Inequality Rising: A Reflection on Expats’ Economic Impact in Mexico Ann Marie Jackson - Mexico News Daily
go to original June 7, 2023

San Miguel de Allende is a UNESCO World Heritage Site and prime destination for both global tourists and expats who choose to stay. (Jezael Melgoza/Unsplash)

I have been thinking about the effects of our comfortable expatriate lives on our Mexican hosts, particularly in the city where I live, San Miguel de Allende.

I was recently shaken out of complacency by an essay a friend posted on Facebook called “La Segunda Conquista, Silenciada” (“The Second, Silent, Conquest”). In her post, my friend Sandra discussed some causes of the substantial increase in the cost of living faced by residents of San Miguel, particularly the dramatic rise in real estate prices. Inflation has also been high in recent years — though it appears now to be abating — and has also had an impact.

While this fair city has welcomed foreigners for generations and is economically dependent on tourism, our numbers have grown in recent years, particularly during the COVID-19 pandemic.

Middle- and lower-income sanmiguelenses, Sandra worries, are getting priced out of their own city. The National Council for the Evaluation of Social Development Policy (Coneval), has determined that San Miguel de Allende has the highest level of income inequality in all of Mexico.

Another friend, a realtor also born and raised in San Miguel, pointed out that it’s not only foreigners driving the gentrification trend. Plenty of the people buying vacation homes to rent out short-term, for example, are upper-income nationals from Mexico City, Querétaro, Monterrey and elsewhere.

But Sandra has a point. In talking with several local realtors, I learned that in the last 10 years, the median price of a home in San Miguel’s downtown neighborhoods has grown from an already remarkably high US $324,000 to US $540,000. That is a stunning price point in a municipality with an average net monthly income of only US $682, where nearly half the population lives in moderate to extreme poverty.

I sat down with Sandra to learn more about what drives her concerns. First, she said she enjoys living among foreigners, who bring energy and new perspectives to San Miguel. She is happy for people who have the ability to work as digital nomads, and she was not against the national government keeping Mexico’s borders open during the pandemic.

However, Sandra can no longer find an affordable home to rent close to downtown (the centro histórico), which was still possible for her only a few years ago. Despite owning a business, she doubts she will ever be able to buy a home unless she buys land far outside of the city. Over many years, she has watched as San Miguel has become one of the most expensive places to live in Mexico, and she fears being pushed out.

Read the rest at Mexico News Daily

Related: Peso Hits New 7-Year High Against the US Dollar (Mexico News Daily)

Related: World Bank Raises 2023 Forecast for Mexican Economy to 2.5% (Mexico News Daily)

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