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REAL ESTATE IN LOS CABOS
"A Piece of Paradise" Real Estate in Los Cabos by Sabrina Lear - Los Cabos Magazine - Issue #6 The lure of a relaxed lifestyle in warm, friendly and picturesque surroundings has many people returning to Los Cabos, often with the thought of purchasing property. Be it an ocean view home, condominium or a remote and rustic rancho, all are available here, some at very reasonable prices. Los Cabos is booming with hotel and residential construction. Choice oceanfront property, while available, is not as affordable or as easy to come by as it once was. Condominium resorts are more prolific but in reality the total number of condos is in the very low thousands. Choosing the area and type of dwelling best suited to you will depend on your lifestyle and the money you have to invest. Check with your realtor for a list of properties offering financing, many developers will carry your note for five years or longer at around 10% interest with 30% down; or inquire about the availability of American mortgage money. "For sale" signs are everywhere and first time lookers will have no difficulty locating the many developments throughout the region. Several local publications are dedicated solely to real estate and many brokers are well versed regarding frequently asked questions about transfer of ownership procedures and tax obligations. Most real estate brokers in Los Cabos are members of the Association of Mexican Real Estate Professionals (AMPI), affiliated with similar associations in Canada, the U.S.A. and the International Real Estate Association. Los Cabos also has a strong Multi List Association with around thirty members, all committed to ensuring fair and consistent operating policies. The MultiList Los Cabos Association can also be found on the Internet at www.loscabosMLS.com, affording prospective buyers a searchable database of properties and links to member's websites. Dealing with an AMPI affiliate or a Multi-List Los Cabos member is definitely in your best interest. Los Cabos is a large municipality stretching between the Pacific Ocean and the Sea of Cortez, encompassing half of the lower peninsula south of the capital city of La Paz. Cabo San Lucas, the best known of Los Cabos' many diverse areas, has a range of properties to suit any budget. The most visible and prestigious of San Lucas' tourist oriented residential developments is the 360-acre Pedregal de Cabo San Lucas, bridging both sides of the spine of Land's End with magnificent Pacific and Sea of Cortez views and a highly coveted stretch of Pacific Ocean beachfront. The Diaz Rivera family first began developing this gated community with cobblestone streets and a Colonial flavor in 1974; and are very oriented toward the aesthetic aspects of the development as witnessed in the numerous gardens and extensive stone work seen throughout Pedregal. Today, in spite of being a mature development, building is still going strong, a testament to the lure of this magnificent site. Spectacular multi-million dollar estates are located on this rocky outcrop with more moderately priced lots and resales found on the lower levels closer to the square and commercial area. Pedregal is currently excavating the first tunnel in Baja California, to provide access to a parcel of exclusive beachfront property located adjacent to the Hotel Finisterra on the Pacific Ocean. In reality there's not many oceanfront homes or condos available in San Lucas, most of the waterfront is occupied by the marina and tourist hotels and resorts.Your realtor will be able to recommend the best listings for great views and amenities in your price range. For condominiums in Cabo San Lucas, check out Marina Sol Resort, a block from the main beach, Plaza Bonita and Plaza Nautica on the marina or TerraSol on the Pacific side, behind Land's End. Also popular are Mañana Condos and Misiones del Cabo, both close to town in the Corridor. There are also affordable single family homes in Cabo San Lucas for those looking for an alternative to higher priced oceanfront or ocean view homes. New residential communities are springing up all over the Los Cabos area, from those in rugged surroundings with limited services to others rivaling Pedregal in luxury and amenities. Just outside of San Lucas towards San Jose is the Cabo San Lucas Country Club, a master-planned community with a Dye Corporation golf course and view lots for those looking for affordable fairway living. For a greater selection near the water, one must venture out to the twenty mile stretch of golden coastline known as the Corridor, between Cabo San Lucas and San Jose del Cabo. To the east are a number of residential estate communities, some with excellent views of Land's End. Cabo Bello, the oldest of these developments now vies with newer offerings like Rancho Paraiso Estates, Villas Peninsula, Vista Real in El Tezal and Punta Ballena, along with more mature communities like Santa Carmela and Villa Serena. New in the neighborhood is Playa del Rey, a gated community of estate lots on the water in front of Cabo Bello. Prospective buyers will find developments all along the coast in various price ranges, depending on services, infrastructure and proximity to the water. Here, smaller developments varying from estate homes to more affordable properties are interspersed between Los Cabos' three main mega-resorts: Cabo del Sol, Cabo Real and Palmilla, all spread over thousands of acres featuring Championship golf among their many amenities. Each with a unique character and style, these developments offer a range of investment opportunities from opulent oceanfront villas to fairway homes and clusters of condominiums surrounding the greens and luxury hotels. Cabo del Sol, closest to Cabo San Lucas, is an 1,800 acre master-planned