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is tulum real estate a good investment?
Yes, buying Tulum real estate is a good investment.
Conservatively Speaking Numbers Are Showing a:
Realistic ROI for Vacation Rental Properties in Tulum Mexico
From 4-10%
Occupancy Rate for Vacation Rental Properties in Tulum Mexico:
Low: 40% - High 85%
The success of the rental revenue depends on the property management, marketing and customer service, it does not depend on the property itself.
Reviews, referrals and returning guests are the main goal to position a vacation rental listing.
By Investment we mean money you already have in your pocket, ok.
We don't mean investment by getting in debt to buy a property in Tulum.
You will be paying more in interests than what you get in rental revenue. This does not make financial sense.
Tulum Annual Real Estate Property Appreciation:
Low: 7% - High: 15%
Some properties appreciate much more than others due to factors such as specific area/location, quality, uniqueness, prestige, services, amenities, benefits, desirability, and so on.
Tulum is not a market to flip properties. You should keep it for a long time so that you can resell it and make a good profit.
So, Tulum real estate is a good investment but it is NOT the best investment ever that you can make in your life, no.
You can get a better yield with several other asset classes, yes, sure.
However, people who are buying homes and new condos for sale in Tulum Mexico is because they can afford it and because they love it.
Simply said, Yes, Buying property in Tulum is a good investment.
Tulum Real Estate | Why Shouldn't You Buy in Tulum?
Why you are considering to buy Tulum Real Estate?
Is it because you just heard about it from a friend who owns there? Did you read on internet articles that Tulum’s beaches are ranked among the best ones in the world?
Is Tulum a very convenient destination only a few hours by plane from your City?
You really love the warm and tropical weather all year long with sunny skies? or Is it basically because you want to invest your money with a income-generation mind?
INTRODUCTION
This information will illustrate to you the things that you have to consider about the Tulum Real Estate Market.
Before taking the final decision of buying a condo in Tulum Mexico, a Home or a piece of land to build, read these tips.
Recent History Of Tulum Real Estate:
The recent history of the booming for the “Tulum Real Estate For Sale” began some years ago, between 2011-2012, following the success of the Riviera Maya as an international touristic destination that attracts visitors from all over the world
At its origins, The Riviera Maya offered only accommodations in all-inclusive resorts with beachfront properties and small downtown hotels in Playa del Carmen.
There was not really a market for a Tulum Mexico Real Estate.
In fact, Tulum was basically a place for the backpackers and the travelers on a shoe-string budget who could not afford to pay for accommodations in Playa del Carmen and found an inexpensive lodging by staying in a palapa or hut for a low price.
A few pioneers with initiative back then, and without a guide to buying and owning Mexico real estate, started buying land and beachfront land to develop in the future.
Nowadays, conversely, Tulum has become a pricier destination than Cancun Real Estate and Playa del Carmen Real Estate, with growing demand and the Tulum luxury Real Estate, has become very appreciated.
The offer for Tulum condominiums is greater than ever before and most of the new buyers want to get into the Tulum condo rentals.
Many foreign people are getting interested on how to buy property in Tulum Mexico.
You don't have to worry about buying real estate in Mexican Spanish.
Most of the professional licensed agents speak English so you can deal comfortably and without stress.
Why Shouldn’t You Buy Tulum Real Estate?
You shouldn’t buy Tulum properties if you want to purchase and sell it quickly with the intention to make a profit. It means that if your intention is to flip it then this is not a market for you.
Tulum has a very active market that launches an average of 5 new projects every month. There is a lot of competition among developers.
RESELLING YOUR CONDO
Selling a Tulum condo for sale by Owner is a hard task as you will be competing against new projects that sell in pre-construction with payment plans in contrast with a cash deal.
The new buyer will realize the advantages to buy a new condo for sale or a home for sale in Tulum with lower prices from the new development.
It won’t be easy for you to sell your property in Tulum as a resale quickly and with the price that you want. So that if you are rushed to sell you might have to reduce the price possibly at the same price that you purchased.
This means that you won’t make any profit and will get even. Tulum Real Estate is a buyers’ market and not a sellers’ one.
Don’t buy properties in Tulum if you want to resell it in the near future to make a big profit.
You shouldn’t buy Real Estate in Tulum if you believe that it will pay for itself.
Some buyers believe that they can purchase a condo or home in Tulum using a loan and making enough money to pay the bank by renting the property as a vacation rental.
This is very unlikely to happen.
It is true that vacation rentals in Tulum have increasing demand and that you can generate income by renting your condo or home in Airb&b and other similar platforms.
