Mexico: House Prices, Rents, and Rental Yields
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Yields are high for luxury housing in Mexico
| Last Updated: Nov 29, 2005 | |||||
| MEXICO CITY & GUADALAJARA CITY - Apartments |
COST (US$) | YIELD (p.a.) | PRICE/SQ.M. (US$) | ||
| TO BUY | MONTHLY RENT | TO BUY | MONTHLY RENT | ||
| 100 sq. m. | 90,000 | 700 | 9.33% | 900 | 7.00 |
| 150 sq. m. | 140,000 | 900 | 7.71% | 933 | 6.00 |
| MEXICO CITY & GUADALAJARA CITY - Houses |
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| 200 sq. m. | 160,000 | 1,200 | 9.00% | 800 | 6.00 |
| 250 sq. m. | 170,000 | 1,500 | 10.59% | 680 | 6.00 |
| 300 sq. m. | 200,000 | 2,200 | 13.20% | 667 | 7.30 |
| 350 sq. m. | 230,000 | 3,000 | 15.65% | 657 | 8.60 |
| 400 sq. m. | 492,500 | 3,500 | 8.53% | 1,231 | 8.80 |
| 500 sq. m. | 500,000 | 4,000 | 9.60% | 1,000 | 8.00 |
| PACIFIC SIDE, BAJA CALIFORNIA - Houses |
|||||
| 60 sq. m. | 35,310 | 235 | 7.99% | 589 | 3.90 |
| 100 sq. m. | 64,735 | 330 | 6.12% | 647 | 3.30 |
| 150 sq. m. | 115,000 | 600 | 6.26% | 767 | 4.00 |
| 230 sq. m. | 175,000 | 706 | 4.84% | 761 | 3.10 |
| CARRIBEAN SIDE, YUCUTAN PENINSULA - Villas |
|||||
| 100 sq. m. | 200,000 | 1,300 | 7.80% | 2,000 | 13.00 |
| 150 sq. m. | 215,000 | 2,000 | 11.16% | 1,433 | 13.30 |
| 200 sq. m. | 350,000 | 10,000 | 34.29% | 1,750 | 50.00 |
| 300 sq. m. | 450,000 | 15,000 | 40.00% | 1,500 | 50.00 |
| 350 sq. m. | 500,000 | 20,000 | 48.00% | 1,429 | 57.10 |
| Source: Global Property Guide | |||||
The small supply of good quality rental units as compared to the huge demand from expatriates, retirees, and tourists have driven up the yields for Residential and Residential Plus segment houses. Rental yields for apartments and houses in Mexico City and Guadalajara City start at 7.7%. This can go as high as 15% for 350 sq. m. Residential Plus properties.
Rents dropped by 13% from 1994 to 2001. It rose by 4.6% from 2001 to 2003 before falling again. Rents are still about 11% lower than its 1994 level. On the other hand, real house prices dropped by 20% and 17% for economic and middle segment houses from 1994 to 1996. It remained stable until 2000 before it rose slowly rose. Middle segment houses are still 7% cheaper now than in 1994.
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