Housing market in San Miguel May 2019

I think the slow down can be looked at as a market correction. SMA real estate is very expensive by Mexican standards. In neighboring Guanajuato city and Querétaro the prices are significantly cheaper. I also think SMA has been overdeveloped due to the growth in the last five years.  I would also suggest that you use the “non-gringo” oriented agents to avoid gringo pricing. Talking to expats will give you referrals to the best “local” agents.

I would advise that it’s better to rent for the first few years in SMA in order to learn what neighborhoods suit your lifestyle and preferences. And if you buy and find that SMA isn’t for you, it may take longer to get out from under your purchase. Good luck with your research.

Thank you so much for your feedback.

The main problem with the Real Estate market right now, in San Miguel, is that they have overbuilt, considering the demand. There are just not enough people to buy all of the homes they are building. You would think this would cause people to sell for less. But that is not happening all the time. Instead many are trying to rent which is actually quite lucrative. Also it seems that some people have the financial resources to hang on to a piece of property until the market turns around whenever that might be.

Hi everybody, I sell real estate here in San Miguel de Allende and 2018 was the best year I have had. January did start a slow down and I would agree for all the reasons that were mentioned. We see more buyers coming now then we did in the last few months and just depending on where the homes were located and their price is part of why they may have been on the market longer. I have lived here for 10 years and still find it a great value, I feel much safer and I'm single here than I do in the United States and the engagement within the people in the community is so much easier and more active as we are all out and about walking and meeting each other on a daily basis.

I still strongly suggest if you are thinking about a home South of the border that San Miguel de Allende offers more than any other place I have been too. This is regardless of my career in selling homes. It was not named the number one city in the world three times in four years by the readers of Travel and Leisure and Traveller magazine for no reason. Year-round lovely weather, culture and great people.
I welcome you to give us a try!

We were looking at real estate here in San Miguel, but decided to rent for now until the market settles down.  Like you said, it’s been a strange year. From what I hear prices doubled in the last four years but then leveled off at the beginning of this year and sales are slow.  There are almost 2000 units currently being built on the outskirts of San Miguel and most of them are being bought on speculation by Mexicans.  They have been buying them pre-build and then selling them three years later when they are completed for twice the price. It’s been working for the last Few years, but I wonder what happens when the only buyers are people who actually want to own those houses.  I think the market is in for a correction, but who knows, maybe as more people flee the US prices might go up again. Certainly this is a wonderful place to live but at the same time prices are quite high compared to almost any area of Mexico. Prices in centro start around  500 K.  We are staying in San Miguel but with crime rates having skyrocketed recently we will wait until things calm down before deciding to purchase.

You think the crime rate in SMA has skyrocketed?  Ten days ago in Chicago 21 people shot in one three hour period. It’s all relative.  Mass shootings are increasing across the USA. SMA’s recent problems seem centered around the drug trade. Don’t sell (or buy) drugs. Cartel’s don’t like competition or disgruntled buyers.

I totally agree.  There are more mass shootings for random reasons in the US for sure.  Unfortunately, most of the crime is cartel related but if you are not buying/selling drugs you are very safe INHO.

I’d say 1000% increase in murder rates this year would qualify as skyrocketing.   I agree that it’s all relative but still disconcerting to see such a huge increase here In crime.  I know plenty of normal Mexicans who are deeply affected and are now having to take lots of extra precautions because they do not feel their neighborhoods are safe. Disregarding the murder rate increase  just because they’re Mexicans seems heartless to me.

I can't find who is saying what about crime in SMA "skyrocketing"?  I recently read the 2018 statistics and they seemed very mild to me, not only in comparison to US murder rates, but also in comparison to other Mexican cities.  And yes, if you are a single woman you don't go for midnight walks by yourself.  You don't get anywhere near drugs or people who sell them.  But those are the same precautions I take in Houston, TX - where I was beaten up one night just around the corner from our house. I had always considered our neighborhood a peaceful place.  When I talked about it to my neighbors the next day (we live in the barrio), they flat-out called me crazy for walking around by myself -- or rather, with only a small poodle on the leash.  Now, none of that ever happened as long as my wonderful German Shepherd was still around to accompany me. 