However, if you think that you are going to earn all the money to pay for all the financing by itself without you having the backup funds to cover the monthly payments, then you are taking a risk.
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Most of the developers advertise that by renting your property you may generate 8-14% ROI.
However, this is in most cases a sales pitch to convince you to buy and to create an unreal expectation to compel the purchase.
There are some properties that have already a historical record of rental income which is producing a 9-10% ROI of Tulum condo rentals.
But these properties are managed by a professional rental management company and they have been promoted for a minimum of three years.
These properties have gained returning customers and positioned themselves with positive reviews that rank them in the most popular platforms.
In order for your property to make this kind of ROI, it has to be handled in a similar way with a very good marketing strategy and a customer care service of quality, besides being a desirable and appealing condo or house for the renters.
Tulum Real Estate Rentals ROI:
Many buyers who are purchasing a Tulum condo or house are doing it with the purpose to use it for their own pleasure during their holidays.
The rest of the time they put it in a rental program to make money by renting the property.
If you buy a condo or a home in Tulum, you may rent it for vacation rentals and expect to get around 4-5% of ROI during the first year.
For the second year, your ROI may rise up to 6-7% based on right rental management.
After the third year, your vacation rental ROI may be 9% with constant good marketing and service.
In the reality of the numbers, it is hardly seen a condo or home that is generating more than 10% of ROI with rental income.
However, if your main reason to buy Tulum Real Estate is to invest only to generate the highest ROI and not using it for your own pleasure, then you may consider buying a property in a Condo Hotel.
A Condo Hotel will offer you a unit that will be handled by the developer in a rental pool and they will maximize the occupancy with a strong marketing plan and will manage the project like a hotel operation.
These units usually include all the furniture and accessories to be the same in all the units and keep the uniformity in the quality and the rates charged to the guests.
In a condo-hotel, you won’t have to worry about the administration and maintenance of the unit and you will only be receiving your earnings by bank transfers.
You will not be able to use it for yourself except for a few weeks of the years and during the low seasons.
This option is the way to go in case you mainly focus to acquire an investment property that produces the highest ROI possible.
To handle a regular property, there are already many options for Tulum Mexico Real Estate for rent management companies that charge 20-30% for their services.
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Tulum Real Estate Rental Rates:
If you look for a property for sale in Tulum Mexico with the goal to rent it, you should know what the average rates are.
The prices per night in a condo for rent depends mainly on the season of the year and on the location of your unit.
You can realise that the rent nightly rates for a Tulum investment property are higher compared with the prices in Playa del Carmen.
This is why Tulum properties are getting more attractive to buyers.
Let’s make some examples with an average apartment in a good location and with nice amenities for the renters:
1 BEDROOMS CONDO:
LOW: The rates during the Low Season are around $ 60 USD per night and the average occupation is 18 nights per month.
HIGH: The rates during the High Season are around $ 100 USD per night and the average occupation is 24 nights per month
2 BEDROOMS CONDO:
LOW: The rates during the Low Season are around $ 160 USD per night and the average occupation is 15-17 nights per month.
HIGH: The rates during the High Season are around $ 350 USD per night and the average occupation is 20-23 nights per month.
3 BEDROOMS CONDO:
LOW: The rates during the Low Season are around $ 210 USD per night and the average occupation is 15-17 nights per month.
HIGH: The rates during the High Season are around $ 400 USD per night and the average occupation is 20-23 nights per month.
OCCUPANCY RATES:
We could think that is logic that the smaller the unit, the more affordable the rates and therefore the higher occupancy.
And That is why many newer developments are selling each time smaller units like studios or suites from 30-45 m2.
The available general inventory has plenty of units of studios, 1 and 2 bedrooms condos.
However, the reality is showing that the most profitable investment properties for short term rentals are the bigger units, like 3 or 4 penthouse units or stand-alone homes of 4 or more bedrooms.
It seems there is a niche of clients looking for rental properties that are large size and where they have all the benefits of privacy, luxury and comfort.
They are the people who do not want to mix with the crowd and do not like to have restrictions or rules that apply in a condo building.
They want to have full control and complete intimacy so they are willing to pay the higher price.
It is also clear that the segment of larger properties with more than 2 bedrooms have the least competition versus the 1-2 bedrooms condos.
There are fewer private homes than new condos for sale in Tulum Mexico.
BEACHFRONT RENTALS
Tulum beach house rentals can charge considerably higher rates but it is only a few of them and they may accommodate a larger group of people.
Nevertheless, in the last recent years, new projects selling 3-4 bedrooms modern condominiums have appeared in the beachfront gated community of Tankah Bay.
