Buyer financing in pre-sales puts pressure on developers

TM Grupo Inmobiliario - México says homebuyers in pre-sale projects often act like lenders, especially in Mexico’s vacation-home market. The company is using its Xcalacoco project in Playa del Carmen to show what it considers the signs of a financially solid development after Tulum’s market correction.

Why it matters: - In pre-sales, buyers often put down 20% to 30% of a home’s price before the property exists, which effectively finances the developer’s construction. - That makes the developer’s balance sheet, delivery history and permits just as important as the apartment itself. - In Mexico’s vacation-home market, weak demand can leave buyers exposed to delays, unfinished buildings or projects that never reach escrituración.

What happened: - Alejandro Zarfino, CEO of TM Grupo Inmobiliario - México, said buyers in pre-sales are lending money to developers and should evaluate repayment risk the way they would with any borrower. - Zarfino made the comments in Playa del Carmen, Quintana Roo, as the company highlighted Distrito Xcalacoco Beach, its residential project in the Riviera Maya. - The remarks come after the correction in Tulum, where a wave of studios and lofts marketed on expected rental returns struggled when tourism demand softened.

The details: - Zarfino said the Tulum problem was not the destination but the product model, because many buyers were chasing ROI rather than real demand. - He cited other stalled or delayed projects, including developments in Monterrey and luxury towers in Miami that have not yet broken ground. - When sales finance construction, a weak sales month can become a construction delay, and the buyer ends up funding the wait. - Zarfino said buyers should check four main signals: proven delivery history, construction speed, completed amenities and controlled margins. - He added a fifth warning sign: delivery is not the same as escrituración, because a project can hand over keys without having the legal papers needed to transfer title. - On delivery history, Zarfino said buyers should look at how many homes the developer has delivered, whether it uses its own capital and how many customers return for a second purchase. - On speed, he said a seven-story building can be completed in a little more than a year if financing is in place, while a three-year pre-sale timeline can signal dependence on future sales. - On amenities, buyers should distinguish between what is finished now and what is only shown in renderings. - On margins, Zarfino said a developer still needs to earn money, but competitive pricing and faster absorption are better than pushing prices above the local market. - TM Grupo Inmobiliario said it has delivered more than 600 homes in the Riviera Maya under its Branded Residences model and has built in Mexico for two decades. - The company said its main metric comes from experience during the 2008 crisis, when it had 700 unsold homes, cut prices by 40% and used the cash to buy beachfront land at a fraction of its later value.

Between the lines: - The message is less about sales tactics and more about financing discipline. - A developer that relies heavily on pre-sales needs steady demand to keep construction moving. - A buyer in that model is not just choosing a home. The buyer is also underwriting the project’s timeline and execution risk. - In Playa del Carmen, Zarfino said demand has shifted from rental yield to patrimony and lifestyle, which favors projects aimed at long-term ownership rather than speculative income. - He said the market on the ocean side of the federal highway has seen steady price growth, while the city center may be nearing what buyers can absorb. - Zonas norte, including Xcalacoco, hold much of the available land and are likely to see the next phase of growth.

What's next: - Distrito Xcalacoco Beach is being used as TM Grupo Inmobiliario’s proof point in Mexico after a five-year pause in construction. - The first phase, with 89 apartments, went on sale in July 2025 and is being deeded in 2026. - The second phase has 96 units under construction and is scheduled for delivery in 2027. - The full project will include 275 homes across three phases. - The private beach club and Plaza Xcalacoco are already operating. - TM Grupo Inmobiliario says it was founded in 1969 in Torrevieja, Alicante, and operates in Mexico under The Fives Hotels & Residences and Distrito Xcalacoco Beach. - More information is available at the company’s website.