Market Size of Residential Real Estate Industry In Mexico
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 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 Size Summary
The residential real estate market in Mexico is experiencing a notable expansion, driven by increasing demand for housing from both new residents and a significant influx of tourists seeking long-term stays and second homes. The trend of remote work has further fueled this growth, as individuals and families are drawn to Mexico's appealing destinations for year-round, resort-style living. This has led to a surge in the purchase of vacation homes, which are often rented out for additional income. The market's resilience is evident despite fluctuations in house prices, with a general upward trend observed across various regions. The demand is particularly strong among young adults, who are taking advantage of flexible work arrangements to seek homes that offer both comfort and connectivity, regardless of proximity to traditional work hubs.
The Mexican housing sector plays a crucial role in the country's economy, contributing significantly to GDP and demonstrating a strong preference for homeownership. The market is characterized by a competitive landscape with numerous players, including major developers and real estate firms, which are essential in navigating the complexities of property transactions. Recent investments and strategic partnerships, such as those involving technology platforms and philanthropic initiatives, are aimed at enhancing market efficiency and addressing housing gaps. These developments underscore the dynamic nature of the residential real estate market in Mexico, which continues to adapt to evolving consumer preferences and economic conditions, thereby maintaining its status as a key driver of economic stability.
Residential Real Estate Market In Mexico Market Size - Table of Contents
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1. MARKET INSIGHTS DYNAMICS
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1.1 Current Market Scenario
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1.2 Market Dynamics
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1.2.1 Drivers
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1.2.1.1 Increasing Residential Real Estate Demand by Young People
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1.2.1.2 Increase in Average Housing Price in Mexico
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1.2.2 Restraints
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1.2.2.1 Lack of Affordable Housing Inhibiting the Growth of the Market
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1.2.2.2 Economic Instability Affecting the Growth of the Market
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1.2.3 Opportunities
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1.2.3.1 Growing Middle Class Population Acting as a Catalyst
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1.2.3.2 Increased Urbanization Contributing to the Growth of the Market
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1.3 Value Chain / Supply Chain Analysis
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1.4 Porter's Five Forces Analysis
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1.4.1 Bargaining Power of Suppliers
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1.4.2 Bargaining Power of Buyers/Consumers
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1.4.3 Threat of New Entrants
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1.4.4 Threat of Substitute Products
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1.4.5 Intensity of Competitive Rivalry
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1.5 Residential Real Estate Buying Trends - Socioeconomic and Demographic Insights
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1.6 Government Initiatives and Regulatory Aspects for the Residential Real Estate Sector
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1.7 Insights Into Size of Real Estate Lending and Loan to Value Trends
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1.8 Insights Into Interest Rate Regime for General Economy, and Real Estate Lending
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1.9 Insights Into Rental Yields in the Residential Real Estate Segment
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1.10 Insights Into Capital Market Penetration and REIT Presence in the Residential Real Estate Market
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1.11 Insights Into Affordable Housing Support Provided by Government and Public-Private Partnerships
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1.12 Insights Into Real Estate Tech and Startups Active in the Real Estate Segment (Broking, Social Media, Facility Management, and Property Management)
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1.13 Impact of COVID-19 on the Market
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2. MARKET SEGMENTATION
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2.1 By Type
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2.1.1 Apartments and Condominiums
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2.1.2 Landed Houses and Villas
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Residential Real Estate Market In Mexico Market Size 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.