It seems that the trend is to recycle older horizontal properties that are beachfront to use the space and build vertical projects, for all those buyers looking to have a piece of beachfront in the Caribbean sea.
How Is The Market Of Real Estate In Tulum?
CONDO UNITS
At present you have many options of new condos for sale in Tulum Mexico, Tulum houses for sale, Tulum lots for sale and a very few beachfront homes for sale which are priced over one million dollars.
Some People believe that they can still find beachfront condos for sale in Tulum Mexico for less than $ 100,000 USD and this simply does not exist.
HOUSES
In regards to houses, there are not so many options for a stand-alone family home.
In this case, the way to go is to buy a lot and have your home built with your own design.
Nevertheless, if you prefer to buy a brand new home in pre-construction, there are some options that you may like.
These are townhomes in small communities with shared amenities and common areas.
Homes with two and three bedrooms and two stories are the most common to find.
Homes with four or more bedrooms are not so common.
About homes, there are some eco-sustainable communities like Los Arboles and Kuyabeh Tulum Real Estate that sell a big piece of land (2 acres) to build a single home in the middle of the jungle and completely off the grid.
Your home here has to be eco-friendly and run on power generators and rainwater collectors.
Buy House in Tulum - 2024 Collection!
Click here to explore our list of selected new houses for sale in Tulum Mexico: Townhomes, Bungalows, Single-Family Homes, Jungle Houses, Luxury Villas, Exquisite Residences, and more...
It is clear that there are fewer available options of Tulum homes for sale than options of Tulum apartments for sale.
About Tulum land for sale, there are also still plenty of choices in all sizes.
In case you want to buy a beach home near Tulum Mexico, you can find listings in Punta Soliman Bay, Tankah and Akumal.
You easily find many choices of Tulum Mexico real estate for sale for every budget and taste.
Click here to find out more about Tulum Real Estate Listings and new developments in Tulum Mexico.
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How Much Does It Cost Buying A Property In Tulum?
Tulum Real Estate prices have been increasing considerably during the last years.
Buyers who bought a property 10-15 years ago may not believe the prices today. They were very fortunate to have purchased at that time with bargain deals.
Due to the high demand and the newer upscale and jet set profile of Tulum, the properties are more and more appreciated.
Currently, the prices for a condo or home designed and built with the most quality materials and intended for the international buyers ranges from $ 2,500 USD to $ 3,700 USD per square meter in pre-sales developments.
In the Sian Kan area, you may find beach homes for sale in Tulum Mexico. Here is the Tulum beach house Pablo Escobar that now is a Hotel.
If you are looking for Tulum real estate beachfront lot to build your custom home, Sian Kan is still an alternative.
The prices for residential lots range from $ 200 USD to $ 1,200 USD per square meter.
Commercial lots are priced at double than that. For Tulum Commercial Real Estate spaces, the prices are from $ 3,600 USD upwards.
Newer properties are more luxurious and with better amenities and comforts than the properties built and sold only three years ago.
How much is a condo in Tulum?
Regarding Tulum beachfront condos for sale or Tulum Real Estate for sale Beachfront lots is another world.
They are not abundant and their prices range from $600,000 USD to more than 3 million dollars.
However, there are very few brand new beachfront condos for sale in Tulum compared with the options available in town.
The cheapest smallest condos (studios) for sale in Tulum costs from 120k, with a total size of 400 sq ft.
The nicest and largest condos costs up to 1.5 million dollars.
It no longer exists Tulum condos for sale under $100k.
What Location Is Better To Buy A Condo Or A House In Tulum?
For buying Real Estate in Tulum, with the goal to serve as an investment property for vacation short term rentals, there are only a few main suggested neighbourhoods that you may consider:
PRIME GATED COMMUNITIES:
Aldea Zama
Selva Zama
Tulum 101
Kaybe
PUBLIC NEIGHBOURHOODS:
La Veleta
Region 15
Region 12
Region 8
Tulum new homes and condos developments are spreading all over these new residential locations.
Aldea Zama:
The Condos for sale in Aldea Zama are the most luxurious of Tulum Real Estate Mexico and the ones that offer the best amenities.
Aldea Zama is a private community. It has world-class infrastructure, services, and the closest location to the beach.
Here you find many of the newest condominium developments, single family homes and a commercial area that offer the residents cafes, bars, and shops for their convenience.
Aldea Zama has lots of green areas and pedestrian-only streets.
It has a very natural atmosphere that makes you feel surrounded by the jungle.
It is all in all the most beautiful location with many advantages and benefits that no other location can match so far.
Click here to learn more about the options of new condos for sale in Tulum Mexico, Aldea Zama:
Region 15:
Also known as “La Veleta” is a developing area where many developers bought land and where they are building condos and homes to compete with the projects offered in Aldea Zama.
