12 Tips for Investing in Playa Del Carmen
Investing in Playa Del Carmen is hot otherwise there would not be so much development going on. That however does not mean that all investments are going to be great for you. A lot of readers have asked questions about investing and buying real estate in the area and we want to continue to offer helpful advice. We want people to make good decisions and avoid some of the pitfalls that others make. With the market tightening and becoming more competitive, it is important to invest in a smart way.
We don’t sell real estate so we are free to give you our honest opinions and recommendations. We hope you find this information helpful. If you have any questions of comments you can post them below or send us an email. We are always trying to help our readers and those that might be moving to the area to be our neighbors and future friends.
First our video about real estate in Playa Del Carmen
We put together this video for our readers to show you areas, what condos are like and get information from experts. We hope this information is helpful for you.
1. Location location location, picking the best place to invest in
Location is what most people in real estate say is the most important factor and that is true here as well. Knowing what areas of Playa Del Carmen are good to invest in or the Riviera Maya, is one of the first steps to making a good investment.
There is a lot of new development happening in Playa. Some of it is in prime rental areas and some is in developing neighborhoods. If you are looking at something in a fringe neighborhood of the downtown, ask yourself, is this mainly for me to live in or am I prepared to wait until the neighborhood develops around me to boost my investment?
If you are looking to invest and use it as a rental, location matters a lot in Playa Del Carmen and the Riviera Maya. We try to help you out with these helpful articles on real estate trends.
- How Playa Del Carmen is getting taller buildings.
- Our Playa Del Carmen real estate guide.
- What is going on with real estate on the south end of Playa Del Carmen.
- Beachfront real estate options in the Riviera Maya.
- Recommended realtors to work with in the area that know the market well and have provided good service to readers.
2. New or older condo building?
Playa Del Carmen is a relatively new city with most buildings being less than 10 years old. So when we talk about older condos and newer condos we mainly refer to “newer” as things built in the past 5 years. Everything else is older. Here are some factors to think about when investing in Playa Del Carmen condos or homes.
What are some of the main differences between older condos and newer condos?
Style, size, rentability, amenities, and long term maintenance are all key things to consider between older and newer condo buildings.
When you look at buildings in Playa you can see the design aspect of condos from the 90’s compared to today is different. Older condos tend to look a little more “Mexican”. There are red tile floors and roofs and more usage of palapa roofs for balconies and rooftop spaces. This can be just a matter of opinion what you like but it does effect you if you are going to be renting it out.
As Playa Del Carmen gets more infill, condos have not lowered in price but rather space. Newer condos in general have gotten smaller. This trend has even become evident in hotel rooms in Playa. If price per square meter is important to you, you will almost always get more for your purchase in an older unit. However you should take several factors into account:
- If you are going to be renting your unit, newer condos almost always rent better. People prefer a stylish place to stay, they like the amenities of a newer building, and newer building show better in photos.
- If you are going to be selling your unit at a later time, most people looking in Playa are looking for a newer style unit. Even doing a major renovation in your condo cannot change the outside and common areas. Most people that have done major renovations get people to come look at it but does not result in a sale.
- For people looking to live in the unit and not rent it out, you can get some lower priced older condos. Just remember though that if the overall value of the condos has gone down, the quality of renters next door also will. Like many buildings in Playa, there is a mix of locals, tourists and expats. Some older buildings that don’t rent well on the tourist market go to locals. This can be fine but can also be an issue for living there if people are loud or not clean.
Amenities at condo buildings in Playa Del Carmen
In general older condo buildings in Playa Del Carmen have fewer amenities then newer buildings. Here are a few differences in general you might notice when looking to invest in Playa Del Carmen.
- Older buildings often do not have parking. Most new condo buildings will have some underground parking.
- Newer units tend to have a storage area available.
- Newer condo buildings have a better water system. This can be a combined water tank for use, filtration and better pumping systems.
- Older condos that have pools are often ground level and might be larger than newer buildings. Most newer condo buildings have rooftop pools.
- Larger condo buildings often offer more amenities. Things like front desk, gyms, rooftop bars, and even kids playroom are being added. Most of the time this makes it more attractive for renters.
Maintenance of older and newer condos
Older units almost always have lower maintenance fees. These can be an attractive purchase point. Often though the return on rent for older units is lower as well and the proportion is better with newer units.
