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With more than a million expats calling it home, Mexico is the runaway #1 choice for North Americans who want to retire abroad. And why not? The cost of living is quite low. Temperatures are never cold. World-class, affordable healthcare is available in major cities. Bordering the United States, short flights are inexpensive and plentiful (heck, you can even drive there!).
The country’s huge size provides a smorgasbord of living choices, from beachfront to mountains, and major metropolises to rural villages. For those seeking to immerse themselves in the atmosphere of a colonial city, two favorites stand out: Mérida and San Miguel de Allende.
That’s not just us saying so. The Readers’ Choice Awards of Condé Nast Traveler just named San Miguel the world’s best small city for the third year in a row, while Mérida was chosen as the fourth best big city. Wow!
Having spent weeks in each place, we enthusiastically affirm that the accolades are well deserved. Plus, both are consistently ranked among the safest places in Mexico.
Nevertheless, these two beautiful expat havens are very different, so let’s dive in and figure out which could be best for you.
Mérida sits on the northwest portion of the Yucatán Peninsula and is the capital of the state. You can drive to the beaches of the Gulf of Mexico in 40 minutes and to Cancun, the country’s top tourist destination, in about 3.5 hours. Numerous important archaeological sites are close by too. A flight from Mérida’s international airport to Houston takes only 2 hours.
San Miguel de Allende is nestled in the Mexican highlands, about a 4-hour drive from Mexico City. Two international airports, one in Guanajuato and the other in Querétaro, are both about 1.5 hours away. The flight time to Houston from either location is 2 hours.
Pro Tip: Mérida offers a wealth of recreational options within easy driving distance. San Miguel is somewhat more isolated.
Mérida, the largest city in southeast Mexico with a population of almost 1 million, manages to maintain a small-town feel. That’s because the city has two very different segments — the colonial historic district downtown and the modern northern suburbs.
Anchored by its central square, Plaza Grande, the historical center is quite pedestrian-friendly. Every Sunday morning, Paseo de Montejo — a grand boulevard patterned after Paris’s Champs-Élysées and lined with ornate mansions — is closed to vehicular traffic and transformed into a massive party featuring bikers, skaters, and walkers; and lots of music, eating, and drinking. 
Mérida’s suburban area feels more like the United States than Mexico. Think sleek highrises; enormous malls (one has an indoor ice skating rink); multiplex cinemas; U.S. big box stores like Costco, Walmart, and Home Depot; and tons of familiar chain restaurants.
San Miguel, with a population of only 175,000, barely qualifies as a city. Despite its small size, walking around town isn’t as easy as you might think. The topography is extremely hilly. Cobblestone streets and narrow stone-paved sidewalks, while an essential part of San Miguel’s charm, require your constant attention when out and about.
Pro Tip: Both places have challenges to their walkability. For Mérida, it’s the heat; San Miguel has those steep hills and uneven surfaces. Solution: Uber. Wait times are short and fares are extremely cheap.
Although both places are labeled “colonial,” each has a very distinct architectural style. Walking down the streets of Mérida’s historic district, rows of tall pastel walls with doors are built right up to the edge of the sidewalks. You’re left to imagine what’s on the other side.
We had the opportunity to tour several properties for sale and saw everything from dilapidated fixer-uppers to grand homes with beautiful pools and exquisite gardens.
San Miguel de Allende, a UNESCO World Heritage site, is a beautiful jewel box. Everywhere you look feels like a movie set. The narrow winding cobblestone streets and beautifully preserved buildings inspire photo after photo. From the surrounding hills, the Cathedral of San Miguel Arcángel, the city’s most notable landmark, dominates the skyline.
An expat candidly admitted to us, “Mérida has three seasons — hot, hotter, and hottest!” With temperatures routinely topping 100 degrees Fahrenheit with oppressive humidity between May and September, even locals avoid being outside in the afternoon.
It’s easy to understand why the city has such a vibrant nightlife with so many rooftop bars and restaurants where you can enjoy the cooling evening breezes. 
Expats recommend having a residence with air-conditioning and a pool. But be advised: electricity in Mexico can be pricey, and if utilization exceeds a certain amount, rates increase exponentially.
