Yesterday our team had the pleasure of viewing Cabo’s newest deeded fractional offering: the Auberge Private Residences at Esperanza. This 5-star luxury resort has made two of their buildings available to sell as deeded fractional. Deeded fractional is quite different than timeshare: you actually receive title to the property. But you share that title with a number of like-minded individuals. Your title allows you to enjoy the property for a certain percentage of the year and you don’t have to carry the expense of maintaining that property when you’re not actually using it. This is a great option for those who are still working and have a limited amount of time they can spend in Cabo.

What I like about Esperanza is that it is so peaceful; this is a very low density resort community. The three and four bedroom condos are huge, they’re about 3,000 square feet of air conditioned space tricked out with all the super high end amenities. I will admit the kitchen is a bit of a disappointment, but that’s OK in a fractional. For a full time residence for someone who enjoys cooking some upgrading of appliances would be necessary. But if you’re only here a week or two it is perfectly adequate. The rooms are spacious with tons of deck and patio, and the baths are quite luxurious. The clubhouse and common areas are lovely with gorgeous landscaping. Most residents travel around the resort by golf cart; one is included with each unit. And of course there’s the Auberge management. ‘Nuff said. What really got me fired up is that the developer has created a 1/24th share which buys you two weeks of dedicated use and unlimited ‘space available’ use for only $99,000. And, that includes membership in the private beach club. While we were there I shot this little video of the beach club. Hope you enjoy it!

Carol Billups is Broker/Owner of Cabo Realty Pros. She has enjoyed working with both buyers and sellers for over eleven years and still thinks hers is the best job on earth. She is also the real estate columnist for Los Cabos Magazine. You can read more of her articles on the website blog www.caborealtypros.com. You can reach her from the U.S. or Canada at 1-760-481-7694, or in Cabo at 044-624-147-7541. You can listen to our 24/7 broadcast on http://www.livecabo.net for a mix of happy music, weather reports and local information.

© 2012 Carol S. Billups

Everyone says they love to read my year-end reports; I’m a little late this year because of the hubbub with changing our name and running some killer open houses. Here is the raw data I pulled from our Multiple Listing Service (FLEXMLS) for the period of January 1 until December 31, 2011. The news is actually better than I expected.

I had thought our prices had hit bottom, and the mid-year stats seemed to indicate that, but the second half of the year proved me wrong. The good news is that (and actually I’ve seen this but didn’t realize it was the same for everyone) although prices are down volume of sales is up in almost every category. Prices do seem to be holding for single family homes in the cities, but for condos and properties on the corridor there was an additional adjustment. Gee, and I thought we were just good negotiators.

Overall there were significantly more sales in 2011 than 2010; my prediction is that 2012 will be even better. I’m judging that on the number of sales and tours we’re having in the first two weeks of the month. That said, we’ve got a ton of inventory we’ve got to work through. As of today, January 18, 2012 there are:
• 486 condos
• 501 single family homes
• 497 building lots
for sale in Cabo San Lucas, San Jose and the Corridor. It could take YEARS to make that go away, but it also tells me sellers are going to have to compete for transactions in the foreseeable future, and that’s great news for buyers. If you’ve ever dreamed of owning a home here in Cabo the situation will never be better.

Carol Billups is Broker/Owner of Cabo Realty Pros. She has enjoyed working with both buyers and sellers for over eleven years and still thinks hers is the best job on earth. She is also the real estate columnist for Los Cabos Magazine. You can read more of her articles on the website blog www.caborealtypros.com. You can reach her from the U.S. or Canada at 1-760-481-7694, or in Cabo at 044-624-147-7541. You can listen to our 24/7 broadcast on http://www.livecabo.net for a mix of happy music, weather reports and local information.

© 2012 Carol S. Billups

The good folks at WordPress suggested that I re-visit some of the themes that were read most last year. Makes sense to me, if that’s the information people are looking it should be as up-to-date as I can make it. One of the most common searches was the cost of living. So, since I just happen to have last week’s grocery receipt sitting on my desk waiting for someone to pick it up (why someone would want my grocery receipt is another blog) let’s talk about what I spent on groceries last Saturday.

First, remember that we pay for kilos of product in pesos. A kilo is about 2 pounds (2.2 to be exact). And the peso conversion rate varies daily; lately it’s been in the high 13’s. Today is 13.8 pesos to the dollar, so that’s what I’ll use to convert to dollars so that you can compare our costs to those in the US. And last, remember that Cabo is almost an island; almost everything in our stores was imported from the US or mainland Mexico.