There are already properties being sold practically at almost the same prices than the ones in Aldea Zama.
These buildings have the same quality of materials and with interesting and beautiful designs.
However, Region 15 is still to be urbanized and to have all the services in place.
It means that many streets are still unpaved.
Neither there are not yet all the municipal services already working.
In Region 15 you have the main road named Av. Kukulkan.
This is the main avenue that is intended to eventually give second access to the beaches of Tulum.
So, when this becomes a reality, it will make all the neighborhood more appreciated in value.
For sure, this will change in the future and Region 15 will transform into the second most desirable location to buy a condo in Real Estate Tulum Quintana Roo.
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Other Tulum Real Estate Locations:
Besides Aldea Zama Tulum Real Estate and Region 15, the other locations to buy a property that is advisable is the beachfront condos or homes in Akumal and Sian Kaan.
These are out of Tulum town but close by.
Click here to lear more about the new neighborhoods in Tulum where you can buy an investment or vacation property:
Why Should You Buy Tulum Real Estate?
You should buy an apartment or a house in Tulum if you really appreciate all that the destination has to offer.
Tulum is a place for people who are looking to be away from city life.
It means being surrounded by natural beauties like the jungle, the beaches, and the cenotes.
If you like activities like yoga, diving, relaxing, working out, and going to artistic events.
This is a place where you can meet people who are coming from all over the world.
In Tulum, you can easily make new and interesting friends. This is a charming town to experience.
You should buy Real Estate in Tulum if you want to combine having a vacation home that you will actually use to live great moments with your family and to make some money by renting your condominium during the time you are not using it.
Or also, if you are looking to move or retire in a town that offers you a good quality of life and that is much more affordable than your own country.
How To Purchase Tulum Real Estate?
First, you need to look for Real Estate Agents of Tulum who are licensed.
In 2014, the state of Quintana Roo enacted the Law of professional Real Estate Services.
This law made it mandatory for all the individuals providing real estate representation to buyers, sellers, landlords, and tenants, to take a course and pass an exam in order to get the license to be a real estate agent or broker.
Before 2014, there was no obligation to have a license so that everybody was doing it without the necessary knowledge and formation.
This is why many people got into trouble. They lacked a good representation and many transactions were carried on poorly and inefficiently.
Despite this law, there are still many people serving as real estate agents in Tulum that shows no interest in getting their license. It is very important that you get in touch only with professionals that are trustworthy to you.
Besides the license, in Tulum, there are few agents who are also members of important Real Estate associations like AMPI and NAR-Realtor.
This assures you even more that you will be represented and supported by a real professional of Tulum real estate that is able to help you in a proper way.
It is a good advise to always ask an agent to show you his valid and current license.
SEDETUS issues the license. It is the state government agency that controls the real estate activities.
This license is granted on a yearly basis, meaning that it has to be renewed each year by proving a good record and by completing additional formation courses.
Despite this law, there are still many people serving as real estate agents in Tulum that shows no interest in getting their license.
It is very important that you get in touch only with professionals that are trustworthy to you.
In this webpage you can check the list of licensed real estate agents. Make sure you work with a professional when buying a property in Tulum.
List of licensed Agents (You can find me on that list under last name "Marquez Weeks".
Find a Real Estate agent who represents your interests and who can help you to buy or sell your condominium or your home in Tulum successfully without risks.
Click the button below to know more about Tulum Mexico Real Estate Listings.
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Is financing available to buy property in tulum?
no, all purchases are in cash...
Financing To Buy Tulum Real Estate
Mortgage Bank Loans From A Mexican Bank:
If you are a foreign national buyer, you do not qualify as a borrower to get a proper mortgage loan to purchase real estate properties in Tulum.
Mexican banks require that you be a legal resident in Mexico and you can prove a source of income here.
Besides, no bank will even lend a Mexican buyer to purchase a property in preconstruction.
The house or apartment that you want to buy MUST be completed and with a title ready to transfer.
It makes virtually imposible to purchase a property in Tulum by means of a mortgage loan from a Mexican bank.
Remember that the majority of the real estate new developments in Tulum are selling in preconstruction phase, about 12-24 months before completion.
Cross-border Mortgage Brokers:
There exist some companies offering cross-border mortgage loans specially designed for USA and Canada citizens to buy a house or a condo in Tulum.
However, once again, you can't purchase any property in preconstruction. It must be completed and ready to transfer the title.
It means that you have to purchase a resale property or a brand new one but already built.
This narrows all your choices drastically.
