting property values.
Sources: BNamericas, ITDP, City Population, Proyectos Mexico
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12) Rental prices in Toluca's suburbs will drop as more housing options become available
Toluca is experiencing a boom in housing development, with projects like the Gelson's-anchored development adding new apartments.
With 37 new apartments added at 10063 Riverside Drive, the housing supply in Toluca is on the rise, leading to more choices for renters. This increase in options often results in higher vacancy rates, which can push rental prices down.
It's not just Toluca; many areas see rental prices drop when housing supply grows. More available homes mean renters have the upper hand, often leading to more competitive pricing.
There's also a shift towards homeownership, thanks to easier mortgage access and supportive government policies. This trend reduces the demand for rentals, adding to the pressure on rental prices.
In suburban areas of Toluca, rental prices are expected to decline as more housing options become available. This is great news for potential buyers looking for a more affordable entry into the market.
For those considering buying property, now might be the perfect time to explore the suburban areas of Toluca, where the market is becoming more favorable for buyers.
Sources: Alphamundi Group, Dwellworks Blog, Urbanize LA
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.