Can foreigners really own property in Mexico?
Yes! Today under Mexican laws foreigners can purchase their own real estate in Mexico. There is, however, a Restricted Zone that extends 50 km inland from the coastline. Outside the Restricted Zone, a foreigner may acquire a property and be direct owners of the property and have all the rights of a Mexican national in compliance with Mexican Law. Inside the Restricted Zone, there are two options available: foreigners can either purchase coastal property through a Mexican bank trust – known as a Fideicomiso – or create Mexican corporation, also known as a Sociedad Anonima (SA) that buys the property, as the law permits a foreigner to be the owner of 100% of a Mexican corporation.
How do I establish a Mexican Corporation Sociedad Anonima (SA)?
The first step is to obtain a permit from The Department of Exterior Relations with the name of the Mexican corporation.
Next step is to create the articles of incorporation (“Acta Constitutiva”). This will be done by a Notary who is a keeper of the public record and is appointed by the state.
Finally it will be required to get a Tax ID (RFC) from the tax authorities. The entire process would generally take from 1 to 2 months.
How is it possible to confirm that a seller has legal title to a property?
A buyer should request a copy of the lien certificate or “certificado de libertad de gravamen”. This document will include information such as: owner of record, property classification, surface area. It will also indicate whether there are any encumbrances filed against the property.
A title search should be conducted and a copy of the property title should be asked to the seller through the real estate agency.
The Notario Publico should carry out the title search but the Notary generally examines the current deed and current lien certificate. Hence it is advisable to hire a Mexican attorney for a legal advice on the status of title.
Who is involved in real estate transactions in Mexico?
In the restricted area, there are typically four parties taking part in a real estate transaction:
The Real Estate agency, the attorney representing the buyer, the seller and the Notary Public.
It is recommended to hire a Mexican attorney to represent your interests instead of having only the seller’s attorney involved. The attorney will conduct title searches, write contracts and review the conditions and terms of a sale.
Can you recommend a good English-speaking attorney?
We have managed the sales of hundreds of properties on behalf of either the Buyers or the Sellers
We can recommend several lawyers who have been selected for their integrity and their knowledge of the real estate transactions for foreigners investing in Mexico. Riviera Maya Paradise can arrange meeting and our clients can access of course all their services.
Can I get financing for my real estate purchase in Mexico?
For the time being there are unfortunately no financing or mortgage options for foreign buyers in the state of Quintana Roo.
What can I expect to pay in property taxes?
Property taxes known as Predial have historically been low in Mexico. The calculation of the tax is based on a percentage of the assessed value (currently .25%) determined at the time of sale. In general terms you can anticipate to pay $100 usd per $100,000 usd of assessed value per annum.