By: Khaki Scott
Joint Commission International is a non-governmental organization whose mission it is to “continuously improve health care for the public, in collaboration with other stakeholders, by evaluating health care organizations and inspiring them to excel in providing safe and effective care of the highest quality and value.” Their efforts stem from a long history of professional health care providers who saw the need for standardization and improvement of care as early as 1910. As the world has grown smaller, Joint Commission International has broadened its reach to include every health care specialty, as well as to include hospitals and health care facilities around the world.
When Mexico Real Estate Investment ran our first story on Joint Commission International accredited medical facilities in Mexico, there were only two and they were both in Monterrey, Nuevo Leon. Today, in September 2009, there are a total of eight JCI accredited medical facilities in Mexico and more on the way. These internationally accredited medical facilities include:
In Mexico City: Both of the ABC Hospitals are accredited by Joint Commission and are a part of the Methodist International Hospital Network.
American British Cowdray Medical Center IAP – Observatorio Campus, The
Mexico City, Mexico
Program: Hospital
First Accredited: Dec. 6, 2008
American British Cowdray Medical Center IAP – Santa Fe Campus, The
Mexico City, Mexico
Program: Hospital
First Accredited: Dec. 12, 2008
The CHRISTUS hospitals are a chain that is owned and operated by the CHRISTUS Foundation, a Catholic non-profit organization. They now have 7 hospitals, 27 Clinics, a very modern ambulance service, 2 Rehabilitation and Physical Therapy Centers, and 7 Social Assistance Clinics in Mexico, as well as hospitals throughout Texas, Louisiana, Arkansas, and Mississippi.
Christus Muguerza Alta Especialidad
Monterrey, Mexico
Program: Hospital
First Accredited: July 22, 2007
Hospital CIMA Monterrey
San Pedro Garza Garza, Nuevo Leon
Program: Hospital
First Accredited: Dec. 19, 2008
Hospital CIMA Hermosillo
Hermosillo, Sonora
Program: Hospital
First Accredited: Dec. 11, 2008
Hospital San Jose Tec de Monterrey
Monterrey, Nuevo Leon
Program: Hospital
First Accredited: Dec. 25, 2007
Hospital Y Clinica OCA, S.A. de C.V.
Monterrey, Nuevo Leon
Program: Hospital
First Accredited: Sept. 27, 2008
Clinica Cumbres Chihuahua
Chihuahua, Mexico
Program: Ambulatory Care
First Accredited: April 23, 2008
These are, by no means, the only good hospitals in Mexico. There are thousands of excellent hospitals throughout the nation, as well as internationally recognized university teaching hospitals. As one would do in one’s home country, before choosing a hospital in Mexico, please do as much of an investigation of their reputation within the hospital and expat communities as possible. With that one caution, there is no reason not to choose Mexico for elective medical services and certainly no reason to fear them in case of emergency.
(source: Joint Commission International)
Tuesday, October 27, 2009
Saturday, October 24, 2009
Medicare Savings: Is the Answer in Mexico?
The words Medicare savings are a red flag to some and a carrot to others; depending on where you stand on the issue of health-care reform, the label is code for cuts or a promise to root out fraud and save billions. But far away from the debates in Washington, a group of expatriate baby boomers point to one place they believe real Medicare savings could be realized: Mexico.
Police Reform Part of Mexico’s Drug War
Calls to Shut U.S.-Mexico Border Grow in Flu Scare
On Obama’s Mexico Agenda: Stopping the Guns from El Norte
Paul Crist, the owner of a Puerto Vallarta resort who once worked as an aide to former U.S. Senator Paul Sarbanes, says that paying for medical treatment in Mexico could save Medicare almost a quarter of the average cost for most procedures. "My research, as well as the research of others, shows that health care in Mexico costs less than a third of that in the U.S.," Crist says.
(See a guide to what health-care reform really means.)