So, what did I buy? Well the first thing on my receipt is the deli. You’ve got to love buying cold cuts in Mexico! Oh, we’re beginning to see pre-packaged, probably for the benefit of the tourists, but the deli counter is a hive of activity in most markets. Mexicans take cold cuts very seriously, and there’s a great ritual to be followed every time you order. You’ll ask for what you want, say a quarter kilo of Zwan brand turkey breast. The clerk, who more than likely works for another brand, will point out that they are having a special on San Rafael brand turkey and that it is very fine and would I like a taste. She (deli workers are almost invariably female) then very ceremoniously cuts and folds a slice of the product in question and presents it. The buyer accepts the sample with thanks and then makes a good show of examining its appearance and then sampling with a look of concentration on their face. Then, after careful consideration they agree that yes, it’s very tasty and will do nicely. Almost never do they insist on their original choice as that would be rude, and Mexicans as a rule are careful to be extra polite. Anyway, back to costs: premium grade turkey breast was $5.22 per pound, extra lean ham was $4.81, and manchego cheese almost exactly $5.00 per pound.

Over at the meat counter I paid $1.38 per pound for lean ground pork, a liter of chicken broth was fifty cents. Butter imported from Denmark was $3.19. A can of soup, I think it was clam chowder, was $1.75. That’s what importation does to your bill, I could have purchased Mexican made butter and soup much more reasonably.

As for the produce section, the sweet pineapple was 55 cents a pound, bananas were 46 cents a pound, and seedless grapes were exactly one dollar per pound. Bear in mind that it’s traditional in Mexico to eat grapes on New Year’s Eve, so the store might have been seizing an opportunity.

Now it’s been quite a while since I bought groceries anywhere but Cabo, but it seems to me that by and large our prices are quite a bit more reasonable, particularly on fresh products like meat and produce. Oh, there are exceptions, but my instinct is that when something is high priced it’s more than balanced by the many bargains. There is one caution that applies. Particularly in Cabo, where there are so many tourists, the merchants play a little mind game with branded products stocking both those imported from the US and those packaged here in Mexico. They’ll put the American Best Foods Mayonnaise right next to the Mexican Best Foods Mayonnaise. The bottles look identical, but one label is in English and the other Spanish. The tourists will just naturally pick up the label in English. What’s inside the two bottles is exactly the same, but that English label costs them an extra 30-40% in import duties, shipping and higher mark-up. So if you’re budget conscious (or just hate being ripped off like me) you’ll make an effort to buy domestic.

I’d like some feedback on this topic: am I right that our groceries are very affordable? What would the same products cost in the States? I’m looking forward to hearing.

Carol Billups is Broker/Owner of Cabo Realty Pros. She has enjoyed working with both buyers and sellers for over eleven years and still thinks hers is the best job on earth. She is also the real estate columnist for Los Cabos Magazine. You can read more of her articles on the website blog www.caborealtypros.com. You can reach her from the U.S. or Canada at 1-760-481-7694, or in Cabo at 044-624-147-7541. You can listen to our 24/7 broadcast on http://www.livecabo.net for a mix of happy music, weather reports and local information.

© 2012 Carol S. Billups

Real Estate the Right Way in Mexico

It’s the holidays. It’s high season. Either one of those might be a reason I haven’t blogged lately, but nope. The real reason is that my associates and I have been doing our best imitation of whirling dervishes. You see, last month we had an office meeting and unanimously decided to change our company name and affiliation. So right smack dab in the middle of all the normal December madness we’re running around making changes and notifying our clients that Realty Executives Los Cabos is now Cabo Realty Pros. Websites, business cards, yard signs, advertising and even this blog have to change. There are reasons we’re making this change, and we’re excited although a bit breathless from all the energy flowing around here.

Of course the name and logo are all that is going to change: our motto is still “Real Estate The Right Way” and we will continue to hold ourselves to a higher standard. And the company will continue to keep overhead to a bare minimum in order to pay the highest commissions in town. Those principles have served us well and gotten us to where we are today so they won’t change one iota. But they’ll be served up in a prettier package.