Buildings in Playa face a lot of harsh environmental factors. The strong sun and salt air take a toll on rebar, electrical, and exterior aspects of a building. This means that larger renovations and building maintenance will be needed with older buildings. It is important to know what is covered by the condo association and what is left up to the owners. Sometimes only common space things are covered by the association and things like AC units, water systems, electrical and inside the unit maintenance is all up to you.
Most new condos will have a one year warranty for things like leaks, cracks, and minor issues as the building starts it’s life. Of course buying from a reputable developer will deliver a better product for you and hopefully issue free.
No matter if you invest in an older unit or newer one, you most likely will hire a management company if one is not included. It is important to discuss what is included and what happens when there is a major repair to be made. That is a little of what we will discuss next.
3. Do it alone or buying with management services?
Websites like Airbnb and VRBO have made it simple for the average person to turn a condo into a rental business. Many people have done well with this but as the market tightens and things change over time, we have heard more stories of people not doing as well. Not all condos are created equal and certainly not all management is the same quality. See our article about 15 tips to get better returns for your rental property.
One of the most common questions is “Where can I find a good property manager?” A good property management company or person is hard to come by in Playa and the better ones are often too busy to take on new properties. A good realtor is going to have those contacts for you. You will want a realtor that is not just going to make the sale, they are going to work for you. That is why we have recommended relators on our website.
If you buy an individual property and are working on renting it out and working with a property manger, you are going to have to work more for your investment and be more reliant on the market prices of Airbnb and other sites like that.
Some condos and developments offer inhouse services that package everything together. This can cost more overall but if it is set up to market the building on different platforms, your overall return might be better. But of course, not all properties that come with management are created equal and it is important to work with a realtor that knows the differences.
4. Investing to retire later?
Almost everyone has the same idea, buy now, rent it out and retire in the condo in a few years. The major mistake here is that where the best rental market is, it is not necessarily where you will want to live. Most people that move to Playa do not choose the beach, 5th Avenue or right in the middle of the action. These however are the better places to have a vacation rental. So it is better to decide if:
- To pick a place you like and accept less rentals.
- Buy a condo for rentals now and plan on selling and buying a place for you when you are ready.
- Or buy a good rental and live more in the center of Playa.
Tip: Be sure to watch our video embedded in this article about an online tool that is very helpful for evaluating properties.
5. Studio, one bedroom, two or more? What condos are best for you?
What places rent the best? In general one bedrooms rent the most in the area since couples are the most frequent visitors to the area. There are not too many studios available on the market but the ones that are available are the cheapest entry level condos. and rent for the lower amounts.
Some condos are set up as “lock off units” meaning you can have a two bedroom and lock off one and rent it as a one bedroom or two bedroom. This option allows you more opportunity to rent it especially if one bedroom can be rented as a studio as well with it’s own bathroom.
You have to spend money to make money
Besides the size of the condo there are important factors to consider. Often the ratio of amount spent is directly related to return. Since visitors are mainly on holiday in the Riviera Maya people will spend to get a good place.
We will say that in our observations the higher end condos have a higher yield return on them. In most buildings the penthouses are usually rented with first floor units that are small the last ones to be rented. Also the nicer the unit and higher rental price, you often get better quality renters with less issues. Here is a little basic illustration to show the point.
Person A buys a condo for $100,000 USD. They rent it for $70 USD a night each.
Person B buys one condo for $200,000 USD and it rents for $250 USD a night.
On paper Person A will have lower maintenance cost compared to Person B. However when you factor in the $200,000 unit probably has a good view and more amenities, it will be more attractive and rent more often. Person B will be making a higher return on investment because he spent more in the beginning.
This is just a basic illustration to show that spending more can make you more and it is usualy better to buy a nicer unit that has something unique about it.
6. Decorating your investment in Playa Del Carmen
Since most people moving to Playa Del Carmen or just setting up an investment in Playa Del Carmen will need to furnish their units, here are some tips.
- Don’t over Mexicanize your units. It is true people want to come to Mexico because it is special but hanging mariachi hats on the wall and making your place look like a cantina is not going to rent your place much.
- If you don’t have style, hire someone to do it for you. Good design will help you rent your unit a lot more. Also someone familiar with local products and things that are durable will help keep cost lower over the long run.
