Simply put? Foreigners absolutely can buy real estate across Mexico, but may need a trustee within certain areas. Many people hold the misconception that it is actually illegal for foreigners to hold real estate in Mexico, or that they cannot hold it within certain areas of land, but this is not the case. There are, however, some constitutional limitations placed on ownership of land that falls within 50 km (31 miles) of the coast and 100km (62 miles) from the international borders. If the real estate falls within one of these areas it will be necessary to set up a fideicomiso (bank trust) so that the purchase is legal. Thankfully, however, this is a pretty straight-forward process thanks to the many banks who offer the service.
Fideicomisos and Bank Trust Institutions for foreigners buying real estate in Mexico
In order to allow for the purchase of land and/or real estate within Mexico’s restricted zones by foreign nationals it is necessary to establish a trust deed through a Mexican Bank. The bank itself can be the trustee, or you can arrange for an Mexican acquaintance or family member to be your trustee, but either way the bank will be the intermediary. The trustee will manage and oversee your real estate in Mexico, but you will enjoy all the rights of ownership including the rights to occupy, rent, sell, transfer, and bequeath the property in a will. A fideicomiso will not infringe upon your rights to the property you buy.
Renewable Bank Trusts for foreigners buying real estate in Mexico
A Fideicomiso initially has a term of 50 years, and can be renewed for a further 50 years at the end of the term, in perpetuity. If you later choose to sell your property to another foreign national the fideicomiso can be transferred into their name, or they can choose to set up their own. If you sell to a Mexican national the fideicomiso can be terminated for good.
Appointing Beneficiaries
When you buy a property through a fideicomiso you will be required to name a beneficiary(ies) when your trust is finalized. These named beneficiaries will receive all the rights of the trust should you pass on before the end of the 50 year lifetime of the trust. In this way your heirs will have one less thing to worry about should the worst come to pass. This way they won’t have to follow any probate proceedings in the Mexican courts.
If you wish more information about the rules surrounding foreigners buying real estate in Mexico, please contact us on 1 844 598 3564.