# Rent Increase ?



## coondawg (May 1, 2014)

Have any extranjero renters been asked to pay more for their rentals now that the peso is about 18.5?


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## Isla Verde (Oct 19, 2011)

coondawg said:


> Have any extranjero renters been asked to pay more for their rentals now that the peso is about 18.5?


I haven't. I have a lease which clearly states my monthly rent in pesos and that's what I pay to my landlord.


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## chuck846 (Jan 15, 2016)

We don't pay rent - but we received a call from the Subaru salesman we have spoken to recently. Prices are going up Feb 1st. Reason : dollar / peso. Feels like we are paying a lot more at Costco recently as well. At least there I can pay with my dollar based Visa.


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## Isla Verde (Oct 19, 2011)

chuck846 said:


> . Feels like we are paying a lot more at Costco recently as well.


I believe that's called inflation and applies to both expats and Mexicans!


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## chuck846 (Jan 15, 2016)

Isla Verde said:


> I believe that's called inflation and applies to both expats and Mexicans!


Yes - but at Costco it is inflation which is being exported by the US.


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## Isla Verde (Oct 19, 2011)

chuck846 said:


> Yes - but at Costco it is inflation which is being exported by the US.


I don't understand. How can inflation be exported?


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## chuck846 (Jan 15, 2016)

Isla Verde said:


> I don't understand. How can inflation be exported?


I'm no economist. I guess it has to do with all the money printed in the US. A google search of "us exporting inflation to mexico" brings up some good reading. And - opinions vary.


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## ojosazules11 (Nov 3, 2013)

Isla Verde said:


> I don't understand. How can inflation be exported?


It is due to increased cost of goods imported from the US or goods pegged to the US dollar. We're already feeling it in Canada, too. Other than the cost of gas, many things are increasing in cost due to the rising US$/falling CDN$. Especially the imported fruits and vegetables that can't be grown in Canada in winter.


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## Anonimo (Apr 8, 2012)

*Not me!*



chuck846 said:


> We don't pay rent - but we received a call from the Subaru salesman we have spoken to recently. Prices are going up Feb 1st. Reason : dollar / peso. Feels like we are paying a lot more at Costco recently as well. At least there I can pay with my dollar based Visa.


When we paid by mistake with a U.S.based CC at Costco in Morelia, we had to pay a surcharge to Costco. Will never do that again!

Of course, that was quite a few years ago.


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## Anonimo (Apr 8, 2012)

coondawg said:


> Have any extranjero renters been asked to pay more for their rentals now that the peso is about 18.5?


A few years into our very long term rental (now going into its tenth year), our rent was raised from $3000 peso a month to $3500. I don't think it will happen this time, as we are well "embedded" here, and our landlords (neighbors, as well) highly value value our steady presence.


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## chuck846 (Jan 15, 2016)

Anonimo said:


> When we paid by mistake with a U.S.based CC at Costco in Morelia, we had to pay a surcharge to Costco. Will never do that again!
> 
> Of course, that was quite a few years ago.


Costco gives a small discount if you use their credit card, and/or if you have a premium membership. They also have a cash/costco credit card price and an 'other' price. The difference is perhaps a couple percent of purchase.

The pesos we have in Mexico were purchased at a MUCH lower exchange rate. So it makes sense to spend dollars and hold our pesos whenever possible (which is almost always).

It hurts when I think of what we have lost on the USD/MXN exchange - but we are earning 'something' on our CETES and the pesos are here. I don't have to worry about some US bank telling me I can only move a small amount of dollars / month or something.


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## Isla Verde (Oct 19, 2011)

chuck846 said:


> It hurts when I think of what we have lost on the USD/MXN exchange


Though I'm aware that the current USD/MXN exchange rate is an indication of big problems with the Mexican economy, I have actually gained from it. Every month when my US SS pension is deposited in my Mexican bank, I get more and more pesos in my account!


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## chuck846 (Jan 15, 2016)

Isla Verde said:


> Though I'm aware that the current USD/MXN exchange rate is an indication of big problems with the Mexican economy, I have actually gained from it. Every month when my US SS pension is deposited in my Mexican bank, I get more and more pesos in my account!


