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Types of Market in the Riviera Maya
As is common in most countries of the world, there are 2 types of market which operate in the Riviera Maya, Preconstruction (also known as presale) and resale. Here I will give you a quick overview of both and their advantages and disadvantages.
Preconstruction Market:
The preconstruction market is the purchasing of a property which is under construction. Developers will create presentations with renders and architectural floor plans of how the property will look once it is completed and depending on the stage of construction, you can often tour the site to see the vision coming to fruition.
The advantages of pre construction are:
- Payment. You get to spread your payments throughout construction period and you receive a brand-new property upon completion.
- Discounts. Developers will often offer discounts or incentives to attract potential buyers.
- Price increase. Generally, the price of your unit will increase in value during construction but we should caveat this point as the real estate market is susceptible to market fluctuations.
- Customization. Some developers offer then ability to customize your property, although this will usually come at an extra cost.
- The disadvantages of preconstruction are:
- Delays. Construction delays are unfortunately quite common and averaging about 6 months. You will be protected by your purchase agreement and developers are liable for penalties for construction delays.
- The finish product does not quite match up to your expectations. I am yet to experience this problem so I cannot provide first hand experience but it is something to be aware of. In fact, with all my clients so far, it has been the opposite (fingers crossed this trend continues!)
- Market fluctuations. While the housing market is generally seen as a long-term safe investment, during periods of economic downturns, house prices can fall in the short term.
Resale Market:
The resale market is the purchasing of a property from a current owner, which has already been built.
The advantages of resale are:
- Finished product. The property already exists so you can physically inspect them and assess their condition.
- Move right in. Unlike preconstruction, you can usually move straight into your property once the sale is complete.
- Price negotiation. There is often room for negotiation on the price.
- Good deals. You can find some good deals through resale e.g. a 2 bed in an older development will be cheaper than a similar property coming to the end of its preconstruction phase.
The disadvantages of resale are:
- Renovation costs. These need to be taken into consideration as they could add significant costs to your initial investment
- Aged infrastructure or amenities. If you are buying an apartment in an older development, the infrastructure or amenities may need refurbishing which will impact your HOA fee.
That concludes our post on the different types of market in the Riviera Maya. I hope you found this information useful and if you would like to get some more advice on which option would be best for your specific requirements, please do not hesitate to contact us!
