Mexico Real Estate Scams: What to Know Before You Buy Property in Mexico — By Jennifer Shipp
Guanajuato Mexico North America

Mexico Real Estate Scams: What to Know Before You Buy Property in Mexico — By Jennifer Shipp

When buying property in Mexico and then building a house (or doing renovations on an existing house), be aware of the possible scams that can take your construction project off-track.

Buying Mexico real estate as an expat isn’t for the feint of heart! We bought a property in Guanajuato, Mexico by searching for interesting houses in the Chopper magazine and on Facebook groups where locals were selling things. We contacted real estate agents ourselves and went out and looked at about 15 to 20 different properties to get a feel for the market before we ever made an offer on one. In Guanajuato, it isn’t easy to look for real estate in this way. One real estate agent, for example, told us to meet him “by the green hand-railing” (in Spanish). This green hand-railing, located in a city with serpentine streets that are not laid out in any kind of organized way, was located in a narrow alley along with 5 other hand-railings that were rusted and therefore NOT green. Each real estate agent presented new linguistic challenges to us and our weak Spanish abilities and each neighborhood was a new learning experience (is it safe? where are the fruit/vegetable vendors? is it noisy? is the house and the rest of the community going to fall off the side of the mountain?). The first house we made an offer on sold out from underneath us. The second offer on a different house went through though. It was a building that smelled so bad we had to hold our breath as we looked at it. It was raining heavily on the day we looked at it and several dogs came in and out from outside through the property at their whim. An ailing old woman was convalescing in a corner. A set of stairs came down from the third floor and dropped off all the way down to first floor. Someone who’d seen the property on a Facebook ad had laughed at it (“LOL–who would want that place?” the person had asked, in Spanish). But the location seemed spectacular to me and the building seemed like it could be renovated.

Purchasing the property went okay for us. We had only been in Mexico for about 8 months when we bought our property and our Spanish was still really weak. We didn’t feel confident speaking in Spanish at all. So we found a Notaria who spoke some English, which seemed smart, but we ended up only working with her staff who spoke only Spanish. So John downloaded a program that allowed him to take pictures of documents in Spanish and then it translated them into English as we were signing the papers.

There are a lot of scams that can happen when you buy the actual property here in Mexico, but the scam that we experienced personally had to do with renovating and building a home in Mexico. It’s important that you know about this kind of scam before you buy property in Mexico because you may decide to spring for a more expensive home that requires fewer renovations if you know what kind of scams you might run into when you try to fix the house. Or you may decide to skip shopping for land altogether and look for existing buildings rather than weather the headache of a building project that goes awry. If you know what you’re up against, you can make an informed decision about buying property in Mexico rather than just hoping for the best!

After the purchase was complete, we asked the seller’s agent (we didn’t have a real estate agent) to recommend an engineer to us. This was how we met “Beto”. Initially, the real estate agent referred us to Beto’s dad, but because Beto spoke English, he was the one who took the job with us. After five months working on our property, nothing was finished though many projects had been started and completed partway. We realized that something was wrong with Beto and his team at this time and extracted him from our house. The scam was complex, but I’m certain that what Beto did to us was something that he’d been taught to do by other engineers/architects who are really just scam artists in Mexico. But keep in mind, this kind of thing can happen anywhere in the world, not just Mexico. Don’t be scared off from Mexico house construction just because you think you might get scammed. Know what to look for and you’ll be at an advantage as you work through the steps to building a house in Mexico.

John and I were lucky in that part of Beto’s team (Felipe and Cristian) stayed behind to work for us directly. Their presence and knowledge of what Beto had done in the house helped us make sense of things and get our house construction project back on track. These workers stay on task and do what we ask them to do. They work hard and for the most part, it seems that they just want to be given a job and told what to do for the day. Then they do it. On the team with Beto, they were told to make projects take “three times as long as they were supposed to” and to create fake issues with easy projects. Cristian and Felipe have shown us that building a home in Mexico isn’t impossible and that it can even be a good way to learn more Spanish (and get some exercise).

We got scammed and the scam was complex and multi-faceted. You can read the full story of our ordeal with building a house in Mexico here or here’s a summary to help you avoid having the same thing happen to you:

  • It started with disillusionment about the actual value of our property in Mexico. Our engineer made us feel like our property was in a bad location and that it was maybe going to fall down it was so poorly built.
  • At first, our engineer made a lot of progress, but within 8 weeks, after the house was a total mess from the “renovations” the progress slowed considerably. It was hard to see whether the progress was slow though and really evaluate whether things were moving slowly or not because of the mess. And the workers seemed to always be working when we were there. We’d show up at unexpected times and always, the workers were working. But nothing, not even little projects were ever reaching a point of completion.
  • Every time we visited the house, our engineer talked our ears off. We were never able to really get a good look at things as a result. Each time we visited, he would take us on a tour to see everything that he and his team did that day. It took an hour or more even if the accomplished tasks were tiny (Look! We put in an electrical outlet cover today!). At the end of our relationship, in contrast, we insisted that he show us everything that he did NOT get done that day and explain why. It didn’t take long for him to get upset with us about this and show us his true colors.
  • Whenever we would get hard on our engineer, he’d invite us to go do something like, “design 3rd floor with an interior designer” or “visit a local muebleria” to pick out things like kitchen cabinets. This made us feel hopeful that there was progress being made. For us, whenever we went to these appointments, they never led to anything or the other people involved never showed up. But the effect was that we got intermittent reinforcement—we didn’t want to give up on the gamble because we’d invested so much into the project and these meetings with new people made it seem like we were on the edge of a breakthrough.
  • Our engineer said mean things about his workers behind their backs (in English), but most importantly, he made us feel like he workers were unable to do the work without him there. But we’re able to manage Felipe and Cristian just fine without having to be on site all day every day. We check in on their progress every day by having them send photos. John meets them each morning to give them their task list. Not having an engineer or architect on the team in an ongoing capacity keeps the costs low. We hire an architect/engineer on an as-needed, short-term basis for discreet projects only. Most of the engineers/architects apparently will offer people a “team” of workers to unsuspecting prey. If you hire one of these architects/engineers along with their team, it’s much more likely you’ll get scammed. Better to hire your own team and a separate architect or engineer to make sketches.
  • Our engineer would promise that things would be done in a particular period of time, but never followed through.
  • The property was a mess. It was hard to see past all the buckets and tools, but not only that…Beto’s workers would leave their clothes on site. The mess made it hard to see the space and decide whether progress was being made. Further, this mess was disrespectful and it showed a general lack of organization. I wouldn’t have allowed it if we’d been in the U.S. Felipe and Cristian, in contrast, keep everything clean and organized. They hung all their tools up neatly in a bathroom that’s under construction right now and all their things stay in this area.

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