Yes - I cost average into our peso holdings as well. This week we moved enough dollars to peso to buy a new car her in Mexico. We got 18.64 I believe. But I'm sure you are aware that if you (or I) have a credit balance in our Mexican banks the pesos there are depreciating at the moment. You get more and more pesos - but the pesos you had prior are worth less.

Edit : And I'm not sure I agree with you on the 'big' problems in the Mexican economy.


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## Isla Verde (Oct 19, 2011)

chuck846 said:


> Yes - I cost average into our peso holdings as well. This week we moved enough dollars to peso to buy a new car her in Mexico. We got 18.64 I believe. But I'm sure you are aware that if you (or I) have a credit balance in our Mexican banks the pesos there are depreciating at the moment. You get more and more pesos - but the pesos you had prior are worth less.


I don't have enough dollars in my US account to buy a car or anything else that pricey, and I almost never withdraw money from it while I'm in Mexico. It's just there for medical emergencies and plane tickets when I travel once a year to the States. I do have a credit balance in my Mexican bank account, which I use to pay my rent and other living expenses in Mexico, so it doesn't matter to me that it's depreciating right now compared to the US dollar. You and I live in very different financial universes, chuck.


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## chuck846 (Jan 15, 2016)

Isla Verde said:


> I don't have enough dollars in my US account to buy a car or anything else that pricey, and I almost never withdraw money from it while I'm in Mexico. It's just there for medical emergencies and plane tickets when I travel once a year to the States. I do have a credit balance in my Mexican bank account, which I use to pay my rent and other living expenses in Mexico, so it doesn't matter to me that it's depreciating right now compared to the US dollar. You and I live in very different financial universes, chuck.


Moderators should not be looking to pick fights with non-moderators.


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## Isla Verde (Oct 19, 2011)

chuck846 said:


> Moderators should not be looking to pick fights with non-moderators.


I'm sorry you feel I was picking a fight with you. I was not picking a fight, just explaining that not all the members of this forum have similar financial situations. Some of us have the financial wherewithal to buy cars and houses in Mexico, others of us take public transportation and rent our homes. Wouldn't the world be boring if we all lived our lives the same way?


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## chuck846 (Jan 15, 2016)

Isla Verde said:


> I'm sorry you feel I was picking a fight with you. I was not picking a fight, just explaining that not all the members of this forum have similar financial situations. Some of us have the financial wherewithal to buy cars and houses in Mexico, others of us take public transportation and rent our homes. Wouldn't the world be boring if we all lived our lives the same way?


We rented the first year we were here - until we found something we were happy with. We take the bus into Mexico City about once a month (with INAPAM discount something like $7USD each way for us both). We take the Metro tons and have recently taken the Metro bus. We take taxis all the time.

We have no pensions. We are not collecting social security. We moved here because we love Mexico - and 'most' of the people. Regarding financial wherewithal - there are a lot of opportunities for expats to 'hand' money to the banks.

Don't hold whatever success we have had in 'saving' our hard earned money against us. It doesn't amount to all that much anyway.


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## RVGRINGO (May 16, 2007)

It would appear that this is not the time to make a rental contract in dollars, as the exchange rate would be fixed at the time of signing. Therefore, since pesos are the only legal tender to actually make the payement, the dollar cost of the rent could soar in the event the exchange rate reverted to 12, for example. Maybe that situation will help the sale of homes to those who might have previously considered renting.


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## TurtleToo (Aug 23, 2013)

Isla Verde said:


> Though I'm aware that the current USD/MXN exchange rate is an indication of big problems with the Mexican economy . . .


I don't believe this is the case. The problem is not that the peso is falling, but that the dollar is climbing. (Although of course, the effect is the same when it comes to the exchange rate.) The dollar is very strong worldwide right now--not just against the peso. When I was last in Europe, a Euro cost $1.38. Today it is $1.08. Similarly, the US dollar buys more Canadian dollars now, and is strong against most other currencies.

