Mexico offers lots of options and opportunity for the expat. This is a big, extraordinarily diverse country that offers two long coasts, mountains, and colonial cities… not to mention Mayan ruins, jungle, rain forest, rivers, and lakes.
Mexico is the most accessible country in the region from the United States and Canada. Being in North America, Mexico is home to many American franchises, from McDonalds to Pet Depot and Walmart to Starbucks. Almost anything you buy in the States is also available in Mexico, though ease of availability would depend on your location (rural and remote areas would offer fewer franchises and order fewer imports).
For all these reasons Mexico is home to the biggest established population of American expats in the world. Ajijic and Chapala are two of the world’s biggest established communities of North American retirees overseas (though these aren’t our top recommendations in the country).
Puerto Vallarta is of the most affordable turn-key retirement on the Pacific Ocean, here, you could enjoy all the comforts of home at a fraction of the cost (despite the well-established expat community).
The silver mines in Mexico’s central highlands provided the incredible wealth that impelled Spain to world prominence in the 16th century and created Guanajuato, the crown jewel of Mexico’s colonial cities. Along with Guanajuato and Puerto Vallarta and we recommend the Bahia de Navidad and San Miguel de Allende.
Mexico is, perhaps, your best choice if you seek an adventure overseas with all the comforts of home.
Cost of Living in Mexico
Live and Invest Overseas offers monthly cost of living budgets for some of our favorite destinations in Mexico:
Infrastructure in Mexico
Mexico’s infrastructure is good and constantly improving. Incumbent president Enrique Peña Nieto has made national infrastructure improvement a focus for his term. In April 2014 he announced a major four-year plan to invest US$590 billion on national infrastructure across energy, land development, transport, communication, health, and tourism industries.
Communications in Mexico are excellent. Broadband Internet is available throughout the country and offers excellent connectivity. Most visitors notice no difference from the American to Mexican internet quality. Mexico very likely offers the best internet connection south of the border. Already impressively good and far-reaching, the telecommunications systems will be enhanced soon by a new fiber optic cable, giving Internet access to about 70% of the population (42% in 2012).
Mexico hosts Latin America’s largest jet fleet and nearly 2,000 airports (the third highest number per nation in the world). Air transport here is excellent, abundantly available, and usually very cheap.
Mexico’s rail system is good, but in need of some renovation. Initiatives have been made to modernize, connect, and bridge various lines around the country. A part of the four-year plan includes upgrading to high-speed rail systems to and from Mexico City. Likewise, the trans-peninsular train that runs across the Yucatán from Cancun to Merida will be completely upgraded.
Driving in Mexico is not as dangerous as you may have been led to believe, but it can be more challenging. There are plenty of well-maintained four-lane toll roads that (for a price) can make you feel as comfortable as if you were back home. The two-lane roads vary in width and conditions—some of them are in great shape and others are full of potholes. Traffic is a problem in major cities and suburbs.
One thing new drivers should be aware of is the livestock factor in Mexico. Livestock isn’t fenced in nearly as much as it is in the States. In fact, many farmers neglect to put fencing of any sort around the fields, even near highways. With no fencing the livestock is free to move about the roadways and because of this, nearly 40% of all Mexican accidents involve livestock in some way.
Climate in Mexico
Mexico has a tropical climate with a rainy and dry season and little temperature fluctuation from season to season.
The temperature in all areas of Mexico typically ranges between 50°F and 90°F throughout the year. Average annual humidity is around 70%. Mountainous regions and any area above sea level may experience cooler temperatures and lower humidity. Mexico receives the most annual rainfall during rainy season, most regions receive about 40 inches of rain per year.
Within Mexico City the weather is dry and mild. Mornings and nights are usually fresh, unlike the afternoons, which are usually warmer. The average temperature between December and March is around 70°F, while during the warmer months of March and April thermometers can go up to 90°F.
Weather conditions can utterly vary within the mountainous areas of northern Mexico, where winter seasons are very cold and usually freezing during the night. On the Pacific coastline, summer temperatures reach 95°F around the southern areas of Mazatlán or Puerto Vallarta.
As in any country, weather depends on your region, but generally Mexico enjoys a warm, tropical climate, with little temperature fluctuation from season to season.
Mexican Dry Season: November to May
Mexican Rainy Season: June to October
Residency in Mexico
U.S. citizens may enter Mexico without a visa and remain in the country as a tourist for a maximum of 90 days per trip. If you wish to stay longer than 90 days, you need to seek permission to remain in the country.
Mexican visas and immigration procedures vary. The first step is to find a good immigration attorney who speaks English. Interview at least two and do your due diligence. It’s a good idea to talk with expats that have been through the bureaucracy before you. On the whole, though, Mexico makes it easy for expats to move. There are two types of immigration permits past tourist: FM3 (long-term) and FM2 (permanent).
