San Miguel de Allende, located about a three-hour drive from Mexico City at 6,135 feet above sea level in the state of Guanajuato, is a prime destination for American retirees. COVID has only increased this gem of a city’s desirability. These ex-pats move for a mild climate, five-star dining, accessible art and culture, Baroque/Neoclassical colonial architecture, and a reasonable cost of living. History and culture run deep in San Miguel de Allende. A portion of the old colonial city is recognized by UNESCO as a prestigious World Heritage Site.
After a four-month lull, when many San Miguel de Allende area offices and businesses shuttered due to COVID, residential sales picked up in September. “We started to see buyers writing offers again beginning in September with closings in October and November,” says Ann Dolan, luxury real estate specialist at CDR San Miguel, the leading luxury real estate brokerage in San Miguel de Allende.
The area, which has a population of close to 170,000, draws residents from around the globe adding big-city sophistication and a close-knit community. “We have 63 nationalities living in San Miguel de Allende. People move here for the five C’s, including culture, community, climate, cost of living, and low crime rate,” Dolan says.
“Now we are very busy as properties priced to the market are selling quickly as buyers have returned. We anticipate this year to be the best on record for sales,” Dolan observes.
Jim Dolan, broker and co-owner at CDR San Miguel, explains that sales are usually made in all-cash because there are no mortgages available to foreigners. Occasionally sellers may take on short-term financing. The result: transactions move to closing in about 30 to 45 days. Buyers must put 10 percent down in cash in an escrow account, with the remainder due three to five days before closing.
The good news for buyers is the San Miguel de Allende market is not operating at a frantic pace like California, where multiple offers and bidding wars have become the norm. There is a mix of unique properties from Centro Haciendas to large ranches, vineyard properties, and equestrian estates located just minutes from San Miguel de Allende.
Jim Dolan, who spent his career in the military before entering real estate, succinctly describes the current market: “Our luxury sector starts around $750,000. While the median home price is $500,000. The sweet spot is around $1 million to $1.5 million. Most homes are sold with the furnishings included. First-time buyers want Centro, the historic center of San Miguel de Allende so they can walk to the main town square. Then after a few years they often decide to buy ranch, horse, or vineyard property.”
The area also boasts a strong polo-playing and show jumping community. For some buyers, a home in San Miguel de Allende may be their third or fourth property.
The Dolans have made their home in San Miguel de Allende since 1996, selling luxury properties to Americans, Europeans and Mexican nationals. American buyers, especially from California, discover how far their U.S. dollars go in San Miguel de Allende. Consider the current buyer demographics where 60% of buyers are foreign, and half are U.S. citizens. With non-stop flights to two international airports from major U.S. hubs such as Dallas, Los Angles, San Francisco and Atlanta, it’s not surprising buyers hail from these U.S. cities. Airports in Houston and Chicago also have direct flights to the area.
Tom and Tina White of Asheville, North Carolina, recently purchased a beautiful courtyard-style home in the San Miguel de Allende neighborhood of Allende for $625,000.
“It was a huge surprise that we bought a home. We have been visiting there for several years and enjoy everything about San Miguel de Allende. Last winter we decided I would look at houses. We ended up buying the first home I saw after looking at many,” explains White who is retired.
For now, the couple plan to “bounce back and forth” between Ashville and San Miguel de Allende. “We plan on possibly renting it out maybe ten weeks a year to people we know. That will cover our annual expense,” White notes.
In addition to a reasonable cost of living, property taxes in San Miguel de Allende are far less than you might find in the States. For example, a house sold for $3 million in San Miguel de Allende would have an annual $2,500 property tax bill—practically pennies on the dollar compared to California and other states with steep property taxes.
For $2.6 million (the price of a Los Angeles teardown) is Casa Barranca. Located on one of the most desirable streets in Centro, this grand 5-bedroom 6-bath home boasts extensive gardens, a swimming pool and panoramic city views.
There is good inventory for well under a million in several of San Miguel de Allende’s finest neighborhoods. For $589,000is Casa Enclave, located in a private enclave of three residences. Owners enjoy a pool and rooftop terrace with city views in this two-bedroom, two-bathroom home with covered loggia taking advantage of the indoor-outdoor lifestyle of San Miguel de Allende.
Look for brisk sales activity to continue as Americans redefine retirement in San Miguel de Allende.