This applies to many countries world-wide today, not just to Mexico, and is not an indicator of big problems with the Mexican economy. (Not that that helps if you are trying to buy a US product with Mexican pesos!) 

.


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## Isla Verde (Oct 19, 2011)

chuck846 said:


> We rented the first year we were here - until we found something we were happy with. We take the bus into Mexico City about once a month (with INAPAM discount something like $7USD each way for us both). We take the Metro tons and have recently taken the Metro bus. We take taxis all the time.
> 
> We have no pensions. We are not collecting social security. We moved here because we love Mexico - and 'most' of the people. Regarding financial wherewithal - there are a lot of opportunities for expats to 'hand' money to the banks.
> 
> Don't hold whatever success we have had in 'saving' our hard earned money against us. It doesn't amount to all that much anyway.


Of course, I don't hold it against you that you have been able to put together a nice nest egg and have used it to buy a car and your home. I hope you won't hold it against me that I live on two very modest pensions, one from Social Security and the other from my last job in the States!

By the way, I also live here because I love Mexico. I don't understand your comment about opportunities for "handing" money to the banks. Please explain.


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## joaquinx (Jul 3, 2010)

chuck846 said:


> We moved here because we love Mexico - and 'most' of the people.


I hope that I'm not stepping too far out of the topic of this thread, but the above quote stirred something in myself. I moved to Mexico because, back in 1967, when I first visited Mexico, I fell in love with the country, its people and even the smell of the country. Now I wonder how many expats who live here did so not out of love, but because it was cheaper than the US or Canada. Perhaps choosing Mexico over another Central American or South American country because it was closer to friends and family who lived farther north. 

I believe I passed an acid test some 15 years ago when a Mexican ask me what was it that I liked about Mexico. Without thinking, I said that it was the people. He replied that that was the right answer.


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## ojosazules11 (Nov 3, 2013)

joaquinx said:


> I hope that I'm not stepping too far out of the topic of this thread, but the above quote stirred something in myself. I moved to Mexico because, back in 1967, when I first visited Mexico, I fell in love with the country, its people and *even the smell of the country*. Now I wonder how many expats who live here did so not out of love, but because it was cheaper than the US or Canada. Perhaps choosing Mexico over another Central American or South American country because it was closer to friends and family who lived farther north.
> 
> I believe I passed an acid test some 15 years ago when a Mexican ask me what was it that I liked about Mexico. Without thinking, I said that it was the people. He replied that that was the right answer.


The smell of the country... I've always felt so many of my strongest memories are linked to specific smells, and there is something about the aromas of Mexico and Latin America in general that makes me feel I'm home. It's weird, because of course I was born and raised in Nebraska, lived most of my adult life in Canada (with frequent stints in Mexico and Guatemala). But since my first visit to Mexico when I was 16 years old, it felt more like a homecoming than a strange, foreign land. I honestly can't explain it... But there is a similar smell in other Latin American countries I've been in - in spite of underlying differences based on climate, flora, etc. I think if you blindfolded me and dropped me in the middle of a town almost anywhere in Latin America, I'd know I was in Latin America simply by the smell.


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## Chelloveck (Sep 21, 2013)

TurtleToo said:


> I don't believe this is the case. The problem is not that the peso is falling, but that the dollar is climbing. (Although of course, the effect is the same when it comes to the exchange rate.) The dollar is very strong worldwide right now--not just against the peso. When I was last in Europe, a Euro cost $1.38. Today it is $1.08. Similarly, the US dollar buys more Canadian dollars now, and is strong against most other currencies.
> 
> This applies to many countries world-wide today, not just to Mexico, and is not an indicator of big problems with the Mexican economy. (Not that that helps if you are trying to buy a US product with Mexican pesos!)
> 
> .


The drop in oil prices also has a major impact on the value of the peso. When oil prices drop, the peso drops. The current combination of a strong dollar and cheap oil is why the peso is so low right now.

It's likely we'll see 20 pesos to the dollar soon.