In the US it's not just murder rates.  It's the fact that the moment you leave your house, you could become a victim of a mass shooting, wherever you are:  shopping center, hospital, movie theater, outdoor or indoor concerts, grocery stores, church, synagogue, school, office building, universities....no place is safe in the US any more.  In comparison, I find SMA downright peaceful.

I would agree with you.

The 500K reason is why many people build a house. We are just finishing building ours. It is 3 bedrooms and 3.5 bathrooms. High ceilings and very large PVC edged sliding glass windows (more expensive than ironwork or aluminum), lots of skylights, about 220 sq meters of living space and a good sized garden area . The total cost not including the land is going to be about 2,500,000 pesos (about $130,000 US). We have been told we could turn this house around for a little over $5,000,000 pesos when it is complete. But I don't believe that would be the case this year or next unless a huge influx of buyers takes place and I see no reason for that to occur. Fortunately, we are planning on living in the house for the forseeable future and will not have to concern ourselves with the poor market conditions that exist right now.

toddphillips wrote:

I’d say 1000% increase in murder rates this year would qualify as skyrocketing.

That percentage figure is soooo misleading. Percentage of what?

This year there have been a recorded 58 murders (if memory serves when I read the last statistics).

Mike GB:  In which part of town are you building?  Can you give us an estimate of the land cost?

El Capricho. West of La Comer up on the hill.

There is a lot for sale now for $1,800,000 pesos. It could possibly be purchased for about $1,600,000 pesos (for about 220 sq meters). . This is not our property because our's was bought some 6 years ago at a much lower cost.

Mike - how difficult was it to deal with the contractors during the construction?  The last 2 times we had alterations made to our Houston house and had to deal with contractors were absolute NIGHTMARES, and I mean the capital letters.  Trying to cheat us, trying to cheat the workers (undocumented immigrants who came back to us asking for money because the contractor tried to stiff them), substituting cheap materials, long pauses in the work, trying to charge us extra for things that should have been included in the total price.  Please let me know how your experience was here.  By now I just have a horror of contractors.

SteveandMarty: We are dealing with an architect. He takes care of hiring, overseeing the project  and purchasing materials.

He has been very flexible in making changes. But he has been very slack in hiring enough workers. Usually only two.

There are houses that were started well after ours that are almost complete. It has been one year since the beginning of construction. His tardiness is not typical.

The only reason we knew about him is that he happens to be a friend of family members. In actuality they should never have recommended him given that he never had done any significant work for them. So they had no knowledge of his work ethic.

I would never recommend this guy for anything.

If I was building again I would get the architect or contractor to commit on paper what he is going to have done each week. If he does not succeed he does not get his weekly payment until he does. Tan tan (as they say here).

Yep, that tardiness and having only one or two workers show up for a couple of hours was making me nuts in Houston, too.  And then that evil deal at the end, that he didn't pay his undocumented workers because he knew they had no recourse -- that's more than nasty.  I really had sworn never to deal with contractors again, it was such a crummy experience.  If you find a good architect, could you please let me have the contact info?  ***.    Marty

Wouldn’t it be an advantage to remodel an existing structure to limit the overall scope of the project?  In doing so wouldn’t the dependence on timeliness and overall project length be reduced?  Mexicans aren’t lazy, far from it, they just have a different point of view on life/work balance. I think in many ways it’s healthier than the American work/life balance.  And I have witnessed this healthier balance in many other countries too.

I find it amazing that we as Americans tend to expect the world to bow to OUR ways, yet if we took the good from the American way of life and meld it with the better approach of other cultures regarding some toxic elements of American life, we can have the best of both worlds. Personally, that’s what attracted me to Mexico in the first place. Of course, to each their own.

