Reflecting a familiar pandemic migration, many Mexico City residents are selling their homes or apartments and moving to outlying areas with more space and greenery, said Hector Romero, partner at Peters & Romero Bienes Raices agency in Mexico City. “The effect is that there is more supply, with many people just trying to get rid of their possessions,” he said. The increase in inventories has also driven down prices, which “have not increased much in recent years”.
Meanwhile, economic anxiety has hampered investment, according to Andrés Vizcaíno of KW Pedregal Keller Williams in Mexico City. Since the 2018 election of leftist President Andres Manuel López Obrador, Mexico’s economy has continued to contract. Investors are “selling properties in Mexico City to reinvest in other countries,” Vizcaíno said.
Ms de la Torre de Skipsey agreed: “Mexicans buy in Madrid, Miami and New York, but not in Mexico. They are afraid to invest here, so we have a lot of inventory.
The high-end market has been particularly hard hit, said Sergio Gómez Rábago, an architect who directs the Real Estate Business Operations Education Center for the Asociacion Mexicana de Profesionales Immobiliarios, a national organization of real estate agents. But a recovery may be coming. “The market will realize that we are already in the second half of this government’s term, and they will take advantage of the reduced prices for luxury homes,” he said. “By 2023-2024, prices will eventually go where they should be.”
Mexico does not have a centralized database for real estate transactions. According to a report by Sociedad Hipotecaria Federal, a government financial agency, the average price of a home in Mexico during the third quarter of 2021 was 1.364 million Mexican pesos ($65,900). In the state of Mexico, which includes the capital, the average was 1.302 million pesos ($62,920).
Prices vary widely from neighborhood to neighborhood in sprawling Mexico City, home to nearly 10 million people. Overall, it remains the most expensive market in Mexico, according to Ramon Davila, CEO of real estate sales and marketing company Inmobilux, with average prices around 4.2 million pesos ($202,000) – “about $85,000 above the national average,” he estimated.