Real estate trends in Queretaro, Bajío, Mexico
This time, we interviewed Cesar Torres Garcia, Real Estate Sales Manager in Queretaro, Bajío, Mexico, who will tell us about his experience and several important aspects related to the real estate market in Mexico.
HalloCasa: “Good afternoon, Mr. Torres. First of all, thanks a lot for your time to participate in this interview. Could you please introduce yourself to our audience and briefly describe your real estate business in El Bajio, Mexico?”
Cesar Torres Garcia: “Good afternoon and thanks to you for this great initiative of Latin American real estate information, where all opinions and experiences undoubtedly enrich the sector.
As you mention, we have been a little more than 18 years in the business of marketing housing in Mexico with a participation in all market segments, analyzing, planning and executing adequate commercial strategies for each product, setting up successful processes and commercial teams in constant implementation of market-oriented actions.”
HalloCasa: “Regarding the acquisition of housing, what is the trend when buying housing? Preferably new (previously built), on plans, purchasing lots or built by the same owner?”
Cesar Torres Garcia: “The acquisition trend in the central part of the Mexican Republic is undoubtedly growing in all sectors.
The economic growth, the foreign investment, the development of the industry and the creation of assembly plants like automotive, aeronautics, robotics and technology among many others, increase the demand for housing in all segments.
The market has evolved and today the consumer has a different rhythm of life, where he prefers much more the purchase of housing already built than self-construction.”
HalloCasa: “Regarding the way in which the process of buying housing takes place, what is the most recurrent way? Is it by financing (banks or other institutions), national housing funds, private loans or with a buyer´s own money?”
Cesar Torres Garcia: “In Mexico, there is a clear trend to acquire housing with credits from national funds such as INFONAVIT and FOVISSSTE for various segments with the expansion of credit capacity for workers affiliated to the national security. The banks with mortgages and “sofoles” are still participating in the higher segments. For medium-residential and residential-plus markets, in all sectors, the investment by individuals with their own resources is beginning to increase since they are obtaining high returns by investing in pre-sale housing and are going hand in hand with the developers obtaining the surplus value. We call this “the investment in bricks”. Today, it is much easier to place 30% of the inventory in a project with private investors and the rest through mortgage loans. “
HalloCasa: “Mr. Torres, during these immense 18 years of experience in the real estate sector, what have you learned and, especially, how do you perceive the evolution of the real estate market in Mexico?”
Cesar Torres Garcia: “It is undoubtedly a constantly evolving market where consumers have diversified, evolving from end consumers to patrimonial and speculative investment, where the investors are placing between 30% and 45% of their portfolio in real estate, motivated among other things, by the increasing demand for housing and attractive returns.
There is still a very important deficit in all segments. The market offers both the liquidity as well as the certainty of growth and potential surplus value of many more cities, such as Queretaro, Leon, Puebla, San Luis Potosi, Veracruz, among others.”
The proximity to the capital is a determining factor for the growth of real estate investment
HalloCasa: “Are the localities and municipalities near the capital an economic choice when it comes to investing in housing projects?”
Cesar Torres Garcia: “Yes, at the moment those arays are excellent options. The proximity, the access roads, the development of industries and growth projections are giving a high potential of growth to the outskirts of the suburbs of the city.”
Cesar Torres Garcia: “The development of roads, of communication and the geographical location in the center of the Republic makes El Bajio a zone of natural growth where the peripheral areas of the CDMX are entering in an economic boom of growth and real estate investment, to mention some such as: Leon, Queretaro, San Juan del Rio, Puebla, Pachuca, San Luis Potosi, Toluca, Lerma.”
HalloCasa: “Queretaro is a locality of the zone of El Bajio which is a little less than 150 kilometers from the capital. According to your experience, which are the municipalities most in demand when it comes to real estate investments? That is to say, are the municipalities and localities close to Mexico City the most desired ones by foreign investors or of local preference? What are the reasons for these choices?”
Cesar Torres Garcia: “The development of roads, of communication and the geographical location in the center of the Republic makes El Bajio a zone of natural growth where the peripheral areas of the CDMX are entering in an economic boom of growth and real estate investment, to mention some such as: Leon, Queretaro, San Juan del Rio, Puebla, Pachuca, San Luis Potosi, Toluca, Lerma.
Investors are looking for the best performance and lowest risk; developing areas outside the capital are much more appealing since they have a price per square meter much lower than in the city and with a clear upward trend. We have experience of annual increases of up to 25%.”
HalloCasa: “How has the Mexican real estate market developed within the last 10 years?”
Cesar Torres Garcia: “It has been an accelerated cyclical growth with a positive trend and there is still a large gap between supply and demand with ups and downs. This can be seen everywhere: from consumer habits, financing schemes, development zones, to investments by experts and first-time developers who try to participate in a very competitive market. There, the experience, adaptability and proper planning make the difference.”
