Residential Real Estate Mexico Market Size
| Study Period | 2020 - 2029 |
| Base Year For Estimation | 2023 |
| Market Size (2024) | USD 14.51 Billion |
| Market Size (2029) | USD 17.78 Billion |
| CAGR (2024 - 2029) | 4.14 % |
| Market Concentration | Low |
Major Players
*Disclaimer: Major Players sorted in no particular order |
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Residential Real Estate Mexico Market Analysis
The Residential Real Estate Market In Mexico Market size is estimated at USD 14.51 billion in 2024, and is expected to reach USD 17.78 billion by 2029, growing at a CAGR of 4.14% during the forecast period (2024-2029).
The market is driven by the demand for housing from new residents. Furthermore, the market is driven by the huge flock of tourists residing in the country for longer vacations and second homes.
- The Mexican destination markets are heating up, particularly as remote workers seek a year-round, resort-style living due to flexible, remote work policies. Buyers continue to snap up vacation homes that they can use more frequently and then rent out for income the rest of the year.
- The global rental market has remained at an all-time high for the past two years as demand continues to outpace supply. Due to the constant demand and transactional complexities that may arise, high-profile real-estate firms have set up shops in Mexico's resort markets to assist buyers. One of these brokerages is The Agency, a global billion-dollar real-estate brokerage with more than 60 offices in luxury markets in the United States, Canada, Mexico, Europe, and the Caribbean. The Agency now has seven office locations in Mexico, including Los Cabos, Todos Santos, La Paz, Puerto Vallarta, Punta de Mita, Riviera Maya, and San Miguel de Allende.
- The Mexican housing market continues to be resilient, supported by strong demand. In 2022, after a Y-o-Y increase of 8.56% in 2021, 5.38% in 2020, 7.66% in 2019, and 9.35% in 2018, the national house price index shot up by 10.41%. Before that, the Mexican housing market had been relatively stable for nearly a decade. Many residents of Mexico City are selling their homes and relocating to more spacious areas or reinvesting in other countries. Home prices in Mexico fell by 57.8% over the previous year, with a median price of USD 128,000 in December 2023. House prices rose by 10.4% Y-o-Y to September 2023, after an increase of 11.5% during the preceding quarter. However, the price of real estate is generally rising, although this trend varies from one region to another.
- After a brief pause during the COVID-19 pandemic, the housing market in Mexico City is reviving, fueled in particular by rising demand in the city's prime areas. There is no centralized database for real estate transactions in Mexico. However, according to the data platform Statista, the average home price in Mexico City in the first quarter of this year was around MXN 2.9 million (USD 148,000), making it Mexico's most expensive market. Condesa, Polanco, and Roma, a cluster of upscale districts prized for their architecture, culture, and culinary scenes, have some of the city's highest prices, ranging from USD 465 to USD 555 per sq. ft.
Residential Real Estate Mexico Market Trends
Demand for Residential Real Estate Witnessing Notable Surge, Primarily Driven by Young Homebuyers
- According to industry sources, the generation of young adults between the ages of 27 and 40 is driving the growth in housing demand. Since they can now buy a home far from their workplaces or neighborhoods that fulfill their social and economic expectations, this sector has significantly benefited from adopting a new kind of working from home. For instance, closeness to work hubs has taken a backseat in Mexico City. Since the trend is now to have "home offices," that is, work from home on a property anywhere in the country, this change in working conditions opens up various opportunities for housing developers around the nation.
- Real estate developments must respond to this new requirement by updating the complex's recreational areas and ensuring technical coverage while adjusting to recent market trends and preferences. With this innovative method of working, employees can conduct their tasks from wherever makes them feel most at ease, giving them the option of working in the heart of Mexico, the United States, Canada, or anywhere else in the world while conducting "home offices" from the Riviera Maya.
- The Mexican residential real estate industry is growing due to young people demanding a place to live. The housing demand projected for the next few years will be driven by people under 30 (representing 55% of the country's population). The Bajio zone, formed by Aguascalientes, San Luis Potosí, Guanajuato, Querétaro, and the northern region of Mexico, is exciting. Cities like Monterrey are growing because of the demand for corporate and residential spaces. Tourism growth in destinations like Cancun, Los Cabos, and Puerto Vallarta also encourages real estate developments. In 2022, around 24.51% of Mexico's population were between 0 and 14 years of age, around 67.17% between the ages of 15 and 64, and about 8.32% were 65 years or older.