LaloSMA wrote:

Mexicans aren’t lazy, far from it, they just have a different point of view on life/work balance.

You are right, they are not lazy. But they can be terribly disorganized. For example, the architect we have, when given plan changes he does not generate new documents that are then made available to his workers. Then what happens is the workers work to the old plans and of course their work has to be redone at greater to cost to him and more time loss for him and us. What would you call this? Would you be happy with this outcome? I think not.

This is about a particular person and nothing to do with nationality.

There are other architects here that do fine work. You just have to find out who they are and that can be challenging. Even recommendations can be wrong. Mexicans tend to be over-helpful to the point of recommending things when they have no basis to make a recommendation.

I am not biased simply because I am an extranjero. My girlfriend, who is a Mexicana and has lived here all of her life, thinks about these things the same as me.

LaloSMA wrote:

Wouldn’t it be an advantage to remodel an existing structure to limit the overall scope of the project?  In doing so wouldn’t the dependence on timeliness and overall project length be reduced?

It might be an advantage to do remodel. But that is a personal choice and not one my girlfriend was prepared to make. It is more her house than mine.

I was actually responding to Steve and Marty. I’m sorry if you thought I was talking about you and your girlfriend. I also wasn’t putting down you or Steve and Marty. My comment was really based on the many senior citizen you tube bloggers and their “ugly American” points of view. I think that those types of extranjeros make it difficult for those that wish to integrate a little bit more. I also think generically that it’s reasonable to expect that many things will require some getting used to and a great deal of tolerance in making a major move anywhere. I’m sorry for the difficulty you have endured and certainly didn’t intend to make light of that in any way.

In Houston, which is a fairly wealthy and multi-cultural city, we have lived in the barrio for 13 years now.  We're the only gringos within several blocks.  Our Hispanic neighbors - documented or not, who cares -- mainly from Mexico, but also a good portion from Guatemala, Honduras, and El Salvador -- are extremely hard-working people, mostly immigrants and their children.  They keep their houses and properties neat and clean, they are polite and quiet.  As the neighborhood "gringo grandparents", we are invited to the baptisms, quinceaneras, birthdays, and we welcome that.  Yep, at New Year's Eve you have the fireworks, but then that's a couple of hours a year, I can live with that. 

Many of our gringo acquaintances, however, more often than not live on unemployment, are on Medicaid and food stamps by some obscure means, but still smoke pot (and worse) and eat out in restaurants.  They get their healthcare and opioides for free and all kinds of government goodies. 

I lived in Guatemala for a few years and have never seen people work harder and do with less than in that country.

Don't NOBODY tell me about lazy Hispanic people.  NOBODY!!!!!!!!!!!!!!!!!!!!!!!!  EVER!!!!!!!!!!!!!!!!!!!!!!! There really never was a time for stereotypes like that.  It's always been pure hideous racism!  And the US pretends to be a "Christian" country?  Really?