Now, even though you may have access to a credit from this mortgage brokers, it won't be cheap at all.
US and Canada citizens are used to have easy access to cheap credit.
It does not work the same way here.
In case you manage to qualify and get a mortgage loan from these cross-border brokers, you will be paying an interest rate from 10-14%.
Therefore, if your ultimate goal to buy a property is to do vacation rentals to generate income, your annual interests will be higher than your rental revenue.
It simply does not make financial sense. You pay more interests than what you get in rents.
Direct Financing From Developers:
Since 2017, when I started working as a real estate agent in Tulum, I have only seen maybe 3-5 cases where the developer offers direct financing to incentivise buyers to purchase their properties.
Most of the developers need the constant cash flow to complete the construction.
Only very few companies are financially strong enough to finance the whole cost of the project from their own pockets.
Nevertheless, direct financing from the developer does not mean you have the same terms and conditions of a mortgage bank loan.
With this option of financing, the title of the house or condo you are buying won't be transferred under your name until the full price has been paid completely.
Direct financing commonly are based on the following:
COMMON TERMS FOR MORTGAGE BANK LOANS:
DOWNPAYMENT
FINANCED AMOUNT
LOAN PERIOD OF TIME:
INTEREST RATE
QUALIFY ONLY:
MUST PROVE:
COMMON TERMS FOR DIRECT FINANCING:
DOWNPAYMENT
FINANCED AMOUNT
LOAN PERIOD OF TIME:
INTEREST RATE
Only Cash...No Bubble!
There is no real estate bubble in Tulum.
The market is very strong due to the fact that all purchases are in cash.
No speculation and no influence of banks nor financial institutions making money by selling credits.
Do you know a similar real estate market like this?
What About Property Taxes?
THEY ARE SIGNIFICANTLY CHEAPER THAN WHAT YOU PAY IN US AND CANADA.
PROPERTY TAXES
How Much Do You Pay For Property Taxes in Tulum?
Property taxes are paid annually to the municipality government.
In Spanish, it is named "Impuesto Predial".
Property taxes are based on a percentage over the property value.
As of 2024, the property taxes in Tulum have factor from 0.0017 to 0.0050 to determine the amount to pay.
This percentage depends on the specific type of property, the geographical location, and the nature: Residential real estate, Urban properties, Rustic farms, Commercial real estate, etc.
Note: Property Taxes are subject to changes and increases from year to year based on the tax law enacted and applicable for every fiscal year.
Property Taxes Discounts: If you pay your property taxes early in the year, during January and February, you will get discounts from 15-10%.
Examples below taking the highest possible outcome.
So it might be even much less:
PROPERTY TAXES IN TULUM:
PROPERTY VALUE
PROPERTY ANNUAL TAXES (ESTIMATE):
PROPERTY VALUE
PROPERTY ANNUAL TAXES (ESTIMATE):
Real Estate Agents In Tulum
By Law, the real estate agents in Tulum, Quintana Roo State, must take a certification course and apply for a licence.
The name of this law in Spanish is "Ley de Prestación de Servicios Inmobiliarios".
It was enacted on June 6, 2014.
You can consult this law with this link of the Quintana Roo State Congress website.
Since then, it has been reformed on July 16, 2021 and on December 21, 2023 with the purpose to adjust to the fast pace of the current real estate market in Tulum, Quintana Roo.
This licence is issued on an annual basis. It must be renewed every year with the requirement to prove having taken at least 30 hours of professional training courses to keep up-to-date.
It is extremely important that you are careful enough to verify that the agent you want to work with in Tulum is a fully licensed realtor.
You will find soon out that there are much more non-licensed pseudo agents in Tulum than duly licensed ones.
How Can I Verify That a Tulum Real Estate Agent is Licensed?
The Quintana Roo State government agency in charge of the real estate regulations is named SEDETUS.
SEDETUS publishes each year on its website the official list of real estate licensed brokers and agents in Tulum and the rest of Quintana Roo.
You can easily verify who is and who is not a proper agent in this link:
Tulum Investor Licensed Broker since 2018:
We have been complying with all laws and regulations.
We are members of the Mexican Association of Professional Realtors, named AMPI.
Here you can verify our registry as active members: AMPI - ILUI WEEKS
NAR and CIPS Memberships:
We are also active members of the National Association of Realtors in USA (NAR) and with the special designation of Certified International Property Specialist or CIPS.
You can verify our membership in the official website directory.
Thus, Tulum Investor Real Estate is a proper Tulum realtor.
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How to Buy Property In Tulum Mexico?
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Tulum Neighbourhoods
Tulum Beachfront
Tulum New Listings
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