Surge in Average Housing Prices in Mexico is Propelling the Country's Residential Market
- The housing sector in Mexico plays a pivotal role, accounting for roughly 6% of the nation's GDP. A majority of homes, about 69%, are owned outright, while only 15% are rented. This preference for ownership is evident, with nearly 69% of Mexican households owning their homes in 2020, while only 17% opted for renting. Furthermore, a significant 87% of owned homes were debt-free, underscoring the financial stability of homeownership in the country.
- Over the past decade, residential real estate prices in Mexico have witnessed a consistent uptrend. In Q3 2023, the average house price saw an annual increase of over 10%, or 5.5% when adjusted for inflation. Amongst the states, Mexico City emerged as the costliest market for homebuyers.
- In Q3 2023, the average residential property in Mexico commanded a price of MXN 1.6 million. This marked a nearly 15% surge from the previous year. Notably, Mexico City stood out with an average price exceeding three million pesos per unit. Continuing its lead, Mexico City retained its status as the priciest residential market in 2023. With an average cost of nearly MXN 3.7 million in Q3, it stood at almost double the national average.
- The Mexican housing market demonstrates a strong preference for ownership, with a significant portion of homes owned outright. The market has experienced a steady increase in residential property prices, particularly in Mexico City, which remains the most expensive market. These trends highlight the robust nature of the housing sector as a key contributor to Mexico's economic stability.
Residential Real Estate Mexico Industry Overview
The residential real estate market in Mexico is fragmented due to the presence of many players in the market. Speculators do not drive the housing market. Some of the major players are Ruba, Consorcio Ara, Sab de CV, Grupo Garza Ponce, Groupo Lar, and Grupo Jomer. There are many developers, and the market is highly competitive. Access to financing has become an indispensable component of the Mexican residential market, with public institutions and private banks having a key role.
Residential Real Estate Mexico Market Leaders
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Ruba
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Consorcio Ara, Sab de Cv
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Grupo Garza Ponce
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Group Lar
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Grupo Jomer
*Disclaimer: Major Players sorted in no particular order
Residential Real Estate Mexico Market News
- June 2023: Habi, a prominent real estate technology platform, is set to receive a substantial financial boost of USD 15 million from IDB Invest. This funding, spread over four years, aims to fuel Habi's expansion plans in Mexico. While the structured loan has the potential to reach USD 50 million, its primary focus is to cater to Habi's working capital needs. IDB Invest's strategic move is not just about bolstering Habi's growth; it also aims to leverage technology to enhance liquidity and agility in Mexico's secondary real estate markets. By addressing the housing gap in Mexico, this funding initiative is poised to elevate market efficiency, bolster transparency, encourage local contractors for home renovations, and expand Habi's corridor network.
- June 2023: Celaya Tequila, a premium tequila brand crafted in small batches and co-founded by brothers Matt & Ryan Kalil, is forging a philanthropic alliance with New Story, a non-profit dedicated to eradicating global homelessness. In a groundbreaking move, Celaya Tequila pledges to contribute a percentage of sales from every bottle towards an affordable housing endeavor in Jalisco, Mexico. This endeavor aims to empower underprivileged families in Jalisco by enhancing their access to homes and land ownership.
