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NEW TU CASA LOGO!

3/24/2020

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We will have t-shirts and hats available soon.

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Special Edition - Newsletter #4

3/24/2020

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Coronavirus Updates:

The state of Baja Sur.
As we all know, we are in an unprecedented situation. There are many uncertainties and unknowns moving forward. There is no need to reiterate all we’ve been watching and hearing on the news. Here are some points pertaining to Pescadero, Cerritos, and Todos Santos areas specifically.

We have 80% cancelations as of this week and 100% moving past this week. We have gained a few month long bookings to wait out the mess. The beaches are desolate and towns are basically empty
Prices for rentals have dropped significantly. Many owners throughout the region are choosing to either help people out or have someone stay in their home for a cheaper price so there is a presence in the home.
Local stores still have all supplies (even toilet paper). There seems to be no issue with getting food, as many locals do not have the money to “stock up.” We were in Costco last week and there was still plenty of needed food, but we imagine Costco and other stores visited by gringos will start to run low.
We’ve heard through the grapevine that agricultural orders have been canceled so many locals or mainland workers who cannot get home are feeling desperate. Also, many laborers are out of work (cleaners, nannies, restaurant workers, etc.) Construction workers are still working daily.
The Mexican government is finally behind promoting healthy distance. Government offices are closed, schools closed as of last Friday, other entities are encouraged to work from home or part time. We have heard rumors of a shutdown, but thus far nothing seems to have validity. Mexico is much more lackadaisical in comparison to other countries.
We have heard of a looting scare. Most locals live paycheck to paycheck without savings as their wages are so low. We personally had an instance of a broken car window and purse stolen at the beach where there is typically zero issue. This could be a coincidence or not, but it peaked our senses.
There have been a few cases of confirmed Coronavirus in Cabo from people traveling into the country. We have also read it is very hard to get tested here, even if all signs point to the virus. It is inevitable, but we are hoping this number remains low in the Todos and surrounding areas. It is more likely the numbers will rise quickly in Cabo and La Paz.

Tu Casa’s next steps.

We are staying healthy and safe, but will continue to work.
Due to the looting scare, we will increase our security checks immediately.
Alex will continue to do the 4 full inspections per month, and will ADD 2-4 more security checks throughout the month.
- We will make sure to go to each of your houses at night as well, turning on lights to show a presence. If you have a TV, we can also leave this on if you’d like. Please let us know.
- Alex will bring one of our dogs along on checks, so people do not know if a dog lives in the home or not. Dogs are the best deterrent for break-ins. We know most of your homes are not dog friendly, but we believe this will be beneficial. If you are opposed to this, please let us know privately.
- We will NOT charge any extra for the added security checks on your home for the foreseeable future, your administrative/inspection fee will remain at the $100 per month with the now 6-8 visits. This is a way we can help you feel your home is safe.
We will plan to bring all outside furniture and any items that are not bolted to the ground indoors.
If there is an issue, we will contact the police and the homeowner immediately.
Owners that have decided to ride this out in Baja, we will also come by your home to check on you and see if there is anything you need. We will of course keep our distance, but want you to know we are here if you need us.
We’ve been trying to broker month long deals for the homes that want them. If any more requests come in, we will pass this along, but I have a feeling we are about done with these requests.
If you need any small construction or handyman projects completed on your home, this is the time for Alex to schedule the work. Please let us know your list of items.

Invoices.
Our biggest issue is getting our invoices out in a timely manner. We apologize for this delay. We will take this break in rentals to get fully caught up and then create a better system for moving forward. Please be on the lookout for your invoices for February in the next few days. We understand this is a tough time financially, and we truly apologize for not having this done sooner. We appreciate your support.

A few personal notes.
Many of you reached out about our little guy’s surgery. He had his tonsils and adenoids removed plus tubes put in his ears this past Thursday. As kids do, he is recovering well. We appreciate your support and patience for the few days Alex and I were not as responsive as we focused on family. We are so happy to have such a supportive network.

Please stay safe and healthy. We are all in this together, even if we are in different places in the world. Stay positive and reach out if you need anything at all. We will keep you updated on your homes. We are here for you!

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Newsletter #3 - March 2020

3/5/2020

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Take a load off in Baja!

Employment shout out.
Nancy has been our right hand since I worked at the Hacienda. She helps us with translation and interpretation, navigating systems we do not understand, and most importantly - with all of your home cleaning. If you happen to see Nancy, please give her a huge THANK YOU for all of her hard work. She works as our part time employee, and she is also our cleaning manager - overseeing the ladies that clean your homes. We truly appreciate Nancy!!

Cleaning and set-up.
When you come to visit your home, we ask that you set up the beds, cushions, cabinets, kitchen drawers, and artwork just as you’d like, then take pictures. We will pass these on to Nancy. This greatly helps us help you. If we can get new pictures once a year or as you bring in new items, we can keep our cleaners up to date with your needs.

