Retiring South of the Border

by : Jim Scherrer

Attention, baby boomers; don't be late for the party! If you haven't noticed what's going on south of the border, but only heard about illegal immigration north of the border, the following may prove to be quite awakening and informative.

Puerto Vallarta, Mexico, a sleepy little Mexican fishing village located in the foothills of the Sierra Madres on Banderas Bay along the Mexican Riviera is no longer sleepy or little. The population has literally exploded since the filming of 'The Night of the Iguana' in 1963. Vallarta has grown from 2,000 inhabitants prior to 1963 to the current figure of 350,000 inhabitants in 2007.

Today, the population of greater PV makes it the second largest city in the Mexican state of Jalisco, only behind Guadalajara. Please refer to the following graph in order to track this explosive growth and its projection for the next ten years:

(Please visit the website below for graph details)


Putting this in perspective, you'll notice that the above chart indicates that Vallarta has now reached the size of St. Louis and assuming the projected growth holds true, it will be equal in size to Cleveland within ten years. The significant note of interest is that St Louis, Pittsburgh, Cleveland, etc., will all probably show little to no, perhaps even negative growth, while PV is expected to grow by another 50% during the next ten years. Now, we ask, what's going on down there?

First, let's consider who's moving there. The entire industry of Vallarta is based on tourism and the immigration of North Americans. The US data from the IRS returns indicates a growth from 200,000 US citizens a few years ago to 750,000 Americans living in Mexico in 2005. Of the 750,000 Americans, we can only estimate that 50,000 Americans and Canadians now call Vallarta home. With the tens of thousands of condos and villas currently under construction or in the ten year planning phase, we can only imagine that by 2017, the North American population in greater PV will be somewhere between 100,000 and 150,000 retirees. The following are some of the reasons for this explosive growth:

Climate--The seven month 'high season' of November through May has an average daily temperature of 73*F with virtually no chance of rain.

Scenery--Vallarta, located in the foothills of the Sierra Madres on the Banderas Bay, one of the largest and most beautiful bays in the world, is in the center of the Mexican Riviera on the Pacific Ocean. Beautiful beaches, rocky cliffs, mountain sides overlooking the bay, tropical flowers and wildlife, and all the sights that one would expect to find in Paradise.

Safe--With tourism being the life blood of the economy, North Americans are 'off limits' regarding any sort of criminal activity. Since guns are strictly prohibited in Mexico, burglaries, robberies, etc., are virtually unheard of. The primary objective of most all of the young generation of natives is to assure all North Americans a pleasant and safe visit to Paradise so that they'll return soon and often. Fear of a terrorist attack in Vallarta? Forget it!

Friendliness--In 2001, a readers poll taken by Conde Nast magazine listed Vallarta as the friendliest resort destination in the world. The locals treat North Americans with dignity, respect, and as friends, family, and almost as royalty.

Clean Food and Water--The explosive population growth has caused a complete revamping and expanding of the city infrastructure. This includes the road system, power generation and distribution, and of course, water treatment and distribution systems. The water is pure and safe to drink from the tap throughout the city. All food products are now available in the many new modern supermarkets equal to the finest in the States. Food for home or restaurant consumption is closely monitored for cleanliness and controlled as in North America.

Medical care--Two new huge modern hospitals and one smaller modern clinic in Vallarta are fully capable of handling all emergencies as well as complicated surgeries. Modern dental clinics are also in Vallarta offering crowns, caps, implants, as well as all the basic dental practices. All of the doctors and dentists speak English and many of them have had at least some professional training in the States.

Friends--Every North American that you see in Vallarta, and they are easy to spot, is either on vacation or retired, i.e., none of them have to go to work tomorrow! They are all open to new friendships and new comers are always welcome. It's one big party with no looming pressures of the office or the commuter drive in the morning.

Language--Because the economy in PV is based on tourism, it is imperative to speak English. Therefore, it is estimated that at least 80% of the younger generation is now speaking or at least understanding English. Communication is not a problem in Vallarta and there is no need to learn Spanish.

Travel Time--Although Vallarta is on the same latitude as Hawaii, it is only two to three hours from most of the US cities. Even the highways coming down from the US are now all super modern tollroads and the drive to PV can be made in two days from the border.

Connectivity--With high speed internet service available citywide, internet based telecommunications, and satellite TV available everywhere, you have the same contact with the world that you would have anywhere in the US or Canada.

Activities--World class deep sea fishing has been for years, and will always be, a major activity in Vallarta. There are now seven beautiful golf courses with more under construction. There are hundreds of tennis courts, water activities, night life galore, and too many clubs and organizations to mention. If you have nothing to do in PV, it's only because that's your choice!

Cost of Living--The cost of basic staples is about the same as in North America, however, housing is roughly half the cost and housing related taxes are a fraction of those in the States. All services are a half to a third of those in the US including medical and dental care because labor rates are so much lower. The cost of dining, outdoor activities, etc., are pretty much in line with those in the States.

Economic Security--The Mexican peso, at approximately 10.8 pesos per US dollar, has held firm for the past ten years. There are no devaluation concerns at this time as the Mexican economy booms.

Political Security--The PAN party has ruled in Mexico since 2000 and will remain in power at least until 2012, assuring a twelve year consecutive run of Mexico being governed by Harvard graduates! Needless to say, they are pro-US and friendly to the North.

Investment--Property values have tripled during the past ten years and are expected to double again during the next five years. With the booming economy, the Mexican stock market has also tripled during the past ten years. There is no slow down of growth in the foreseeable future.

Hopefully, the above 15 items will provide some explanation for the booming economy and explosive growth in Vallarta. They say that the party's not over, that it has only just begun.

The Mexican National Tourism Development Foundation (Fonatur), has designated a 30 mile stretch of pristine Pacific Ocean shoreline north of Vallarta as the new Riviera Nayarit, where more than five billion dollars will be invested during the next ten years creating 30,000 new jobs as they build close to 20,000 new condos, villas, hotels, etc. As the North Americans continue to flock to Paradise, the infrastructure growth and future planning activities continue at a torrid pace.

If you're retired or close to retirement, you ought to check out Vallarta before it's too late. If you're fortunate, you'll be included in the next 150,000 gringos that migrate to Paradise!