A doctor's office visit or house call (still a common practice in Mexico) costs only $25 to $40, according to a 2007 study by the University of Texas LBJ School of Public Affairs. The same study presented information on comparative costs for common procedures: a hip replacement costs between $43,000 and $63,000 in the U.S., compared to $12,000 in Mexico, according to Texas-based hospital chain Christus Muguerza, which also operates in Mexico; a coronary bypass in Mexico costs an average of $21,000 compared to $149,000 in the U.S. Citing statistics from the U.S. census and State Department, Crist estimates approximately 200,000 of the 1 million U.S. citizens living south of the border are Medicare-eligible.
(See what health care is like around the world.)
However, Crist says many Medicare-eligible expats living south of the border are forced to fly back to the U.S. for medical treatment because Medicare will not pay for most coverage outside the U.S., even though they have paid into the system during their working lives. Medicare will cover only emergency care if it occurs within 60 days of leaving the country. To utilize their benefits, Medicare-eligible American citizens in Mexico have to opt for periodic flights home or else choose to pay out-of-pocket medical expenses. And because expatriates have diverse geographic origins in the U.S., there are no specific congressional districts they can pressure to legislate change in the Medicare rules on their behalf.
Crist took matters into his own hands. Touting the potential savings to Medicare, he founded Americans for Medicare in Mexico and began campaigning for reform. He travelled to Washington earlier this year to lobby Congress for expansion of Medicare to expats in Mexico. He visited about 85 congressional offices and says many members were open to the idea. Other expat groups like the Association of American Residents Overseas (AARO) joined in a letter-writing campaign. But as the health-care-reform battle grew larger and the bills more complex, Crist says supportive members of Congress told him 2009 was not going to be the year the change could be made.
Resistance to the expansion of Medicare to Mexico is coming from some health-care industry groups like the American Medical Association and the American Hospital Association, according to David C. Warner, who teaches public affairs at the University of Texas LBJ School. Warner says these groups see it as the beginning of a slippery slope that will lead to expansion of Medicare coverage to places like China and Eastern Europe where health-care costs are rock bottom.
(See a video of Ze Frank explaining health-care reform.)
Warner adds that the issue also has been raised at the highest levels by Mexican President Felipe Calderón in a meeting earlier this year with President Barack Obama. But any pressure from Mexican interests could be politically tricky, Crist says: "It would not necessarily be helpful to have Mexican firms pressuring Congress on an issue that will benefit this industry and the Mexican economy generally. This could create a backlash among some [U.S.] political groups."
However, there are several forces set to join the battle that could change the power balance. Not only are more expats finding Mexico's climate and low costs welcoming, but investors are flocking to Mexico as a growth market for health care and senior living. "Many in the baby-boomer generation have seen their retirement savings disappear and it is not likely those funds will be built back up quickly," Crist says, explaining why Mexico, with its low costs, has become attractive. Seeing potential profits, he adds, "the developers and operators of senior housing, which runs the spectrum from independent-living communities through nursing-care facilities, are certainly betting on a substantial influx in the coming years." Developments aimed at attracting seniors have been built near Puerto Vallarta and in the northern Baja peninsula, and independent-living projects are planned for San Miguel de Allende, already a popular expat center north of Mexico City, Warner notes.
(See the top 10 health-care-reform players.)
"Some of the developers in Mexico are affiliated with firms in the U.S., so there will certainly be support in Washington from those firms," Crist says. "Both the senior-housing industry and the health-care industry are internationalizing, and the U.S. players in these industries will be big winners. They have the capital, and the experience to dominate this industry in Mexico and elsewhere, because the senior-housing industry, in particular, is so new in many countries."
Crist plans to hold town-hall meetings in 15 Mexican cities beginning January to pull the expat community together and launch a massive letter-writing campaign. He and other proponents are also hoping to engage another key group in the fight, the so-called returnees — Mexican dual citizens, or Mexican-born citizens with legal status in the U.S. who are Medicare-eligible after a lifetime of payroll contributions. In the U.S., proponents will focus on gaining the support of a key member of Congress to carry the banner. Warner says two from Texas are likely targets: Democratic U.S. Representative Eddie Bernice Johnson and Republican U.S. Representative Pete Sessions, whose districts include concentrated returnee populations, multigenerational families with roots in the state of Guanajuato, Mexico, the cradle of Mexican independence and a favorite spot for expat retirees.