Good  Morning  KL,

I  will  try  to  be  as  brief  as possible  on  answering  your  concerns.  I  lived  in  the  San Miguel  "Centro"  area  for  a  year.  I  relocated  from  New York City where  I was born and raised.  Between  the  high  cost  of  living  and  being  a victim of racial  attack,  I  moved here to San Miguel. But  after a year  I  moved  out to the country  30  minutes minutes away.  The  "centro"  area  is  a good  community  but because of  the   growing population of expats  the  community has become  similar to New York City.  Expats  who  are  purchasing  properties  in  the  centro  are  charging  high  rents  while  native  owners  are  more open and transparent with their rentals.  Natives are actually charging  $300 to  $500  a month for 1  to 3 bedroom  apartments  while  expats are charging  $1500.00  a month which defeats the purpose of saving money.  If  you move 30 minutes away to the country setting, you can actually  rent a new  home for $150.00 to $300.00  per month for a two to three bedroom home.  In the country  you are renting  from  a native  and not an expat  and  you can  actually  purchase  a  new home for $50,000  to  $100,000 cash.  Please  do  not  misunderstand  me,  although  I am  an  American  I  am  only being transparent  about renting  or buying from other expats.  To  rent  or  buy in San Miguel  it pays to understand  and  embrace  a new culture, learn the language and truly live among the natives to begin a new life,  while also saving your pension or other means of financial support.  It  has  been  almost  six months since I moved from the centro  and  living  in  the country has been  the best  decision both financially  and  quality  of  life.  Everyone  has a reason for saving money when moving  to Mexico, but living in the centro defeats  saving money.  Living in the country has many benefits such  as  public transportation every 15 minutes  19  hours per day  7  days a week. Owning a car is optional. Well KL  I hope I answered your concerns.  Have  a  great  day.

Chris and Venera: "Natives are actually charging  $300 to  $500  a month for 1  to 3 bedroom  apartments"

I would agree. There are some very good rents to be had if you look around. I pay $8500 pesos a month for a very nice one bedroom apartment in Los Frailes (which is not that far out of the city). I rent from a Mexicana friend and I have access to other parts of the house when my friend is not here. Even when she is here we spend time together.

Good  Morning  Mike,

I  should  have  used  pesos  when  describing  what  rentals go for.  I  pay  7000  pesos ($300 USD) per month for a 3 bedroom  2 bath home outside of Cieneguita .  It  is  rich in horses, sheep, cows and green fields as far as the eyes can see.  Out of  a  population  of  3,000   there  are only  2  expats in the community.  The most  excitement here is  a horse  being chased by sheep.  There are no similarities to San Miguel in terms of fireworks or  special evens.  This is truly  a  country setting  in every sense of the word along with the benefit of saving money. Well  Mike  I  just wanted to say thank you for your reply. I wish you an incredible day!

chris and venera wrote:

It  is  rich in horses, sheep, cows and green fields as far as the eyes can see.

And no doubt lots of flies. Wherever there are lots of animals of this type there are lots of flies. I like horses but would never want to live where they do. Not my kind of living space even though it is a  little less expensive than where I live.

But I am glad you have found your slice of paradise.

En una boca cerrada, no hay moscas!

Hola ivydp!
Good to hear your views on the market and SAM area in general.
I am interested in learning more about the Lake Chapala area more so.  I much prefer being at the higher elevation for climate and also where I can enjoy boating and fishing.  One of the things I am hoping to do is eventually purchase a 4 -5 bed property for a Bed n Breakfast.  With a 3 bed private residence as well.  Nothing soon as I plan to do some traveling in the next couple of years checking out other areas and the Lake Chapala area.  Are you familiar with this area?  Do you also do business there?  Thank you.
Alan

Hola Chris and Venera.
Thank you for your advice and info.  I myself am a farmers son from Wisconsin.  Definitely not into city living.  I prefer country but any suburb kind of thing has possibilities too.  And knowing that this area has New York city folk makes me leery as well.  I presently live in Spring Hill Florida and New Yorkers always seem to want to bring that all with them instead of like you just enjoying where you are and appreciating your neighbors.  After all if we wanted to be in New York city we would live there.
Have you been to the Lake Chapala area?  I have not and hope to travel in the next couple of years to check it out.  From what I have seen on the internet it looks very appealing to my interests.
Thank you.
Alan

Hola Steve and Marty!
Love your post.  I could not agree more with you.'
I would love to have you for neighbors.
Alan

Well, we're looking for long-term rental right now.  So if you find something, let us know and we can do it!

Packman - have you ever heard the joke, New York is a wonderful city, only one problem, it’s filled with New Yorkers!! Jajaja. I think that’s one of those fill in the blank type jokes. Insert any city and it still works like Chicago and Chicagoans for me or Houston and Houstonians for Steve and Marty!!