- It is easy to accept a design package from the developer. It makes it easy if you do not have time or the ability to design your interior well. However this will men that most units will look the same and your place will not stand out if you are renting it independently.
- Take your time. Look around and see what are good prices. There is no one stop shopping location in Playa for everything. There are some great craftspeople that make furniture and local made things that can make great décor. Doing it yourself will almost always save you over a design package.
- Have practical things in your unit that guest will like. Watercoolers for drinking water, beach towels, cable tv with English channels, and good Wifi are just some things to mention here.
See our guide on where to buy furniture in Playa Del Carmen.
7. Who makes the best investments?
People that know the area and know what trends are currently taking place tend to make the best investments. Knowing what is coming online and knowing the market will be in a better place to make good decisions. Just coming to visit for a month will help but may not give you enough time to really get a feel for things beyond just looking at condos.
People that have been here for a while and either work in the real estate market (and invest) or just people that are investors, tend to make the best moves. Being able to jump on a new project and buying presale or knowing what a good deal can be key to making a good investment. Most people do not have the time to research everything, that is why a good agent is key, someone that will work for you and not just the sale.
Some pre sales offer good introductory rates but not all pre sales are good opportunities. Knowing the reputation of the developer and comparing details in relation to the price is going to be key. Often when buildings are new and offered to the public, they are already 20-35% sold. Often developers, real estate agents and partners reserve units. People who wait until the building is finished get to select from less popular units and don’t get the benefit of the early pricing. Having a good realtor looking out for you and knowing what you are looking for, will work for you and let you know if there are good opportunities for you.
8. Yesterdays advice is not for todays investors
Playa and the Riviera Maya are always changing. What was good advice a few years ago is not necessarily the best advice now. New options, new projects, and areas become more attractive with time. Stay up to date with trends so you can make a good investment. Again working with a good realtor is key.
Tourism trends also effect real estate especialy if you are looking to rent it out. For example now in the Riviera Maya you can get good ROI in other areas outside of Playa Del Carmen that you might not have thought of before.
Another current trend we see is a rise in national tourist. This means there are more people coming to the area that search for rentals on non English language websites. People that focused on only English speaking tourist are missing out on more rentals because the market has changed some from days of yesterday.
9. Understand what drives real estate prices in the region
Any investor needs to understand what drives the Playa Del Carmen real estate prices and the region. Many people come to Mexico thinking it is supposed to be cheap. They find out that prices are more then they expected and have to take more time to think about things.
We describe the Riviera Maya as a funnel. It is true Mexico is not an expensive place but there are places like Playa Del Carmen that have higher baselines of real estate. Why is this? You have to start by looking globally at the market. Europeans that want to invest in Playa Del Carmen or the Riviera Maya drive prices and so do wealthy South Americans that want to divest their money out of some economies. Americans and Canadians that look to move to Mexico or invest look to certain areas like Playa Del Carmen. Mexicans that are wealthy look to up-and-coming locations within the country. There are actually not a lot of beach towns with the economy of Playa Del Carmen and the surrounding towns. So a lot of money is funneled into a small area and this drives prices.
There are also smaller factors that push up market prices like tourism and rental demand. This also true what is happening in the Tulum real estate market.
10. Look in person and not online
A simple google search will come up with a lot of new condos in the area. Some look great in the illustrations or animated videos. What will they look like or what is the reality in person? The reality can be very different. We have visited many new buildings in the area and have two stories to illustrate the point of why it is good to visit in person.
There was a new building going up that had very nice pictures and attractive prices. It was in a good area as well. The tour took us to some of the entry level budget condos. The thing we noticed was the fact that it was an interior unit with no exterior windows. If the power ever went out it would have become a hot box. The roof of the building also looked nice in photos but the building had around 40 units and only a small space for guests. It was actually very unpractical for the amount of people renting in the building let alone living there.
Another condo building we went to see did not have any electricity that day. It was fine because it was the middle of the day, so it was light out. As soon as you entered the building you felt the stagnant hot air. There was no air conditioning on and oh what a difference it can make. This building only had windows on the street side and a small interior air shaft. Their was no natural airflow through the building. It meant that the energy you would need to keep the building cool was going to be a constant need. That leads us to our next point.
11. Consider the energy of your investment
Energy prices in the Riviera Maya are rising. There is one electrical company for all of Mexico called CFE. It sets the rates for the zones of Mexico.