"The opportunity to provide services to Americans at much lower cost outside the U.S. border is enormous," Crist says. "This is pushing even private insurers to explore coverage options outside of the U.S., and Medicare will certainly be a part of this globalization, sooner or later. My preference is for sooner."
By Hilary Hylton
Police Reform Part of Mexico’s Drug War
Calls to Shut U.S.-Mexico Border Grow in Flu Scare
On Obama’s Mexico Agenda: Stopping the Guns from El Norte
Paul Crist, the owner of a Puerto Vallarta resort who once worked as an aide to former U.S. Senator Paul Sarbanes, says that paying for medical treatment in Mexico could save Medicare almost a quarter of the average cost for most procedures. "My research, as well as the research of others, shows that health care in Mexico costs less than a third of that in the U.S.," Crist says.
(See a guide to what health-care reform really means.)
A doctor's office visit or house call (still a common practice in Mexico) costs only $25 to $40, according to a 2007 study by the University of Texas LBJ School of Public Affairs. The same study presented information on comparative costs for common procedures: a hip replacement costs between $43,000 and $63,000 in the U.S., compared to $12,000 in Mexico, according to Texas-based hospital chain Christus Muguerza, which also operates in Mexico; a coronary bypass in Mexico costs an average of $21,000 compared to $149,000 in the U.S. Citing statistics from the U.S. census and State Department, Crist estimates approximately 200,000 of the 1 million U.S. citizens living south of the border are Medicare-eligible.
(See what health care is like around the world.)
However, Crist says many Medicare-eligible expats living south of the border are forced to fly back to the U.S. for medical treatment because Medicare will not pay for most coverage outside the U.S., even though they have paid into the system during their working lives. Medicare will cover only emergency care if it occurs within 60 days of leaving the country. To utilize their benefits, Medicare-eligible American citizens in Mexico have to opt for periodic flights home or else choose to pay out-of-pocket medical expenses. And because expatriates have diverse geographic origins in the U.S., there are no specific congressional districts they can pressure to legislate change in the Medicare rules on their behalf.
Crist took matters into his own hands. Touting the potential savings to Medicare, he founded Americans for Medicare in Mexico and began campaigning for reform. He travelled to Washington earlier this year to lobby Congress for expansion of Medicare to expats in Mexico. He visited about 85 congressional offices and says many members were open to the idea. Other expat groups like the Association of American Residents Overseas (AARO) joined in a letter-writing campaign. But as the health-care-reform battle grew larger and the bills more complex, Crist says supportive members of Congress told him 2009 was not going to be the year the change could be made.
Resistance to the expansion of Medicare to Mexico is coming from some health-care industry groups like the American Medical Association and the American Hospital Association, according to David C. Warner, who teaches public affairs at the University of Texas LBJ School. Warner says these groups see it as the beginning of a slippery slope that will lead to expansion of Medicare coverage to places like China and Eastern Europe where health-care costs are rock bottom.
(See a video of Ze Frank explaining health-care reform.)
Warner adds that the issue also has been raised at the highest levels by Mexican President Felipe Calderón in a meeting earlier this year with President Barack Obama. But any pressure from Mexican interests could be politically tricky, Crist says: "It would not necessarily be helpful to have Mexican firms pressuring Congress on an issue that will benefit this industry and the Mexican economy generally. This could create a backlash among some [U.S.] political groups."
However, there are several forces set to join the battle that could change the power balance. Not only are more expats finding Mexico's climate and low costs welcoming, but investors are flocking to Mexico as a growth market for health care and senior living. "Many in the baby-boomer generation have seen their retirement savings disappear and it is not likely those funds will be built back up quickly," Crist says, explaining why Mexico, with its low costs, has become attractive. Seeing potential profits, he adds, "the developers and operators of senior housing, which runs the spectrum from independent-living communities through nursing-care facilities, are certainly betting on a substantial influx in the coming years." Developments aimed at attracting seniors have been built near Puerto Vallarta and in the northern Baja peninsula, and independent-living projects are planned for San Miguel de Allende, already a popular expat center north of Mexico City, Warner notes.
