So you want to start investing in real estate in 2024? Excellent idea! The reality is that getting started with any type of investment requires familiarizing yourself with the basics before it is too late. In the specific case of real estate, it is imperative to know what your short, medium and long term objectives are, as well as the sector you want to enter: residential or commercial, and, of course, to have defined the amount of money you want to put to work. While investing in real estate has historically been one of the safest ways to get returns, before you begin you should know the pros and cons in this universe. Find out below how much money you need to start investing in real estate in 2024 and how to improve your chances for higher returns.
Why should you invest in real estate in Mexico?
From ultra-luxury real estate developments with the best amenities and in privileged locations within the CDMX, to revolutionary projects in paradisiacal destinations on the coasts of the country, Mexico is presented as an attractive and sustainable option for several reasons.
The Mexican real estate market offers stability and steady growth, resisting economic fluctuations thanks to the momentum of economic growth, the migration of foreigners with high purchasing power and the constant urbanization in cities throughout the country. This environment provides investors with a solid foundation for their projects. In addition, real estate investment stands out for its tangibility, as these are concrete physical assets that can be seen and touched, providing a sense of security and peace of mind that other types of investments, such as stocks or cryptocurrencies, may not offer.
While there are risks, such as loss of property value (a highly unlikely scenario) or lack of tenants, careful research, portfolio diversification and professional guidance can help mitigate these risks, making real estate investment in Mexico a profitable and safe option for those looking to expand their wealth responsibly. Data from the Informe de Coyuntura Inmobiliaria (INCON), indicate that in Mexico City, the most sold units correspond to the plus and luxury residential sector, with houses over 300m2 and with a value of more than 700 thousand dollars.
Regulation in Mexico allows property owners the ability to generate passive income by renting out their properties, providing investors with a steady stream of monthly income. In addition, the potential to build equity as property prices rise provides a long-term perspective for investors, offering a valuable asset that can be passed on to future generations.
Advantages of investing in real estate in CDMX in 2024
Investing in real estate offers numerous advantages that go beyond financial returns. Among the main ones are:
- Security and Flexibility: The properties provide financial stability and can serve as collateral in emergency economic situations.
- High Return on Investment: The return on real estate is calculated considering the capital gain, the conditions of purchase and sale, and the money generated when the property is sold.
- Portfolio Diversification: Many experts consider real estate investment as a valuable complement to diversify an investment portfolio.
How much money do you need to start investing in real estate?
Contrary to the myth that a significant sum is required, real estate investment has evolved for all budgets. Currently you can find from digital platforms that facilitate this type of investment and that allow you to start investing from $1,000 MXN, to opportunities in millions of dollars where you can get directly involved with the most internationally known real estate developers. Therefore, one of the keys to success in real estate investing is to understand your financial objectives and explore options that align with your investment capacity.
- Small budgets (between $1,000 MXN and $100,000 MXN): Crowdfunding platforms allow acquiring fractions of properties with initially low investments.
- Medium budgets (Between $100,000 MXN and $1 million MXN): Possibility of acquiring more substantial participations or diversifying the portfolio with projects outside the main cities of the country.
- Large budgets (Between $1 million MXN and $10 million MXN): Ample opportunities, from acquiring entire properties to participating in ambitious real estate projects. Among the most coveted destinations to invest with this type of amounts in the CDMX are areas such as Condesa, Narvarte, Roma and Del Valle.
- Larger budgets (over $10 million MXN): Access to a virtually unlimited universe of options, from high-end properties to significant real estate development projects in neighborhoods such as Polanco, Bosques de las Lomas, Lomas de Chapultepec, and practically the entire western part of the city, a spot known for being one of the most affluent neighborhoods in the country.
What are the best destinations to invest in real estate?
To answer this question you need to think about your current situation and what your main financial goals might be in the future. For example, if you want to invest a relatively small amount, you may want to look at less popular areas with big plans for urban development. On the other hand, if you want to invest a larger amount and are looking for a return on that investment in less time, the major cities in the world represent a highly aspirational living destination for many people in the world, so you can get better returns in a short time.
During the writing of this report we have concentrated on the case study of Mexico City, however, there are other destinations besides the Mexican capital. Municipalities in the State of Mexico and others such as Monterrey, Guadalajara, Tulum and in general the Riviera Maya, are experiencing a great economic development that is very attractive to foreign investors. With the high in the trend of the nearshoring and the arrival of mega factories such as Tesla and Samsung, the real estate market in Mexico is about to experience one of its best periods in history.
Spain, on the other hand, is experiencing a high demand for luxury properties by foreigners looking for a dream quality of life in this European country. Cities such as Madrid and Barcelona, as well as areas such as the Costa del Sol represent a high potential investment opportunity for Latin Americans who want to experience a truly luxurious lifestyle.
Where can I buy property safely in Mexico?
A great recommendation to start buying properties in Mexico and anywhere in the world, is to work with companies with a great track record, testimonials from satisfied customers and transparent processes. If you want to start investing in the luxury residential market, Nolab has a team of specialists and real estate advisors ready to solve all your doubts and take you through an easy and uncomplicated process, even for foreigners. On the other hand, Nolab has direct contact with the main real estate developers and the most awarded architects in the country, so you will be able to invest with total security.
Investing in real estate is accessible to a variety of budgets, and Mexico offers a dynamic market with attractive opportunities. From beginners to experienced investors, understanding the financial advantages and considerations is key to making informed decisions on this exciting investment journey.