community that's home to luxury hotel resorts, condominiums and fairway home sites and a Championship 18-hole Jack Nicklaus designed oceanfront golf course of the same name. Soon the Ritz Carleton and Fiesta Americana hotels will share the shore with the Hacienda del Mar Resort and Puerta del Sol condominiums. La Riviera, Las Brisas and Buena Vista fairway estates are part of a master-plan that includes a traditional Mexican village and a second 18-hole Tom Weiskopf designed golf course. About half way along the Corridor is Cabo Real, the largest of the three main resorts with 2,800 acres of mixed development and the Robert Trent Jones II and Jack Nicklaus designed El Dorado golf courses, with two more courses planned. Homesites and the Las Gardenias condominiums are currently available around the Trent Jones II course, with the oceanfront Casa del Mar condominiums nestled around the charming hotel of the same name. Next door is the opulent Rosewood Resorts' Las Ventanas al Paraiso, with Villas Paraiso, a cluster of lowrise buildings nestled around the hotel with discriminating villas just off the sand. Look for more first class condominiums at Bayview Grand, near the Westin Regina Los Cabos at the other end of Cabo Real. Closer to San Jose del Cabo is the Palmilla, indisputably one of the finest resort communities in North America for private oceanfront living. Graced with a Championship 27-hole Jack Nicklaus signature course and the stately Hotel Palmilla, the communities of Palmilla Norte, Caleta and Villas del Mar occupy some of the most stunning coastline in the area. On the course there are fairway homes and the elegant Villas del Oro condominiums, some with both ocean and golf views. Nearby, cradled on the side of Punta Palmilla with a superb view of the bay and the Palmilla golf course is the 75-acre Cabo Esmeralda community, offering custom homesites, villas and a planned hospital clinic and mini-plaza. On the other side of Palmilla you will find Punta Bella with beautiful oceanfront and oceanview estates and Rancho Cerro Colorado with both mountain-side homesites and Las Terrazas, with 14 hillside 3 and 4 bedroom luxury residences in a grouping of attractive lowrise buildings. Residential homes and condominiums in and around San Jose del Cabo offer investors a different mood; the town itself is small, Colonial and more laid back with less tourist hype than Cabo San Lucas. Around the nine-hole Campo de Golf are affordable condo projects like La Costa Condominiums, Misiones del San Jose and Laguna Vista Condominiums; and single family homes, most with expansive ocean views. La Costa Golf Course Condos feature 1 and 2 bedroom units and will have three phases with 3 swimming pools for each phase, when complete. Along San Jose's beachfront are the luxurious Las Mañanitas with 1, 2 and 3 bedroom condominiums with its contemporary Spanish - Mediterranean style architecture of red tile roofs and white Spanish arches. In the same area, Sampaguita Beach Resort offers nicely appointed studio, 1 and 2 bedroom suites. Both of these new condominium developments are close to downtown San Jose. Nearby in the Corridor are El Zalate, Mykonos, Mira Vista and La Jolla de Los Cabos, all oceanfront condominium projects with sales and rentals in several price ranges. Even more investment opportunities, some very affordable, can be found on the "Pacific side" of Cabo San Lucas, featuring an array of property from modest homes to beachfront estates, and even farther north, simple ranchos nestled in the shadows of the Sierra La Laguna. Further east of San Jose del Cabo, along the Sea of Cortez (known as the East Cape) are miles and miles of oceanfront, yet surprisingly most of this beachfront property is already bought up or held by Mexican families or developers. Most of these areas, like much of the "Pacific side", rely on solar power and trucked-in water making them less desirable to those not entranced by a somewhat remote and pioneer lifestyle. Mexico, largely due to it's history of invasions and conquests, constitutionally prohibits the direct ownership of real property by foreigners along its borders and coastlines. Los Cabos and the entire Baja Peninsula are included in this restricted zone. Instead, property ownership by foreigners is held through a bank trust (fideicomiso), made possible by an amendment to the Mexican Constitution in 1973. Further amendments in the late 80's and early 90's expanded the duration of the trust to fifty years, renewable for fifty year periods in perpetuity, as long as it is renewed within the legally established terms. Once you've made your decision to purchase, the procedure for acquiring a bank trust is not overly difficult yet it can take considerable time to complete and receive title depending on individual circumstances. First, an application for a permit to establish the trust must be made to the Secretary of Foreign Relations. Once the permit's received, the trustee bank instructs the notary public (in Mexico an attorney appointed by the State Governor) to prepare the deed. Then the transfer and other applicable taxes are paid and the deed is recorded in the local municipal office. The procedures for transfers of property for Mexican citizens are similar, except that foreigners have the deed held in trust by a bank which designates the buyer (you) as the beneficiary of the trust. The beneficiary (you) enjoys the same rights of ownership as a Mexican national and can assign his rights to another party at any time. In private condominium and estate home developments, a Master Trust is usually formed and individual owners obtain their beneficial rights under the "umbrella" of the Master Trust. If the Master Trust is in place when you sign your purchase agreement (which should be in Spanish with an English translation, not on the back