Beware when purchasing real estate in Mexico
06:11 PM Mountain Standard Time on Tuesday, May 2, 2006
By Gary Harper / 3TV reporter
Real estate may seem to be leveling off here in the states, but in Mexico, it remains hotter than ever.
More Info
3 On Your Side
Arizona Department of Real Estate
2910 North 44th Street, Suite 100, Phoenix
For more information, visit
www.re.state.az.us. 3 On Your Side says hang on, though, because there could be risks when it comes to buying Mexican property.
For one Valley woman, buying Mexican property was a great investment.
She bought a beach home nearly three years ago in San Carlos and got a great deal.
But her Mexican home has been sold right out from underneath her and she never got a dime.
Kathy James had a spectacular view from that home and it's the very reason she decided to purchase the house in 2003.
"I knew this was the house I wanted to purchase for my husband and our family retirement, vacations," she said.
She bought the 4,400-square-foot, four-story, four-bedroom house for $189,000.
She then spent another $170,000 renovating it.
"People here don't realize how much work it is to purchase a home in Mexico, but, yes, it is well worth it," she said.
Real estate experts claim buying Mexican property these days is easier, but the rules are still very different compared to the states.
Mary Utley is with the Arizona Department of Real Estate and said even though Americans pay for beachfront property, they still can't legally hold the title.
Instead, the title is held in something called a trust.
"That's one last control that the Mexican government has over foreign investors," Utley said.
But that's where James' problems began.
She said she bought her home through Snowbird Realty and used an agent named Catalina Ordaz (Evatt), who was featured in a New York Times article on buying real estate.
James claims she was under the impression that Ordaz-Evatt and Snowbird Realty had established the trust to hold the title.
But James found out recently that there never was a trust, and the home she bought had been sold to someone else.
"This doesn't make sense. We paid our money. We owned the home. How can you take someone's home?" she said.
But the Arizona Department of Real Estate said what happened to James has been known to happen to others who fall in love with Mexican property.
"They go to who they assume is the owner," Utley said. "They are buying it from that individual. A trust is not established. It's just one-on-one contact that is established and in the long run they end up losing their money."
As for James, it's a hard lesson learned and she still can't believe her beach home was sold without her knowledge.
"The locks were changed. There was a for sale sign on my home," she said.
So what happened? 3 On Your Side contacted Ordaz at Snowbird Realty about the sale of James' home.
In turn, her attorney in Mexico wrote 3 On Your Side stating, "This case was tried in Mexico and the courts made a decision. Snowbird Realty was not involved."
But James said Snowbird Realty was involved and there was no court hearing as claimed by Snowbird's attorney. She plans on suing in order to get her home back.
"They took our home illegally," she said.
What happened to James is rare, but the Arizona Department of Real Estate said it does happen.
The agency publishes a guide for you with some tips to keep in mind when looking at investing in Mexican property.
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