Yes, non-Mexicans may obtain direct ownership of property in the interior of Mexico. By Mexican law, properties within the 50 km of any ocean front and 100 km of any border must be acquired via a bank trust or via establishment of a Mexican Corporation.
Yes, laws passed in 1973 and 1993 have made it possible for foreigners, foreign firms, and Mexican firms with foreign participation to acquire interests in coastal real estate through a bank trust or a Mexican Corporation. Please note you can see more information about Bank Trust and Mexican Corporation in the FAQ – Closing process section.
Yes, a non-Mexican must purchase property within the restricted zone either with a Bank Trust or under a Mexican Corporation. If you want to acquire a property solely as a residence, you need to acquire with a bank trust. If you want to acquire for purposes other than residential, you can acquire via Mexican Corporation with certain requirements and procedures.
Foreigners often worry about their land being expropriated by the Mexican government. Under the North American Free Trade Agreement (NAFTA), Mexico may not expropriate property, except for a public purpose. This is the same as "Eminent Domain" in the U.S. When it is necessary to expropriate land, swift and fair market compensation must be paid, together with accrued interest.
The bank trust is a legal substitute for fee simple ownership, but in many cases, the trustee is the legal holder of the property. As beneficiary, you have the right to sell your property without restriction. You may also transfer your rights to a third party or pass it on to named heirs.
Anyone, even someone in Mexico on a Tourist Visa, may buy property. It is stated that if you sign a contract, rent a house or condo, buy a house or condo, or lease property, you are no longer a "tourist" and therefore, are invited to apply for a Temporary Resident Visa. But in order to acquire property, it is not necessary to possess a Temporary Resident Visa.
When you arrive to Mexico, a Tourist Visa is issued. This visa allows you to remain in Mexico for up to 180 days (almost six months) without working. You also have the option while in your home country to apply for a Temporary Resident Visa, which is valid for a 12-month period and can be renewed for up to four years.
This is the visa that is obtained when first entering into Mexico and can continually be renewed by simply leaving Mexico within the allotted 180-day period, and then reentering.
This is a document for anyone who wants to live part time in Mexico, but does not necessarily intend to make this their permanent home. To be granted a Temporary Resident Visa status, you must prove you have sufficient resources to be financially independent, or meet certain requirements to be able to work or own a business in Mexico. Temporary Resident Visa "Rentista" status is available to anyone with a monthly income (from investments, social security or other retirement) more than $1,000 USD plus around another $500 USD for each dependent. If one owns property in Mexico, the amount of income required is reduced by nearly one-half.
This document is for a person who intends to permanently reside in Mexico, with qualifications only slightly more stringent than temporary resident status. After four years of successfully meeting the requirements of Temporary Resident Visa (including restricted time out of Mexico), one may apply for "Inmigrado" status, which allows you to enjoy most of the rights and privileges of a Mexican citizen, the primary exception being the right to vote. Inmigrado status does not require you give up your native citizenship, but holders may freely work and remain in Mexico without annual renewals of immigration paper.
Yes, you can sell to either a Mexican or a Non-Mexican. Please note that a Non-Mexican would also be required to set up a bank trust.
Define your Budget
I always advise to my clients an approximate rate of 6.5% of the price, but it can go up to 11%. The final cost will depend a lot on the price of the property, but other factors should be considered. I prefer to be conservative on the spreadsheet.
There are just a few options available for foreigners. In general, the best option is taking advantage of preconstruction projects offering financing. This can give you up to a year to pay for your property in Mexico. Ask your agent for reputable developers currently offering this option.
The pricing per square meter is a constantly changing figure. Especially in the past 2 years, the price has been jumping constantly as this zone continues to be a booming area. Write me for the latest figures Contact Us.
Include the closing costs on your budget
It is common that the buyer pays the transfer of acquisition tax and all other closing costs, including the Notary's fees and expenses, while the seller pays his capital gains tax and the broker's commission.
Define if you need financing
For non-Mexicans buying real estate in Mexico, usually the transactions are cash operations. Most of the times non-Mexican buyers use home equity or other assets from their home countries to raise capital for investing here in Mexico. With the new tools now available, allowing for Mexican Property to be mortgaged, many foreigners are now discovering new exciting options to purchase their Mexican ocean front homes
Yes, you can finance, raise your capital from any bank in the US or Canada that will allow for such operation. In other words, here in Mexico there are no restrictions, it is basically the banks who are processing the loans who will advise to you whether or not they have a program to finance property in another country.
Making the Offer
The offer to purchase contract is normally a simple written document that declares how much you are willing to pay for the home provided that certain conditions are met. In some cases you might consider to have a lawyer review it due to the legally binding conditions and the fact that you will be signing and dating.
