In Which Region Should I Buy My Tulum Airbnb Property?

Buying A Property In Mexico 00:00

If you want to learn about the ins and outs of buying or developing a home or boutique development for Airbnb in Tulum to generate ROI, then this post is for you.

Myself and Tony had a client who was interested in building more cash flow through real estate abroad – here in Mexico.

I’m super excited because Ryan actually flew down to Tulum and purchased a two-bedroom, two-bathroom penthouse to generate ROI. And on top of that, he purchased a piece of land to build his own property.

So what he’s doing is having cash flow from the rental, and then that will supplement and help him build the property later down the road as another investment.

This post is going to help you understand how you can buy a property in Mexico, and I will discuss with you how I started my own property management company in Tulum – to maximize rental income.

How To Get The Highest ROI From Airbnb In Mexico 03:26

Ryan was excited about the development part. We first began by talking about the ROIs in the area and then about what makes more ROI.

There are a lot of different factors to consider, which we will dive into in this post.

I told you a little bit about the inside of development. Like how much money we make on the ROI, which is the money that you could save in the end. You know, by doing your own house or development versus buying.

And I want to clarify that I don’t think that there’s anything wrong with buying. You could still get a great deal in pre-construction, but there’s no higher ROI than the one the developer has from the rental direct.

If this is your first time searching for buying a property in Mexico – I suggest you check out our guide first, to fully understand the Tulum market and what Tony and I do here.

I’m not sure if you came up with any other questions that followed our last conversation. I know we said we were gonna look into the land. I have some land as well, I’ll show you, but wanna know where you stand at first.

Upfront Costs in Tulum 04:19

What I took out of that first meeting was that my biggest concern is the upfront costs. Especially since I’ve been getting crushed during the last month in the US market.

The upfront cost is a big concern for me. It’s the short of it. What I got from that conversation is that construction is cheap in Mexico.

So, most of the cost comes from the land and the design versus buying something already built. You’re gonna get the ROI based on what the price of that post-build is.

I think what might be a bigger concern for me now is what the cost of land will be, what options you have, and what the estimate looks like for the actual construction of the building.

I assume we won’t have an actual true estimate until the design phase is paid for and done. I don’t know how accurately you’re able to get those estimates.

Factors To Consider For Multi-Unit Complexes In Tulum 05:31

I think the biggest data point that I would need to know is what layout options are available.

So that’s kind of point one.

Point two was a question about the design phase. I assume these are multi-units that you’re building. We had talked about a house and multi-unit building like Aguasanta that you built and Nick invested in – The Tulum Vibe with the crazy mural.

In your experience, what it’s like in the design phase when you have multiple investors that each has a piece of the multi-unit complex?

How does that dynamic work and how are disagreements handled?

I know that back then when we first began talking, we were leaning towards a house because it does offer a boutique opportunity or Airbnb listings.

But I’m just curious, if we were to go a different route based on cost, maybe a multi-unit build might be more affordable from an entry perspective.

That’s something I’m still open to, but I think there’s a trade-off there too. You have less control over the design phase and other aspects when you share the property with others.

You have to be mindful of the other investors and take them into consideration.

We briefly talked about the rough cost of construction, the whole process, and promissory notes, but I don’t know if there are more details I should be aware of.

Cost Of A Multi-Unit vs A House 07:52

**Tony Speaking

As far as the cost of a house versus the cost of development – a house, believe it or not, will probably be less than if you were to build a multi-unit.

A house, you can control the size of the house – I’ll give you a quick example.

We can find land for a house anywhere between $65,000 on the very, very low end up to $80,000 USD.

That would be the cost of the land.

And I already did some research for another client that’s similar to you and likes the idea. They actually are moving in full force. We are working on the design of the home right now.

If you’re interested in this design and the home we are building for other clients – you can watch our YouTube meetings.

So we’re already doing a market study to see what is the best land available and we’ve already found them options. I’ll show you some. So you can see the examples of the cost and the locations of the land.

Breakdown Of The Costs Of Building A House From Scratch 08:44

We are almost done with one of our new projects, named Muki – a new build under our Aguasanta brands. You can check out the renders here.

I already picked out four options for him and we’re really set on one. They’re all within the same range of $65,000 to $80,000.

The size of the house is what we can control. For a house, I recommend three bedroom minimum. And the smallest house with three bedrooms is probably gonna go, let’s say, 230 square meters or 2,500 square feet.

So 2,500 square feet just in construction alone, we’re gonna spend $210,000 for that house. This is a conservative estimate, but 2,500 square feet it’s fitting.