Picking a new name was a fun and collaborative process but the best part was finding a new logo. Luckily Jim had just done a course where they mentioned a design service called 99designs, at www.99designs.com. I cannot tell you how great they were to work with and how much fun the process was. The last time I went through a logo review it was excruciating. This was a blast. We contracted with 99designs to run a logo design contest: we supplied them with information about our company, our beliefs, where we are and put up the prize money. They then got the word out to graphic designers around the world and entries started to stream in. We provided feedback about which ones we liked and which we hated, and the designers responded. But things really got interesting when, having seen a number of logos with which we could live, I guaranteed the prize. When you do that there is no going back: some designer somewhere is going to take home the paycheck. And that’s when they get really motivated. And when we started having a little inter-office rivalry with one group claiming the colorful designs are representative of Mexico and another group who claimed the more monochromatic designs are ‘classy’. Posters went up supporting each position and visitors to the office were pressed into giving opinions. It was a really tough choice, but eventually everyone settled on the logo incorporating the sun, ocean and a whale.

Now we’re in the notification phase: letting everyone know we’ve got a new name, and getting everything switched over. It’s hectic, but fun. Being a whirling dervish has its perks: the switch has already brought us luck in the form of new business.

Our goal is to have the change complete by the end of the year and start 2012 with a new name and image. And then maybe stop whirling, and breathe.

Carol Billups is Broker/Owner of Cabo Realty Pros. She has enjoyed working with both buyers and sellers for over eleven years and still thinks hers is the best job on earth. She is also the real estate columnist for Los Cabos Magazine. You can read more of her articles on the website blog www.caborealtypros.com. You can reach her from the U.S. or Canada at 1-760-481-7694, or in Cabo at 044-624-147-7541. You can listen to our 24/7 broadcast on http://www.livecabo.net for a mix of happy music, weather reports and local information.

© 2011 Carol S. Billups

Rain in the desert is a big deal. We love it, although the tourists are disappointed the locals are ready to celebrate. Yesterday we had a very cloudy day and most parts of town got a good soak. And this morning? The sunrise was outstanding and the city sparkled. I stopped on the way to the Organic Farmer’s Market to take this quick video of how beautiful Cabo looked after yesterday’s ‘beauty treatment’.

Carol Billups is Broker/Owner of REALTY EXECUTIVES Los Cabos. A Certified Home Marketing Specialist, she has enjoyed working with both buyers and sellers for over ten years and still thinks hers is the best job on earth. She is also the real estate columnist for Los Cabos Magazine and Chairman of the AMPI Los Cabos Board of Realtors. You can read more of her articles on www.reloscabos.com. You can reach her from the U.S. or Canada at 1-760-481-7694, or in Cabo at 044-624-147-7541. You can listen to our 24/7 broadcast on http://www.livecabo.net for a mix of happy music, weather reports and local information.

© 2011 Carol S. Billups

I am just so psyched today! When you see the video, you’ll understand why.

I have this little listing, a studio apartment. The location couldn’t get better; it’s right on the marina here in Cabo San Lucas. It’s been on the market a few months, and has gotten a few offers (which is amazing considering the market and that it’s low season). But here’s the problem: the offers were very low. In fact, both offers were about one third less than our asking price. I tried to be as tactful as possible, but the seller was not getting it…

Here’s the thing. Everybody thinks their stuff is better than it is. Including real estate. In Cabo we don’t really have good data on final sales price, and even when we have some data the sellers usually dismiss it. They tell me those are exceptions because of the economy, desperate sellers, etc etc etc…. So they look instead at what their neighbors are asking, and because obviously their property is better they price it higher than their neighbors, so the entire area’s prices are escalating and buyers are turned off. Which is probably why we have (I’m not joking) five years of inventory and average time on market is over a year.

This little condo was priced well under other units in the same building, which is why we were getting offers. But the offers were reflecting the buyer’s belief that this condo was a fixer-upper if not a candidate for complete gutting and rebuilding.

Finally the manager of the building and I got approval to do a little cosmetic work. The building manager, Lulu, was convinced that for very little money she could turn this condo into a showplace. I went by this morning to check on her progress and feel like I was witnessing a miracle. So here’s a really short ‘before and after’ video showing you how some creativity, a little paint, and some creative touches can turn your home around. I’m expecting our next offer to be a good one.

As yes, I’ll be asking Lulu’s help many times in the future. Enjoy the video:

Carol Billups is Broker/Owner of REALTY EXECUTIVES Los Cabos. A Certified Home Marketing Specialist, she has enjoyed working with both buyers and sellers for over ten years and still thinks hers is the best job on earth. She is also the real estate columnist for Los Cabos Magazine and Chairman of the AMPI Los Cabos Board of Realtors. You can read more of her articles on www.reloscabos.com. You can reach her from the U.S. or Canada at 1-760-481-7694, or in Cabo at 044-624-147-7541. You can listen to our 24/7 broadcast on http://www.livecabo.net.