Once you have found the right property, let your TOP Mexico buyer’s representative know as soon as possible that you're ready to reserve or to write an offer to purchase. Please note that with the new anti-money laundering laws and due to the new real estate licenses, it is important for us to have an offer to purchase for every transaction
Your offer should have a time limit for the seller to accept it, reject it, or make a counter-offer. You should also include the date, if you plan to use an escrow account, outline conditions, amongst other items. If a counter-offer is made, you will have some time to respond. Often, several offers go back and forth until an offer is accepted, or one party decides to end negotiations.
Yes, it is usually accompanied with an earnest or reservation deposit.
When you sign an offer to purchase document, the sales agent will ask you for “earnest money.” Earnest money is usually given when purchasing an existing property, and refers to a monetary commitment that shows that you are serious about wanting to buy. Usually, you will be asked to deposit for 5 up to 10 percent of the sale price.
The earnest money on most occasions is made out to the notary, the sellers listing real estate agency or into escrow. I recommend using an escrow account which may cost a little more, but allows for safer administration of monies.
An escrow account involves a process whereby an impartial third party, such as an attorney, an escrow company or a title company, is entrusted with the job of seeing that the transfer of ownership takes place according to the terms of the written contract agreed upon by all parties involved. The escrow agent holds any funds safely until all the conditions and details have been realized as instructed by the contract and disburses the funds to the proper parties at the proper time as outlined in the escrow agreement signed by both the buyer and seller.
In the offer to purchase a time period is normally stated for a response from the seller to either accept or reject the offer. Once the offer has been accepted, and if all documents are in order and clear, the establishment of the bank trust or corporation can be realized. This may take from 4 to 6 weeks. With the bank trust or corporation established, the notary public can be contacted to initiate its process which may be 7 days approximately.
Normally the escrow account quantity is forfeited. On some occasions a penalty amount less than deposited into escrow by the buyer can be defined.
When selling condos in pre-construction, most developers will ask for investors to reserve units with a certain quantity ranging from $10,000 up to $20,000 USD.
Usually, once a reservation has been made on a unit, the developer will forward a copy of the contract for review by the investor. A certain amount of time is allowed to the investor to review such contract ranging from 7 days up to 30 days. If the investor decides to proceed, 20% up to 50% might be requested as down payment. During the construction process up to the 90% of the unit value is collected, and the final 10% is usually collected at the actual title transfer.
Retaining legal counsel
Not always, but many people prefer to work with an attorney due to the fact that many of the legal contracts and other paperwork involved in buying a home in Mexico are complex and can be confusing to the general public. An attorney can review the title of the property and ensure it’s free of liens or defects, he can review contracts and make you aware of special considerations and potential problems, and can also coordinate and accompany you to the closing.
Investors should hire competent Mexican legal counsel when contemplating any real estate investment. Mexican laws and practices regarding real estate differ from those in the United States. Your Buyer’s Representative can assist you in finding a quality attorney.
The cost varies depending on the price of the property and the services provided. But for you to have a general idea, a closing done with the assistance of an attorney can go from 5% to 7% of the cost of the property, including the bank trust and Notary Public costs. If you want more details, please go to Closing Costs. See Closing Costos
An escrow account involves a process whereby an impartial third party, such as an attorney, an escrow company or a title company, is entrusted with the job of seeing that the transfer of ownership from the Seller to the Buyer takes place according to the terms of the written contract agreed upon by all parties involved. The escrow agent (third party) holds any funds safely until all the conditions and details have been realized as instructed by the contract and disburses the funds to the proper parties at the proper time as outlined in the escrow agreement signed by both the buyer and seller.
Yes. Please ask your agent about the companies that offer such services.
No. Establishing an escrow account is not always necessary. Using this tool depends on the buyer and seller.
There are basically three companies that we recommend - Stewart Title, Mexlaw, and First American Title.
Yes, it is always advisable to notify the listing agency and the seller of your desire to utilize an Escrow account.
In pre-construction projects, a reservation agreement allows the buyer to make an offer and come to an agreement with the developer in terms of delivery time, equipment, modifications to the unit, etc. For more details, review the FAQ - Making an Offer.
The Purchase Contract is basically a contract giving beneficiary rights to the investor of a specified unit or units. The contract also outlines the payment schedule, dates of delivery, size and location of the unit, size and location of the complex amongst other details. Other names for the Purchase Contract are Hard Contract, Promissory Contract or Assignation of Beneficiary Contract.
These contracts can be reviewed by the buyer, and it is also recommended that a Mexican legal counsel do a revision as well.
The buyer signs on the buying part. The legal representative of the developing company, or the person who has legal authorization and capacity will sign on behalf of the selling part.
No, not until the property has established a condominium regimen will the developer be able to transfer title of the individual condo units and at this time, will the operation be recorded and realized with a Notary Public.
Several items are necessary to be contained within this document. Payment plan, delivery dates, items to be included with delivery amongst others. Your Buyer’s representative will work closely with you during this process.
Ask a Question
If after reviewing the FAQ section you still need answers, feel free to get in touch.