Ai Real Estate Review
2 December, 2016
Ai Real Estate + Relocation, formerly Audrey International, enters into a new era — serving more clients with more sophisticated needs and offering better services. The only Real Estate office in Sayulita certified to the Mexican Association of Real Estate Professionals (AMPI), which translates to more knowledgeable and professional services, including listing properties on the MLS, shared with 100+ agents in the Bahia de Banderas Bay. Audrey currently serves on the regional AMPI board; Lucas Daniels has joined the team as an Ai Sales Associate who is extremely personable and is very familiar with the local market as he has been coming since a child.
The current local real estate market continues to improve in both sale volume and sale price. Last year, properties in the $300,000USD range and a few stellar deals were cleared out of the market; this year we are seeing buyers with double the budget for some of the bigger ticket items. Prices are still dropping, and while there is a level of stability approaching, most all properties in the Sayulita market can still come down to meet demand. The San Pacho market was very successful this past season implementing a 30% decrease in prices on many listings. Their market is much healthier than Sayulita as a result.
Buyers continue to come from the United States, Canada and Mexico (Guadalajara and Mexico City and developers). New, younger families and professionals are moving into the town, replacing sellers, who tend to be older, seek medical security and/or are unenchanted with the changes in Sayulita. An exclusive Ai listing, Casa Botellas ($899,000USD *negotiable) is an oceanfront house with about 1,000 meters of land; the sellers have owned in Sayulita for over 20 years.
Buyers request condos and/or properties below $200,000USD, something missing in the Sayulita market. Monta Rosa condos have been successful this previous year selling out two towers and is its developer is hoping to meet more demand with this and other projects. Rinconada Magica Sayulita, a new development that broke ground this past September, offers houses with 2 or 3 bedrooms in a quiet neighborhood on lots of approximately 200 meters squared; prices start at around $180,000USD and they offer short-term financing.
The short-term rental market continues to be strong, and a key investment factor, however, an increase in market supply (from construction to Airbnb listing bedrooms) has driven prices down to some degree. The long-term rental market is completely saturated and many long-term clients (3 months +) are not able to find accommodations in Sayulita.
Land continues to be a good investment in Sayulita and surrounding areas for buyers because the cost of building remains low compared to finished properties on the market. For example, Ai exclusive listings Vicki´s land is 2.3 hectares (5.7 acres) for only $359,000USD just a couple minute drive from the center of Sayulita with two large platforms with ocean views; in San Ignacio, Montegudo land is 4 hectares (9.9 acres) for under $100,000USD! Despite this however, land stays on the market twice or three times longer than a house.
The US Dollar to Mexican Peso exchange rate continues to strengthen and has a subtle effect on the real estate market. Since almost all property sales in the Bahia Bay are listed in USD, it has had a minimal effect on sales, yet land, usually sold by Mexicans, is a bit more negotiable given the exchange rate. Mexican nationals and Canadian buyers are impacted negatively by the exchange rate to some extent, but it is ultimately the seller who decides what price is right for them to sell, even if they have it listed above market. Building costs for Americans are more attractive with their current Purchasing Power Parity.
Uncertainty in Sayulita is a major barrier to buyer confidence. The status of Pueblo Magico has brought an eye to the lacking infrastructure in Sayulita- an inadequate and poorly managed water treatment plant, inadequate sanitation services and facilities, and gridlock traffic, are just a few. General corruption and a lack of Municipal support has created a huge gap in security services, where Sayulita sees a higher level and more sophisticated crimes. One potential Ai buyer was deterred from making an offer a couple weeks ago because he and his partner got sick and then were robbed.
Land irregularity- Ejido land, parcels that are not legally subdivided, prestanombres on titled land, tax documents that lack manifested construction, etc.- pose numerous barriers, with often costly solutions, for sellers. These properties most often do not make it to market, or if they do, they impact buyer confidence which is already on shaky ground.
The Ai team spends significant time working with sellers to educate them on capital gains taxes and subsequently finding a fiscal strategy. The capital gains rate is approximately 32% on the gain, and exceptions are increasingly challenging to comply with. Each situation is distinct and requires significant analysis to come up with an appropriate strategy. Sometimes, despite best efforts, the capital gains tax is too significant to a seller and the property does not go to the market.
The upcoming season we look forward to more sales in the market, and a cleaner, more transparent market. We also foresee an increased number of listings and sales through our office as we become a more prominent symbol of knowledge and professionalism. Please contact us if you have any questions or comments about our services or the market.