Ladybug18- I agree somewhat with mjplatt, who advised you not to rush into anything and to come down first to check things out. My wife and I have lived in Ajijic on Lake Chapala for 2 years, and love it. Guadalajara is still a long way away and Lake Chapala does't face becoming a suburb any time soon. Don't know what mjplatt is talking about the pollution, air is clear and fresh every day (and we live here every day).
I am not clear about your situation. Are you retired, or about to be? Are you still working and thinking of buying for a future retirement or for a vacation home? Are you thinking of coming here are working?
There is a perennial debate among expats here over whether Lake Chapala or San Miguel Allende are better places to live. We have visited San Miguel and have some idea of the place and like it a lot. However, we prefer Lake Chapala for several reasons.
1) The climate is better because Lake Chapala is somewhat lower in altitude and the lake itself keeps the area at a relatively constant spring-like temperature. San MIguel will be colder in the winter and hotter in the summer, and will therefore likely require expenditures for heating and cooling. We use neither here in Ajijic, except for a fan on overly warm days. Â
2) San MIguel is a small city, with ever increasing levels of development. Property there is relatively more expensive than Lake Chapala. I have a number of friends who, although they loved San Miguel, moved here for that reason. The communities along Lake Chapala are small towns or villages, with much less population pressure and they have the ambiance of small towns--you can walk almost anywhere, and nearly always meet your friends on the street. However, Lake Chapala has developed very good infrastructure in recent years, and most of the technological conveniences are fairly easily available (high-speed internet, cell phone service, cable tv with English language channels, supermarket shopping etc).
3) Lake Chapala is only 30 minutes from Guadalajara Intl. Airport with direct flights to the US, while San Miguel is more than an hour from Leon or Queretaro airports. I am not sure about connections from there to the US, but very possibly you'd need to go through Mexico City, a nightmare I'd personally rather avoid.
4) While Guadalajara doesn't really encroach on Lake Chapala (and probably won't for some time) we are close enough to easily access anything we want in terms of big city services, culture, and activities. It is the second biggest city in Mexico (with all the good and bad that might imply).
I would advise in the strongest terms to come down and rent for a while (1-2 years) before even considering buying, whether in Lake Chapala or San Miguel. Prices in both places are grossly inflated and do not yet reflect the drops seen in the US. Waiting will save you money that way and also because you will have time to study the local real estate situation, which is very unlike what you experience in the US. There is no mortgage market comparable to the US. Most folks end of paying cash, which means a huge chunk of your assets are tied up at best and at risk at worst. Real Estate here is VERY illiquid. Houses, even in good times, can stay on the market for a long time, sometimes several years. Can you tie up $150-300K like that? Finally, there are no disclosure laws, so the rule is caveat emptor with a vengeance. The Mexican legal system is byzantine, so if you run into a problem, you may have little recourse.
On the bright side, all this means that there is a great rental market with lots of homes and condos on the market owned by people who can't sell them and are desperate to rent to get some income. Most places some fully furnished (and I do mean fully-down to soap in the dish), so you don't have to haul all your stuff down until you actually decide to buy. Just move in and live! This also give you the option of sampling several different places or even different villages. You could even rent for a while in Lake Chapala and then in San Miguel to see first hand which you like best.
Whatever you decide, buena suerte! For a real-world view of what it's like down here, check out my blog:
