So, you’ve decided that owning a condo in Mexico would be a good idea. You love the beaches; you vacation there 3 times a year as it is, so why not take that next step and buy one?
A question I often get from new buyers about this topic is if they can rent out this same condo to generate income when they are not using the property. Are there rules and restrictions? Is the demand high? Should you count on this income?
The basic answer is, yes, you can rent out the condo you own to generate income. However, there are some considerations to make if this is your plan.
Are you buying in a tourist region?
Of course, generating income from the property you own by means of vacation rentals works best in really active tourist areas. Finding such an area shouldn’t be difficult since Mexico is home to some of the world’s most successful tourist regions, such as Cancun.
What is the specific high-demand location within your region?
Every tourist destination has its ideal location, the location where all tourists want to stay. For example, in Playa del Carmen real estate, condos either directly on the beach or a within a block or two will see the best success for vacation rentals, but further back demand will drop considerably. (Long-term rental still works very well, but if you’re planning on using the condo for yourself at times, this arrangement wouldn’t work.)
What kind of properties are renters looking for?
Typically larger condos, with at least 3 or 4 bedrooms hold the highest demand since vacationers who rent condos tend to be small groups looking for a way to be close together and save money.
Have you found a good property manager?
Don’t count on putting a sign on the balcony to get the renters you need. While this may work, in any case it will be complicated to manage the rentals and get tourists from all over North America to rent your condo from home. Find a property manager that has an established advertisement approach.
What about your personal belongings?
Is there storage for your personal belongings?
Have you considered a strategy for taxes?
You will be required to report the income from rental both in Mexico and the U.S. Hire an accountant in Mexico, and be sure to have a strategy worked out to avoid double taxation in the United States.
Buying condo in Mexico that will give you some income on the side is a great idea! Just be sure to do your homework and plan it so it works out well!