Beware and be careful!

Ah yes Baja California or "Under" California as it's known, is a gorgeous strip of land stretching 700 miles from Tijuana, Mexico to Cabo San Lucas with golden beaches, five star resorts, golf courses, world-class fishing and of course affordable beach front real estate. It's easy to get sucked into the vapors of owning land on this pristine peninsula so please do your homework.

Many investors who have not done their due diligence will be paying the price much like many of us who have purchased real estate the past four years in the United States. The recent downturn in the national U.S. real estate market accompanied by a real estate boom in Baja California leads me to believe that we are jumping in with both feet again before testing the international waters.

U.S. lenders entered the Mexican market a few years ago resulting in a burst of real estate investment coupled with an influx of buyers who used their home equity in their primary residences to secure property in Mexico. What a great time to invest, right? Not exactly. Many factors like vanishing home equity, dropping home prices and the disappearance of the U.S. sub-prime market have led to many key U.S. banks and lenders to exit the Baja real estate market.

Also, keep in mind that Baja is one of Mexico's "Prohibited Zones" meaning foreign investors are not allowed from owning property titles in these areas.

However, there are still ways to purchase property legally there. Below is a link to more detailed information that explains foreign ownership, specifically with regard to Baja, California.

By. Ed Kim

Foreign Ownership in Baja, California

Good luck!