I  certainly  understand  your  concerns  regarding  New  Yorkers,  however as a native New Yorker I also know not to bring  city life to the country.  I  enjoy my new life in the San Miguel community and more importantly  I am extremely pleased living  almost an hour away waking up to green fields and panoramic views of the forest.  No tourist traffic, no celebratory fireworks noise.  I have never been to Lake Chapala but plan to do so in August.  I have been living here almost 2 years and have never looked back at returning to the big city.  Hope I've answered  your question  and enjoy Mexico, this is a great country.

Kolobog58
I agree.  Being farm raised I want to always be connected to the land.  Just plain good economics and aesthetics for good health and well being.  Society does have its social benefits but that only goes so far.  Too many people too close to me is not a good thing especially when economics start to suffer.  Then anything I may have others think they should have it more then I do.  Country folk enjoy their privacy but also the freedom that comes in knowing who your neighbors are.  Developing trust, caring about others, socializing and helping each other when in need.  I got your back and I know you have mine.

KLOremus, back to the OP question
Hi, I am a Realtor in Lake Chapala and what you have said about the sales market in SMA is true and has been happening in Lake Chapala as well for all the reasons you listed. Prices here in Lake Chapala had been rising for the past two years (the boom actually sftarted in the fall of 2016) but as of this past December it leveled and by February we were seen lots and lots of price reductions. From what I have read this has also happened in the U.S. during the same timeline. The market this year continues to be slower than what we have seen. Average home prices here though are currently $280,000 USD as of the first quarter but I am expecting to see that fall to $250,000 in the second.  So much more affordable than SMA but it's a totally different town as well. Some love SMA and some love Chapala. And even here there are those who prefer Ajijic or Chapala or San Juan Cosala or some of the other towns close by. 
Lake Chapala has received a lot of bad press though YouTube videos recently but it's mostly self inflated hogwash designed to gain YouTube advertising revenue.   Anyone interested should come and visit and talk to the people living here and see for yourself what the area is like and what it is like living here.  If anyone has questions about living here you can PM me.

Hi,
I'm Ken Douglas,I live in Celaya Guanajuato,just about 30 minutes from
San Miguel Allende, I have lived here for about 8 years,before that I lived in Mazatlan,Sinaloa.Celaya is a city of about 400 thousand,mostly business and agriculture,many university s,hospitals  banks large department stores. just about anything you might enjoy,also a selection of many restaurants, a casino.
Celaya is usually quite and safe,or as safe as any other place in mexico. It also is a historic city with many churches,parks and a old down town area.
Due to health concerns I am moving back to Oregon where I have access to the VA hospital.***

Kdoul!
Your residence sounds like a good bargain.
Wish I were to a point where I was interested.

The only problem with Celaya is that it is not a very nice town. It is bigger than San Miguel and not so long ago there was a problem with bad guys holding up people coming from Costco. But those incidents were very limited. If I was choosing another town bigger than San Miguel but around this area I would choose Queretaro. There are some very nice areas of that town and a very nice little lake with houses and apartments around it.

I have lived full time in SMA for just over four years. I love the city as I can walk almost everywhere. Overall the locals and expats are very helpful and friendly, and there are always things going on, many for no cost. Almost every weekend there are festivals, fairs, and/or parades. There are unlimited social groups for everything from gardening to feeding the hungry-check out the weekly Atención paper for a long list.
Twice I have visited Ajijic. I. Was. Bored. To. Tears.
The Jardín was dark and empty, even on Saturday evenings. The town is very small and, while there are many inexpensive restaurants,  and a handful of cute shops, there didn’t appear to be anything going on except for a lively theater group. I even found most of the architecture boring. As well I found that there was little interaction between the expats and the locals.
I do not intend to state that I am an expert on Ajijic, but from my limited perspective, the overall vibe of San Miguel is much better.