June has always been a slower month (shoulder month) for visitors here in the Punta Mita area but we are expecting more activity as we head into the summer vacation season. With regard to real estate transactions, June for us has been a positive beginning to the summer months ahead, as we have several transactions in escrow with closings happening through the end of this month, as well as additional closings scheduled in July and August.

We are feeling the market strengthening, as evidenced by three of our most recent transactions – single family home sites within Punta Mita and a development parcel in the North Shore – indicating that the prospective purchaser is willing to start venturing outside of the finished product limitation.

New construction within Punta Mita is another signal that more confidence is beginning to return to our market, and is another indicator for us that the market is gaining momentum and confidence, albeit slowly.

We are clearly seeing that Canadian and Mexican buyers are more active, with U.S. investors still remaining on the sidelines for now. The strength of both of these economies is underlying the increase in interest and activity, coupled with the unique attractions this area holds for these markets.

In Canada, the economic recovery has fully taken hold, with first quarter 2010 GDP growth leading all G-7 countries at a rate of 6.1 percent. This is also the strongest increase in over ten years, and contributed to the increase in employment, erasing almost a third of the job losses experienced during the downturn, which bottomed in August 2009. Canada’s stable housing market and more conservative financial institutions contributed to the more rapid recovery, which also benefited from a strengthening in demand for some of Canada’s key commodities.

Canadians have traditionally been buyers in the Puerto Vallarta and Punta Mita markets, as they look for a winter beach escape—and air access here is readily available from key points in Canada. The exceptional prices available now are motivating buyers who hesitated when real estate prices were at historic highs. The recent price adjustment in many desirable properties is providing a terrific buying opportunity, and our Canadian buyers are taking advantage of these opportunities.

In Mexico, where GDP is expected to grow at close to 5% this year, the relative absence of financing helped protect home prices—especially in resort areas—from experiencing the same sort of free-fall price declines as were seen in Florida and other areas. As the Mexico economy recovers, the emerging middle class here has created a whole new market of resort homebuyers. In our area, interest is especially strong from the Guadalajara market—which is less than a 3-hour drive away, as well as from Mexico City and Monterrey. In addition to offering a resort home for enjoying holidays and weekends, the Mexican buyer also sees these as value-based investment properties, especially those on the beaches.

We are very sympathetic to the crisis of the oil spill in the Gulf of Mexico and the surrounding areas, and share in the frustrations of many over this ecological disaster. However, being realistic, we do believe that as oil comes ashore on the beaches of Florida, attention will turn to Mexico’s beaches, especially those in Pacific Mexico, as an alternative for both beach vacations and resort home ownership. Where clean beaches were once assumed as a “given”, more attention will be paid to policies and practices that could impact their continued health over time. Mexico has an active certification process to monitor and track the cleanliness of its beaches and waters, and there are no offshore drilling facilities which could impact the beaches in our area – which is another benefit of property ownership here.