© 2011 Carol S. Billups

Baja Pony Express is a great newsletter/egroup based in Las Barriles, I always enjoy getting it but feel like I’m kind of free-loading since I don’t have anything to share. Well, yesterday someone posted a question I could answer. And, since someone is asking that means there are probably more out there who could the information. So here’s the exchange:

Questions:
c. Re: Immigration Status in Mexico
Baja Insider recently published an article reviewing the four immigration status’ which seemed very up to date and informative. The article was written by Lic.J.E Beauine, LLB. 045-(612)348-9793 cell in La Paz at the end of August.
It stated that one needs the FM-3 status only if one is in the country for more than 180 continuous days.
Previously, we had heard that having the FM-3 would help to reduce or eliminate the “Capital Gains” tax imposed upon selling your home.
It appears that now you have to have an FM-2 to actually accomplish this. Is this correct?
I also wonder if when it states that,” One must be in Mexico for no less than 3 out of 5 years”, does that mean one must enter into Mexico for at least 3 out of 5 years or actually reside in Mexico for three out of five years in order to obtain FM-2 status which would then enable you to reduce your “Capital Gains”.
Thank you for your assistance in finding the answers to these questions.

and here’s my answer:

Disclaimer: I’m not a Notaria or attorney, just a broker who has to walk clients through this on a regular basis. A year or so ago Sabrina Lear had me on her program on CaboMil with two notarios (one state and one federal) and this topic was a major part of the conversation both on and off air. This would be the summary, since I can’t remember which parts occurred on the air.

The exemption is at the discretion of the Notario Publico presiding over the transaction. Of critical importance is that the transaction being exempted must be on the party’s primary residence regardless of nationality. So just having FM2 status is not going to be enough, you’ve got to convince the Notario that this property is indeed your primary residence. Notarios are hesitant to give the exemption unless they’re sure as the new tax laws hold them personally liable. So if SAT (Hacienda) disagrees they could end up paying the amount of tax exempted out of pocket. So you’ve got to give them proof that you do occupy the Mexican property year-round, or at least more than half the year that they can pass on to SAT during their semi-annual audit. Utility bills are one way to do this. One East Cape resident who was off the grid successful proved her case by producing propane bills that didn’t vary seasonally. I haven’t had a client try it yet, but it seems to me that the receipts from your ATM withdrawals would be rock solid. I’m pretty sure we were in station break when one of the notarios admitted to me that they really don’t feel comfortable unless they know the person first hand, or if they are so prominent and well known in the community that no one would question their full time status. That said, I do know of people who were able to plead their case successfully. And remember it’s five years right now, which is always subject to change.

The big point, one that I always make to clients, is to find out about the exemption BEFORE you put your home on the market. Most of the Notarios will meet with you at no charge to see your documentation. If you can get one of them to agree to exempt you (preferably in writing), then we can make using that Notario a condition of sale. The FLEX MLS system has a section for private remarks visible only to other agents where we can designate this; it’s pretty much universally understood what requiring a specific notario means.

One more thing to consider. Don Nelson, the CPA/Attorney specializing in ex-pat US taxes, spoke to our AMPI group last summer about the 3520 and 3520A forms. At the end he just made one quick comment that for US citizens there might be US tax advantages to declaring Mexico as your legal primary residence a few years prior to selling. So you might want to have that conversation with your US tax advisor.

Hope that helps!
Carol

So, hopefully somebody got something of value from that information. If you’re into the East Cape you might want to subscribe to the BPE, you can reach them at bajaponyexpress3@gmail.com.

Carol Billups is Broker/Owner of REALTY EXECUTIVES Los Cabos. A Certified Home Marketing Specialist, she has enjoyed working with both buyers and sellers for over ten years and still thinks hers is the best job on earth. She is also the real estate columnist for Los Cabos Magazine and Chairman of the AMPI Los Cabos Board of Realtors. You can read more of her articles on www.reloscabos.com. You can reach her from the U.S. or Canada at 1-760-481-7694, or in Cabo at 044-624-147-7541. You can listen to our 24/7 broadcast on http://www.livecabo.net.

© 2011 Carol S. Billups