By JUAN DE JESÚS BREENE
As some level of normalcy returns to Mexico City, more foreigners are coming to the city to live and work. hey are usually pleasantly surprised at the low cost for electricity, water, internet, cell phone service and the somewhat-low cost for natural gas, although that has recently been on the rise.
But those same foreigners are also typically surprised at the high costs and intricacies of the contract for apartment rentals.
To begin with, moving is a challenge in and of itself, and doing it in a new culture, just adds to the craziness.
Mexico City, a.k.a. CDMX, is the fifth-largest city in the world, having taken the place of Miami as the center of corporate Latin America. Miami became too expensive for leasing office space and Mexico City had a surplus, even pre-covid.
But what about the foreign employees?
Foreigners seem to prefer to live in these neighborhoods, listed in rank order of monthly rental per square footage: Polanco, (east of Insurgentes), Colonia Juárez, Condesa and the two Romas (Norte and Sur).
Santa Fe, would be at the top of the list for cost, but most foreigners do not want to live in Santa Fe unless they are not working there because it is geographically isolated from the rest of the city.
By law, rental agreements are for a year in Mexico, but some foreigners are looking for monthly contracts while they get to know the city.
Recently, the cost of Airbnb rentals have skyrocketed, with significant overlay taxes for both the guest and the owner.
For an annual contract in Mexico, most landlords expect three months up front: first, last and the deposit, plus a guarantee, an aval, from someone who owns real estate property with no mortgage in the city as collateral for nonpayment, in addition to the signing of 12 legally binding IOUs.
This is not something just for foreigners. It is a common practice for all high-end rentals. Yes, it’s a different ballgame.
For furnished apartments in the neighborhoods listed above, and be prepared to pay conservatively up to $1,000 a month.
If your employer is paying and serving as you aval, they already know this. For those who are self-employed or working from home at distance, technically in Mexico on a tourist visa, the situation can become even more tedious.
Many foreigners arrive in Mexico thinking that their costs will be manageable, but when housing becomes part of the equation, the out-of-pocket expensive might end up being more than in their home country.
So what does Mexico City’s rental profile look like for the future?
Simple. Corporate inventory is ample, so that’s good for businesses. On the other hand, personal inventory for fully furnished apartments is in demand and expensive, making renting in high-end neighborhoods an owner’s market, and a serious challenge for the foreign employee.