Supply vs. Demand for Mid-Range Single-Family Developments
The successful commercialization of single-family homes in Bahía de Banderas is due to the combination of several factors that current developers highlight and offer as added value, so this type of construction continues to boom. To learn more, we visited Brando González, project manager and commercial manager of GOVACASA, a company created in October 2013 that includes El Roble among its projects of this type, the successful residential development of 188 homes being 95 percent sold at the close of this issue.
“A single-family development must focus on satisfying families and ensuring that they feel part of the neighborhood. Thus, in addition to houses with well-distributed spaces, common areas and green areas are essential, as well as ensuring that the facilities are actually functional for the inhabitants,” he says. “Previously, this type of development was built far from the areas where people work, as well as far from recreation and service facilities, such as shopping centers, schools and hospitals. In addition, transportation was not very accessible. All this made the cost of daily transportation more expensive than paying for the house, resulting in desolate developments. This phenomenon was present not only here, but also in cities such as Guadalajara, Monterrey and Mexico City.”
The Boom of Mid-Range Single-Family Developments in Bahía de Banderas
“When speaking about a boom, it is essential to understand that the Puerto Vallarta region is divided into two important real estate zones: one for tourism and one where people buy to live. Thus, they should be offered a product that they can purchase and afford, that is accessible in every aspect and that is fully habitable—that is, it has adequate space, all services and is close to commercial areas. If we add an appropriate price range to this list, we can say that a development will be successful.”
He says that when people perceive that the price is fair for what they receive, demand tends to increase. “Throughout my more than 15 years of experience, I have seen that some developers base the price of housing on simply being close to something attractive or because the neighboring development is set at the same price; however, when potential customers come to the site and do not perceive that the cost reflects what they are going to find, they immediately eliminate it as a real option and start looking elsewhere.”
Open vs. Private Single-Family Developments
“The difference between open and private single-family developments is that in open developments, the streets, lighting and parks belong to the municipality, which is responsible for maintenance. In the private development, since these areas are part of the development property, there are maintenance fees. The advantage of acquiring a property in an open development is that the price is less, as it is limited to only housing. However, in the private development, one must pay for the streets, parks, lighting and all the internal areas of the subdivision. Currently, developers implement programs such as Hipoteca con Servicios de INFONAVIT (Mortgage with Services), where maintenance fees are charged, even for open developments, to clean, care for and maintain in good condition the development’s amenities and public areas. This benefits the inhabitants, because they maintain their added value over the years.”
Future of Single-Family Developments in Bahía de Banderas
When asked about his expectations for this type of development in the destination, Brando González affirms that he is confident that there will continue to be high demand in Bahía de Banderas. “We must understand this phenomenon in the following way: The development must be located in the right place and at the right price. Today, due to the high price of land, it is becoming more challenging to have subdivisions with only single-family houses, so apartments are included in master plans. As developers, the issue forces the price of housing to increase. Obviously, this makes purchase impossible for many people. In addition, several emerging developments are not affordable to most people, and perhaps the people who can afford it do not like the location or do not see the potential of the area. So, why do those people who can afford it choose not to buy houses at those prices? Because with that money they could buy a resale property in a development they consider to be better located,” he says.
“Single-family developments do have a future, but it must be well studied so that they remain profitable. Here in Puerto Vallarta—specifically here, because there is a big difference between buying on this side of the Ameca River and buying in Bahía de Banderas—it is very difficult to find land at affordable prices to continue building single-family developments. On the other hand, in Bahía de Banderas, the situation occurs in the strip where people want to buy. The cheapest places to develop are in the area toward Valle de Banderas, but not all people want to live there. To continue successfully commercializing this type of development, a fair combination of land price and sales price must be found,” he concludes.
