Real Estate Investing: The Essential Guide

May 1
4 min read

When we look to invest our money, we always ask ourselves what the best option is:

Cetes?
Dollar?
Equity investments through a brokerage firm?
Cryptocurrencies?
NFTs?
Airbnb?
Real estate? Of course, it's the best and safest of financial alternatives.

We should always seek advice when we're not financial experts. In the case of real estate —as in all markets —there are many self-proclaimed "experts" who, unfortunately, are not.

To put things in context, I should inform you that this article was written in July 2025, when the world was in the midst of a global financial crisis, inflation was rising in all countries, as were interest rates.

Let's analyze the different financial returns of the alternatives we mentioned earlier:

Cetes : Banxico auctioned 365-day CETES at 8.23% in the third week of July 2025. As you can see, the real return (interest minus inflation) is around 4%.
Dollar : We are experiencing the "Super Mex Peso" effect, and the exchange rate remains around $18.90, with zero return over the past year. This option is not recommended.
Brokerage firms : difficult to evaluate, given the risk involved, especially in these uncertain times. Prudence dictates staying away. For example: Tesla is projected to lose 9.66% by June 2025.
Cryptocurrencies : a disaster. Despite Bitcoin reaching historic highs nearing US$120,000, all other cryptocurrencies are losing money. It's an extremely volatile market.
NFTs : the famous Non-Fungible Tokens , unique digital objects of very relative value. So far, they have only proven to be a good source of inspiration for jokes and stories of disastrous investments.

Real estate investment

In contrast, real estate in Mexico City has never decreased in value, consistently maintaining positive returns. According to data from Propiedades.com on the areas with the greatest potential for appreciation as of the second quarter of 2025, property values in the new construction market in Mexico City have shown sustained growth since 2016, and some neighborhoods have registered an annual cumulative appreciation of up to 50% from 2019 to 2023 (San Rafael neighborhood, source ).

The value of real estate doesn't depend on exchange rates, interest rates, or the whims of politicians. It's always a safe investment, and most importantly, I can literally touch it, see that it's there .

Types of real estate investment

There are three types of real estate investments:

Resale
Long-term rental
Short-term rental

Let's explain each one:

1. Real estate resale investment

In this case, the investor buys a property in pre-sale, where prices are well below market value. For example, buying an apartment in pre-sale in the Condesa neighborhood of Mexico City in June 2025, with delivery in 24 months:

Purchase price: $5,000,000
Down payment: $500,000 (10% usually)

The investor will put the apartment up for sale in January 2026, six months before delivery. This way, they won't pay closing costs. When the construction company delivers the apartment after 24 months (June 2026), and the investor closes the sale, the final figures are as follows:

Resale value: $6,000,000 (estimated based on historical data)
Purchase price: $5,000,000
Profit: $1,000,000
Amount invested: $500,000
Performance: 200%
Annualized return: 100%

2. Long-term rental real estate investment

In this option, the investor buys a property to rent it out based on annual contracts. Rents in Mexico City fluctuate between 5% and 6% annually, so let's do the math:

Purchase price: $5,000,000
Annual income at 6%: $300,000
Monthly rent: $25,000
Area appreciation: 10% (estimated for the neighborhood in our example)
Annual return: 16%

3. Short-term rental real estate investment

There are apartments designed exclusively for this type of investment. The idea here is to buy a luxury hotel suite, with all the services and amenities of a luxury hotel, and rent the property on Airbnb or a similar platform to short-stay visitors.

Living area: usually between 30 and 50 m2
They don't have parking.
They are located in areas favored by tourists and businesspeople. Let's take the hypothetical case of a development located on Paseo de la Reforma, near the Angel of Independence, making it a great option for a foreign tourist or businessperson. They can walk to the Historic Center, the tourist area of Paseo de la Reforma, take a bus to the Museum of Anthropology, and so on.

In the case of this development, the Reforma area rents on Airbnb for between US$100 and US$200 per night. Let's do the math again:

Purchase price: $2,500,000 for a 30 m2 apartment
Daily rate: let's be conservative, let's take US$100 per night
Occupancy rate: again conservative, let's use 3 nights a week (less than 50%)
Total weekly income: US$300
Monthly income: US$1,200. In Mexican pesos: approximately $24,000
Total annualized income: MX$288,000
Annualized rate of return: 11.52% on income only

If I were to rent this same property under an annual contract, my return would be 6% annually, which is equivalent to MX$150,000. As you can see, the difference is very large.

I have the essential information now, which option suits me best?

As we mentioned earlier, it is best to seek advice, and in this case, we are talking about a subspecialty of the real estate market, which is Real Estate Asset Consulting.

Our Property Coaches® are qualified to provide this guidance, and are always accompanied by a Director from our Real Estate division, ensuring you receive the best information to make an informed decision.

I want a Property Coach®, what should I do?

Call us: +52 55 4174 6906, info@metroplex.mx

A Property Coach® will contact you shortly.

The content of this website is for informational purposes only and should under no circumstances be used or considered as an offer to sell, a solicitation of an offer to buy, or a recommendation to carry out any other transaction, unless expressly stated otherwise. Any purchase decision made by the reader should be based on publicly available information on the subject.