Because San Miguel is located at an altitude of 6,200 feet and relatively close to the equator, its climate is pleasantly mild year-round. Highs range from the low 70s to mid-80s with comfortable humidity levels.
Pro Tip: In our conversations with Mérida expats, the happiest ones usually had come from states with similarly hot weather. People living in cooler northern climates would be well advised to book an extended visit to Mérida during the summer months before making a final decision to relocate there.
No matter where you are in Mexico, your dollars will go a lot further than the U.S. or Canada. That being said, it is hard to be precise regarding the topic of “cost of living” because of the wide range of differences in standards of living.
Real estate, whether renting or buying, is more expensive in San Miguel, especially in the historic area. Expats have been coming here since the end of World War II (more on that below), so most bargain properties were snatched up long ago. 
In Mérida, however, investment opportunities abound. We met several expats who earn an excellent income buying, renovating, and selling fixer-uppers. But beware: diving into this profession without carefully assembling a reliable construction and legal team can be hazardous to your financial health.
On average, a couple that is renting can expect to spend around $1,500 per month in Mérida, excluding international travel. In San Miguel, a budget of $1,800 will provide a very comfortable lifestyle.
Whatever your definition is for “Mexican food,” be prepared for a surprise when you bite into the country’s authentic cuisine. Familiar Tex-Mex is notably absent from any menu (Taco Bell has failed twice to establish a foothold in Mexico).
What you’re served also varies from region to region. Mérida’s rich Mayan cultural heritage is on full display with its unique gastronomy. Cochinita pibil is a traditional dish of pork marinated in sour orange and slow-roasted in a banana leaf. Sopa de lima, or Yucatán-style lime soup, may sound odd but is absolutely delicious.
Because of the flourishing expat presence and a steady stream of affluent tourists from Mexico City, San Miguel offers an astonishing variety of top-quality food for a city of its size. The chocolate croissants we devoured at Panio were every bit as good as the ones we’ve tried in Paris (and way cheaper). Dinner on the rooftop of Casa Nostra is divine.
When you think of alcoholic beverages in Mexico, tequila and beer immediately come to mind, right? If so, you’ll be surprised as we were to learn that beautiful vineyards can be found a short drive outside of San Miguel. We enjoyed a professional tour and fabulous tasting menu at Tres Raíces.
San Miguel was in a state of serious disrepair when artist Stirling Dickinson arrived in the 1930s. However, he was captivated by the city’s natural beauty and established an art school that began attracting U.S. residents after World War II. And they’ve been coming ever since, renovating properties and opening lots of art galleries, shops, and restaurants. 
Today, it’s estimated that 10 percent of the population is made up of foreigners. Meeting fellow expats is easy and learning Spanish is frankly optional.
Whereas San Miguel has been an expat magnet for decades, Mérida has more recently seen a surge in interest. Part of this is being driven by the digital nomad demographic, plus the fact that the city has become one of Mexico’s newest LGBTQ+ destinations.
Because there are roughly 10,000 expats (half of whom are snowbirds) in a city of one million residents, finding your community in Mérida takes a bit more effort but is by no means difficult. Expat hangouts like Hennessy’s Irish Pub and Rosas & Xocolate are great places to start. There are also numerous Facebook groups you can join.
Mérida and San Miguel de Allende are two fabulous cities internationally recognized for excellence. How do you decide which one is the best fit for you?
Both places are extremely safe, foreigner-friendly, have an established expat presence, and offer a very affordable cost of living.
Of all the factors to consider, climate and topography offer the starkest contrast. Mérida’s weather is hot; San Miguel offers year-round moderate temps. Being only a short distance from the Gulf of Mexico, Mérida is flat. San Miguel is hilly — extremely so on the outskirts of the city.
If you can’t make up your mind, we’ve got great news: Volaris, Mexico’s second-largest airline, has announced new non-stop flights between Mérida and Guanajuato, the closest city to San Miguel, starting in early 2023. After an extended visit to both of these top expat destinations, you’ll know which one is right for you.
Read more from our TravelAwaits expat experts:
Edd & Cynthia Staton are recognized experts on both living and traveling abroad. They are regularly featured in major media outlets, have authored three Amazon #1 best-selling books, and are creators of an online program called Retirement Reimagined! Learn more about them on their website.


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