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Report: Home prices see biggest drop in a decade
U.S. home sales fell in April, making this the second month in a row with a decrease in sales. There was also a significant drop in home prices, one of the most notable since 2012. According to CNN Business, the average home price in the U.S. is $388,800, which may help new homebuyers find more affordable homes. Despite this drop in home prices, there is still low home inventory and therefore, even with sales down, low prices and inventory changes are causing each home to bring in multiple offers. Even more interesting is the change in the demographic of those who are buying homes. Currently, the U.S. is seeing an influx of international home buyers in the market.
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According to DATOS from the Arizona Hispanic Chamber of Commerce, Mexico was the second largest source of foreign buyers in 2022, purchasing $2.9 billion of real estate in the United States. These international investments are not just happening in the U.S. American investors are also making a change and more are entering Mexico’s market. The Mexican luxury apartment market had a 32.08% increase in sales to U.S. citizens in 2022.
Why are Binational Investments Important
Binational investments benefit the economy of both the U.S. and Mexico. This is because collaborations and partnerships in real estate investments can generate jobs for those in the surrounding areas. Like trade, international investment is critical to Mexican jobs.
Additionally, the legal framework for foreign real estate investment is stable. In recent years, Mexico has not pushed for any reforms that deter or jeopardize real estate investments. Real estate for residential purposes is not the only attractive option, there is a wide range of real estate available for tourism, commercial, service, and industrial purposes.
The fees and taxes homeowners must pay in places like the U.S. and Canada have continued to climb over the last decade. Rises in housing and community taxes have out-stripped inflation, and maintenance costs are steep, putting a lot of pressure on people with fixed incomes. In Mexico, homeowners enjoy low property taxes as well as lower maintenance costs due to lower material prices and labor fees for house maintenance services.
According to the former U.S. Treasurer Marin, real estate is truly the engine that drives our economy, impacting so many industries, and is the single most important source of wealth for many people.
Those interested in binational investment need to ensure that they are educating themselves before investing, including learning what the financing options are for USA-Mexico investments and how to handle binational relationships. This will allow them to buy property on both sides of the border the right way and minimize risk.
Those interested in learning more about investing in Mexican real estate can attend the Real Estate Summit Across Borders at the Sheraton Downtown Phoenix on June 9. The Real Estate Summit Across Borders will host over 1,000 professionals and offers attendees the opportunity to become a part of a robust, bilateral economic ecosystem that results in new development opportunities and expanded relationships. The conference programming provides key opportunities to acquire valuable information on real estate, investments, and regulatory issues from industry leaders in both the United States and Mexico.