# Tulum questions (many!!)



## trvlinful

I am seriously thinking about investing now in the Tulum area. I would prefer something close to the ocean...but open to jungle living as well. I would prefer a home rather than a condo or townhouse, but am still just looking at ideas. I would like something that I can rent out now until I retire (10-15 years).

I hear there are funding problems or approval problems with the new proposed int'l airport. Any Updates? When will it be open?

I am looking to possibly convert my traditional IRA and invest in my retirement/rental home. Has anyone any experience in this? I've heard that you can transfer a traditional IRA into a self directed IRA but you need to be self employed. Is this true?

If I am able to buy an existing home or condo, what can I expect as far as rental income? Occupancy rates? Has anyone had successes or problems with trying to rent out their home/condo?

I have been looking at an eco community called Los Arboles. It looks very intriguing but when I GoogleMap it, it looks like it might be in the flight path of the proposed Int'l Airport. Thoughts?

Building vs Buying Existing? Pro's-Con's?

I have many other questions before I pull the trigger...more to come.

Thanks to those of you that respond.


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## TundraGreen

trvlinful said:


> I am seriously thinking about investing now in the Tulum area. I would prefer something close to the ocean...but open to jungle living as well. I would prefer a home rather than a condo or townhouse, but am still just looking at ideas. I would like something that I can rent out now until I retire (10-15 years).
> 
> I hear there are funding problems or approval problems with the new proposed int'l airport. Any Updates? When will it be open?
> 
> I am looking to possibly convert my traditional IRA and invest in my retirement/rental home. Has anyone any experience in this? I've heard that you can transfer a traditional IRA into a self directed IRA but you need to be self employed. Is this true?
> 
> If I am able to buy an existing home or condo, what can I expect as far as rental income? Occupancy rates? Has anyone had successes or problems with trying to rent out their home/condo?
> 
> I have been looking at an eco community called Los Arboles. It looks very intriguing but when I GoogleMap it, it looks like it might be in the flight path of the proposed Int'l Airport. Thoughts?
> 
> Building vs Buying Existing? Pro's-Con's?
> 
> I have many other questions before I pull the trigger...more to come.
> 
> Thanks to those of you that respond.


I would suggest you be very careful before considering being an absentee landlord to rental property in Mexico. I have heard first hand, too many horror stories of what can go wrong: tenants that trash the property and/or don't pay rent; property managers that skim or claim the property is vacant while actually collecting rent; people that occupy the property, claim it is abandoned, then tie the title up in litigation. 

I think you would be much better off investing somewhere closer to home, then buying in Mexico after you move here.


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## RVGRINGO

You would also have to have immigration permission for lucrative activity on your visa, be in Mexico at the required renewal dates, for a week or three, and also deal with the need for an accountant and dealings with the 'hacienda'.


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## abscissa

Friends of ours just finished building just out of downtown Tulum (off beach). He's a construction contractor in BC and his wife knows quite a bit about construction. 

Three month after they had got a contractor to build the house the build in Tulum was going sideways, the contractor spend all the first installment but little was done on the house. The wife took 8 months off work and when down to Tulum to run the job. She made sure that things were getting done, she bought all the materials and made sure that the workers on the job site were actually on the job site that she was paying wages to and all the other thinks that seem to come up when you are building in Mexico.
It all worked out in the end for them but it wasn't as cheap as they though it was going to be, it contrast our place on the Yucatan (new house, finished, on the beach with NoB amenities) cost way less than what they spent). Their lesson was if you are not down there babysitting the job you'll probably get charged way more for alot less work.

Unless you know of a reputable contractor in Tulum area .. I would not build .. I would buy something existing. I'd also be warey of pre-sale projects that have not had a lot of work put into them (under funded) some of these never get completed and you can't get your money back.

As far as rentals goes right now, with the US economy the way it is ... rentals are slow and they are not get the big bucks that they use to. But you still have to clean the house and pool before the renters arrive and again when they leave, plus you have maintainance to do on the house and if it's on the beach it can be pricey. In the summer months you have to have someone come in to open the house up to air it out, at lest 2 times a week, sometimes 3 or 4, because the humidity is so high that everything well get moldy.

Also many of the venders and restaurants from Cancun to Tulum are complaining that they are not doing well (decreased traffic) ... they are surviving but not much more. So if you are thinking of this as an investment to make you an income .. I'd think again.

