PUERTO VALLARTA (PVDN) – While the Puerto Vallarta brand continues to stand strong, both nationally and internationally, the real estate sector is encountering significant obstacles. Federal authorities have suspended at least 20 construction projects since last year, which is causing increasing concerns about investment in residential tourist housing.
Numerous individuals who have directed their retirement savings towards pre-sale deals, with dreams of settling down in Puerto Vallarta in the near future, are currently in a state of distress. They are fraught with uncertainty regarding the completion of their homes following the government’s abrupt halt to construction.
Moray Applegate, a local real estate agent and director of Applegate Realtors, expressed that the issue is impacting Puerto Vallarta’s credibility as an investment destination: “The real estate developments that were halted due to supposed lack of an Environmental Impact Statement or other formalities, are located primarily in the Emiliano Zapata, Conchas Chinas, and Amapas neighborhoods in the southern zone. I understand the requirements have been met, but the bureaucratic procedures are exceedingly slow.·
The real estate expert has already engaged with municipal authorities to resolve these issues with the Federal Attorney for Environmental Protection. The objective is to clear the way for projects that have satisfied the stipulated requirements. According to Applegate, the market cannot afford to wait. The delay is diverting investments to other locations: “What is happening is that investments are primarily shifting to Nayarit, to communities like Bucerias, which is experiencing rapid growth in the supply of luxury residential tourist housing due to more accommodating conditions.”
Applegate clarified that the goal is not to erect large buildings that would disrupt the traditional image of downtown Puerto Vallarta. However, in other neighborhoods, there is potential to cater to the flourishing market seeking second homes or investment properties. “The situation is complex since some projects continue while others under the same conditions have been halted. This inconsistency not only affects the city’s economy but also undermines Puerto Vallarta’s credibility as an investment hub; stated Applegate.
The real estate mogul hopes that all developments complying with legal stipulations will receive the necessary authorization from the authorities. Those failing to meet the requirements are urged to fulfill them promptly to ensure continued progression. This action is essential to maintain Puerto Vallarta’s status as an attractive real estate investment destination.
Thes project are not stopped without cause, many of the developers have violated building codes, or as business is done in Mexico, they can no longer afford the bribes to government officials, and sometimes cartels, to allow construction to continue. But there are some things potential buyers could do to help protect their investment.
- Research the Developer: Before making any investment, thoroughly investigate the track record of the developer. Have they completed past projects on time and according to the promised specifications? Are there any lawsuits or complaints lodged against them?
- Visit the Site: If possible, visit the site of the development to verify it existence and progress. This might not always be practical in the case of overseas investments, but it is still an important step if feasible.
- Legal Consultation: Engage a local real estate attorney who is familiar with the country’s property laws and the specific area’s regulations. This can help you navigate contracts and ensure that all legal aspects are covered. NOT AN ATTORNEY EMPLOYED BY A REAL ESTATE COMPANY! GET INDEPENDENT LEGAL ADVICE.
- Verify Ownership and Rights: Ensure the developer has ownership rights to the land and permissions to build.
- Escrow Account: Funds should ideally be placed in an escrow account to protect your investment until the project is completed. The money should only be released to the developer according to a pre-set schedule based on completed construction milestones.
- Clear Contract Terms: The contract should clearly outline all terms and conditions, including the total cost, payment schedule, project completion date, specifications of the property, and actions to be taken if the project isn’t completed on time.
- Insurance: Check whether the developer has insurance that covers bankruptcy or failure to complete the project.
- References and Reviews: Look for reviews from previous customers and, if possible, speak to them directly about their experience.
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