I live in Chiapas and Jalisco so I cannot tell you about Mazatlan but I recently looked into it and I was quoted 1000 dollars per square meter for luxury construction which is basically US construction. My Mexican friends are building with cheaper material right now and they say 6000 to 10 000 pesos so it really depends on the type of construction and material.
In Chiapas I am involved in cermic oven construction and I can tell you that the price of material has gone through the roof during the last 2 years.. Cement went from 180 to 235 for a 50kg bag , bricks have gone up , plywood is through the roof, anything metal has gone way up as well from the barrillas to the beams...and that is just a small sample of material. ANything imported is way up and we have experienced shortages here and there as well..

 

Thank you for the insight, it definitely helps to get an understanding of prices. I knew materials would be pricier but the bulk of US construction costs is our much higher wages where 1 US construction hour is an entire days wages in Mexico so I was still shocked out how high the rate was. Considering my friend just bought a 400m2 house in Ensenada land included for $120K and my own house in a premium location is similar.

So to have a quote for for 3/4 the cost of the whole house+land for 1/4 of the build has me guessing whether my expectations are out of line.

 

Masons in CHiapas in the indigenous communities make 250 pesos a day the helper 150 and the prices go up if you are in San Cristobal and Tuxtla and way up in Cancun or Mexico but it is still cheap in comparaison to the States but material adds up quickly.. I have a 400m2 house and 1300 m 2 piece of land the lake Chapala area I bought 20 years ago for 200 000 pesos, I am looking at selling it for way more money but the price of land and material have gone way up and I could not rebuild this house for the price I will sell it.. New build is expensive and the price of lots is going up up and up.

 

Changes in prices of materials over time make it difficult to set prices ahead of time. I built my house in sections and converted dollars to pesos as the building progressed. I found that expenses in dollars was reasonable.

 

I redid my apartment in Cancun, about the same square meters, but with more bathrooms, and it ended up around $80k US. That included new tile throughout, new ceilings, new air conditioner blowers (six of them), but not a redo of the kitchen and no new appliances (the former owner had sunk 1.7m pesos into just the kitchen a few years prior).

Some contractors will tell you any price you want to hear, sign a contract with you, and then ignore everything. When they have spent all the money you've given them so far, they just stop. If you want more work done, you need to give them more money, or they leave things all torn up and half remodeled until you do. They will commit to as many remodels at once as they can find customers to pay for, and the more business they get the slower yours goes, even if your contract has a completion date (that's ignored too).

In general, however long they say, it will take at least twice that long to finish. In the end, they're likely to leave a bunch of small things unfinished, because when you think you've paid all you are going to pay, they realize that, so they stop doing more work.

You can count on things being done approximately correctly, in a way that varies between well-done and sloppy. If you have a number of small special requests, the contractor will forget about some of them, either accidentally or on purpose.

If you are not too picky and are on the job site almost every day while the work is being done, you can get the job done for a lot less than the US more or less acceptably. If you are not on-site every day, you will be presented with many more fait-accompli situations to live with.

This is based on my one experience with one contractor. Your mileage may vary, or not.

 

It sounds like mx contractors try to get the whole amount upfront. That sounds like a good way to get ripped off. In the states, smaller jobs are paid when finished. Larger jobs may have a small deposit then payments either monthly or more likely after each stage of construction. Like after the foundation is set, walls go up, plumbing, electrical, roof, etc. They get paid when each stage is done and inspected.

What good is having a contract if they can "ignore" it at will? Is there no legal mechanism to make them honor it? Or is it like many things in mx where the delays and paperwork make it almost impossible? I take it there is no official inspection they have to pass?

 

No there are no 'official' inspections and when we bought our house we paid an expat guy who said he was an inspector. Well - he was more interested in selling a satellite tv service. Should an inspector detect that the 2 hot water heaters in the house needed to be serviced ? Our first night in the house we had cold showers...

We relied heavily on referrals for our projects and ALL of them were with Mexicans. After 9 years we had a very good collection of people we dealt with. If a project required substantial materials those materials were almost always paid for up front. I don't think we ever paid 100% up front. Mostly 50% on start and 50% on finish. If it was a couple month project and the engineer had to pay workers each week we paid like 50% / 25 % / 25%.

We got pretty good at crafting decent agreements up front and after a couple bad experiences we got all deviations from the plans signed off on in real-time. For me - what you need to be careful of is the guy who makes suggestions on the fly and then later charges for the changes to implement the suggestion.

 

No, you don't pay 100% up front. But neither do you pay 0% up front. I paid 40% up front, but then more as work progressed.

Mexican independent contractors don't have the money to pay for everything up front themselves. A Mexican contractor probably owns a truck, tools, and has relationships with his workers who he pays cash weekly. He won't have any other money invested in the business, and he won't have a revolving line of credit from a bank to pay for materials (because that's harder to get here than in the US). You have to give him cash for materials. You have to pay-as-you-go because otherwise his workers don't get paid on Saturday. So you're going to have to pay a good bit up front and then more as the work continues. I ended up making about six payments over time.

In theory you can hold back some of the money to the end and pay when you accept the job as complete, but if the job goes over budget the contractor doesn't have the money to be in the red on the deal.