of a cocktail napkin), your fideicomiso may be completed faster than if you were establishing a new trust. The cost for the permit to establish a new trust is presently around $1,000 USD. The bank will also ding you a one time Foreign Investment Registry fee and an additional acceptance fee, with annual bank fees around $300 to $400 USD. Rates vary from bank to bank so it's best to shop around. Transfer tax is 2%, the higher the selling price, the more the buyer pays. To get the deed in your name, all closing costs must be paid, including appraisal, notary fees, certificates, transfer tax and registration costs. Title search and title insurance are also a consideration and can save you from purchasing property without a clear title. Depending on what type of property you're buying and its designated use, it may be more to your advantage to form a Mexican corporation and acquire the property through a legal Mexican entity without the need for a bank trust. These decisions must be made only after careful research. In all cases consult with a professional, especially with respect to Capital Gains taxes, and don't base your decisions on heresay or rumors you heard on the plane. Using a reputable third party like the Settlement Company to transfer your title will ensure that all necessary permits and procedures are followed. Like any boom area, some deals look too good to be true, and more often than not they most likely aren't. Most properties in Los Cabos will be in private or semi-private master-planned tourist communities and, depending on the developer, transfer of ownership rights will usually be under a "Master Trust". These projects are similar in style to the private, gated residential and condominium communities in the U.S.A. and Canada. Due to the building boom, some developments may be partially completed while others may still be largely dirt. In these instances it's wise to investigate the situation thoroughly to determine if the developer is fully capitalized to meet his obligations. While rules and regulations may exist for height restrictions, density and building permits, no one can guarantee the solvency of a developer. While it's not overly common, there have been past situations where investors have been disappointed and ultimately left with unfinished homes or condos, some projects have faced bank foreclosures. In some instances buyers have paid in full for their property, however, the developer has not made the required transfer of ownership and the condo, lot or home has continued to be included in the development's assets, thereby liable for seizure in the event of foreclosure. In these cases, an experienced real estate broker may lend invaluable assistance in providing the necessary information beforehand to ensure the buyer purchases in the best development available in his price range. We stress that, for the most part, investing in the Los Cabos area is safe and rewarding yet there are pitfalls which a well-informed buyer can avoid with a little forethought and research. One of the best ways to know what you're buying into is to canvas the existing property owners in the development you're interested in and get their opinions. While it's true that growth in Los Cabos has been better managed than in any other resort area in Mexico, it's important to ask the right questions when buying property. What will the area look like in five or ten years? Will your expansive ocean view be someday teeming with condos and time-share resorts? If you're considering a condominium or private home development, what are the homeowners' fees and developer's responsibilities? Are their building covenants, codes and restrictions registered for the use of the land? Is there infrastructure in place and if not, who will pay for it? Is the development governed by a Horizontal or Vertical Condominium Regime and if so, what are your rights and responsibilities? While these regimes provide a legal instrument for the management of the development, as a co-owner of all common property you may be obligated to pay for amenities and services you'd just as soon do without. In most instances, the Developer controls the development until 50 or 60% of the existing lots are sold, if you bought early, it may be years before the owners' group is legally allowed to administer the property. Investors who squirm at this thought may want to investigate the option of individual ownership, however, bear in mind that public services and road maintenance are not what they are in the U.S.A. and Canada. You may find yourself in a neighborhood of poor dirt roads with little muscle to affect repairs or improvements. Those that have owned condominiums up north will have a better idea of how common areas are administered and what participation in a homeowners group involves. Definite pluses are annual budgets to make improvements, repairs and perform general maintenance, all things you must arrange yourself in an individually owned property. Unless you plan to reside in Los Cabos fulltime, owning and maintaining your home can be a hassle without the aid of a competent property manager. For those who are thinking of buying raw land and building a home on their own, it should be noted that your building permit will not be issued without title and registration of the property in your name. While space prohibits us from expanding further, a qualified real estate professional will be able to assist you with any additional information you may need. Los Cabos Magazine thanks Linda Neil, founder and CEO of the Settlement Company, located in San Jose del Cabo (114-2-20-06), for her invaluable assistance in the preparation of this article.
Copyright © 2010 - Joseph A. Tyson - Tyson Promotions, Inc - All Rights Reserved Los Cabos Magazine - Los Cabos Visitor's Guide - Promociones Tyson, S. A. de C. V. |
