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"He
that will make a good use of any part of his life must allow a large part of it
to recreation." John Locke, 1690 "Few people
do business well who do nothing else." Lord Chesterfield, 1749 Since
September of last year, the citizens of the United States become more aware of
the importance of being a part of the international community. Our neighbor to
the south, Mexico, has continued to support us during these serious times. Mexico
has given to many Americans a respite from the sorrow and loss. What
is your neighbor doing regarding its own internal financial health and quality
of life? National News Investment
Grade Rating
In February of this year, Standard and Poor upgraded Mexico's
sovereign debt rating to "much-coveted" investment grade. The nation
had previously been awarded investment grade by Fitch and Moody's Investor Services.
Small and large funds will be competing for investment dollars, with more products
offered and more advertising aimed at the US market. The market is now open for
small investors to invest their money into the future of Mexico. Large investors,
such as banking investment groups, major retails such as Wal-Mart and Home Depot,
have a large presence in Mexico. Efficiency
The Fox administration is continuing to implement the Program for Regulatory Improvement
2001-6. This procedure to simplify and streamline business practices is saving
the Mexican federal government billions of pesos. Many documents needed by Americans
and Canadians, as well as Mexicans, can be now completed via the internet. With
the implementation of these office procedures, Mexico hopes to meet its goal of
ISO 9000 certification (international standard for quality). The state of Jalisco
is one of several Mexican states leading the adoption of these guidelines. North
Americans and Europeans will enjoy simpler, more efficient ownership here in the
Bay of Banderas Less Red Tape
Additionally,
the process to open a new business in Mexico has been reduced from 50 days to
one day, after the federal taxpayer registration and company permit are issued.
The one-day approval applies to new companies exempt from an environmental impact
study or those companies, which pose no security risk.  Bay
to the Beach
Tourism in Mexico has recovered. 19.6 million visitors visited
Mexico last year, 5% fewer than in 2000. Even more significant: revenues were
up by 8.35 billion dollars. Tourism, behind oil production, accounts for 8.3%
of the GDP. Mexico is more aggressively seeking the Japanese and Spanish traveler.
Vallarta already enjoys regular arrivals from Amsterdam, the UK, and Germany.
Direct flights have been reinstated from many US cities on the East coast. Air
Alaska has added more direct flights to Vallarta from the West coast. The states
of Jalisco and Nayarit have active, forward thinking tourism boards and hotel
associations who market for foreign travel to Mexico.
Whale Refuge
Significantly, Mexico is now the largest sanctuary for Whales.
Banderas Bay, within the Sea of Cortez, is a breeding ground for the Humpback
whale. Every November, we look forward the arrival of our fellow mammal, which
stays through March before it takes its northerly route for its food source.
Local Puerto Vallarta News: Fewer Buses
The city has negotiated an agreement with the larger bus companies (all are private,
not municipal) to reduce the number of buses entering the center of town. This
reduction of buses and bus stops will greatly reduce the visual and audio pollution,
to say nothing of the air. Low pollutant buses are to be used in the downtown
areas, and alternate routes through the tunnel to the northern part of the city
are planned. Some streets in the heart of down town will become walkways. Investors
are being encouraged to build parking lots within the city. Many citizens, from
all countries, have named the "bus problem" as one of their top complaints
about the quality of life in Vallarta. It is encouraging that the local major
is addressing this problem and city leaders. The Health
of Real Estate
In the first 4 months of 2002, the Multiple Listing Service
of Vallarta reported 36 sales, compared to 43 for the same period in 2001. Gross
listed sales price of sold properties (Jan.-April) in 2001 were over 14 million
dollars, compared to in access of 11 million dollars in the first four months
of 2002. The MLS service does not release actual selling prices, but does list
the property and its number of bedrooms, construction and land size, etc. Cooperation
is Key
Broker cooperation or co-brokering, as always been a fundamental
way of conducting business. For the period Jan.-April, 2002, co-brokering accounting
for 53% of the sales, compared to 47% for in-house sales. Niches
are Good Deals
The majority of sales these first 4 months of the year
are in the prices range of 100's and 200's. There were sales; however, in every
price range up two million dollars. Condos inched out house sales by 15%. These
sales statistics do include private sales or sales volume north including certain
projects Nuevo Vallarta and Punta Mita. Paradise Village has had a great deal
of success with its construction of town homes, condos and developed lots built
around the golf course and marina in Nuevo Vallarta. Punta Mita, Punta del Burro,
Real de Mar, are all experiencing activity and sales. It has reported to us that
17 million dollars of land has been sold inside the Punta Mita, Four Seasons Project,
since the beginning of this year. The mountains of Amapas
and Conchas Chinas have new projects started and being sold, in addition to re-sales
of individual villas. One new condominium project in Amapas has enjoyed successful
pre-sales at prices from the 200's. Adjacent to their location is planned a series
of spec homes designed and built by some of the leading architects from Mexico
City priced in the 2.5 million dollar range. Land Play
One of the most significant South shore sales this first quarter was the
sale a large multi-palapa villa on two lots overlooking the ocean. While the home
can be updated, the 1,500 meters of land at a price under 1.6 million dollars,
makes an attractive land play for its new American owner. Oceanfront land is in
short supply on the South Shore. Many buyers are used to the Conchas Chinas and
Amapas proximity to popular restaurants and shopping in Vallarta, so demand for
the south side remains strong. 3 Million Dollar Villas
on the South Shore
A very exclusive new project is being developed of
10 home sites. Completed values will average 3 million dollars per villa. Casa
la Vista is the anchor at the edge of the Bay at Mismaloya. Offered at $2,950,000US
with 5 bedrooms and an incomparable view, this contemporary design, is receiving
a great deal of interest. A Condo Niche
One
of the most successful new projects in the downtown core is a new condominium
building, which had great success with pre-solds last year and this first quarter.
Sales are over 50%, for delivery this winter. Ease of walking to town and high
interior finishes at a competitive price, have created selling momentum. There
is still some very desirable one and two bedrooms condos left. Price ranges are
in the low 200's to 295,000US. While sales in the mid-price
ranges of 100's to 200's will continue as long as inventory holds out, the astute
buyer can find some great buys, even in the million dollar plus category. A large
sale is in escrow, which went for a heavy discount from the asking price. Good
values:
At this moment, there are some million and two dollar luxury
homes that have very attractive rental incomes and provide a handsome return.
In addition, there is the personal enjoyment of using the villa and good market
appreciation. The safest investment of this type should be on the water or have
a dynamite view. Location is still the golden rule. Harriet
Murray, Broker For additional information
on properties for sale or lease within the bay, please call or e-mail me at: harriet@pvmirror.com
Thanks and until next week. Archives
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