(See the top 10 health-care-reform players.)
"Some of the developers in Mexico are affiliated with firms in the U.S., so there will certainly be support in Washington from those firms," Crist says. "Both the senior-housing industry and the health-care industry are internationalizing, and the U.S. players in these industries will be big winners. They have the capital, and the experience to dominate this industry in Mexico and elsewhere, because the senior-housing industry, in particular, is so new in many countries."
Crist plans to hold town-hall meetings in 15 Mexican cities beginning January to pull the expat community together and launch a massive letter-writing campaign. He and other proponents are also hoping to engage another key group in the fight, the so-called returnees — Mexican dual citizens, or Mexican-born citizens with legal status in the U.S. who are Medicare-eligible after a lifetime of payroll contributions. In the U.S., proponents will focus on gaining the support of a key member of Congress to carry the banner. Warner says two from Texas are likely targets: Democratic U.S. Representative Eddie Bernice Johnson and Republican U.S. Representative Pete Sessions, whose districts include concentrated returnee populations, multigenerational families with roots in the state of Guanajuato, Mexico, the cradle of Mexican independence and a favorite spot for expat retirees.
"The opportunity to provide services to Americans at much lower cost outside the U.S. border is enormous," Crist says. "This is pushing even private insurers to explore coverage options outside of the U.S., and Medicare will certainly be a part of this globalization, sooner or later. My preference is for sooner."
By Hilary Hylton
Monday, October 12, 2009
Attention Canadians: The Time is Now and The Place is Mexico!
By: Jim Scherrer
For more than 50 years, the de facto world currency has been the US dollar with many of the world currencies being pegged against it (some countries have even eliminated their own currencies in favor of the US dollar). As an example, Canadians feel a sense of wealth when the Canadian dollar is on par with the US dollar; the opposite when the Canadian dollar devalues to .70 US dollar, i.e., when the Canadian dollar will purchase only 70 cents worth of US goods and services. The following graph shows how the Canadian dollar has strengthened from $.77 US to $.96 US or by 25% during just the past seven months.
Currently, the global economy is changing and as the US dollar continues to erode, many foreign currencies have strengthened significantly relative to the green back. Consequently, savvy Canadians should now be looking at currencies outside of the US and evaluating their own newfound purchasing power in those foreign countries. For instance, the Canadian dollar has virtually exploded in value recently relative to the Mexican peso. The graph below depicts how the Canadian dollar has risen in value from an equivalent of 7.1 Mexican pesos in 2003 to 12.6 pesos today in 2009.
Now, let's compare this increase in the purchasing power of the Canadian dollar to the increase in purchasing power of the US dollar, both relative to the Mexican peso. The graph below clearly shows that during this 6 ½ year time frame the US dollar increased in value by a bit more than 20% relative to the Mexican peso whereas the Canadian dollar increased by a whopping 75%!
It's quite understandable, that toward the end of 2007 when the Canadian dollar reached par with the US dollar, the Canadians were major buyers of real estate in Mexico. However, by March of 2009, the Canadian dollar had slipped to a low of $.77 US and Canadian buyers were virtually eliminated from the Mexican real estate market.
Next, let's closely review the Canadian and US dollars relative to the Mexican peso during the past year. Because the recent strengthening of the Canadian dollar has far outpaced the US dollar relative to the Mexican peso, you'll see that during the past year, the US dollar has barely appreciated in value over the Mexican peso while the Canadian dollar has exploded in value by nearly 25%. (please see graph) The ramifications that this phenomenon has had on the Canadian purchasing power in Mexico are addressed below.
During the past decade many tourist zones and retirement havens in the resort areas of Mexico experienced exponential growth. Along with this growth came significant real estate price appreciation; so much so that real estate prices in many Mexican resort cities were no longer within reach of many Canadian retirees, especially when the Canadian dollar plummeted in value in 2008. Well, we have good news for you fortunate Canadians holding those wonderfully strong Loonies; that's no longer the case!
