Mexico is a beautiful country with a rich diversity of cultures, cuisines, and ecosystems. Whether you’re relocating for business, family, or retirement, the cost of living in Mexico may be your top concern before making the big move.
Although we look forward to the delights of a new local when we move or travel, unexpected expenses are rarely welcome. We may occasionally get stuck in a rut, but there are few things more upsetting when moving than finding out your income falls far short of your needs and lifestyle expectations.
But the news is excellent when it comes to Mexico. This is one of the main reasons it's such a favorite retirement spot for so many North Americans. Your U.S. dollar, in particular, goes a lot further than it did at home. In fact, you may find you can indulge in a few unexpected luxuries once you relocate and settle in. Just as in the United States, however, the cost of living in Mexico depends mainly on where you settle.
The Cost of Rent and Real Estate in Mexico
Mexico is very popular as a vacation or wintering spot, and the tourism industry can drive the cost of living in Mexico up depending on where you move. Like anywhere else in the world, the price depends on the location.
The cost of housing in Baja California Sur
Cabo San Lucas, in Baja California Sur, has a thriving population. So, it's a busy destination for relocation and retirement. Depending on the size you need, an apartment rental will put you back about $510 a month for a one-bedroom in the thick of the city. Expect to pay about $800 for a three-bedroom dwelling in the suburbs. That's not bad at all, considering that the average rent for similarly sized properties in Chicago run from $1,700 to up to $3,000 per month.
As for purchasing a home, the cost of buying real estate depends on your budget, as it is anywhere. Especially with the wide range of properties on the market. You can find a small condo for as low as $90,000 or invest in a 9-bedroom luxury mansion on the ocean for $12.7 million.
The cost of housing in Yucatan
The cost of living in Mexico differs in other areas of the country. It is much cheaper on the Gulf, for example. In Merida, Yucatan's largest city, rent is very low. You can get a one-bedroom apartment in the city center for as little as $140 a month. On the higher end, a suburban three-bedroom home will set you back about $320 per month.
Purchasing a home is an absolute steal in Merida, and you can find a lovely, two-bedroom home for as little as $50,000. An eight-bedroom luxury mansion in Merida may only cost you $5.75 million. Similar Gulf of Mexico properties in the U.S. sells easily for twice the price.
The cost of housing in Mexico City
As the capital city of the country, the cost of living in Mexico City, particularly for housing, is slightly higher than in other regions. Rent for a one-bedroom apartment in the middle of this big city about $525 a month, while a larger apartment, suitable for a family, is about $1,000 per month. It's slightly cheaper on the outskirts at about $655 in the suburbs.
Real estate for purchase, however, is at a premium when compared to the rest of the country. You can get a lovely five-bedroom villa for about $600,000, or invest in a substantial estate for as much as $11 million. While Mexico City is more expensive than much of the country, the cost of living is still quite low when compared to the U.S.
The cost of housing in Ajijic, Mexico
Not far from Mexico City, Lake Chapala hosts the expat haven of Ajijic. Prices for housing are slightly lower to those found in the capital, although the cost of other services might be higher. Compared to Mexico City, the cost of living in Ajijic, Mexico is lower overall, and its laid-back feel gives the town a resort atmosphere not found otherwise in Central Mexico. A small apartment in the city will run you about $486 a month, while a larger family-sized apartment with three bedrooms will run about $950 in town and $600 on the outskirts.
Properties for purchase tend to favor investors, with a 1/1 vacation condo running about $90,000, while a nice four-bed, two bath family home might run you as much as it does in the U.S., at about $230,000 to $260,000.
The Overall Cost of Living in Mexico in US Dollars
The day-to-day necessities are the real bargain when it comes to the cost of living in Mexico. Utilities, food, clothing, and even luxuries like a maid or garden service is where Mexico shines. In Cabo San Lucas, Merida, Ajijic, or bustling Mexico City, utilities for your home could be as cheap as $45 per month.
Transportation is also pretty cheap, and purchasing a brand new car may only cost you $10,000 to $14,000, depending on the make and model. Gasoline, on the other hand, is similar to the cost in the U.S, ranging from about $2.85 to $3.30 per gallon, depending on the region.
The overall Merida, Mexico cost of living is thrifty $1,300 for a family of four, not including rent. Out of 538 cities ranked, Merida came in at 498th regarding the cost of living. For Mexico City, it's a bit higher, as expected in the nation's capital. At approximately $1600 per month for a family of four (barring rent or mortgage), Mexico City ranked at 476th for cost of living. These figures show you how much financial leeway you can expect after locating there.
The Cost of Personal Services in Mexico
Your gym membership will cost you the most in Mexico City or Cabo, at around $50 per month. Expect to pay half that much in Merida or Ajijic. One essential living expense for living abroad is the cost of childcare and education. While preschool and daycare are very inexpensive, expect to pay more a private elementary school for your children. Daycare can cost as little as $100 a month in Cabo while costing you about $250 per child in Merida or Mexico City.
The cost of a private international day school for your children also varies wildly by location. You may pay as little as $1,700 per year per child in Cabo where there are more resources for English-only speaking expats. On the other hand, expect to pay up to $6,300 a year in Ajijic and Merida, where resources are few.
The Cost of Dining in Mexico
The beautiful climate means that Mexico is abundant with fresh foods. Restaurants throughout the country boast of their recipes for piquant flavors and regional specialties. And it's cheap, too, making Mexico a foodie's paradise. A mid-range restaurant in Mexico City might set you back about $25 for a three-course meal for two. In Merida, it's even cheaper, with an average cost of $16. Not bad at all if you like eating out and have to keep to your budget.
Checking out at the grocery store might provide some pleasant surprises. The cost of fresh chicken and beef is far below the cost in the U.S. Interestingly enough, the cost of milk is similar at a little over $3.00 per gallon. Rice is both abundant and cheap at less than $0.50 per pound, which is why it's a staple food in Mexico at all income levels. Better yet, fresh-baked bread will only set you back $1 per loaf.
Getting Ready to Save and Enjoy
If you are considering moving to this breathtaking and exciting country to retire, or even if you move for business, knowing the cost of living in Mexico will help you plan your budget accordingly. The weather is delightful, and the living is easy. And most of all, it's incredible value for the money. Take stock of your resources, calculate your savings and expected income, and consider the kind of life you want for yourself and your family. Mexico may be the right mover for you, whatever your budget.