By Timothy Scott
With dramatic panoramic views, year–round warm weather, and a sizable but not overwhelming expat community, Zihuatanejo is the perfect place in the sun for many upscale home buyers. Add a slow-moving market lately and there’s plenty to choose from in paradise.
Casa Leo in Zihuatanejo
Finding a home with a view is easy in Zihuatanejo, on the Pacific coast of Mexico. With steep hills surrounding a beautiful bay, you can get into a condo or house with a breathtaking view starting at around $300,000. The real question is, “What will surround you as you take in the vista?”
As the prices rise, so do the houses: higher on a bluff, a higher palapa over the pool, larger homes with bedroom balconies and more spectacular open living rooms. Many of them are the kinds of showpieces readers drool over in design magazines, but here they come with a price tag that’s often easier on the wallet—especially in this slow real estate market. It is possible to spend three to five million dollars on a home here still, but what you get for that price would be hard to match on any beach north of the Rio Grande.
After lounging around poolside at Capella Ixtapa and Villa del Sol Zihuatanejo, I met up with two of the region’s top real estate agents for luxury homes to get a feel for the market. With them I got to look inside the top-tier mansions around this once-sleepy fishing village turned tourism magnet.
Zihuatanajo Plays the Waiting Game
John Murphy, with Mexico Beach Property, has been in the area since the early 1990s. “At that time,” he says, “I could count the electric lights on the hillsides on my fingers and toes.” Then the Mexican government waved its magic development wand over Ixtapa, creating a custom-made resort area, a west-coast version of Cancun. Zihuatanejo came along for the ride and the whole area boomed.
Now, with the real estate market in intensive care in the U.S., Mexican vacation and retirement home resort markets like this one have gotten sick from the contagion. “Right after the housing crisis hit in the U.S., the bottom fell out here as well,” says Murphy. Prior to that, all over Mexico, American buyers were using equity from their U.S. home to get a loan there for a vacation home, or were selling their former home at an inflated price and moving up—bigtime—to a more elaborate home on the coast down south. When the bubble burst, especially in California, the party came to a halt. The cable news coverage of violence on the Mexican border with the U.S. hasn’t helped, plus a strange one-off series of shark attacks in the area got Zihuatanejo on all the cable news channels for a few days—never a good thing for business.
This doesn’t mean all sellers are ready to take a lowball offer, however. “The people who truly need the money right now have dropped their asking price anywhere from 5% to 20%,” says Murphy. “Most people just aren’t in much of a hurry to sell though, so they can wait it out.”
It doesn’t cost all that much to maintain a home in this climate, taxes are minimal, and most houses are fully paid for, with no loan to service. Some of the slack from the U.S. buyers has been taken up by those from its two neighbors too: luxury buyers from Canada and Mexico—both economies fueled more by natural resources—are closing on more houses in the region.
Prestige Addresses in Zihuatanejo
Murphy took me to two properties on offer in a gated area marketed as an upscale, prestige development for multi-millionaires—Monte Cristo—where building lots alone start at $600,000. Located on the right side of the bay as you look out from town, it looks back at Zihuatanejo and all three of its beaches. A small beach and tennis courts are part of the infrastructure.
It’s hard to imagine a more striking coastal panorama than the one you get from Punta Godomia, pictured here. Priced at $5 million, it has multiple pools, five bedrooms with balconies, media room, huge gourmet kitchen, and a hardwood deck bar area bigger than that at most hotels. A two-car garage and maid’s quarters are also built into the hillside location.
We also looked at a $3.4 million compound, Puerto Mio that is two houses for one price. These were some of the first homes to be designed and built by the area’s best-known architect, Enrique Zozoya, whose name graces dozens of the regions highest-priced villas. The first home is 7,500 square feet, with five bedrooms and six baths. The second is 5,000 square feet and has four bedrooms, each with its own terrace and bath. Both homes have a pool overlooking the water and access to a small rocky beach.
The Newer Hot Addresses
On the other side of the bay, Judith Whitehead took me to newer developments with equally lofty locations, but with a different outlook and a wider range of prices. Paradise Properties is the agency for Cerro del Vigia, a gated hill-clinging complex with common tennis courts, chapel, and clubhouse. Here it’s possible to get a 4BR house with a pool and great view for around $700,000 to $800,000: follow this link to Paradise Properties for listings like Casa Carolina or Casa Cascade for examples of what $800K will buy here. Or you can buy a lot and build a dream home with more custom details and hand-crafted custom furniture for under a million.
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