Appreciation In Puerto Vallarta

Ap-pre-ci-a-tion (noun)

Definition:  Growth in value – an increase in value, especially over time;

Appreciation is a very subjective word.  It is said that what goes up, must come down; but what does that mean in Real Estate?  Since the beginning of time we have seen the cyclical movement in Real Estate values.  Sometimes it is just a natural self-adjustment of the market and at other times, such as now, there are other factors influencing prices such as economic issues in our core target-market and of course our own domestic issues.

It has been reported that the real estate market for cities in beach locations in Mexico was the one that most felt the effects of the slowdown in 2008. The real estate crisis in the U.S. put a brake on sales in the second home market, while the decline in tourism activity limited the ability for Mexico’s nationals to realize their dream of owning a vacation home as well.

Does that mean the market is dead and will never recover to the point where one can “own a piece of the rock”, as Prudential likes to say, and see their investment not only appreciate, but become one of the best investment returns of a life time?

Supply and demand have always been two of the most dynamic forces in the appreciation of any tangible product.  Fortunately, Puerto Vallarta is always in demand for its tropical climate, beautiful topography and friendly people; and there is only so much coast line to develop, which creates a finite supply.

The challenge for 2010-2011 for realtors will be to adapt to an environment of slower growth, considering at all times real demand and attending more precisely to client preferences and needs, and remembering the rule of thumb has always been and still is, buy low, sell high, and there is no better time to buy low than right now to ensure that you will be able to sell high in the future.

Marilyn Newman is a sales associate with Prudential California Realty-Vallarta Division.  She can be contacted at marilyn.newman@prurealtypv.com .



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