Most new condos are meant to be air conditioned 24 hours a day. That means a chunk of your operating expenses are going for electrical. If you are renting the condo, most likely there will be tourists on vacation and the last thing on their mind is saving energy. It will be the first time in the hot climate and they will have the air conditioning on all the time. This can mean electrical bills in the hundreds if not a thousand dollars a month.
Condo buildings are not that energy efficient in Mexico. It is something that developers should be investing in and using as a sales point. It is up to you to ask about it and see what the building is like for energy usage. Here are some tips:
Energy saving tips for your investment in Playa Del Carmen
- Does the unit come with appliances? or do you get to choose? If so are they energy efficient appliances? Many refrigerators for example in Mexico are on the lower end for energy saving. If you are shopping for them, be sure to check the yellow tags for consumption. It can mean big savings in the future.
- Does the building have shade? Are their awnings, trees, or other buildings that shade it? Remember, the sun changes angle during the year. Imagine the building year round.
- Are there special windows like double paned? tinted? does it come with window treatments? Not a lot of windows are made of specialty glass in condos. Many times you can feel just how hot the interior of the glass gets in the sun. That is all heat you have to combat with air conditioning.
- Look at natural air flow. Are their ceiling fans for air circulation?
- Is the hot water and stove electric or gas? Gas is much cheaper but some new buildings are all electrical which result in higher energy consumption.
- Are their exhaust fans above the stove in the kitchen? This is something standard on many parts of the world but not necessarily the fact here.
12. But I heard from someone…..
I heard from someone that….. there is a bubble growing, now is the best time to buy, or that people are not making as much return. It is true that not all condos and buildings are created equal. Some people that have invested have not done as well as others. The important thing is to be as educated as possible and work with people with a proven track record.
Everyone’s circumstances are different and it is good to listen to all angles of what things are like. Remember just because someone has bought here, it does not make them an expert. It is good to take your personal needs and circumstances into account when looking to invest. The best investors are educated investors.
We hope this article has given you some ideas and things to consider when looking to invest in the area. You might also like to read our article about investing in Mexico and property appreciation.
About The Author
I appreciate your cander on things to think about for real estate. I have been reading all your articles preparing to buy something soon. I have narrowed it down to a few options and will be down in January to select something. I would love to take you out for lunch or dinner just to thank you for all the helpful articles. Let me know if you can, my email is below.
I have been looking at condos for a while and went with a company that has a lot of ads online. I have not been happy with what they show me. It is as if they want to push certain developments on me. I wish I had found your site first. The good thing is I am still looking and have not committed to anything yet.
I have been coming to the Riviera Maya for ten years now and am looking to buy something before I retire. What are your thoughts on Puerto Aventuras and Tulum? I am looking to buy a condo and rent it out for a couple of years and then move down.
Hello Darren
Tulum and Puerto Aventuras are very different places. We are sure you have visited them and know what are the best things about them and also what they might be lacking. One part should be about what you prefer and the other is rentability. The two markets are pretty different. Do you prefer having a management company take car of everything for you or are you going to be hands on? Do you speak Spanish? Tulum gets more international guest than Puerto Aventuras and you will need to communicate with more people from different locations. The Tulum market is renting very good right now but is prone to more fluctuations compared to Puerto Aventuras. These are just some observations. We can email you some other information if you like.
Hi I am looking to invest in a pre construction two bedroom , two bathroom condo in playa del Carmen in Ipana. It has great amenities with roof top swimming pool, gym, kids room, swim up bar etc. Future retail shops that will be build ground level. . What do you think about the location and rental in this area or at Ipana? Do you know if builder developer is reputable given this mega projects?
Hello David
Thanks for your question. This is a new “area” of Playa. We say area because almost a four block area is being developed including a new supermarket. In our new real estate video we have coming, we talk about this. The developer is well known and has been working in the area for a long time. I even lived and bought one of their condos and was pleased with it. It lasted over time and was made well. Playa is moving more north and this area is a good area with access to 38th Street and upper 5th Avenue where more of the upscale shops and restaurants are. If you do not have a realtor now, may we recommend Lilia. She has worked very closely with this developer for about 20 years and knows the developers personally. It can be an advantage to making a purchase with them. Here is her contact if you would like to send her a message. https://everythingplayadelcarmen.com/realtors-playa-del-carmen/
Hello
You said you own a condo in Ipana. How is the rental market in Ipana for two bedroom and two baths with lockout bedroon given close proximity to beach and 5th Avenue?