Residential Real Estate Market In Mexico Market Report - Table of Contents
1. INTRODUCTION
- 1.1 Study Assumptions
- 1.2 Scope of the Study
2. RESEARCH METHODOLOGY
- 2.1 Analysis Method
- 2.2 Research Phases
3. EXECUTIVE SUMMARY
4. MARKET INSIGHTS DYNAMICS
- 4.1 Current Market Scenario
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4.2 Market Dynamics
- 4.2.1 Drivers
- 4.2.1.1 Increasing Residential Real Estate Demand by Young People
- 4.2.1.2 Increase in Average Housing Price in Mexico
- 4.2.2 Restraints
- 4.2.2.1 Lack of Affordable Housing Inhibiting the Growth of the Market
- 4.2.2.2 Economic Instability Affecting the Growth of the Market
- 4.2.3 Opportunities
- 4.2.3.1 Growing Middle Class Population Acting as a Catalyst
- 4.2.3.2 Increased Urbanization Contributing to the Growth of the Market
- 4.3 Value Chain / Supply Chain Analysis
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4.4 Porter's Five Forces Analysis
- 4.4.1 Bargaining Power of Suppliers
- 4.4.2 Bargaining Power of Buyers/Consumers
- 4.4.3 Threat of New Entrants
- 4.4.4 Threat of Substitute Products
- 4.4.5 Intensity of Competitive Rivalry
- 4.5 Residential Real Estate Buying Trends - Socioeconomic and Demographic Insights
- 4.6 Government Initiatives and Regulatory Aspects for the Residential Real Estate Sector
- 4.7 Insights Into Size of Real Estate Lending and Loan to Value Trends
- 4.8 Insights Into Interest Rate Regime for General Economy, and Real Estate Lending
- 4.9 Insights Into Rental Yields in the Residential Real Estate Segment
- 4.10 Insights Into Capital Market Penetration and REIT Presence in the Residential Real Estate Market
- 4.11 Insights Into Affordable Housing Support Provided by Government and Public-Private Partnerships
- 4.12 Insights Into Real Estate Tech and Startups Active in the Real Estate Segment (Broking, Social Media, Facility Management, and Property Management)
- 4.13 Impact of COVID-19 on the Market
5. MARKET SEGMENTATION
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5.1 By Type
- 5.1.1 Apartments and Condominiums
- 5.1.2 Landed Houses and Villas
6. COMPETITIVE LANDSCAPE
- 6.1 Market Concentration
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6.2 Company Profiles
- 6.2.1 Ruba
- 6.2.2 Consorcio Ara, Sab de CV
- 6.2.3 Grupo Garza Ponce
- 6.2.4 Groupo Lar
- 6.2.5 Grupo Jomer
- 6.2.6 Grupo HIR
- 6.2.7 Inmobilia
- 6.2.8 Groupo Sordo Madaleno
- 6.2.9 Aleatica
- 6.2.10 Ideal Impulsora Del Desarrollo*
- *List Not Exhaustive
7. FUTURE OF THE MARKET
8. APPENDIX
Residential Real Estate Mexico Industry Segmentation
Residential real estate is an area developed for people to live in. As local zoning ordinances define, residential real estate cannot be used for commercial or industrial purposes. A complete background analysis of the residential real estate market in Mexico, including the assessment of the economy and contribution of sectors in the economy, market overview, market size estimation for key segments, and emerging trends in the market segments, market dynamics, and geographical trends, and COVID-19 impact is included in the report.
The Mexican residential real estate market is segmented by type (apartments and condominiums and landed houses and villas). The report offers market size and forecast in value (USD) for all the above segments.
| By Type | Apartments and Condominiums |
| Landed Houses and Villas |
Residential Real Estate Market In Mexico Market Research Faqs
How big is the Residential Real Estate Market In Mexico Market?
The Residential Real Estate Market In Mexico Market size is expected to reach USD 14.51 billion in 2024 and grow at a CAGR of 4.14% to reach USD 17.78 billion by 2029.
What is the current Residential Real Estate Market In Mexico Market size?
In 2024, the Residential Real Estate Market In Mexico Market size is expected to reach USD 14.51 billion.
Who are the key players in Residential Real Estate Market In Mexico Market?
Ruba, Consorcio Ara, Sab de Cv, Grupo Garza Ponce, Group Lar and Grupo Jomer are the major companies operating in the Residential Real Estate Market In Mexico Market.
What years does this Residential Real Estate Market In Mexico Market cover, and what was the market size in 2023?
In 2023, the Residential Real Estate Market In Mexico Market size was estimated at USD 13.91 billion. The report covers the Residential Real Estate Market In Mexico Market historical market size for years: 2020, 2021, 2022 and 2023. The report also forecasts the Residential Real Estate Market In Mexico Market size for years: 2024, 2025, 2026, 2027, 2028 and 2029.
Residential Real Estate Market In Mexico Industry Report
Statistics for the 2024 Residential Real Estate In Mexico market share, size and revenue growth rate, created by Mordor Intelligence™ Industry Reports. Residential Real Estate In Mexico analysis includes a market forecast outlook to for 2024 to 2029 and historical overview. Get a sample of this industry analysis as a free report PDF download.