In Puerto Vallarta, real estate prices of recently built condos have dropped by anywhere from 20-35% during the past year alone. This reduction in value was caused mainly by the global recession, however the swine flu scare and the media hype over the border town drug war (1,200 miles away!) were also contributing factors. With the tremendous glut of unsold new condos recently introduced to the market by developers combined with the many condos that were purchased at pre-construction prices by speculators now just trying to recover their investment, PV is a true buyer's market.
Last year you could buy a $400,000 condo with all the amenities and breathtaking views for 10% off list price or for $360,000. Today, you'll have no problem finding that same condo offered at $300,000. Okay, that seems like a pretty nice savings of nearly 17% but remember, these Mexican condos are all priced in US dollars; Canadians must now evaluate these costs in terms of Canadian dollars! A year ago when the Canadian dollar was worth $.77 US, $360,000 US dollars was equivalent to $468,000 Canadian dollars. Today, with the same condo selling for $300,000 and the Canadian dollar worth $.96 US, it will cost only $315,000 Canadian dollars. That's a savings of $153,000 Canadian or 32.7% (as opposed to the apparent 17%) in just one year!
Until as recently as 4 years ago there were no mortgages available to any North Americans buying resort property in Mexico. At that time, a number of US based mortgage companies introduced mortgages to US citizens buying property in Mexico but not to Canadians. That all changed a couple of years ago when the major mortgage companies finally made the same mortgages available to Canadians. These fixed and variable rate mortgages require at least 20% down and can have terms for as long as 30 years at rates generally about two points above those in the States or at approximately 7% at this time.
It is the opinion of many that the Canadian dollar will continue to strengthen. After all, the Canadian banks didn't make all the foolish sub-prime no-doc loans that were made in the US, the Canadian unemployment rate is somewhat less than in the US, and Canada is rich with natural resources with worldwide demand. Knowing this, it seems only logical that having a mortgage in Mexico based on US dollars would be a very wise investment; it would be paid off with ever strengthening Canadian dollars.
Let's assume we bought that condo for $300,000 US ($315,000 Canadian) and made a down payment of $100,000 US ($105,000 Canadian). A 30 year fixed rate 8% mortgage of $200,000US would result in payments of $1,467/month US ($1,528 Canadian). Of course, if and when the Canadian dollar again reaches par with the US dollar, your payments will be reduced from $1,528 to $1,467 Canadian. Now, let's get a little aggressive and assume the Canadian dollar will reach $1.05US. At that exchange rate, your monthly mortgage payments would drop to $1,397 Canadian. It's not too far a stretch to predict an annual savings of $2,000 Canadian or more based solely on the exchange rate differential. Of course, if the Canadian dollar were to plummet for some unforeseeable reason, these mortgages can be paid off after 2-5 years (depending upon the loan) with no pre-payment penalty.
Finally, let's evaluate the cost of living in Mexico. For starters, let's assume that a year ago we were considering a lifestyle in Vallarta based on a budget of $10,000 pesos per month. With the annual inflation rate in Mexico of 5%, the same goods and services in Mexico will be $10,500 pesos this year. A little more than a year ago, when the Canadian dollar would purchase 9.5 pesos, $10,000 pesos was equivalent to $1,052 Canadian. Today, with the favorable exchange rate of 12.7 pesos per Canadian dollar, the $10,500 peso budget will cost a mere $827 Canadian, i.e., a savings of $225/mo or a 22% reduction in the cost of living in just one year!
In summarizing, it's obvious that the time has never been better for Canadians to explore the opportunities that exist in Mexico today. International monetary circumstances are ideal for Canadians concurrently with the condo supply and demand equation in Mexico heavily tilted in favor of the buyer. In terms of Canadian dollars, you can expect to find incredible condos at 30-35% lower prices than just a year ago and your cost of living will be 20-25% less than it was a year ago.