No. I was referring to a condo built by the same developer. I was commenting on the quality of construction.
Hi Mr Yucatan,
Can you send me the link to your video about playa del carmen?
Hello David
Here is the link to our recent video on real estate. There is a lot of info in it and we tried to cover the most important things. We hope you find it helpful. https://www.youtube.com/watch?v=yrSd49v5CR4
Hello Yucatan
By chance if you know any interior designer in siampre playa area that furnishes condos with fairly market priced package in that area that oversees from start to finish. Also, can you recommend a reputable property management company in that area for Ipana condos that is fairly priced for maintenance and oversees rentat?
Thanks
Dave
Hello David
Many people buy a furniture package or do a mish mosh of buying some and part package. There are a few interior designers but we often hold back on suggesting some of them because of lack of consistency of quality or service. Are you working with a realtor now? A good real estate agent should have all these contacts for you. This is why we feature a few agents on our website because they are able to help out before, during and after the process.
My husband and I are looking to invest in some property for the long term. We love the Riviera Maya and want to spend our retirement there. We have seen how Playa is always evolving and changing so we are not sure what Playa will be like in 5 or 10 years. Can you let me know what your opinions are for up and coming locations and what area might be good to focus on? Thanks.
Hello Andrea
We will send you an email with some areas we think are good to look at for the longer term. Thanks for your question.
Hi there! I’d love to get an email about these up & coming areas you’re looking at as well. Thank you!
Hello Christi
It is best to contact on the realtors in our video you probably watched in the article. They will have an up-to-date list of things to share with you. Here is an article with all the email links. https://everythingplayadelcarmen.com/playa-del-carmen-real-estate/
I really appreciate your articles on real estate. There are a lot of places for sale now and a lot of options. It can be hard to narrow down a search. Your past articles have been spot on about the market and direction of how the market is moving. I am sure a lot of people have found this information helpful. Please keep writing more articles.
Hello Will
Thank you for your compliments. We will keep finding topics to write about and keep people aware of new developments in the area and market.
Can you send me some information on condos and investment places to consider for the area please. I have been looking online and I don’t trust those real estate websites that say they will pay you to fly down. It just smacks of scam and it makes like they just sell overpriced things to gringos. I want to buy at market prices and in a good development that is not just for tourist. Thanks
Hello Kevin
We will send you an email with some information for you. Thank you for your comments.
We are happy we bought in Tulum a few years ago because prices for land havce risen so much. Now in the downtown the lots are going for so much you need to build a hotel or guesthouse to make it profitable. So much iof the investing is for busineses now. The same happend in Playa del Carmen when small houses went to create three story condo buildings. Now in Playa it is all about condos and less about land.
Hello Mr Yucatán can you share with me the properties or areas you are referring to on this post I will send you my email information. Very interested in looking at a retirement home
Hello Mark
We will send you a link to some recommended realtors that we suggest for our readers. They have been very helpful to other readers and get great reviews. They are also up on the latest developments and have expertise. There are so many properties that it is hard to send all of them. If you send them an email with some details of what you are looking for, they will send some info to you. Thanks https://everythingplayadelcarmen.com/realtors-playa-del-carmen/
Hi,
Looking to buy a 1 bedroom pre-construction condo in Playacar phase 2 which s ging t be completed next year. Is this area of Playa del Carmen good for investment rental? I would appreciate your feedback. Thanks
Hello Alicja
Playacar phase 2 is a nice area that some people like to rent in. It does get a mix of foreigners and nationals. This means you might have to advertise in Spanish and English to maximize rentals. Playacar gets less turn over then some parts of the center of Playa since there are more people that want to be walkable on vacation. Playacar usually means you will take taxis or have a car on holiday. There are also beach access issues to consider. There is limited access to the beach from Phase 2. There are a lot of factors like management, if you are going to be living there in the future or vacationing there to consider location. A good read is this article on ROI. Sebastian that wrote it is very good with investment properties.https://everythingplayadelcarmen.com/roi-playa-del-carmen/ We just were in Tulum for a week looking at what is going on there. Have you thought about there? There is a moving trend for good ROI there. We hope to have that article and video up soon.
