The Lake Chapala area has long been a favorite tourist spot for people from Guadalajara and Mexico City dating back to the days when the only way to get there was by stage coach.
You can still visit the old train station which is now an art gallery / museum and imagine what a grand way it would be to arrive here. The lake shore in Chapala, Mexico still has many large estates on it in various states of condition but it easy to see it was once a hot spot for the elite of Mexican society. There was at one point a big peer which featured a large paddle boat and even a casino. Not sure what happened to those but they are another indication of the plush lifestyle which once was Chapala, Mexico. There are several lodging establishments which still reflect this plush lifestyle.
Today Chapala is still a favorite weekend destination for people form Guadalajara to escape the smog and heat. They have recently tarted up the pier area and beach front with a nice promenade and the small retail stalls remain and lodging accommodations a neat way to spend a few hours. The “Beer Garden" has mariachis some days (I think most Sundays). It’s been there forever and is a pretty Mexican way to spend your day.
You can also hire a boat to take you out on the lake or to Scorpion Island where there is an old fort. I’ve only been here 16 years so I haven’t actually gotten around to doing this. I am saving it for later (it just isn’t my cup-o-tea).
In terms of “real estate desirability”, Ajijic has out legged Chapala for some time. There are some very nice homes in Chapala for rent or sale. You get more bang for your buck, and it is a little less “Gringo-ized” ( that’s a real word, look it up) than Ajijic but for resale numbers you are still better off closer to Ajijic mainly because there are some unstable parts of the hills in Chapala as a result of the underground thermal water springs. Of course, that’s not true everywhere in Chapala but be aware of the problem if you want a lake view property. In general Chapala hasn’t preformed as well as Ajijic in terms of real estate investment but those that live there think it’s great.
I think most of the following is true but there are varying points of view on the subject. If you are expecting to see Lake Placid or Lake Tahoe you need to lower your expectations. Lake Chapala is large but shallow (they say the majority of it is only around 10 feet deep and only 60 feet at it’s deepest point). Being that shallow, it doesn’t take much to move the lakeshore up and down. Several years ago the lake went down to dangerously low levels and scared the pants off of the foreign community. The Mexican nationals were also concerned but some had seen this before and said “don’t worry it will come back”. It did, and is higher now than when I first arrived ( 1994).
The point is the lake is polluted and shallow and not much of a recreational lake. It is pretty and people are aware it has long term issues but it probably isn’t going to be a place to frolic any time soon. Hate to see you arrive with your swimming trunks and fishing pole only to be disappointed when your skin breaks out in welts and you grow another limb from eating a fish from the lake.