Of the nearly 50,000 expats living in Vallarta, we estimate that close to 30% of them are Canadians. Needless to say, the winter weather in Puerto Vallarta is more conducive to most outdoor activities (excluding snow boarding and ice hockey!) than anywhere in Canada. So, why hesitate? Come on down this winter and have some fun in the sun with your fellow countrymen and while doing so, save a significant portion of your nest egg on your retirement residence in Paradise. It's now certainly well within your financial reach and as they say, "if you snooze, you lose"; you'll never find a better time or place to invest those Loonies than now in Mexico!
Jim Scherrer has owned property in Puerto Vallarta, Mexico for 26 years and resided there for the past twelve years. The mission of his series of nearly 70 articles pertaining to retirement in Puerto Vallarta is to reveal the recent changes that have occurred in Vallarta while dispelling the misconceptions about living conditions in Mexico. For the full series of articles regarding travel to and retirement in Vallarta as well as pertinent Puerto Vallarta links, please visit us at PVREBA.
For more than 50 years, the de facto world currency has been the US dollar with many of the world currencies being pegged against it (some countries have even eliminated their own currencies in favor of the US dollar). As an example, Canadians feel a sense of wealth when the Canadian dollar is on par with the US dollar; the opposite when the Canadian dollar devalues to .70 US dollar, i.e., when the Canadian dollar will purchase only 70 cents worth of US goods and services. The following graph shows how the Canadian dollar has strengthened from $.77 US to $.96 US or by 25% during just the past seven months.
Currently, the global economy is changing and as the US dollar continues to erode, many foreign currencies have strengthened significantly relative to the green back. Consequently, savvy Canadians should now be looking at currencies outside of the US and evaluating their own newfound purchasing power in those foreign countries. For instance, the Canadian dollar has virtually exploded in value recently relative to the Mexican peso. The graph below depicts how the Canadian dollar has risen in value from an equivalent of 7.1 Mexican pesos in 2003 to 12.6 pesos today in 2009.
Now, let's compare this increase in the purchasing power of the Canadian dollar to the increase in purchasing power of the US dollar, both relative to the Mexican peso. The graph below clearly shows that during this 6 ½ year time frame the US dollar increased in value by a bit more than 20% relative to the Mexican peso whereas the Canadian dollar increased by a whopping 75%!
It's quite understandable, that toward the end of 2007 when the Canadian dollar reached par with the US dollar, the Canadians were major buyers of real estate in Mexico. However, by March of 2009, the Canadian dollar had slipped to a low of $.77 US and Canadian buyers were virtually eliminated from the Mexican real estate market.
Next, let's closely review the Canadian and US dollars relative to the Mexican peso during the past year. Because the recent strengthening of the Canadian dollar has far outpaced the US dollar relative to the Mexican peso, you'll see that during the past year, the US dollar has barely appreciated in value over the Mexican peso while the Canadian dollar has exploded in value by nearly 25%. (please see graph) The ramifications that this phenomenon has had on the Canadian purchasing power in Mexico are addressed below.
During the past decade many tourist zones and retirement havens in the resort areas of Mexico experienced exponential growth. Along with this growth came significant real estate price appreciation; so much so that real estate prices in many Mexican resort cities were no longer within reach of many Canadian retirees, especially when the Canadian dollar plummeted in value in 2008. Well, we have good news for you fortunate Canadians holding those wonderfully strong Loonies; that's no longer the case!
In Puerto Vallarta, real estate prices of recently built condos have dropped by anywhere from 20-35% during the past year alone. This reduction in value was caused mainly by the global recession, however the swine flu scare and the media hype over the border town drug war (1,200 miles away!) were also contributing factors. With the tremendous glut of unsold new condos recently introduced to the market by developers combined with the many condos that were purchased at pre-construction prices by speculators now just trying to recover their investment, PV is a true buyer's market.
Last year you could buy a $400,000 condo with all the amenities and breathtaking views for 10% off list price or for $360,000. Today, you'll have no problem finding that same condo offered at $300,000. Okay, that seems like a pretty nice savings of nearly 17% but remember, these Mexican condos are all priced in US dollars; Canadians must now evaluate these costs in terms of Canadian dollars! A year ago when the Canadian dollar was worth $.77 US, $360,000 US dollars was equivalent to $468,000 Canadian dollars. Today, with the same condo selling for $300,000 and the Canadian dollar worth $.96 US, it will cost only $315,000 Canadian dollars. That's a savings of $153,000 Canadian or 32.7% (as opposed to the apparent 17%) in just one year!