On the higher end, let’s say you bought the piece of land for $80,000 and you spent $210,000 for the build. Then on the permits and all that, we’d probably spend $30,000 on the high end.

So we’re at $320,000 and that includes permits, land, construction, and closing costs. You’re going to have to look at the closing costs on the land. The land was $80,000 and at 6% closing so it’s only about $4,800 – but let’s say closing is $6,000 for conservative estimates.

So we’re at $326,000.

Then the furnishing of the house may be $30,000 on the higher end.

So you’re in about $360,000.

There are also multiple permits before you can build on the land which is about $30,000 total – because the government needs to make sure we are preserving certain trees and doing all of this legal.

Cost Of A Home In Mexico During Pre-Construction 11:05

$360,000 is a very realistic number for what you would spend on a nice house. And I say this because a friend of mine just bought a two-bedroom house in this price range.

He got a really good deal on the house actually. He bought it in pre-construction for around for $320,000. And I was like, wow, that’s pretty cheap.

Now, he’s turning around and selling it for $420,000. So he is making a really good profit.

It’s a beautiful design and a beautiful house. His house is around 2,000 square feet. It’s not super big, but it’s a nice-sized house.

And the builder still ended up making a profit. The builder might have spent maybe around $220,000 to $240,000 to build it.

So a three-bedroom house, at $350,000 to $360,000, we’re way over on budget.

I think we’re fine.

And then of course, if you wanted to go bigger with four bedrooms, a bigger backyard, and a bigger pool, then we could get into the $400,000 range.

Buying Land That Holds Multiple Homes 12:34

The builder is able to complete it for $240,000 with the extra 500 square feet on this house because he bought a piece of land that held six homes. And he built six homes on this lot.

So you walk in, there’s security and a common area for the six homes. It’s still very private, but the owner was able to get a lot of land for cheap. So a lot of the cost of the land was eliminated.

On the other hand, you’re only building one house. As we said, a lot of the cost is the land itself.

Property Value Skyrockets After Building In Mexico 13:01

We can look for a piece of land in Tulum that’s just under $80,000 and try to save as much as we can here.

But I think you should budget if you’re gonna do a house a minimum of $360,000, including the land.

That house will be worth $450,000+ the day it’s built and done, FYI. So, there’s a lot of value there right off the bat.

Now let’s talk about the process of how you pay for constructing a home in Mexico and all that.

You don’t have to buy the construction upfront because we go through stages.

So you don’t have to cover the construction cost.

What you do need to get started would be, of course, the land. So we gotta pay for the land and the design initially.

Monthly Cost To Building A Home In Mexico 13:56

So at first, that’s basically it, and the permits come before we build.

So the design of a home in Mexico with an architect is gonna cost you about $20,000. So you’re looking at a $100,000 basically. You got the land and the design.

Then we create a construction calendar.

It marks the different phases month by month. You pay us, and we deliver. We’re not asking you for a big chunk of money upfront during your first month.

It doesn’t get divided equally either though, and this is because we’re gonna want to buy a lot of concrete upfront; things that go up in cost over time.

So, we want to buy in bulk in the beginning. We buy them, put them in the bodega, and keep them.

I’ll give you an example. Let’s just say that the construction cost for this house is $210,000. Okay? So if we divide it equally between 12 months, that would be $17,500 per month.

Your first month, though, instead of being $17,500 would be somewhere around $30,000 or $40,000.

Okay?

And then the rest is month by month. Every month after that is probably gonna be around $13,000 till we’re done with the house.

Other Costs To Buildin A Home In Tulum, Mexico And Financing Plans 15:30

When we’re done with the house, the build is ready.

You have to title that.

So that’s when the closing comes in because you have to create a title out of the house.

So those expenses cost around $6,000 to $7,000 at the very end.

Furnishing the home and decorating is also an added cost to building a home in Mexico.

I would say, another $40,000 at the high end. This is subjective to the design that’s chosen.

So you’re financing $210,000 and you got $40,000 at the end. And before that, you have the land and the studies.

So that’s an estimate, more or less. We can take it as low as you want because you are the owner and it’s up to you.

So you can say, hey, I know 12 months is normally what it takes you to build a house. But I wanna stretch it for 18 or 24 months to spread out my payments.

I don’t recommend more than 24 months. This is because we’re gonna end up paying maybe another 5% to 7% more on the house as everything goes up in price.

And if we’re buying smaller quantities, it’s costing us a little extra. It’s not a lot; definitely under 10%, way under. But it could be 5% to 7% if we stretch it.

There are two closing costs; for the land and for titling the house.

So it’s not really closing, but to do that transfer, it shouldn’t be more than $6,000.