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## sunnyvmx (Mar 14, 2010)

I have recently signed a rental contract for a lovely casita in La Floresta, Ajijic. My Mexican lawyer landlord requires my rent to be calculated by Oanda.com each month when due and can be paid in U.S. dollars or peso equivalent. This was a first for me as I have always paid a specified amount in pesos. I can't say I blame him and I have no complaint as it's a beautiful house with a very low rent.


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## coondawg (May 1, 2014)

sunnyvmx said:


> I have recently signed a rental contract for a lovely casita in La Floresta, Ajijic. My Mexican lawyer landlord requires my rent to be calculated by Oanda.com each month when due and can be paid in U.S. dollars or peso equivalent. This was a first for me as I have always paid a specified amount in pesos. I can't say I blame him and I have no complaint as it's a beautiful house with a very low rent.


As long as you both are happy. I would suggest you pay in USD, as changing to pesos to pay will be more costly for you.


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## joaquinx (Jul 3, 2010)

coondawg said:


> As long as you both are happy. I would suggest you pay in USD, as changing to pesos to pay will be more costly for you.


Rent can be quoted in USD, but legally the landlord can not demand any currency other than Pesos. How, in the middle of Mexico, do you acquire enough USD to pay the rent?


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## sunnyvmx (Mar 14, 2010)

We have one ATM that supposedly will give U.S. dollars. I've been chicken to try it. It's at an HSBC bank. If it's out of money you still get a deduction from your U.S. bank acct., but so far it's been caught and canceled before the day's end.


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## TundraGreen (Jul 15, 2010)

sunnyvmx said:


> I have recently signed a rental contract for a lovely casita in La Floresta, Ajijic. My Mexican lawyer landlord requires my rent to be calculated by Oanda.com each month when due and can be paid in U.S. dollars or peso equivalent. This was a first for me as I have always paid a specified amount in pesos. I can't say I blame him and I have no complaint as it's a beautiful house with a very low rent.


Does this mean that your rental rate is fixed in US dollars, and you have to visit oanda.com to determine the peso amount. It sounds like the landlord is taking advantage of the fact that the peso is falling against the dollar and that he has a tenant with access to dollars. As long as it is clear to both of you, and you are happy with the rent, it sounds like the landlord is just a good businessman, at least while the peso is falling. Should it start to rise again, he might get burnt with the rent fixed in dollars. It doesn't seem like it would matter to you which currency you use to pay the rent if you have a way of converting between them without a fee and you get a competitive exchange rate, i.e. equivalent to the one quoted by oanda.


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## joaquinx (Jul 3, 2010)

TundraGreen said:


> Does this mean that your rental rate is fixed in US dollars, and you have to visit oanda.com to determine the peso amount. It sounds like the landlord is taking advantage of the fact that the peso is falling against the dollar and that he has a tenant with access to dollars.


Actually, landlords often do this to any nationality including Mexicans. Generally, it is those who have no trust in the stability of the Peso. As I mentioned before, no landlord can demand payment in a foreign currency. They can set the rate but not the actual payment currency.


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## coondawg (May 1, 2014)

joaquinx said:


> no landlord can demand payment in a foreign currency. They can set the rate but not the actual payment currency.


UNLESS, both parties agree to it by signing the lease.


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## disenato (Jan 18, 2016)

Usually rent for foreigners is in USD and you pay the rent according to the cost of dollars on that day.


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## Isla Verde (Oct 19, 2011)

disenato said:


> Usually rent for foreigners is in USD and you pay the rent according to the cost of dollars on that day.


That's not true for everyone - it's certainly not true for me.


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## coondawg (May 1, 2014)

disenato said:


> Usually rent for foreigners is in USD and you pay the rent according to the cost of dollars on that day.


That may be true in 
areas where there are many "gringos", but my experience from renting for 14 years(7 different places and 4 different cities) is that I always paid in pesos, not a USD equivalent amount. One landlord asked for $400 USD in a "******" area, and when I said that I could pay 4000 pesos, as I did not have anything except pesos, they were fine with it. If they had not have been acceptable to me paying pesos, I would have sought other lodging. Just sayin'.


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