Mr. Yucatan!
Amazing article – thank you for assisting your readings in choosing a solid investment property in Playa. I am an investor from the US and am interested in a condo near 5th that has good access to the beaches and attractions. I am looking to rent it year round and will be hiring a property manager to advertise and fill my condo.
I am looking at a 1 bedroom that has deprecate areas with pull out sofas. Most of the 1 bedroom units I am looking at comfortable sleep 6.
Do you have recommendations on location? Any and all information would be greatly appreciated. I am going to be in the area March 10-16th and plan on visiting several properties while in the area.
Side note: I have not booked my accommodations so if you have any recommendations there, I am happy to listen 🙂
Again, thank you very much!
Paul
Hello Paul
What part of 5th Avenue are you looking at? It runs from Juarez Avenue to 46th street and then continues into Colosio neighborhood. Once I know where you are looking I can suggest a hotel in that area. We also just did a long video on Tulum and the market there. It might interest you if you are looking for an investment. https://everythingplayadelcarmen.com/tulum-real-estate-market/
This website has amazing advice and has been invaluable to me. The realtors they recommend are very good. Working directly with a developer you take a risk. You have no one helping you navigate problems with the developer. When developers force you to use their in house rental team…buyer beware. Koox has kept the rental profits from owners and then rebranded their new in house rental team as KLR. I have not received my rental income from Koox for 2018. They have essentially stolen our profits and said there is nothing they can do..they don’t have the money to pay us? Most have walked away and are renting on their own. such a poor reflection on a supposedly reputable company. I have essentially given up the fight and am moving forward with a small property management firm I can trust. A complete headache and nightmare dealing with dishonest companies. I still love Playa and think it is a good investment . There is no way to predict this would happen. Glossy presentations and promises of !3 percent ROI ? hmmmmm. Not so much. But I am purchasing another property and believe in the real estate…I just have to be much more hands on than I imagined and many of us are out al year of profits.
Thank you for taking the time to comment and letting people know about your personal experiences. Have you seen our article and video on Tulum real estate market? It is interesting to see what is going on there.
Your articles are the best!!! My husband and I were in Playa del Carmen Dec/Jan and we absolutely fell in love with the place. We have started looking for an investment property and after watching your video on Tulum, we think this will be an awesome option for investment purposes! But we would love Playa del Carmen for our own personal retirement in 10 years. If we could only afford 1 property to start with, where would you suggest, Tulum or PDC? We will not be able to travel there every year as we are very far away in New Zealand but we would love to come at least every 2 years so would really want something that will rent well. Appreciate your advice?
Hello Lee-Ann
Thanks so much for reading and watching the videos! A couple of things, in 10 years when you retire all the places will be very different. Even in the past 5 years neighborhoods evolved and new areas became popular. So looking for somewhere for you right now might now be a good idea. Perhaps a place that works better as an investment and something you can visit when you can. Since you will not be able to come often, having really good management will be key. In general ROI is averaging higher in Tulum right now. Buying new is better than an older unit because they rent better and have less headaches or unexpected maintenance. it will depend on when you come and how the rental season is, you might find that staying in a hotel or resort is just as good and let your place rent out to pay for your trip. That way if you buy something in Tulum and want to stay in Playa, you can. These are just some thoughts. Part of real estate is passion and just how it feels. The other part is all that research and boring stuff. Having a good agent is also going to be key as you look for something to meet your criteria. Best of luck with it and let us know if you need anything else.
Hi Lee-Ann, we were looking to invest in PDC and spend winters there (Jan to Apr). What really put the brakes for us is the sargassum issue. We were there this New Year’s in Puerto Aventura and it was everywhere. We were there in April in Cancun and it was there but not as dense. This is probably due to the vast beach area while PA had coves where the plant just piled up making the areas unswimmable. We have also read that the Mexican government is not providing funding to help Quintana Roo (North and South) resolve the issue. Some say this is cyclical but other experts say it is here to stay. Until the government makes a commitment to find a solution, I don’t think we would risk committing. We’ll continue to visit because we love it there be it Cancun, PDC, Puerto Aventurs, or Tulum.
Would you have any insight on what efforts may be planned from local government and business associations?