Probably the most popular visa is the FM3 status. It can be obtained before traveling to Mexico, or can be requested after arrival. The FM3 is a renewable long-term (more than six months) permit. It gives a person the right to live in Mexico, but does not automatically lead to permanent residency. To qualify, you must prove “sufficient funds to sustain yourself” and/or a proven steady income. There is no official minimum or maximum amount—every application appears to be dealt with on a case-by-case basis. You’ll need to show your bank statements, proof of investment income, credit cards, or some combination of the three. The FM3 may be renewed for an additional four years (for a total of five years). After this period, a new FM3 may be applied for and, if granted, will serve for another five-year period, renewable annually.
Permanent residency is granted through the FM2 visa. Time accrued under an FM3 visa cannot count towards your FM2 visa. This option can make sense for some, retirees over 50, investors, qualified professionals, qualified technicians, artists, and athletes.
Residency in Mexico can lead to a second passport and dual citizenship in this country once you’ve had an FM2 visa for a minimum of five years.
Health Care in Mexico
Mexico offers affordable, international-standard health care and medical tourism in this country is a booming industry. Mexico is one of the 10 most visited countries in the world for medical treatments.
Mexico’s health-care system provides both public and private options. The treatment and care are high-quality and affordable. You can find at least one hospital in every mid-sized and large city. Many Mexican doctors are trained in the United States, Europe, or Canada and speak English fluently and most medical workers at all levels speak basic-to-good English. Any town we direct you to in Mexico would have adequate local facilities to treat basic ailments, be it a clinic or a hospital.
The doctors here will spend time with you and often provide their home and cellphone numbers so you can contact them directly. Many doctors make house calls. Several expats commented that the cost of a routine office visit was the same or less than their copays back in the United States, around US$30. Specialists are available in town in private practice or in Querétaro. Fees are in the range of 500−800 pesos (click here for currency conversion) per visit. Expats report high levels of satisfaction with quality and cost both with doctors and dentists in Mexico.
Like many countries in Latin America, Mexico has developed a broad-based health system that comprises complex institutional structures. Following several health-care reforms, the resulting system is a segmented delivery structure with three separate components: a Social Security system that covers workers in the formal sector (and also accepts voluntary applications, see below), a public-services system that provides services to a portion of the lower and middle classes, and a diverse private sector that covers Mexican citizens from various economic backgrounds.
Foreigners usually apply for the insurance offered by the Mexican Institute of Social Security as a major medical fallback because the health care provided is sometimes deficient. Once you are a resident, you can apply to IMSS, and, if accepted, you will renew the contract each year and pay the annual fee.
Real Estate In Mexico
There is a lot of misinformation about whether foreigners can own property in Mexico. The simple answer is yes, but there are different ways to hold title, depending upon the property location, type of use, and whether financing is involved.
While foreigners may hold fee-simple title in their own name, fideicomisos (trusts) are also commonly used when there is financing involved or for purchasing using your IRA or 401k. Foreigners may also establish a Mexican corporation, which can own property. However, this is only to be used for business and commercial applications and is not allowed for holding title to a personal residence.
Real estate purchases by foreigners are almost always cash deals, although we’re seeing the first offering of financing for foreigners—the lender is an American bank in collaboration with a Mexican bank. Loans can be made in U.S. dollars, euros, or pesos, although the peso loans are only available for foreigners with the FM2 or FM3 visas and income in Mexico. For loans in U.S. dollars, the minimum amount is US$100,000, at 20- to 30-year terms, and the interest rate, depending on your credit score and documentation, could be as low as 5.25%; a rate of 6–7% is more common. No extra collateral is required since the property you are purchasing is the collateral. The minimum down payment is 30% of the larger of the purchase or appraised price.
Unlike most of Mexico, Puerto Vallarta has a Multiple Listing Service, called MultiList Vallarta. It provides over 2,000 property listings for the Puerto Vallarta and Riviera Nayarit area. There are plenty of English-speaking real estate agencies and agents in Puerto Vallarta, including Prudential California Realty-Vallarta Division and Tropicasa Realty, among others, so language is not a problem. In addition, property prices in Puerto Vallarta are usually listed in U.S. dollars. (In fact, you are unlikely to see properties here with prices listed in Mexican pesos unless you get well off the beaten track.)
The Mexican government, through its FONATUR tourism development agency, has a seriously sound track record developing little stretches of this country’s coast. All interested investors have to do is to pay attention to where FONATUR is moving next to cash in.
Foreigners cannot own within 100 kilometers of international borders or within 50 kilometers of the coastline, except through a fideicomiso.