• Paul Mascard


What is the first thing that comes to mind when you think about Mexico? It is probably not something pleasant if you fall victim to all the negative news about the country in the Canadian and U.S. press. To paraphrase another person’s analogy, “not considering a visit to Mexico because of the problems along the U.S. border is like refusing to visit New York because there are gangs in Los Angeles”. Mexico is a very large country and if you have had the opportunity to visit one of their famous destinations such as Puerto Vallarta, you know that nothing could be more misleading than judging an entire country by the news in the north.

A client of Northland Wealth permitted us to us share their experience from a recent trip to Mexico. The client met with Paul Doolan, a real estate agent in Puerto Vallarta, to chat about purchasing property in Mexico. Mr. Doolan said to our client: “When I think of the Mexico I live in and have loved for over 16 years, I think of people whose lives are centered upon the family and who go out of their way to help anyone who asks. I think of a people who love to sing openly and who say “Buenos Dias” to strangers. I think of a people who welcome foreigners with no pretense or prejudice. I also think about a country where one can still find real value in real estate investments in a land where the cost of living is a fraction of that in Canada or the USA.”

International Living magazine reports over a million North Americans live in Mexico and that number goes up much higher during the winter months, when snowbirds escape the freezing temperatures in Canada and decide sitting on the beach and enjoying a cold beer sounds so much better.

Real estate options in Puerto Vallarta vary in price from $100K CDN to several million dollars, just as they do in any highly desirable location. The Mexican real estate market suffered, as did that of the United States, in 2008 and it has taken 4 years to recover. Excess inventory has finally stabilized to before 2008 numbers and prices are once again rising, with beachfront properties appreciating as much as 10% or more per year and other homes at 5% per year. Homes and Villas are appreciating more than condos but not by much.

Property taxes in Mexico on a $300,000 CDN home are about $300 CDN per year. Car insurance is about $600 CDN per year. Medical and dental care is available at a fraction of the cost north of the border and the quality is exceptional.

There are many areas close to Puerto Vallarta where Canadians are the predominant buyers among non-nationals. Bucerias is one such pueblo that is 15 minutes from the international airport and is known for its galleries and restaurants and beautiful beach. There you can find an assortment of condominiums,homes and villas available for rent or for sale. Those who decide to enter the housing market as buyers of Mexican real-estate often decide on a condo simply because they are typically guarded and gated developments and care for the building(s) is part of the package.

Mexico is close to Canada and flights from most Canadian cities are readily available. When it is below freezing in Canada it is 80 degrees there with blue skies, tropical breezes and warm ocean water.

No matter which destination you are considering for a vacation property there are many factors that need to be addressed during your due diligence. Should you buy or rent? Renting relieves you of many of the financial obligations; however owning assures you can visit when you wish and provides the potential of rental income. How should the property be registered? The use of trusts is now being promoted as a means for Canadians to avoid the potential effects of U.S. estate taxes. You will need to have a Will drafted to address assets in the foreign jurisdiction. How does that integrate with your current estate plan? How are non-resident owners treated in relation to taxation, protection and ownership rights?

Regardless of the end decision, there are many questions that need to be addressed during the due diligence process. Northland Wealth can assist you by connecting you with professionals in various foreign jurisdictions, integrating your decision into your Wealth Plan by exploring the best options for financing and ownership structure, and most importantly being a trusted advisor to ensure you have considered all of the important variables when making these types of decisions.

As Canadians approach retirement, their search for the perfect paradise tends to come to the forefront. Here’s to you discovering your “Paradise Found”!


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