Since the crowning of Playa del Carmen as the #1 destination in Latin America for 2018, this caribbean city has cemented itself more in the investment world and as a premium tourist destination for many Americans, Canadians and Europeens. A property investment in Playa del Carmen has seduced yet many people. Playa del Carmen is divided in various suburds and some of them are better for a property investment in Mexico. This article will help people looking to buy, rent, or buy and move to the Colosio area. So depending on your situation, we hope you will find this article helpful.
Investing in Playa Del Carmen
Where is Colosio area?
Colosio is located north of CTM Avenue (also known as 46th Street) between the beach and 30th Avenue and up to approximately 112th Street. This area is large, but when you look at the area that is being developed now and in which areas people rent and buy, is a much smaller part of Colosio. In the map below, we show the large area of Colosio and the orange area is the area that people generally look for to buy real estate. We also added 4 red markers to show beach access points and get an idea on the location of an eventual property investment in Playa del Carmen.
Playa del Carmen real estate investment
Colosio has a unique history in Playa del Carmen and it is important to know how it came about. In the 1980s, Playa was just beginning to grow. Beyond CTM Avenue, at the north end of Playa, it was all forest. There was nothing there. The locals had begun to feel pressure to have places to live and own land. Community activist hatched the plan to take over what would become the Colosio area. In 1987, activists and locals participated in what was called “the invasion”. People came with machetes, chainsaws and bulldozers to open roads and divide the land.
This resulted in the division of the land into parcels. Depending on which side you believe and which part of the government you listen to, it was considered legal or illegal. Regardless of legality, the bottom line is that many properties do not have title in Colosio. This has made buying difficult and has slowed down the development of the area.
This means that anyone looking for property in this area will need to do extra due diligence by reviewing paperwork.
Apartment for sale in Playa del Carmen
Condo developments in Playa del Carmen
What prices do people pay for rent in Colosio? ?
Colosio has been the area for single or young couples to rent cheaper places. It is an artistic area not only because of the murals, but because of the (foreigners) who rent there. Before Covid-19, we received digital nomads who came to Playa del Carmen, but since so many were able to work online during Covid-19, we have seen the number of digital nomads in Playa Del Carmen triple. Colosio has gotten a lot more people looking for long-term rentals.
Prices start at around 6,000 pesos (around 300 USD|) and go up to around 15,000 pesos (750 USD) for monthly rentals. Since most tourists who come for a week want to have access to things located in the center of Playa, this area is not as desirable for short-term rentals. We never recommend this area for short stays when readers ask about booking something at Colosio. It’s just not worth your time and the standard of most accommodation in this area. However, Colosio is much better than a cheap long-term rental situation.
Knowing current demand and prices, this means that if you are looking for an investment property in Playa del Carmen and want to count rent as part of your ROI, you should temper your expectations and not invest too much in a property that will not appeal to the current rental market.
Real estate investment in Playa del Carmen
Let’s take a look at some of the factors that affect the value and potential of Barrio Colosio.
Positive points to consider
- More condominium buildings are being built, this is beginning to transform this neighborhood from one-story houses to a denser residential area.
- Boutiques are beginning to line part of Fifth Avenue.
- The new grocery store being built on Calle 34 and Avenida 10 is going to have a positive impact in Colosio. Although this is not in the neighborhood, it provides access to a large grocery store much closer than the other midtown grocery stores.
- The southern end of Colosio is easily walkable to downtown Playa del Carmen. All Colosio is a bike friendly
- Prices per square meter are cheaper in this area.
- Colosio is close to the beach, although there is limited access and the beach is more natural. Because there are no hotels or businesses in front of the beach, it is not cleaned as much.
Negative points to note about Colosio
- The infrastructure has not improved much in recent years. The main problem is the capacity of the sewage system and what happens when it rains a lot. Sewers often overflow onto Fifth Avenue.
- Parking in the most popular parts of Colosio is now metered. Since most new buildings do not have parking due to their smaller size, parking on the street can become a hassle.
- Rents are considerably lower than downtown. This means that if you are looking for an investment property in Playa del Carmen, you should consider that it is not as popular with short-term rentals. Long-term rentals are more popular in this area, but that means less rental income per month.
- The big factor for Colosio is what will happen to the large empty beachfront lot. If it remains empty, it does not add any value to the area. It is built, it could block many views of the current units.
Properties for sale in Playa del Carmen
There is no question that Colosio is changing, growing and adding more condos to the area. Colosio is becoming a downtown bedroom community, and more foreigners are renting in this area making it a good property investment in Playa del Carmen.
While some like Colosio’s artistic edginess, it’s also an area of friction between locals and short-term renters who come to the area. Often in these types of areas, crimes of opportunity, such as robberies, are more prevalent. The further north you go in this area | (80th street and above) can feel a bit sketchy for some single women or men for the night.
We would not consider this a great area to live personally. The only three things that make it a good area are the proximity to downtown, the current ocean views (which are not guaranteed), and the lower price. It’s not as much of a cohesive community as some of the other areas further back in Playa. Currently, access to grocery stores is limited and it would be more difficult to run daily errands.
We also consider that all of our recommended real estate agents that we refer to readers, none of them have invested in Colosio. The main reason is that there are other areas that have better rents and are better places to live. As the saying goes “the more you invest, the more you earn”. This is quite true in the Playa del Carmen real estate market for a property investment in Playa del Carmen Mexico.
Cheaper properties get cheaper clients and you often have more maintenance because it is cheaper construction. It really only works if you’ve been put out of business in downtown Playa or other areas and want something close to the beach and downtown.
Property investment in Playa del Carmen
With these factors in consideration, here’s what We’d buy another don’t buy:
- We wouldn’t buy anything on the first two floors of a building in Colosio. Partly for safety and for views.
Nothing without a view or good airflow.
There would have to be a small plunge pool on the roof.
- We wouldn’t buy anything beyond 70th Street. Beyond 70th Street, it becomes too far to walk or bike and becomes less desirable the further north you go in Colosio.
Nothing more than a two bedroom unit. The larger condos are for families or groups and Colosio is not the best area for families with young children to stay. So cheaper group rental equals trouble. A study or a bedroom would probably be better.
- We would not buy anything above $180,000. The reason is that the rental market doesn’t support high-end rentals and for about the same top price, you have a lot more options, even Tulum.
- If you buy something like a personal unit to live in, it would have to be at least one bedroom. The studios are too small for daily life.
Real estate agents in Playa del Carmen Mexico
Who would we contact to buy something in Colosio ?
We would only work with a real estate agent who is a buyers agent, meaning you would not be dealing directly with the developer. Having a good real estate agent and one who is a buyers agent means they work just for you and will do the research on the developer and the finances.
It’s true that you can bypass the middleman (a real estate agent) and buy from a developer with inside sales. There are still vendors, but sometimes they may offer better deals or include something for a property investment in Playa del Carmen. However, there is much more risk in doing this. They will only work to sell you their product, they won’t offer you any other options, and you don’t have an outside expert voice on whether it’s a good buy or not.
Since many of the lots are smaller in Colosio, there are smaller and newer developers doing projects in this area. This means that extra care is needed to research the developer and look at their reputation and funding. Just by walking through Colosio you can see evidence of projects that were started and then stopped and others that were not built correctly and are abandoned.
Thanks for reading our second article about property investment in Playa Del Carmen. We hope you have found it useful and informative. We have much more information about real estate in Playa del Carmen in our guide here.