Hi,
Your articles are amazing, we are looking to invest in Playa del Carmen in a presale of a new beach front condo building in the Coco beach area, it will be ready in 2021. Please let me know what you think about this area? What would be the realistic ROI for a three bedroom apartment and what can we expect it to be in 10 years from now? Thank you
Hello Alex
ROI goes by building, apartment, what floor you are and how you manage it. Neighborhood is only one factor. There are more rental unites on the market now and prices are lower for rentals. However some still do very well, most people do ok and very few only do poorly. At any rate ROI is better than most banks and investments. Most apartments are running from 5-13% ROI now.
The Coco Beach area is developing and there is a lot of new condos going up. Certainly the newer ones rent better than the older ones. The plusses for this area is the amount of luxury units in the area, there is a police building at the foot of CTM Avenue, you are adjacent to 5th Avenue but not in the heart of it with noisy bars and the beach is a little quieter. The negative side is the beach has not been in that great of shape, the Canibal Royal club closed and is empty leaving only a few beach clubs, some of the streets are not paved yet and when it rains can pool water, there are some restaurants but not as many as other areas, you do need a car to go shopping, it is almost fully a rental area (which is good and bad). If you are looking at a luxury unit, you might consider the fact that more upper end people are renting in Tulum and the ROI can be better there now. You might have seen our article and video about Tulum Real Estate.
Great Info! We might be heading down in October to look at properties and research area. W want to buy for an investment property with a month or two usage for us each year. We were sent a few properties that are run like a hotel and has a rental pool program and worry free concept where everything gets taken care of for you and your expenses just get deducted from your rental income. We would have access for 56 days a year and the rental agreement would be for 12 years after we could stop or renew it. Is this a good Idea if we only plan on staying in the unit for 1 to 2 months a year?
There are projects like that that make is super easy because everything is taken care of. It usually means higher fees though. It is also important to know if it is a collective commission from all units shared or just yours. Not all units rent the same. It also depends on the location. Some buildings that are not in a good area are not getting a lot of reservations now. It is also good to know how they market the property. If the management is just posting on Airbnb or if they have multiple venues for advertising. Some management groups have contracts with travel agencies to guarantee some blocked rooms per month. It is also good to understand maintenance cost and what you are responsible for.
Hi! Thinking of buying at the still being built The Fives in Puerto Morelos. This would be an investment property managed by The Fives. We are worried about the seaweed problem and it’s overall effects on tourism. Any thoughts on that. Also, we read that serious crime has over doubled in the last year in QR – again, thiughts?
Hello Gareth
Sargassum is an unpredictable thing and has effected tourism. In places that offer more than just the beach, there is more potential to rent units. Playa Del Carmen has become more cosmopolitan and offers restaurants, events, rooftop pools and more than just the beach. Tulum has been more resilient to the drop in tourism because of its reputation as a chic place to be. Crime has dropped in the past 8 months and is not something that is posing a risk to tourism.
Hi Everyone,
Good article and it makes a lot of sense. Ill give my 2 cents. I bought almost 10 years ago a new condo in Coco beach. Great location: close to the beach and to 5th. Far enough away to have peace and quiet.. Although if you are too close to the beach now. Ie. Casa del Mar you are right in front of the Martina beach cub and others that often have loud music all day and sometimes all night. that can be brutal. All the roads in coco beach now are paved. There are SO MANY new condos in the this area and Playa in general that its harder to rent or sell. I would say my condo 10 years later is about 20 percent less in value. When people look at condos they want to buy NEW. Having said that I have looked at many new condos in the area.. They are quite small. 2 bedrooms for 900 square feet. So I think that will get annoying and lose value when they become resales also. There aren’t many empty lots left in Coco beach and when that happens I think the market will come back and go up. I wouldn’t expect the market to go up for another 5-10 years. Just remember: whatever the asking price, I would only offer at least 20 percent lower than the ask. For resales, I would say at least 30 percent. The only good deals I believe can be had in coco beach are the resales. There are people who want OUT and after some time will accept a low ball offer. There are some very nice condos that are modern that are resales. The beach now in Coco beach I think are some of the best in Playa. The beach is wider now, and 3 beach clubs. It was only Canibal Royal for a while which is gone, but now Sargassum under control. Coco beach is very nice. I want to keep my condo for retirement so I don’t want to sell, which is still a ways away, so doesn’t bother me that the value has dropped.
