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July 6, 2012 9:18 pm
In 1810, San Miguel de Allende was one of the first cities liberated from Spanish rule during Mexico’s 11-year war of independence. More than two centuries later, this sleepy hill town in the mining state of Guanajuato retains its progressive spirit. Located 200 miles north-west of Mexico City (a 45-minute drive from the international airport at Querétaro), San Miguel is far removed from the capital’s congestion or the highly publicised “narco-terror” plaguing Mexico’s northern states and Pacific coastline. Designated a Unesco World Heritage Site in 2008, San Miguel’s cobblestone streets and colourful casitas are so charming they border on cliché.
But beyond the city’s set-like façade is a sophisticated and increasingly wealthy international property market. Anchored by the arty American expats who “discovered” San Miguel after the second world war, the city’s “Gringo old guard” is making way for Canadian, European and – most recently – middle- to upper-class Mexican homebuyers. Today, foreigners comprise almost 15 per cent of San Miguel’s population and English is spoken almost as widely as Spanish. Yet with churches still outnumbering fast-food restaurants, and traditional fiestas and religious processions held most weekends, San Miguel’s character remains intact.
“The foreign community has been welcomed by and has helped shape San Miguel for more than 60 years,” says Joanie Barcal, owner of Allende Properties, who moved to San Miguel from California 22 years ago. “People have an emotional response to the city. Even in the current economy, visitors will buy homes their very first time in town.”
Typically younger – and more professional – than their retirement-age predecessors, the newcomers are lured by San Miguel’s safety, creativity and accessibility. Internet connections are fast, healthcare is reliable and the cultural offerings are varied and plentiful. Violent crime rates – in spite of the murders of three Americans last year – remain among the lowest in Mexico, according to Policia Preventiva, the municipal police force. And international-level schooling, which until recently required a daily commute to Querétaro, will be available from August when the Academia Internacional is scheduled to open.
“We wanted to settle in Mexico but needed stable internet because my wife works from home,” says Neil Parker, a Canadian engineer who purchased a three-bedroom home in January. “We hadn’t intended to buy so quickly but renting is relatively expensive and San Miguel is definitely a buyers’ market right now.”
Indeed, prices – which rose in tandem with the US housing bubble – are now 15 to 25 per cent below their 2008 peak. Moreover, the number of properties available is helping to keep prices contained. “I have homes listed from under $200,000 all the way up to $5.5m, but most are selling in the $300,000 range,” says Nancy Howze, managing partner of agency CDR San Miguel.
Barely a decade ago, Howze’s clients were almost exclusively American – typically over 50 with an eye towards the low-slung, terracotta tile homes crowding San Miguel’s colonial core. Today, almost 40 per cent of her buyers are Mexican: mostly families seeking an alternative to Mexico’s increasingly insecure metropolises. With new buyers come new tastes. “While Mexicans like colonial architecture and exteriors, they prefer contemporary interiors and furnishings,” says local architect Jorge Olivares, whose Mexican clientele has increased five-fold in the past five years. “They also want greener homes, so elements like solar panelling have become almost standard.”
Much of this evolution can be seen in the planned communities rising beyond San Miguel’s colonial centre. Los Senderos, for instance, is a development of apartments and villas priced from roughly $300,000 on a 300-acre tract near a golf course and soon-to-open farmers’ market. Similar in style is the Villas de Candelaria, a 30-unit project with vacant lots from $189,500 and move-in ready homes from about $500,000.
San Miguel’s most ambitious project, however, is in town – the Artesana Residences close to leafy Parque Benito Juarez. Opened last year, Artesana is part of the 67-room Rosewood San Miguel Hotel and its initial phase includes 29 homes. With colonial-style architecture and 21st-century interiors and technology, Artesana aspires to the old-meets-new aesthetic favoured by San Miguel’s wealthiest buyers. The development also includes five-star amenities from the hotel.
Half of the 2,000 sq ft to 8,000 sq ft properties have already sold to a 50-50 mix of Mexicans and foreigners – mostly Americans. Prices range from $600,000 to $3m. David Parker, principal at Bald Mountain Development, which developed Artesana, says it will include up to 100 more homes during the next 10 years, with the second phase breaking ground “once phase one sales are further along”.
Parker’s cautious approach is understandable. With neither the American economy nor Mexico’s security woes showing marked improvement, San Miguel property prices could continue to fall before they recover.
Nonetheless, for buyer Joan Oestreich San Miguel has proven so safe – both personally and economically – that she’s now considering a second property in the desert scrubland beyond the city’s borders. “Whether hiking by myself or walking through the city at night, I never feel at risk here,” says Oestreich, a retired New Yorker who owns a three-bedroom home in San Miguel designed by Olivares. “San Miguel has a great mix of people, but the city is still very Mexican – you never feel like you’re in an American community.”
● Easily accessible from Mexico City and most major US airports
● Well-established international community; English is spoken city-wide
● Housing prices are 15 to 25 per cent below their pre-recession highs
● The housing market may continue to fall before it recovers
● Can be a crowded tourist destination
● Security remains a concern across Mexico
What you can buy for ...
$100,000 A one-bedroom, one-bathroom apartment in the city centre with parking
$1m A five-bedroom, 3,712 sq ft villa in the city centre with pool
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