In the US, I learned (in a business contracting course) that when two businesses have a contract dispute, 95% of the time it's handled by negotiation without going to court (in spite of there being a contract which everyone has worked hard to make concrete and complete). 5% of the time legal proceedings get initiated, but in the significant majority of those cases a settlement is made out of court before the court proceedings complete. The court system is slow and uncertain and expensive and it's just better for all to reach a negotiated settlement. You go the full distance to a mandated court judgement in far fewer than 1% of all business disputes.

In Mexico the courts are even slower and less effective than the US (and perhaps less predicable), so the desire to avoid them is even higher. The contract gives you a basis to negotiate from, and involves a lawyer who can call and haggle on your behalf, but that's about the only value it gives. You need to expect things to deviate and have extra money to handle over-budget situations. A wise person, I think, would have set aside an extra 20% that they hope to not have to pay, but wouldn't be ruined if it cost that much.

My figuring is if you get what you expect for the price you expect, you're way ahead of average. If you end up over budget by 10% and get most of what you want, you should be pretty satisfied and happy. If you go over by 20% and get and don't get several important things you wanted, then it didn't go well and you won't use that contractor again, but at least the work is done and wasn't an utter disaster.

 

What you speak of is what is called unqualified contractors in the states. There are no large companies that aren't on a shoestring in mexico? So if you make the deal and the contractor runs out of money you have to give him more no matter what? Giving 40% up front means he has your money and if he decides not to finish the job he can just walk away. It sounds like he kept "running out" of money at strategic moments. This kept you paying out additional amounts and if you can't or won't pay the extra, you are left holding the bag.

Apparently even the "honest" workers are doing this, and the dishonest ones just take the upfront and scram. I think its like you said, you have to be involved yourself. Go with the guy to the materials store, he picks out what he needs for your house and you pay for it. He has no money to pay the workers so on payday you and he go over the hours worked. You could get daily hours worked and look at the progress to see if it makes sense. You give him the money for workers and reasonable extra expenses. If you do it that way how can he run out of money and demand more? If the prices go up on materials, you see it yourself when you pay for it.

That way is extra work, you have to stop by every day and go with him to the materials store. If he buys something he forgot to tell you about, you pay him back. Surely he is not dead broke? Its extra work but you also see if they are following plans, any deviation is seen immediately and a max of one days labor is involved. When each stage of the work is done then you pay him a portion of the rest of the money promised. I doubt they will agree to be micro managed like that but that would work

Or do the inspection less often and give him money by the week, some in advance and some after he shows receipts end of week. If they say no it means they do not trust you to pay every week and you are supposed to trust them. There has to be a happy medium, I think my plan works but if the guy is planning to raise the price later, he will not agree.

 

We did spend an afternoon together to buy the tile, he took me to a series of stores. He went to the really fancy outrageous price ones first (3000 pesos/m2) and slowly worked down to cheaper stores. Eventually we ended up at the store I bought at, which was a big discount kind of place in the middle of Cancun with a less-fancy open-air showroom and a lot of business going on, with the warehouse immediately visible adjacent. They had gotten some kind of special order in of a fancy big (400mm x 800mm) tile that was nice and pretty much what I was looking for color wise, and had it reduced in price so I bought it. Turned out to be imported from india. It was 600 pesos/m2 (still not the cheapest), and so I picked out cheaper selections for bathrooms and outside to economize. And I paid directly.

I was amazed at how many bags of tile setting mix it required. They bought these 20 kg bags of pegamix. It seemed to take a full bag for enough mix for just two of the large 400mm x 800mm tiles, because the setters were applying it maybe 3 inches deep under the tiles. Lots and lots of bags of that, and it wasn't something I bought directly, like the wall board, paint, aluminum ceiling hangers, and other non-finish supplies it was all paid for out of the money I gave him. It would be impractical for the owner to try to insist on paying for all materials like that, I think. I did specify I wanted him to use anti-mold (green) wallboard for all the ceilings rather than the lighter stuff they sometimes use that turns to mush the moment it gets wet. Some contractors will use that only in bathrooms.

Same thing with the bathroom fittings like toilet paper holders, hooks, and towel racks (which are ridiculously overpriced). He picked out the faucets and did fine, had a brand he wanted to use.

One thing he did was choose new door hardware for every door inside. That was fine, but he chose door handles with keys and locks which seemed made for external doors, paid around US $40 per set, which I thought was unnecessarily nice for interior doors.

I picked out and procured the ceiling light fixtures.

For the front door, the contractor replaced it, but provided what I consider to be a crappy door, it's just hollow-core interior door (the front door of the apartment leads to an indoor lobby, so there's no weather involved). Then the contractor was miffed I picked out a middle-of-the-range lock set that I liked. He thought I should splurge on a big expensive high-security lock, when I knew I could kick in the door inside 30 seconds. (I had years of tae kwon do long ago, 30 seconds is generous, I could get through the door in 5 seconds, and I mean literally through, but if I went that fast I'd end up with splinters in my leg).

So I guess my point is that if you let the contractor decide on stuff like that he's not going to do it exactly as you would, they'll spend too much on some things and too little on others, as tastes and priorities (and common sense) all vary.