New Mexican rental tax laws. Big Changes!
After speaking with our accountant - we learned of a new short term rental law going into effect JUNE 2020. I will write my best description of what this means for you, but I do encourage you to do some research beyond what I am writing so you can make the best decisions for your rental property. There are some areas that I am still unsure about, so again - please continue to do research and update us if you learn more than we know!
Mexico has caught on to the income generated that is not being taxed through venues like Airbnb and VRBO/Homeaway. Airbnb and VRBO/Homeaway (and other sites) will now ask for your Mexican Tax ID. If you are able to provide your Mexican Tax ID then nothing will change. The government will assume you are already claiming your income and paying taxes accordingly. If you are not able to provide a Mexican Tax ID, the site will begin to take your taxes from your income. The breakdown looks like the following - Airbnb and VRBO already take 3% Hotel tax. This will not change. They will begin to take the 16% VAT tax. This is the basic sales tax for all of Mexico. Also, they will manually collect income tax. This is based on your monthly generated income: up to 5,000 pesos - 2%, up to 15,000 pesos - 3%, up to 35,000 pesos - 5%, over 35,000 pesos - 10%
Let’s do some numbers:
$2,000 USD income on rentals in January
10% - $200 (Income Tax)
16% - $320 (VAT Tax)
3% - $60 (Hotel Tax - already deducted)
Total: $580 taken for taxes plus your airbnb/vrbo fees.
This is significant. While it is frustrating, I also understand why the Gov’t is stepping in, and this is also happening in other areas of the world with short term rental sites. The issue is many of you pay taxes on this income in the states or Canada. I recommend speaking with your accountant, as I have no idea what those next steps would look like so you do not pay double. If you are considering obtaining a Mexican Corporation to hold your rental under, we can recommend a wonderful and honest lawyer to do your paperwork.
This does not take place until JUNE so there is still time to problem solve. We would love to have further conversations to help you create an individualized plan based on your rental goals.

Business updates.
Facturas, Taxes, and Fees
WE NOW HAVE OUR MEXICAN BANK ACCOUNTS - USD & PESO!
If you would like us to provide you with a factura for our transactions, we will charge an additional 16% VAT tax. You can still pay into our US accounts, and we will transfer the money to our MX accounts, or you can pay us directly into our MX account. If you are paying into our bank account and/or paying the 16% tax, then this means you can claim this as an expense. Otherwise, you can continue payments through Venmo, Zelle, direct deposit (US BANK), or Paypal into our US account. Paypal has further fees than they have had in the past, so we are trying to avoid this method. Please know the client is responsible for fees.
The ATM fee is 14.87 USD per money withdrawal. You will begin to see this on your invoice as it has greatly impacted our bottom line. We love offering you this service of paying bills, but need a system where we are not negatively impacted. Also, we are charging a 5% money holding fee for money we put on our credit card or take out of our accounts, as we are losing money for the amount we are paying upfront.
Our goal is to NOT charge fees!!!! Here are a few ideas - 1) You provide an account we draw directly from for your MX money needs. You provide us with an ATM card as we withdraw as needed, of course providing receipts for all. 2) Provide pesos on hand to use for your specific needs the next time you are in town. 3) Provide us with USD on hand. You would still be charged the ATM withdrawal fee but not the 5%. 4) We go through our Mexican bank account, charge the 16% VAT taxes and you deposit money from the bill directly into our account. We have no major fees when we pull money out of our Mexican ATM, so no ATM fees. 5) We are open to any other ideas!!

Administrative and Combined Inspection Fee (just as a reminder)
After being operational for one year, becoming legal (and all that comes with it), and understanding individual property needs, we have an understanding of our business and each property’s scope more completely. For full transparency, to maintain our level of service, for a typical rental property, we will charge a flat monthly fee of $100 USD. This price includes the 4 (security) HOME INSPECTION checks per month plus the basic administrative oversight for your account (~10 hours per month). As we know, new charges are never fun and we understand you may have some questions. Please feel free to contact us as we are happy to discuss. You will see the change on your January invoices. We truly appreciate your understanding.

Managing expectations.
One of the largest hurdles we face is the guests’ expectations versus reality. People all across the globe are reading about Todos Santos and Cerritos as a hidden gem, then quickly book without a lick of research. While we don’t want to scare people away, we also don't want people to have a miserable experience, thus leaving a negative review. I have added a paragraph in our listings explaining the reality of the area, this way it covers us as the managers and you as the owners. The issues I listed are the majority of complaints we receive. We would rather be upfront so we can be on the front side of complaints.
If you manage your site, please feel free to copy and paste to your site. If we newly manage your site, we will take care of adding this.
Cerritos, Pescadero and surrounding areas are considered RURAL Mexico. We love our guests to have this understanding before arrival, which helps manage expectations. Infrastructure and certain amenities are still developing in many ways. Electricity is fairly new to this area (within the last 3 years), so there are times of power outages. Many systems are only on solar and are not tied into the power grid in any way, solely relying on sunny days. Driving at night is dangerous due to cows on the road or cars without headlights (not banditos!) Please go slow. Most roads off the main highway are dirt and all roads in the area have potholes with lots of bumps. Most roads do not have street names, and houses do not have addresses. You must rely on the maps provided and do a little research of your own. Baja midnight is considered 9:00pm, and expect many businesses to close at this time. Buildings typically leak during rains, and water can come under doors depending on the amount of rain. We are in the desert with many new human inhabitants, therefore, the natives do make appearances. We attempt to mitigate this as much as possible, but please do not be surprised if you see a mouse or two, flies and gnats (bobos), ants, scorpions, or a rare snake. This area is considered safe, but we do still have petty theft. Please lock electronics and valuables in safes or locked cabinets when you are not home. We recommend trip insurance as unfortunately we cannot refund for weather or rural Mexico related incidents.

Growth.
We are officially growing. Welcome to the Tu Casa family Casa Marina, Casas Quain, Casa Palmeda, Casa Poole, Casa Margan, Casa Rustika, Casa Lita, and Casa de Sur (2.0). We are happily overseeing the HOA maintenance and grounds at Puesta del Sol as well. All of this growth means we can expand our resources and continue to hire. We are in the process of updating our website to reflect our new rentals and properties.
Kevin and Meghan are doing amazing work with our new Todos Santos expansion!

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What you need to know!

NEW TU CASA LOGO!

Special Edition - Newsletter #4

Newsletter #3 - March 2020

Take a load off in Baja!

Rachel

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