These are all ver valid points and on point. Although I would say it depends on the condo because some people we know have done well. It is a tighter market and it means more examining the properties tans working with a good agent.
Hello,I found your article very Interesting. Will you please send me some new construction condos in the pre constructed phazes. I would like to take advantage of the pre phaze costs… I’m interested in the condos you feel that will bring in good ROI’S of course. Thanks
Hello
Thank you for reading our article. We don’t sell real estate but we do write helpful articles for our readers. We also point them in good directions. A good person to email is one of our recommended realtor. They have the details of buildings and can send you some helpful information on the area. Their email addresses are here and you can read a little more about them here. https://everythingplayadelcarmen.com/real-estate-agents-playa-del-carmen/
Major thanks for the article. Really thank you! Really Great.
I have been looking at Tulum or somewhere in the Riviera Maya to buy a condo and rent it while not there. I have had two other friends do it already and they have been happy with their places. Thanks for your articles and tips.
Very good article, I am looking to invest in a one bedroom condo in PDC and wanted to know what areas do you recommend that have the highest ROI as well as which developments. Thank you for sharing information with us.
Hello Mayra
Thank you for your question. Location is important, the reasons for investing is important and the exact building is important. As for location, most tourists want to be somewhere from 14th Street to 46th St AKA CTM Avenue and between the beach and 30th Avenue. There are other areas with appealing condo prices but often the rental return is going to be lower and some of the areas will not gain in popularity for years sine they are slowly developing now. The reason you are investing is important because many want to buy something now and retire in a few years to live in the condo you bought. Almost all people say they want to do this but the realty is living in a building that is all rental is not as fun and after a while living in Playa, some prefer more quieter neighborhoods to live that are closer to super markets and have good parking. Then comes the conditions of the building. Just because a condo is in a good location does not mean that it will be a good investment. Each developer has different restrictions on how to manage your property for rental. Some developers have a better reputation than others and the exact unit you purchase can effect how your rental income is. A good person to talk to is Sebastian. He is one of our recommended real estate persons who has not only invested himself but also helps a lot of our readers focus on what places are better in terms of investing. He works in Playa as well as Tulum. I don’t know if you have seen what is going on in Tulum as far as development, but right now the return on investment is higher there than Playa, we have a good video here with Sebastian about it that gives a lot of details. https://everythingplayadelcarmen.com/tulum-real-estate-market/ If you want to contact Sebastian, his email is here in this article that also has more info on him. https://everythingplayadelcarmen.com/real-estate-agents-playa-del-carmen/
What’s most important is the fact you give spot on advice. I see some realtors pages and it is loaded with rosy crap that is pushing subpar buildings for sale. I like your take on things. It helps a lot.
Very good info. I wonder if you could send me some more information on buying and investing in the Riviera Maya? I have been thinking about it for about two years and am ready to pull the trigger.
Hello Kyle
We will be glad to send you some more information. We sent it to your email you posted here. If this is not the best place to send it, let us know.
Just bought two new place in tulum region 15 looking for recommendations on a good property management copy to help me rent them out
Hello Alvin
We are not as familiar with the management companies in Tulum. What realtor did you use for your purchase?
Thank you for everything that you do. We are seeking a resting place to enjoy by the water with affordable living and milder crowd. We’ve been to Playa del Carmen, and we think it is a growing development. It’s true most of its architecture is non local based as there is no flow of breeze much like where I was from in the Philippines. It seems like they put a dessert type of house in the area. I do not even think they consider the rise of tides, so there are no proper irrigation and ditches to support the overflow. This certainly kind of gives me some distaste as anyone in our time should be considerate of the climate situation. But when cost of living, amenities and friendliness to diversity necessitates, I think PDC is a good option.
Thank you for the informative article. Very thorough!
We are thinking of buying a property to rent / use in the Playa del Carmen area as well. Can you share any current recommendations you have and info on how to contact a realtor in the area? Thank you so much!
Hello
We have this article on some recommended realtors to work with in the area. https://everythingplayadelcarmen.com/realtors-playa-del-carmen/
Thanks for the information. What are your thoughts about the calle 8-12 area of Playa Del Carmen for investing?
In general, this is a more affordable area to buy in. However, this does not mean it is the nicest and an area where you can charge high rents. It is a central area but we still like more north since this area is not as nice and can have noise issues.