HalloCasa: “When you talk about real estate, what is the preference when it comes to investing: condos, industrial parks, commercial corridors? Which areas of the country are specially chosen?”
Cesar Torres Garcia: “Everything has its market and its demand where these three products intertwine, in my experience, it is the development of a master plan or integral plans in high potential areas where we invite investors to generate industrial parks and commercial corridors to generate employment and demand for housing.
Generating the demand itself by developing a functional environment where employment, housing and services are guaranteed is what we do today. Each area has its advantages, certainly for investment in housing, industry and offices in the Bajio zone. Furthermore, the growth for weekend houses on the beach and “magic towns (typical villages) has its market.”
Projections of the Mexican Real Estate Market for the year 2018
HalloCasa: “What is the expectation for the Mexican real estate market for the remainder of this year 2017?”
Cesar Torres Garcia: “An increase in the demand of all the segments, mainly in the states where investment is generating jobs (automotive manufacturers) in Mexico. The first trimester will close with an increase in sales over previous years, which shows the dynamism of the market.”
HalloCasa: “What do you augur to the national real estate sector for 2018?”
Cesar Torres Garcia:“A clear positive trend with developments of more real estate poles, innovation in vertical projects of mixed uses, fixed interest rates and innovation of financial products. Furthermore I regard that proven projects, suitability to the market and business model will make the difference.”
HalloCasa: “Since most of the square meters are offered in US Dollars, on what regions has there been more deceleration due to the depreciation of the Peso against the Dollar?”
Cesar Torres Garcia: “This phenomenon is affecting the rental sector of offices and commercial spaces, and the residential-plus segment. In those areas, US Dollar prices are moving the investor’s appetite to areas of lower risk and higher growth. In fact, we are talking about housing which are much lower priced in Pesos than the prices of the CDMX Premium Zone (Santa Fe, Polanco, Reforma).”
HalloCasa: “What advice would you give to those foreign investors who think of Mexico as an ideal country to live after their retirement?”
Cesar Torres Garcia: “An important point to tell them is that we receive them with open arms, with lots of possibilities to invest in, both recreational properties such as beach properties and “Magical Towns” but also young fast-developing cities which offer an unequaled blend of Mexican tradition with modernity and development.”
Professional advice before investing: An inescapable first step
HalloCasa: “How important is professional advice when investing in any housing project?”
Cesar Torres Garcia: “It is just what we do. Through the experience we have gained, undoubtedly, the success of a project starts from a detailed analysis of the market variables, the existing information, industrial growth prospects, population, the services, among many others. We take those elements into account to seek a greater certainty of the success of our developments for our customers.”
HalloCasa: “Please give our readers of HalloCasa at least 10 tips that should be taken into account before choosing a housing project.”
Cesar Torres Garcia:
- “Differentiate between an investment for return purposes investment and for end-use purposes.
- Background of the constructor.
- Growth Prospects.
- Price per m2.
- Delivery time.
- Types of financing.
- Existing bid.
- Functionality of amenities.
- Access to commercial and business areas .”
HalloCasa: “Without emphasizing the investor profile, are there any specific precautions that investors should be aware of before buying?”
Cesar Torres Garcia:
- “Existing offer.
- Evolution of the segment prices.
- Market trend.
- Rate of return proposed by the developer.
- Projected demand.
- Market response.”
Big or small, the best investment will always be real estate
HalloCasa: “Mr. Torres, given your experience in the management of commercial teams, in which the operation from the prospection to the titling and delivery of the real estate product is fundamental: what qualities and changes do you consider are necessary in these processes to be competitive in this digital era? Has IT affected the commercial real estate business?”
Cesar Torres Garcia: “As I mentioned before, the market has evolved and today the commercial strategies are based much on the commercial success, in the information and communication technologies. Today, we have much more information of the consumers, which allow us to create a project with much more design for a much more segmented consumer group, where the commercial and marketing team go hand in hand with the use of technology and digital information.”
HalloCasa: “Mr. Torres, we know your time is limited. We would like to thank you for this informative and in-depth interview. Would it be possible for interested readers to contact you if they have any follow-up questions? Thank you very much for the interview.”
Cesar Torres Garcia: “Yes of course. Investors can contact me through HalloCasa or contact me directly on mobile phone number _55 60275075_ also via email firstname.lastname@example.org @ZOECesarTorres @torresgace _. Thank you.”
HalloCasa: “Thank you so much for being with us. Always welcome to HalloCasa.”
Cesar Torres Garcia: “Thank you very much.”
HalloCasa, the marketplace for international real estate properties, is being founded by a German in Bogotá. HalloCasa´s mission is to build trust for vendors and investors with respect to cross-border real estate transactions.