Buying a Home vs Building A Home In Mexico 17:39

The marketing material for Muki (our development is being built right now) is here.

(Ryan speaking) – So, we’ve talked about how there’s flexibility with regard to the completion time. I was wondering if there are tax advantages to completing the project during a certain part of the year?

The answer to that is no, not at all.

Building is one of the routes that you can take. I don’t want you to feel overwhelmed about the payout. But it is one business opportunity that is there.

And I don’t want to say that buying a pre-construction development is not a good idea. That’s what most people do.

That’s what most of my clients do, and that’s what I recommend a lot of times.

Some people just don’t have the energy to build. Not that you need energy, but you have to be there for the design, give us your ideas, and all that. You are involved in the process.

Some people don’t want to take on the challenge of building something from scratch.

They prefer to take the easier route and buy something that is already predesigned and built. They might feel more comfortable sticking to a more simple route, and that’s totally fine.

However, for those who are willing to take that extra step, the rewards of developing a unique property in a different country can be great.

It’s important to remember that it’s not easy for just everyone to want to build. Even people with an abundance of money to spend would prefer not to go through the process of building.

So it’s understandable.

I don’t wanna completely shut down the idea of investing as a whole anyways, whether you are building or buying.

This is because I think the time to invest is now. Whether you build a house or we get you a nice condo, it will be worth it either way.

The Design Process Of Building An Airbnb Property In Mexico 19:00

(Ryan Speaking) – So in terms of involvement with the design process of my property, I don’t really have an artistic eye. I wish I did, but unfortunately, I don’t possess that natural talent.

I understand the importance of design in creating a functional and visually pleasing space, but I wouldn’t trust myself to take care of the design of the house.

I recognize that designing a house is a complex process that requires a lot of skill, knowledge, and experience.

It’s not something that should be taken lightly, and I don’t want to risk making any mistakes. I would rather leave it to the professionals who have the expertise to turn my vision into a reality.

So my question is, do the designers come up with options and present them upfront? What level of input and ideas are expected from the investor?

(Tony speaking) – That’s a great question. So here, let me show you some of our work and give you the statistics. I would say that most of my clients don’t get involved at all during this process.

They just have us propose something to them. And the one who gets really involved is me (Tony). The design part is my favorite.

Prior to me building, I used to do market studies. So I know the people what the people want; what they like and don’t like.

I have a wealth of knowledge and experience in the industry, so I know what rents well and what properties provide the best experiences for tenants.

I have a very well-rounded perspective on what kind of designs work best in this industry.

I understand the importance of creating functional and comfortable spaces that cater to the needs of different types of tenants. I also recognize the importance of aesthetics and how a well-designed space can contribute to the overall appeal of a property.

I’ve seen firsthand how certain design elements can attract or deter potential tenants. I know what features are most desirable and which ones aren’t as relevant.

So this has allowed me to have a very keen eye when it comes to the experience that we want to give.

An experience can be a super rare pool, a floating jacuzzi, a water cascade in the pool, or a super artistic wall, like in Nick’s condo. That really pulls people.

I think that the design is important for a house or a condo to rent. Because if the design is there, then the furnishing is easy.

The design kind of already tells you where everything goes. The concept is established and then there are finishing touches to be added.

So with that being said, I definitely get super involved during this phase.

The architects put our ideas onto paper, but I’ll be the one having meetings with you and looking at where we can advance.

Do I Have To Get Involved During The Design Stage? 21:10

We’ll create different models and see what would look best.

So you and I will probably meet 3 to 4 times on a call, and then you’ll tell me if you approve of the design. Once you give us the green light, then we do the final design.

We create renders.

These are visuals that bring the design to life so you can visualize the end result. Once the renders are done and the architectural plans are done, we can move on to the permitting.

So as I mentioned, during the design stage, you don’t have to get involved at all.

Amenities And Maintenance Costs To Building 25:10

(Ryan speaking) – Depending on the design, are there more maintenance costs?

For example, the more pools you have, the more maintenance costs. Do you have opinions or data about what the balance is there?

Because you could go nuts with cascading waterfalls, pools, and all that. And I’m sure that there are different costs associated with each amenity.

Is there a balance between making it a desirable property to rent and getting the most ROI versus things getting out of hand with additional fees?

(Tony speaking) – That’s a great question.

I would say that it depends on the amenity that we’re investing in. Some amenities are not worth it. You’re gonna spend more on building it than what you’re gonna make back.

But then there are some amenities that really do pay you back.

And in my experience, a pool has always been number one. This is due to the aesthetics, the photos, the visuals, and the amount of content that we can create from a nice pool.

