With all the uncertainty presented by the current economic situation in the USA, is it a good time right now to buy property in Rocky Point, Mexico?
I would like to discuss my opinion regarding this.
The economy in Puerto Pensaco seems to mirror what is going on in the USA. Three to five years ago, there was a mad buying frenzy in Rocky Point. This buying frenzy helped to create Rocky Point as we know it today. New resort plans came one after the other. With this came quick condo sales and the prices of a condo would rise immediately. This is very similar to what we saw state side five years ago. Homes were placed on the market and purchased immediately, and done so at a high price. However, things have changed, we pretty much know the current real estate position in the USA, how is it looking in Rocky Point?
I was recently advised last month by a real estate agent on-site at the Sonoran Sun resort that a 2bd 2ba upper floor Sun condo fully furnished was slashed in price from $375,000.00 down to $325,000.00. WOW, the initial sale lottery price of this very same unit type was $299,999.00. One year to 18 months ago, this very same condo type was being listed for 425,000.00 – 450,000.00. This is a significant difference and begs to question, is something like this a good deal to jump on?
To answer the above question, I think YOU need to evaluate if this is the bottom or not? This now becomes a guessing game, at what point is the “floor price?”
If you look at this investment as a long term investment, I believe in my opinion at this price you will come out ahead, even if the floor is indeed lower than what we are seeing prices at now. There are many factors to consider for the long term, the new International airport is coming, as well as the new highway that will allow Southern California to get to Rocky Point quicker. When completed both of these will increase the amount of people coming to Rocky Point. That will in turn, increase traffic to the resorts and your rentals will increase.
If you are a cash buyer or you can take advantage of financing at a lower cost than what the developer can finance, you are at a real advantage. Prices are definitely down and this opens up a chance to make money. Prices are now very close to where they were when the Rocky Point boom was in full flight.
In my opinion, this creates a buying opportunity. If you believe in the long term position of Rocky Point growing as an International vacation destination or even just branching out in the USA to more than predominately, Arizona and California visitors, then you will make a wise investment choice. Of course, prices could continue to decline and never bounce back, this is the risk of investing.
With any investment, there is risk involved, if you decide to invest, you do so at your own risk!
Adios,
Arturo
