Transportation Upgrades Likely to Boost Yucatan, Riviera Maya Property Values
Mexico’s ambitious railway project, Tren Maya, is set to revolutionize transportation and boost tourism in the picturesque region of the Yucatan Peninsula in Mexico. Connecting major archaeological sites, stunning beaches, and luxurious hotels, this railway system has garnered attention, sparking local excitement, and foreign investment. We’ll take a look at the train’s impact on property values in the region and answer some frequently asked questions about the new train.
The Tren Maya project encompasses the construction of a 1,500-kilometer railway network, consisting of 21 stations, 17 stops, and 42 trains . The railway aims to facilitate daily transportation for over 40,000 passengers (plus cargo), linking key attractions and destinations across the Riviera Maya such as Cancun, Tulum, Playa Del Carmen and Merida. The project, headed by the National Fund for the Promotion of Tourism (FONATUR), began construction in 2020 and is divided into seven sections, implemented across two phases. It is scheduled to be mostly completed and running by the end of 2023 (Dec 1).
In addition to the Tren Maya, another major upgrade is coming to the region in the form of a new airport in Tulum, a booming area near Cancun and Playa Del Carmen. Americans, Canadians and other foreigners will be able to fly directly to Tulum, saving time and money for renters and vacationers to a growing city. The new airport is noted on the map above.
Transportation Upgrades in Yucatan & Riviera Maya Likely to Boost Property Values by 5-25% in the Next Decade
Beyond the convenience they offer, these significant infrastructure developments are also expected to have a sizable impact on property values in the surrounding areas. With improved accessibility and increased tourist influx, the stage is set for a remarkable surge in real estate demand, making up and coming cities like Tulum an enticing investment opportunity for both domestic and international buyers.
Several organizations in the transportation space have looked at the effect that these types of updates have on home values and the consensus is clear: transportation upgrades generally lead to increased property values. We took a look at several reputable studies that examined the impact that transportation had on property values there to get an ide
- An extensive study by APTA, spanning 2012 to 2016 revealed that in US regions rental units near transit stations witnessed rent price increases of 2-14% compared to areas farther away. (Source)
- Redfin found that one Transit Score point can increase the price of a home by $2,040 or about 0.7% per point. While these major US cities differ from Mexican cities in various ways, a Transit Score for the area would certainly increase by multiple points for many homes as these new upgrades are deployed. (Source)
- In Chicago, being near public transportation can lead to a premium of up to 15% on property prices. (Source)
- Research by Nationwide in London indicates that properties located within 500 meters of a tube station carry a 10.5% premium compared to those farther away. (Source)
- A study by the Center for Neighborhood Technology revealed that transit-adjacent homes outperformed the general market by 41.6% during the recession, showcasing their resilience and value retention. (Source)
If we take into account some of the differences between say, Cancun and many of the U.S cities including size, commute length, population and more we can estimate that property values in the Yucatan and Riviera Maya will increase from 5-20%, if within 5 miles/8 kilometers of the Tren Maya over the next decade.
Real Estate markets everywhere fluctuate often and are subject to the macro-economic conditions at the time. But given the results of the studies above, transportation upgrades will boost real estate prices in the Tren Maya service area, increasing more-so when located closer to useful transportation options.
Tren Maya FAQs (Frequently Asked Questions)
What is the Tren Maya?
The Tren Maya, is a 1,525-kilometer (950 mile) intercity railway project in Mexico. It aims to connect tourist destinations in the Yucatán Peninsula (including Cancun, Playa Del Carmen and Tulum) and to promote overall economic development in the region.
When did construction on the Tren Maya begin?
The Tren Maya was announced by President Obrador in September of 2018 and construction on started in June 2020.
When is the Tren Maya scheduled to be completed?
The Tren Maya is scheduled to be completed by December 1, 2023. Test runs for the train will begin in September 2023.
What are the main routes of the Tren Maya?
The railway starts in Palenque, Chiapas, and travels northeast towards Cancún, Quintana Roo, via two routes that encircle the Yucatán Peninsula.
All stops and stations on the Tren Maya
How much will it cost to build the Tren Maya?
Initially estimated to cost 150 billion pesos ($7.4B USD), the project’s construction estimate was later revised to 200 billion pesos. The total cost, including 30 years of operating and maintenance but excluding electrification, was estimated to be about 321 billion pesos ($18.5B USD).
How was the Mayan Train project funded?
Funding for the project primarily comes from a tourism tax levied in the region and funds diverted from other programs. The Mexican Grand Prix also contributes to the funding.
What were the results of the December 2019 referendum to approve the Mayan Train?
In the referendum, 92.3% of the participants voted in favor of the Mayan Train project, while 7.4% voted against it. The voter turnout was 2.36% of registered voters in the affected municipalities.
What are some concerns raised by critics of the Tren Maya project?
Critics have raised concerns about the project’s impact on the environment, particularly the construction of new tracks through the jungle. Indigenous rights activists have also expressed opposition to the project. The government of Mexico has argued that the reduction in highway traffic, in favor of the more environmentally friendly mass-transit train, will have a positive impact on the environment overall.
Which companies are involved in the construction of the Tren Maya?
Several developement companies are involved in different stretches of the project, including Mota-Engil México, China Communications Construction Company, Operadora CICSA, FCC Construcción, Construcciones Urales, GAMI Ingeniería e Instalaciones, and Grupo ICA.
Tulum Airport FAQs
When is the new airport in Tulum expected to open?
The new airport in Tulum is scheduled to open in April 2024. Please note that construction timelines are subject to change.
What will the new Tulum airport callsign be?
The official callsign for the new Tulum airport has not been announced yet. It will be assigned by the relevant aviation authorities closer to the airport’s opening date.
How far is the new Tulum Airport from Cancun, Playa Del Carmen, and Merida?
The new Tulum Airport is conveniently located about 13 miles or 20km north of Tulum’s beaches. The airport is technically in the municipality of Felipe Carrillo Puerto and will offer close proximity and easy access to several cities:
- To Cancun: 120 kilometers or 75 miles
- To Playa Del Carmen: 65 kilometers or 40 miles
- To Merida: 280 kilometers 175 miles
Will there be direct international flights to the new airport in Tulum?
Yes, the new airport in Tulum is expected to have direct international flights. While specific routes and airlines have not been announced yet, the airport aims to accommodate both domestic and international travelers.
What airlines will operate flights to and from the new airport in Tulum?
The list of airlines that will operate flights to and from the new airport in Tulum has not been finalized. However, it is anticipated that major airlines and regional carriers will offer services at the airport to connect Tulum with various destinations. As the opening date approaches, more information about airline partnerships and flight schedules will be announced.
Sources:
- https://trenmaya.gob.mx/en/
- https://www.eesi.org/briefings/view/the-impact-of-public-transportation-on-real-estate-values
- https://www.jstor.org/stable/43096216
- https://medium.com/age-of-awareness/mapping-the-20-billion-railway-in-the-jungle-using-felt-66ce2da56af3
- https://www.homelight.com/blog/public-transportation-property-values/
- https://www.struttandparker.com/knowledge-and-research/how-new-transport-infrastructure-affects-property-prices-and-saleability
- https://www.usnews.com/news/blogs/home-front/2013/03/22/study-proximity-to-public-transit-boosts-home-values/
- https://www.redfin.com/news/how-much-is-one-point-of-transit-score-worth/
- https://www.aljazeera.com/news/2021/4/21/tren-maya-suspension-fuels-indigenous-community-rift
- https://www.aljazeera.com/news/2019/12/17/mexicos-president-says-mayan-train-project-to-move-forward
