We are excited to share with you some of the real estate for sale in Playa del Carmen and the Riviera Maya, Mexico. We know how many people visit this area and decide to make a little piece of it their own. If you are looking for something we do not list, please give us your specs and we will do our best to connect you with an agent who might have properties to suit you!
FAQ’s and answers about buying property in Mexico as a foreigner- Buying in Mexico
In 1989, regulations were passed to promote Mexican Investment and Regulate Foreign Investment. Just recently, those regulations also became law and included significant and beneficial changes. The most beneficial change increased the length of the renewable trusts to 50 years. Now foreign owners can extend their trusts for an indefinite number of 50 year terms. The relaxed political environment has given non-Mexicans their first real access to pristine coastal property.
As a result of Mexico’s commitment to tourism, and the recent relaxation of its Foreign Investment Law, resort properties in Mexico are expected to develop at a rapid pace. What once may have been seen as a complex form of property ownership is quickly becoming familiar to non-Mexican buyers.
Here are some frequently asked questions about buying property in Mexico:
Q: I have always heard non-Mexicans cannot buy coastal property in Mexico. Is that true?
No. While it was once true, times have changed. Prior to 1973, foreigners were not allowed to hold legal title or to exercise direct titles to real property in an area located within 64 miles of Mexico’s borders and 32 miles of its coastlines. But 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 (Fideicomiso).
Q: Who is involved in this bank trust?
Three parties. The seller in the property is the Trustor. The bank is the Trustee (Fiduciario), and the buyer, or Beneficiary, is the Fideicomisario.
Q: How does the trust operate?
Title to the property is transferred to a trust to a Mexican bank acting as trustee. The trust agreement is formalized by the issuance of a permit from the Mexican Ministry of Foreign Affairs. The lot or home buyer is designated as a Beneficiary in the Trust and the Beneficiary rights are recorded in the public record by a Notary Public.
Q: What are my rights as a buyer?
You have the right to use, lease, improve or sell your property without restriction. You may also transfer your rights to a third party, or pass it on to named heirs.
Q: Is the trust renewable?
Yes. According to the Foreign Investment Law passed in 1993, trusts can be renewed for an indefinite number of successive 50 years periods. In effect they run in perpetuity.
Q: How do these procedures work in master planned communities?
In the case of larger master planned communities, the developer establishes a master trust when he purchases the property. Then, individual lot or home buyers are simply designated as beneficiaries in the master trust.
Q: How are closing costs calculated and who pays for them?
Closing costs are determined by the declared value which is usually the same as the sales price. The value becomes the basis for all related taxes and fees. Generally, the seller pays for real estate fees, the buyer is responsible for the transfer tax and the cost of establishing the bank trust (if it isn’t already in existence), notary fees, registration fees, tax appraisal fees and trust permit fees. The purchaser’s total closing costs average between 5% – 8% of the purchase price.
Q: How much will I be charged for property taxes?
Mexico’s annual property taxes are .25% of the assessed value for tax purposes.
Q: If at a later date, I decide to sell my property, can anyone buy it?
Yes, if the new buyer is also a foreigner, you simply assign your beneficial interest. If the new buyer is a Mexican National, you can instruct the bank to endorse the title in favour of a buyer.
Q: If the buyer is a foreigner, is his interest limited to the balance of my 50 year trust?
No, upon application, a foreign buyer automatically receives his own renewable 50 year permit.
Q: Do many foreigners currently own coastal property in Mexico?
Today, thousands of foreign owners enjoy their Oceanside resort property, many have benefited from property appreciation.