Geologists claim the tectonic plate beneath Mexico’s Baja California is moving northwest at the rate of one inch a year. Eventually, this peninsula will become an island, which is what Spanish conquistadors sent by Hernán Cortés thought it was when they arrived in 1533. But at the moment, the most visible movement on the peninsula is above ground and in the opposite direction.

So many gringos have set up house, the region has become known as Amexica. What’s going on?

The Baja Peninsula encompasses nearly 2,000 miles of coastline, a mountain range, and a desert. Its climate and local attractions are so varied that even the pickiest of visitors need not look far to find the perfect setting. Retirees, artists, restaurateurs, fishermen, and writers from the United States and Canada have been moving south in droves over the last decade.

The U.S. Embassy estimates more than 600,000 American citizens now reside in Mexico, part- or full-time, and in such places as San Felipe on the Baja Peninsula, the influx is dramatic. A two-hour drive south of El Centro, Calif., San Felipe’s 21,000 residents include more than 7,000 from the United States and Canada. At the two major towns some 900 miles farther south at Cabo San Lucas and San José del Cabo, the percentage is nearly as high. Baja’s real estate market is booming, drawing hordes who want to escape the hurricanes in the Gulf states, ice in New England and Nova Scotia, and snowstorms in the Rockies.

Home business

One of those “migrants” is Julie Kershner, whose husband, Tom, flew OH-6A Loach helicopters as part of the Army Scout program in Vietnam. He now is an Alaska Airlines pilot, and the couple lives in San José del Cabo, six miles south of Los Cabos International Airport. Astride the Sea of Cortez and a few miles shy of the peninsula’s southern tip, San José features trendy restaurants, art galleries, and boutiques. Twenty miles west is famous Cabo San Lucas, perched at the tip of the cape, with its high-priced marina, daily cruise ship visits, nightclubs, and glitz. Condos on the beach cost $500,000 and up.

Julie and Tom first came south in 1993. She commuted, doing part-time real estate work in Seattle, then went full time as a real estate agent in Mexico in 1999. Finding work is not easy as an expatriate. Permits are required, and only certain occupations, such as real estate, are relatively easy to break into. Facility with English and the increased trust from U.S. customers that comes with being from “up north” are what make for openings in that field.

The Kershners built their home overlooking the sea the same year. “Our house cost $150,000, and that included the lot, pool, and construction,” Julie says. With its “million-dollar view,” she estimates the property is worth at least double its cost now, and as far as her real estate work is concerned, “Business has been good.”

Buying in

What caused the up-tick? The North American Free Trade Agreement (NAFTA) between the United States, Canada, and Mexico, which went into effect in January 1994. After enactment, the Mexican government decided to allow foreign investment in land, but the 1917 constitution prohibited foreigners from owning land within 60 miles of an international border or within 30 miles of the coast. Because most of Baja falls within that definition, a new method of holding title was created. Called a fideicomiso, or trust, it allows a Mexican bank to act as purchaser but not owner. The foreign buyer is the beneficiary or owner of the trust. According to Julie, “you can now buy, sell, improve, lease, and bequeath the property. You have all the rights of ownership.” The initial term of the trust is 50 years, renewable indefinitely for additional periods of 50 years. The key is to make sure the seller of the property is the actual owner. Title insurance is the way to protect yourself, and a number of U.S. title insurance companies provide that security.

Owning your lot is one thing; building your dream home is another. Much like conditions in the United States, contractors can have fluid reliability. The difference: In Mexico the legal remedies are not as readily available if your contractor proves unreliable or incompetent.

Though high-speed Internet access, satellite TV, and Costco have found their way south, medical facilities, reliable mail delivery, and other services leave much to be desired. Most towns in Mexico have medical facilities—clinics really—that are OK for the basics, but specialized and emergency care are substandard. Most residents purchase medevac insurance for less than $500 a year per family.

Prices in Cabo San Lucas have skyrocketed in the last five years, so don’t expect to find bargain deals there. Inflation on the rest of the peninsula is close on Cabo San Lucas’ heels, but building costs (less than $70 a square foot) are about half those in the United States. Affordable homes still are within reach of modest budgets, and property taxes are low. “A three- to four-bedroom home costs about $200 a year in taxes,” Julie says. There is no income tax in Mexico, and full-time workers get a U.S.-income-tax break.

Life of leisure

Terry and Dianne Barkis spent $19,680 for a time-share on the beach in Cabo San Lucas in 1986 while seeking a cheaper alternative to Hawaii. Dianne recalls, “We were so embarrassed at spending that much money, we didn’t even tell our grown children for a while.” They got one week a year in a 3,200-square-foot, three-story penthouse complete with a private swimming pool, Jacuzzi, chef, servant, and maid.

But after seven “terrific years” vacationing at Cabo San Lucas, they wanted more. A one-hour drive north is the town of Los Barilles. The couple fell in love with the place while socializing with friends there. On their return to the states, Dianne says they realized “we’re doing something wrong. We have to go back to work while these folks have to plan their next party.” They sold their time-share in Cabo San Lucas for the purchase price and used the money to buy a half-acre lot near the Sea of Cortez in 1995. They plunked down another $80,000 dollars and four months later had a finished home. They began a life of leisure, including twice-weekly card games, full-moon parties on the beach each month, and cookouts.

Weather can be a problem there, however, with temperatures reaching more than 100 degrees in July and August. “Everyone came over to our place,” Dianne says, “because we had air conditioning. Our electric bill hit $600 a month at times.” Then there were the hurricanes—12 of them—that Terry and Dianne got through. “The storms come from just about every direction, but we weathered them without damage to our house.”

Stay a while

Ruth Bennett is a retired technology specialist who, along with her family, is putting down roots in the central region near Punta Chivato on the Sea of Cortez, 500 miles north of the cape. She has, “a piece of land, a house, and a plan to live here full time.” She recommends, “if you are inclined to settle a while—and most folks can’t resist the miles of beaches, gorgeous vistas, and fascinating hikes in the area—plan ahead to either camp at a camping beach, rent a local home, or stay at a hotel.”

Because culture shock can affect people differently, the best way to approach the problem is to take a long look before buying or building a home. Six months is not excessive in terms of a “toe test,” and you might just happen to be on hand when a really good piece of property comes on the market.

Bennett’s house was finished in late 2003. “Now, homes are scattered in pockets down the 6-mile-long beach, and there are more on the way,” she says. “Managing this growth and its impact on the land and resources is our biggest challenge, and we hope to set an ecology-sensitive standard that others can look to.”

Those are sound words to heed as the migration of gringos down south continues.