Even the people that stay there will take photos by the pool. That’s gonna be their vacation photo for their friends to look at.

A Nice Outside Area Is A Huge Asset 27:05

For one of the units that I rent on Airbnb, there’s a very nice-sized pool.

This one rents really well. People always comment on the fact that the pool and the outside terrace are large.

The comments that we get have a lot to do with the pool and the outside area. So I do think that that outside area is key.

I wouldn’t shy away from investing in a nice pool. It doesn’t have to have a huge waterfall or anything like that.

The unit that I mentioned, that unit has been renting for a year and a half now.

We had to replace the water pumps once because we left one of the pumps on during the night. So that burnt it out and it cost us $350 to replace the pump. The pumps will break, that’s common.

Would I recommend building multiple pools in one house? No, I wouldn’t.

Unless you’re gonna rent them as separate units and create a different type of business model, then yes.

But otherwise, it’s not necessary.

I wouldn’t tell you that we rent more because we have two pools. We don’t.

Some people don’t even see that feature in the listing and show up surprised when they see that they have two pools.

Should I Build In Aldea Zama Or Region Fifteen? 29:53

In the past, I was all about investing in Aldea Zama because it was one of the most promising real estate markets in the region.

It had all the characteristics of a great investment. I was convinced that it was the best place to put my money.

But as land prices began to rise, my opinion quickly changed.

I realized that the high prices were making it difficult for me to find properties that met my investment criteria.

I also began to see that the market was becoming increasingly competitive, with many investors competing for a limited supply of properties.

As a result, I started to look at other markets and opportunities. I realized that there are many other areas that offer great investment potential, and I began to look into other areas such as region fifteen.

If you’re gonna build, you’ll get more bang for your buck in region fifteen. And I believe that all that area will eventually be very nice.

With the level of construction and design there, you wouldn’t think it’s a traditional city in Mexico. It’s really innovative.

I’m excited to see how the standard will raise as time goes by with all the development here. If I didn’t see the potential, I wouldn’t have invested there myself and started building Muki.

Because when we design and build, we keep some of the properties. So I wouldn’t, I wouldn’t design and build somewhere where If I’m not gonna keep a unit.

What Is The Developer’s Main Role In This Process? 31:10

Tony, what percentage of your time is dedicated to building and developing versus some of your other ventures?

I spend probably 80% of my time designing and building.

The majority of my time is spent in workshops with architects, discussing and planning the design of each project.

I believe that the design phase is one of the most crucial parts of the building process, and it’s essential to get it right from the beginning.

That’s why I spend so much time working with architects, ensuring that every detail is thoughtfully considered and that the plans are functional and aesthetically pleasing.

I put the majority of my time into constructing and developing. I don’t have a lot of time for calls with clients and other tasks.

We started our YouTube channel and this blog and it’s honestly been doing amazing, but my brother’s now gonna help us. He’s now the sales manager of my company and will be taking these calls instead of me.

What I’m good at is designing and building.

I like building things that rent well and building things that are sexy and aesthetically pleasing. Because that’s the market we’re in.

I’m not building for people to retire, I’m building for people to come and spend the most amazing week here. So I’m creating an experience for the user while Nick manages our client’s properties to gain 5-star experiences and drive the ROI.

A Project With Pininfarina (Luxury Design Company) 33:09

We hired Pininfarina to design development for us. This is the architectural firm that designed the Ferrari Enzo, the Istanbul Tower of the airport, and more.

They just put our development on their homepage which is super exciting.

But they’re in charge of the whole project. My partners and I are in charge of the funding.

We have a sales team that does all the sales and marketing aspects of it. But I play more of the intelligence part.

In workshops with Pininfarina, I’m the one telling them who’s our client and who to design for.

One of my other business partners is a lawyer, and the other one functions as an accountant because he worked in finances and economics all his life.

So we’re more so watching Pininfarina and figuring out what to do next with this project. This is not a traditional project.

But with other projects that I’m showing you that are my builds, that’s on me. My architects and my construction team.

What Does Our Team Not Do? 35:05

Now, my team’s not gonna do everything. For example, we don’t do infrastructure. Services like water, electricity, or streets, we don’t do any of that.

So my team’s not really gonna build anything until the amenities part. Like the gym, the entrance, and some of the other amenities like the spa.

Our team will get involved, but we’re still a year away from that. For now, it’s just infrastructure.

Hw To Find A Trustworthy Developer In Mexico 36:18

(Ryan speaking) – I know we spoke about finding potential plots of land versus potential post-build properties. Do you have projects that you’ve already built that are available?

