Mexico is calling you.
If you’re thinking about buying property internationally, Mexico should be first on your list. It is easy to buy property in Mexico even if you are a foreigner; there is no residency requirement. Further, foreigners get full protection under Mexican law in Mexican real estate transactions, which is great peace of mind for buyers.
Read on to learn everything you need to know about real estate in Mexico, and how you can get started on this exciting adventure. It’s easier than you might think.
Mexico is an incredible country is full of storied history, diverse culture, wonderful cuisine and fantastic people.
Although it is just one-fifth the size of the United States, it similarly has immense diversity in geography, land forms and wildlife and is known for its large and bustling cities, white sand beaches, rainforests, mountains and warm but varied climate.
There are so many reasons to move to Mexico or to purchase investment property there – even beyond the reasons described above. First and foremost, the cost of living is very low. By some accounts, it is as much as half the cost of the average cost of living in the U.S.A.
Second, its very close to the United States, which makes it easy and inexpensive to travel back and forth. Further, there is great healthcare, there are a number of bustling ex-pat communities throughout the country, and the laid back lifestyle is a strong draw for many, too.
Great Locations in Mexico
Whether you wish to be surrounded by other ex-pats or not, there are hundreds of cities and towns in Mexico that are a great place to buy property. If you enjoy coastal living, you might consider Puerto Vallarta or Cabo San Lucas on the west coast, or Cancun, Playa del Carmen, or Tulum on the eastern Yucatan peninsula. Each of these towns has many real estate agents who would love to tell you more about their area’s offerings, like this website for Tulum.
If you’re a city lover, the hustle and bustle of Mexico City might be right up your alley; other major cities include Guadalajara, Puebla City and Monterrey. If it’s the mountains or desert that you love, you may want to check out and consider San Miguel de Allende or Lake Chapala. There’s something for everyone in Mexico.
Owning Real Estate in Mexico as a Foreigner
It used to be impossible for foreigners to own property in Mexico. In time, those laws changed, and that’s great news for you.
The Mexican Constitution was written in 1917 and is considered to be the endpoint of the armed conflict of the Mexican Revolution. It has 137 articles and is still followed today. However, there have been some changes to it over the years, and one of those changes is in regard to foreigners owning property in the country.
When the Constitution of 1917 was written, only Mexican nationals could own property, or it had to be communal property. That made it impossible for any foreigner to buy property in Mexico. An amendment to the constitution occurred in 1973 and changed this law. After that, foreigners could own property as long as it was not in a restricted zone.
As one might imagine, this changed everything. Since 1973, thousands of Americans have purchased property in Mexico, and today, around a million Americans live within Mexico’s borders.
Unfortunately, the mention of the restricted zone was off-putting to many would-be American investors or potential ex-pats. The restricted zone refers to all land located within 100 kilometers (about 62 miles) of any Mexican border, and within 50 kilometers (about 31 miles) of any Mexican coastline. Obviously, these are some of the most coveted areas for real estate purchases.
However, to remedy this issue and to help encourage foreign investments, in 1993, the Fideicomiso system was introduced. Through this system, foreigners can purchase property through a bank trust in which the bank is the trustee.
In the fideicomiso system, the Mexican bank is the legal owner of the real estate, but the foreigner is the beneficiary of the trust and can sell, lease, or mortgage the property. They can also pass it on to their heirs when they die.
These trusts are in place for fifty years, but at any time during those fifty years, the trust can be renewed for another fifty years. This can go on indefinitely. If the property trust is not renewed on time, there is a ten-year buffer during which it can still be renewed if it expires.
Steps to Owning Property in Mexico
Now that you understand your rights regarding property ownership in Mexico, perhaps you are ready to move forward on purchasing a place to live or rent in this beautiful country.
Hire the Right People
No matter where in the world you wish to buy property, you will likely need a real estate agent and a lawyer. If you do not speak fluent Spanish, you will want to hire someone who speaks fluent English. Don’t make the mistake of overestimating your language abilities; you may end up misunderstanding something important.
Making Power Moves
The basic terms, principles and paperwork required to purchase property in Mexico are similar if not identical to each of those things in the United States. However, with that said, real estate brokers and agents are not licensed in Mexico like they are in our country. Make sure you work with people you trust, and buyer beware.
There are fees that you will have to pay when making a purchase. Notary costs, acquisition taxes, registration fees and title insurance, are all the responsibility of the buyer. On the other hand, in Mexico, the seller pays the real estate agent fees.
After a few showings, meetings, negotiations and signatures, you can easily become a proud owner of real estate in Mexico. The process is really quite easy and soon you can start telling people that you own international property. You can start living there almost right away or you can begin renting your property out for an additional income stream.
Happy Property Shopping
As you can see, buying real estate in Mexico is much easier than you likely thought. If this post has inspired you, roll with that momentum and get started right away. There are many wonderful properties you can view online and perhaps this time next year, you too will be living in Mexico as a happy ex-pat. Good luck!
If you’d like to read more about real estate in the United States and around the world, check out the Real Estate section of our site!