When we bought our beach house we did not have "rental" in the equation at all. If we rent it... great it's a bonus .. if not .. we don't care, it bought and paid for and we bought it to use 6 months out of the year. As Tundagreen states ... being an absentee landlord can be nerve racking if you don't have someone down there, looking after the house, that you can really trust ... you are a long way away from Tulum. It took us a couple of years to find a good person that we can trust to look after ours.


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## m55vette

You could circumvent some of the rental issues by booking the tenants yourself on a site like VRBO, then you'd know when it was rented. I would think a reputable Realtor might have a line on a rental agent who is honest if they don't have the function in their organization. But the long distance landlord thing is never a slam dunk, you will inevitably have tenant issues at one time or another, or another or...


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## jj4music

You can open an LLC or a sole prop to move money into a Self Directed IRA to purchase real estate.

You can set up a Self Directed IRA, which is supported by a LLC or you can open a Solo 401k as a sole prop. There is a lot of information on this at www (dot) IRA123 (dot) com.


What is nice with these Self Directed IRA plans is that you can invest in property outside the USA with a 401k from the USA.

Hope that helps!


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## Cameron Crow

*Los Arboles Tulum, flight paths, other questions*

Hello, my name is Cameron Crow and I am one of the co-founders of the Los Arboles Tulum eco-residential project. I saw your post and I wanted to offer my perspective on some of your questions. I have lived in Tulum mostly full time since early 2003, and have been visiting the area since 1995.

Airport: The current "word on the street" (and in the local newspapers) about the proposed Tulum international airport is that the recent downturn in the tourism market, and thus lack of demand, has delayed the project. It is really impossible to say at this time if and when they will start moving forward again with this project. There are powerful forces that want it, and powerful forces that do not. The existing airport is not anywhere near capacity and they are not interested in the competition anyway. So this one is really a "wait and see" kind of thing, it's too hard to get reliable information at this point and know what is going to happen.

Flight paths: What IS a fact is that Los Arboles Tulum is not in any possible flight path from that site. We are too close to the state road, and in a parallel orientation to the site and the flight paths, which are pre-determined by prevailing winds. We are also well out of the lateral "noise cone" barrier projected, if an airport is developed on that site. Our property is over 1200 acres of dense, old-growth forest, with a 95% conservation rule. We are well buffered from any external impact. Finally, the google earth images you see are over 5 years old. We fly over the area regularly and on the last trip, we noticed that those strips are no longer visible... the jungle has overgrown them once again.

IRA purchase: Several clients have purchased investment lots with us through their self-directed IRAs. If you contact me off-forum, we can discuss how they did it.

Rental Income: Other posters have said this, I would agree-- there is potential for rental income, but there are significant fluctuations seasonally and volume is down significantly now. "How much will I earn" is going to be difficult to calculate accurately. There are local agencies that can help you manage a rental property. It is possible, but of course issues do pop up and sometimes you have to come here to resolve them. Isn't that the case with a rental anywhere? In my experience, periodic "face-time" in Mexico is important, no matter what type of purchase/investment you make. Finally, I know many people that successfully use the VRBO option mentioned here when renting their second home.

Building: we have a portfolio of builders that we have worked with for years. They come with references and proven track records. Of course there are glitches here and there, and you pay a little more for professional, organized, bi-lingual management, but successful projects can be and are completed on a regular basis. Of course there are nightmare scenarios playing out all the time, but with proper due diligence, they can be avoided.

OK, I hope this perspective helps. You can contact me directly at cameron at losarbolestulum dot com if you have any other specific questions.

Cameron



trvlinful said:


> I am seriously thinking about investing now in the Tulum area. I would prefer something close to the ocean...but open to jungle living as well. I would prefer a home rather than a condo or townhouse, but am still just looking at ideas. I would like something that I can rent out now until I retire (10-15 years).
> 
> I hear there are funding problems or approval problems with the new proposed int'l airport. Any Updates? When will it be open?
> 
> I am looking to possibly convert my traditional IRA and invest in my retirement/rental home. Has anyone any experience in this? I've heard that you can transfer a traditional IRA into a self directed IRA but you need to be self employed. Is this true?
> 
> If I am able to buy an existing home or condo, what can I expect as far as rental income? Occupancy rates? Has anyone had successes or problems with trying to rent out their home/condo?
> 
> I have been looking at an eco community called Los Arboles. It looks very intriguing but when I GoogleMap it, it looks like it might be in the flight path of the proposed Int'l Airport. Thoughts?
> 
> Building vs Buying Existing? Pro's-Con's?
> 
> I have many other questions before I pull the trigger...more to come.
> 
> Thanks to those of you that respond.


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