(Tony speaking) – With the number of clients that we’ve been taking on and the variety of needs, I decided to create a real estate agency. At times, we don’t have our own inventory because we sold them all.

But through our YouTube channel and blog, we get people who read and watch this who want to work with us because of our transparency and knowledge.

Our channels guide the client in their purchase, assuming they don’t wanna invest with us.

With building, sometimes clients feel that the projects are too long or it might not fit their budget. So we can guide you to other investments.

However, we’re different than most agencies because I know all the developers.

I am very selective when it comes to choosing the developers that I work with. Trusting them is the most important thing to focus on.

I know that there are only a few good ones in the entire state, so I carefully choose the ones that I know will provide the best quality work and are trustworthy.

As a result, I only work with about 12 developers throughout the entire state. In Tulum, where I focus a lot of my real estate investments, I am even more selective and only work with about eight developers.

I have thoroughly vetted each of these developers and have established a strong working relationship with them.

I trust them to deliver high-quality properties that will meet my investment criteria and provide a good return on investment.

By working with a small group of trusted developers, I am able to streamline the building process, reduce risk, and ensure that my properties are built to the highest standards.

In Tulum, there are a lot of pre-construction projections where you look at a digital brochure, and the renders look amazing.

But the issue I’ve seen is that most people are buying based on that, not even knowing the developers or if they’re from here.

That developer may not know the market or who he’s designing for.

He might need the money from the pre-sales to build, so there are a lot of risks there. I’ve seen agencies guide their clients to the wrong developers, and I’ve seen what happens.

We’ve never wanted to be a part of that.

So I told myself and my team that we were only gonna work with trustworthy developers.

How To Get A Discount 38:34

We play the role of a real estate broker during the process of buying a property in Tulum.

We understand that buying a property, particularly in a foreign country, can be a daunting task, and we are here to make the process as smooth and stress-free as possible for our clients.

Our main focus is to help clients find the right property that meets their needs and fits within their budget. You can see this time and time again in our YouTube client calls.

We have an extensive network of contacts and resources that allows us to access properties that are not listed on the open market.

We also have a deep understanding of the local market and can provide valuable insights and advice to our clients.

However, we don’t just stop at helping clients find the right property, we also get involved in the closing process in order to negotiate a bigger discount for our clients.

I have a good understanding of the real estate market and the developers and can use this knowledge to secure a better deal for our clients.

I know what questions to ask like about building costs and all the other little details. This can result in a 2-3% discount on the unit when making an offer.

How To Find A Good Property Lawyer In Mexico 40:33

I have a lawyer that I recommend to my clients – named Carla.

She’s a lawyer who specializes in real estate law and has been working in Mexico for many years.

She’s able to create trusts – also known as a fideicomiso in Spanish, for clients investing in Mexico by doing a thorough title search.

She ensures that there are no liens or multiple owners on the property.

Also, Carla will create promissory contracts for the client, which are legally binding agreements that outline the terms and conditions of the purchase.

The cost of hiring Carla to represent the client in the purchase will be roughly $1,500.

Nick just recently worked with a lawyer, and the trust was a one-time fee of $1,900 to set up, and $500 per year for maintenance.

Some clients trust me to read and understand agreements, but I’ve done many. But I don’t do the trust; it has to be done by the lawyer.

It’s crucial to have a trustworthy lawyer review and approve any agreements, as the legal system and language can be complex and difficult to navigate for those unfamiliar with it.

Handling Accounting and Legalities As A Foreigner For Airbnb Properties In Mexico 42:46

You may be wondering about the logistics of paying taxes and fees in Tulum as a US citizen or foreigner.

The process involves wire transferring money in either pesos or US dollars and the exchange rate will be taken into account.

The way that Nick is going about it is by using Tony’s accountant and having Carla as his lawyer.

Carla is not only a lawyer, but she’s also an experienced accountant and she knows how to handle the taxes and fees that come with buying a property in Tulum.

She has a deep understanding of local laws and regulations and can advise clients on the best way to structure their purchases in order to minimize their tax liability.

She also has the knowledge and expertise to handle the scheduling and communication with the notary, making the process much more manageable for clients.

Working with Carla, clients can rest assured that they are in good hands as she guides them through the process step-by-step.

From the initial stages of buying a property to the final closing, Carla is there to assist clients every step of the way, handling all the legal and financial aspects of the purchase.

She is the point of contact for clients, handling the scheduling and communication with the notary, which means clients don’t have to worry about coordinating these activities themselves.

Clients can focus on the more important aspect of buying a property, such as finding the right property that meets their needs, while Carla takes care of all the legal and financial details.

