It appears that 2015 is off to a good start. Work on the city’s infrastructure projects continue with progress being made on the street improvements around town and of course the home port project which stalled late last year is moving forward again. It was noted that the city was busy making an extra effort to collect property and federal zone taxes in late November and December. Hopefully, they were successful and the funds collected have been put to good use.
Now that the 2014 full year MLS activity is finalized, 2014 activity was essentially flat compared to activity of 2013. There were 25% fewer sale transactions in 2014 but the median sale price was fractionally higher. We also had 7.3% more new listings in 2014 compared 2013. We finished 2014 with virtually the same number of active listings in our MLS meaning that there were more cancellations and, or expired listings that overcame the increase in new listings.
Since the sale values held up despite the fewer number of sold transactions, that reflects some strength in our housing market. However, buyers are still in a strong position as well due to the amount of inventory available. Sellers may well have to lower their expectations of price in order to complete a sale and compete against other similar listings. We should expect a similar market in 2015 as we had in 2014. Professionals expect significant upward price and volume movement to coincide with the completion of the home port which will no doubt trigger commercial airline flights to Peñasco as well.
Last month the Rocky Point Times Editorial commented on private real estate contracts and new federal regulations adopted last year. Let me take this opportunity to explain the two ways that foreigners can purchase property here in Puerto Peñasco. If the buyer takes title in his or her name (personal or LLC) then a bank trust is legally required. If the purchase is financed whether by an intuitional lender or directly by the seller, the buyer can obtain title by virtue of a warranty trust. The warranty trust contains all the terms and conditions of the financing and incorporates it into the deed or title. In doing so, the property is in the name of the buyer and the buyer is recognized as the rightful owner and duly recorded in the city public registry. Among other things, this means that the buyer can sell the property without the permission of the lender.
Alternatively, a buyer could purchase a property with seller financing using a private contract. This method is used more infrequently as each year passes as real estate professionals recommend the warranty trust for financed transactions. Using a warranty trust which is recognized by most all of the major Mexican banks, gives more protections to the buyer. One of which I mentioned above about the authority to sell the property. However, sometimes buyers still prefer a private contract because it is less costly. However, the deed and title does not transfer or change to reflect a sale until the buyer pays off the loan in full. That means that the seller is still recognized as the true owner. Notarios have different opinions on the validity of these transactions but a real estate contract between two parties is still a valid enforceable contract so it may be used in the future for quite some time.
Whether buying or selling, I recommend establishing a relationship with an AMPI real estate professional. You will know that you are working with an educated, ethical real estate professional, and that just could be the most important step to realizing your real estate goals for 2015. A list of members can be found online at www.RockyPointampi.com.
If you have questions about the information presented here please feel free to contact me. In addition, if you have questions about our market and desire to seek more detailed information please contact a licensed professional from our AMPI organization.
Richard Savino is the Designated Broker for Realty Executives Rocky Point and is a Past President of the Puerto Peñasco chapter of AMPI. He can be reached at firstname.lastname@example.org or 480 707-3822 US.