Until as recently as 4 years ago there were no mortgages available to any North Americans buying resort property in Mexico. At that time, a number of US based mortgage companies introduced mortgages to US citizens buying property in Mexico but not to Canadians. That all changed a couple of years ago when the major mortgage companies finally made the same mortgages available to Canadians. These fixed and variable rate mortgages require at least 20% down and can have terms for as long as 30 years at rates generally about two points above those in the States or at approximately 7% at this time.
It is the opinion of many that the Canadian dollar will continue to strengthen. After all, the Canadian banks didn't make all the foolish sub-prime no-doc loans that were made in the US, the Canadian unemployment rate is somewhat less than in the US, and Canada is rich with natural resources with worldwide demand. Knowing this, it seems only logical that having a mortgage in Mexico based on US dollars would be a very wise investment; it would be paid off with ever strengthening Canadian dollars.
Let's assume we bought that condo for $300,000 US ($315,000 Canadian) and made a down payment of $100,000 US ($105,000 Canadian). A 30 year fixed rate 8% mortgage of $200,000US would result in payments of $1,467/month US ($1,528 Canadian). Of course, if and when the Canadian dollar again reaches par with the US dollar, your payments will be reduced from $1,528 to $1,467 Canadian. Now, let's get a little aggressive and assume the Canadian dollar will reach $1.05US. At that exchange rate, your monthly mortgage payments would drop to $1,397 Canadian. It's not too far a stretch to predict an annual savings of $2,000 Canadian or more based solely on the exchange rate differential. Of course, if the Canadian dollar were to plummet for some unforeseeable reason, these mortgages can be paid off after 2-5 years (depending upon the loan) with no pre-payment penalty.
Finally, let's evaluate the cost of living in Mexico. For starters, let's assume that a year ago we were considering a lifestyle in Vallarta based on a budget of $10,000 pesos per month. With the annual inflation rate in Mexico of 5%, the same goods and services in Mexico will be $10,500 pesos this year. A little more than a year ago, when the Canadian dollar would purchase 9.5 pesos, $10,000 pesos was equivalent to $1,052 Canadian. Today, with the favorable exchange rate of 12.7 pesos per Canadian dollar, the $10,500 peso budget will cost a mere $827 Canadian, i.e., a savings of $225/mo or a 22% reduction in the cost of living in just one year!
In summarizing, it's obvious that the time has never been better for Canadians to explore the opportunities that exist in Mexico today. International monetary circumstances are ideal for Canadians concurrently with the condo supply and demand equation in Mexico heavily tilted in favor of the buyer. In terms of Canadian dollars, you can expect to find incredible condos at 30-35% lower prices than just a year ago and your cost of living will be 20-25% less than it was a year ago.
Of the nearly 50,000 expats living in Vallarta, we estimate that close to 30% of them are Canadians. Needless to say, the winter weather in Puerto Vallarta is more conducive to most outdoor activities (excluding snow boarding and ice hockey!) than anywhere in Canada. So, why hesitate? Come on down this winter and have some fun in the sun with your fellow countrymen and while doing so, save a significant portion of your nest egg on your retirement residence in Paradise. It's now certainly well within your financial reach and as they say, "if you snooze, you lose"; you'll never find a better time or place to invest those Loonies than now in Mexico!
Jim Scherrer has owned property in Puerto Vallarta, Mexico for 26 years and resided there for the past twelve years. The mission of his series of nearly 70 articles pertaining to retirement in Puerto Vallarta is to reveal the recent changes that have occurred in Vallarta while dispelling the misconceptions about living conditions in Mexico. For the full series of articles regarding travel to and retirement in Vallarta as well as pertinent Puerto Vallarta links, please visit us at PVREBA.
Subscribe to:
Posts (Atom)
Posts