By working with Carla, clients are essentially being guided through the entire process, from signing documents to sending payments, and everything in between.

Is Building A Home The Best Option In Mexico? 46:18

So should we be focusing on developing or focus on other options as well?

Building still seems to be the prime option for me.

It seems to have a lower cost of entry and can offer a higher return.

And because there’s a gap between the purchasing, design phase, and construction phases, there’s some security in case something drastic happens.

I’m thinking that securing land and potentially waiting to start construction, could possibly mitigate unexpected events such as the COVID-19 pandemic.

This can also be a good way to lower the cost of entry and increase the potential return on investment, as we talked about.

I think that’s a great Idea.

And I operate in a similar way during certain situations. For example, sometimes I buy land ahead of time, just because I see a good deal or because it’s a growing area.

Then, I wait to either sell it or build on it at a later time. This option is always available to you as well, and the decision is ultimately up to you.

Regions near the main federal highway, the streets that lead to the beach, and regions such as Aldea Zama and Region Fifteen are popular locations.

Region Eight Or Region Fifteen 49:11

We previously discussed region eight, but it never came up in this particular conversation.

Region eight has a different density and different zoning.

We previously talked about how you can build four stories in Tulum, but this does not apply to region eight. In region eight, you’re only allowed to build a two-story home and no higher than that.

The reason why is that you cannot have a lot of weight on the house. There are a lot of mangroves in this area which influences the density.

There’s a property right in the heart of region fifteen near Kukuklkan.

The beach is about 15 to 20 minutes away walking and in car, this would be 10 minutes maximum. So this property is super close to the ocean.

The red arrow is pointing at the area of the property mentioned above.

The land measures a total of 355 square meters, which would be 3,800 square feet.

So it’s a big lot; a very nice sized lot for a house. The purchase price is only $65,000. In my opinion, this is the most value you’ll get for your money.

Does The Location Of Buying Land In Mexico Affect Its Value? 51:52

When it comes to purchasing a lot, there are many factors to consider, and one of them is the positioning of the lot and location.

It’s important to understand that the positioning of a lot can greatly influence its value and potential for development.

For instance, having a lot that’s on the corner versus having a lot in the middle of the street can make a big difference in terms of visibility and accessibility.

Lots on the corner of a street have a distinct advantage in terms of visibility and accessibility.

They are more easily seen by people passing by and are often considered more desirable for commercial development. Additionally, lots on the corner often have more frontage and provide more opportunities for parking and other amenities.

On the other hand, lots in the middle of the street may be less visible and may have less frontage, which can limit their development potential.

There is definitely value in the positioning of lots. The corner lots are traditionally the most valuable because they have two facades.

This allows for a more unique and interesting design. It can be super wild and crazy.

However, some people may prefer not to have a corner lot due to the noise from passing cars. So it really depends on personal preference.

The corner lot is traditionally worth more. They can be worth 10% more than other types of lots.

There’s a lot of value in lots located on small streets with low traffic.

A lot in this location may be more desirable because it’s likely to have less noise from passing cars and may even have an amenity or park nearby. Having a neighbor but no street behind can also be a good thing.

So to reiterate, there are valuable aspects to various lot locations.

Corner lots are traditionally more valuable due to their unique design potential, but lots on small, low-traffic streets can also be desirable for their quietness and potential amenities.

Can I Build On The Entire Piece of Land In Mexico? 52:51

Another important factor to consider is the positioning of the lot in relation to your neighbors. You cannot build on the entire lot, because then your neighbor would be wall-to-wall with you.

For instance, if I buy a 190 square meter lot, I would only build on 60% of the lot.

I wouldn’t build on the entire thing.

The remaining 40% would be designated as a green area or a “jungle.”

This creates a buffer between properties and ensures a certain amount of protected green space for you and your neighbors.

I personally chose not to build a wall on my property. I instead opted for a chain fence and planted trees and other plants to create a natural barrier, while also enhancing the view.

One of the main reasons I took this approach is because I wanted to take advantage of the natural buffer created by the green space regulations in the area.

These regulations require developers to preserve a certain amount of green space around the property, which can help to create a natural barrier between the property and the surrounding area.

By planting trees and other plants, I was able to create a natural barrier that blends in with the natural environment.

Is Tulum Fully Developed? 55:43

The development in Tulum has been taking place starting from the center of the city and moving outward.

The most developed areas are closer to the center, and the less developed areas are closer to the ocean.

Region nine, also known as La Veleta, is one of the most developed areas in Tulum and has already established commercial areas and paved streets.

La Veleta, Tulum

On the other hand, other areas such as Region 15, were not even on the map of the municipality just five years ago.

The municipality only began to focus on developing this area and putting in infrastructure due to the recent boom in development.

As developers started to build in these areas, the municipality began to move its development efforts further out.

Today, paved streets extend out to a certain point, but beyond that, the roads are not yet paved.

However, the area still has access to services such as water and electricity. In about the next five years, this area will be fully developed with paved streets, commercial areas, parks, and stores.

For region eight, I’m guessing we’re still around 7-10 years away from seeing homes being developed there.

Wifi And Internet 58:47

Can you tell me if there are permits or plans for internet fiber being dropped in the area?

We have recently contracted fiber optic services in Aguasanta Vibe and Tulum, a significant development that will greatly benefit the residents of this area.

Fiber optic internet is considered to be the fastest and most reliable form of internet connectivity, and it will greatly enhance the overall quality of life for residents in this area.

With fiber optic internet, residents will have access to faster download and upload speeds, which will allow them to work, study, and play online with ease.

They will also be able to stream high-definition video and audio and enjoy online gaming without interruption.

We are currently working on plans to bring fiber optic internet to Region 15 as well.

This is a major undertaking, but we believe that it’s essential to the development of the region and it will be very beneficial. Access to fast and reliable internet is no longer a luxury, but a necessity in today’s world.

So we are committed to making sure that guests in these areas have access to the best internet connectivity possible. Some buildings are bringing Starlink as an amenity.

The rollout of fiber internet in region 15 will not take long to install because the infrastructure is already in place.

There are already many developments in this region, such as Airbnbs, that have been mapped. The region is expanding and better internet infrastructure will support this growth.

Aldea Zama vs Region Fifteen 01:00:50

We manage around 20-25 properties in Aldea Zama and in Region Fifteen; most of our properties are in these areas. We actually have 15 properties here in Region Fifteen.

The performance between the two areas is not as different as you might expect.

We have some clients of ours who have “killer” homes or condos in Aldea Zama that are done super well. Like they’re designed and decorated very nicely.

We also have some properties that are boring properties in Aldea Zama that were built conservatively, and they’re nothing special.

In a situation like that, the client doesn’t know about the Airbnb market and furnishes themselves. In a scenario like that, the Region Fifteen condo will outperform Aldea Zama every time.

If two properties located in Aldea Zama or Region Fifteen are equally nice, the Aldea Zama property might get more rentals. Possibly by 10-15%, but it’s not a major thing.

If you’re doing a house, you’re not gonna have an issue because you’re designing the house. You’re gonna build a house that’s gonna look extremely appealing and aesthetically pleasing.

I’m a believer that if you build it right, they shall come. And that’s what we’re doing.

When it comes to houses, the location is not an issue as long as the house is built and designed in a way that is visually appealing and attractive. If you build it right, people will come.

The development that I’m working on is an eight-unit, one-bedroom complex in a currently undeveloped area of Region Fifteen called Muki. Once I build, brand, and showcase the development, people will want to stay there regardless of its location.

In due time, the land will become more valuable as the infrastructure improves, especially when the property is closer to the ocean.

Optimizing And Focusing On 5 Star Reviews In The Airbnb Platform 1:04:30

Reviews on your property are a valuable tool for both future renters and for you, as the property owner.

They provide a glimpse into the experiences of past guests to give you insight into how the property is doing. We optimize all of our listings to the fullest to generate more ROI for investors.

One is having floor plans drawn out.

The other is having hand-personalized QR codes placed throughout the home to link to our concierge pages. And our online menu pages.

Having good reviews is a huge asset and will contribute to the appeal to more guests wanting to rent, ultimately resulting in more ROI.

Also, the number of reviews on your property can give you an idea of what to expect in terms of profit.

Consider Tony’s unit that has 4.97 stars out of 5.

He generated over a million pesos (about $50,000) from renting his unit last year, despite only having 47 reviews.

This means that depending on the number of reviews the property has and the price, you can estimate how much money a unit is making.

For example, if a unit has 27 reviews like the one below, it could amount to maybe 500,000 pesos ($25,000). Not everyone leaves a review, but this is a rough estimate.

And when they don’t – we hunt them down to make sure they are leaving a review.

Requesting A Review 👆

Also, it’s not just the number of reviews that matters. As I mentioned, it’s also important to pay attention to the details of the reviews.

If a unit has a five-star review for its location, it means that every single person who reviewed it thought that it was a perfect location.

Location is an important factor when it comes to vacation rentals, as it can greatly impact the overall experience.

It’s also important for the property owner to give renters the right expectations about the property. For example, if a villa is advertised as being serene and private, this should be accurate.

If the description claims that it’s within walking distance of the best beach, this should be true.

The guests will know what to expect and will be less likely to be disappointed. Clear and accurate descriptions of the property can help to ensure that renters have a positive experience.

One Of The Best Locations In Mexico To Invest 1:07:51

When it comes to finding the perfect piece of land for your property, location and lot positioning are key factors to consider. One great option that may be worth the investment is a lot in block 136.

The owner of the entire block created a subdivision in this area. Not only is the location pretty good, but the lot is cheaper to get materials in there and the construction team is already present.

I personally bought a lot in this area and there’s a lot behind mine that is available.

I’m gonna recommend this one to you because I start building three to four months from now.

So I’m gonna have a full-on construction site in the area. It’ll be cheaper to get materials this way. My team will already be there and could work on both of the projects.

The location is really good.

It’s located on Avenue Chechen, which is a major avenue, and it’s super easy to get there. The location is perfect because it’s close enough to everything, but it’s away from the hustle and bustle.

Also, it’s just five short minutes away from the beach.

The developers who bought land here are building high-quality designs and you’ll be quite impressed with what’s being created here. It’s as good as, if not better, than some of the projects in Aldea Zama.

As I said, the lot behind is for sale and that would be key if you’re looking for something that stands out. It would also save you money because of the factors discussed above.

You may have concerns about being further down south, but it’s right by the street Fifth Avenue and it’s only five more minutes further to get to the beach than other options that are more north.

Another reason why we bought property here is that it’s a little bit further from Kukulkan Avenue. This area is really busy, and for the client that I have in mind, it just isn’t ideal.

So the reason why we bought in the area closer to Chechen Avenue is that you’re close enough to everything, right?

You’re five minutes from basically everything. But you’re not too close to the streets that can get too busy.

To reiterate, the lot in block 136 is an optimal choice because it’s surrounded by high-quality designs and investments, it’s not too close to the hustle and bustle, and it’s five minutes away from the beach.

It’s great for lot positioning, and you’d save money on materials and labor by building on that construction site.

Should I Invest In A Busy Area In Tulum? 1:11:02

Kukulkan Avenue is a busy area; there are a lot of developments and hotels. So personally, I wouldn’t want to live there because it’s just too busy. However, I would live in a property around Chechen Avenue.

And most developers feel the same way because they want to be away from the hustle and bustle. This area is perfect for developers looking to create something better and of higher quality design.

The projects in this area are as good, if not better, than those in Aldea Zama.

A lot of people in the Northern part of Region Fifteen bought many units there and created studios. So personally, I don’t wanna be directly there. So we bought a unit to the left of that area.

I wouldn’t want to be investing in the busier area unless I was going to open a plaza or open up a popular hotel there.

But if I was going to build a hotel, I’d want it to be something that I’m proud of. Like a luxury boutique hotel, not just any other commercial hotel that rents out for 80 bucks a night.

I want to balance out the location as a rental where people feel close to commercial areas, but I also consider the value and square footage. I’ll send you four options to look at, including one behind my own land, which is meant for multiple condos.

The biggest lot of all of the options I’m sending to you is the one behind my own land. This one would have more opportunities for landscaping and having a pool.

I’ve heard this question from clients many times: where should I buy it? My answer is if you’re not in a rush, buy anywhere in the southern part of Region 15

On the other hand, if someone wants to see traffic and renters in their unit right away, they should consider buying closer to the more developed areas.

If someone is looking for something more midterm and doesn’t want to rush but also doesn’t want to wait seven years for it to be built, then the area where I bought it, right in the middle, is a good option.

I’ll be sharing four options – two in the more developed areas, one in the middle, and one further away. Block 136 is the one that is behind me, which we discussed earlier.

I’m trying to balance the need for a rental property that is close to commercial areas and also has good value. For example, I like the idea of being near cafes or other amenities, but I also don’t want to miss out on a good deal if it’s further south.

I’m considering all these factors, including pricing and square footage, as I make my decision.

Additionally, I appreciate the potential for landscaping and amenities like a pool when it comes to a bigger lot, even if we don’t end up using all of the space.

We can meet again to discuss this further and make a final decision about all of this.

Thanks For Tuning In! 1:15:46

And there you have it! Ryan, our client, spent the entire day with us. He flew down and ended up buying a penthouse and a piece of land. You can see the unit that I am operating for him here on Airbnb.

If you’re interested in doing the exact same thing, reach out to me here. We can set up a meeting via Zoom to figure out the best places to buy in Mexico.