The short answer is YES! Of course, there are legal steps you will have to follow whenbuying property in Mexico as a forigner, however with ym guidance youll soon discover that the process is simple and easy to understand. In short, forigners can own property through a bank trust known as a Fidecomiso that is set up when you purchase property in Mexico.

The fideicomiso is a real estate trust that is held under your name in a Mexican bank. The bank acts as the fiduciary, you and your heirs and assigns are the beneficiaries of the fideicomiso. The fideicomiso gives the beneficiary absolute control of the property. So you can enjoy it, lease it, improve it, mortgage, sell, inherit, give away. Basically, your property is under a fiduciary of which you are the owner to be managed by a bank in Mexico on your behalf. The purpose of a fideicomiso is to authorize foreigners the power to buy real estate in Mexico within the “restricted” zone and ensure a secure transaction. The “restricted” zone is land 31 miles from the coast and 62 miles from the border. When the Mexican Constitution was written it was designed to protect this land. In order not to amend the Mexican constitution, they created and added the fideicomiso to promote high demand international investments, especially on the coast. Residential properties outside the restricted zone can be acquired directly by foreigners without a fiduciary, however, some buyers decide to obtain it. Your fiduciary is not owned by the bank; they are simply administrators.

With the advent of the North American Free Trade Agreement (NAFTA), the Mexican government recognized that it was crucial to make foreign investment in Mexico safer and easier for non-Mexicans. Because the Mexican Constitution prohibits non-Mexicans from purchasing or owning real estate within 60 miles of the U.S. international border, or within 30 miles of the Mexican coast, an innovative and secure method of holding title was created. This method allows non-Mexicans ownership through a Mexican property trust called a Fideicomiso. This is a trust agreement, much like an estate trust in the U.S., which gives the Purchaser all of the rights of ownership. In order to gain the rights of ownership, the Department of Foreign Affairs in Mexico City issues a permit to the Mexican bank of the Purchaser’s choice, allowing the bank to act as Purchaser of the property. Essentially, the bank acts as the “Trustee” for the trust and the Purchaser is the “Beneficiary” of the trust. The trust is not an asset of the bank; the banks simply act as the Trustee to hold the trust.

Much like living wills or estate trusts in the U.S., the Mexican bank, or Trustee, takes instruction only from the Beneficiary of the trust (the Purchaser). The Beneficiary has the right to use, occupy, lease and possess the property, including the right to build on it or otherwise improve it. The Beneficiary may also sell the property by instructing the Trustee to transfer the rights to another qualified Purchaser, or bequeath the property to an Inheritor. The initial term of the trust is 50 years, however the trust can be renewed for additional periods of 50 years indefinitely, providing for long-term control of the asset.

Once you have an accepted offer you will be assagined a in-house closing coordinator from Engel & Volkers Snell Real Estate. They will ensure all documentation/signatures are on schedule and coordinated with the closing company. A Real Estate Attorney will be in charge of making sure there are no liens on the property, the escrow deposits, set up your Fideicomiso, coordinate title insurance (if required), obtain the municipal appraisal & certificates, get the closing paperwork drafted and bring you to the closing table. They are behind the scenes every step making sure everything is ready to be closed upon the Notary. Notario Publico A notary public in Mexico is a more powerful office than that of a notary in Canada or the USA. In Mexico, notaries are appointed by the State Governor and must hold a law degree. In their position, notaries witness and certify documents, guaranteeing their absolute authenticity. They are also tasked with managing and safely securing original documents and records, and no real estate transaction can be legally processed in Mexico without being overseen by a notary public. By law, a deed to any property for sale in Mexico must be prepared by a notary and the notary will also ensure that all the documentation and permits needed for the transfer of real estate are in order, securing the legitimacy of the transaction.

The Purchaser holds the same rights as a property owner in the U.S. or Canada, including the right to enjoy, sell, rent, improve the property, etc. This is not to be confused with a land lease. The property purchased is placed in a trust with the Purchaser named as the Beneficiary of the trust — the Purchaser is not a lessee. If the property purchased is already held in a trust, the Purchaser has the option of assuming that trust, or having the property put in a new trust.

In the trust document the Purchaser must name the Beneficiary or foreign Owner of the property. The purchaser can be an individual, multiple partners, a foreign corporation, an estate trust, a living will, or another entity. The Trustee of the trust (the Mexican bank) will take direction from whomever you name as the Beneficiary. Remember: If you sell the shares in the U.S. corporation, you have created a real estate transaction in Mexico and all Mexican capital gains taxes apply.* You can own a property in a Mexican corporation and take title in Escritura (fee simple) only if the property is for development or investment purposes. You cannot own property through Mexican corporation to bypass the trust process. It is against the law for a foreigner to own property in a Mexican corporation for residential purposes.

The only taxes due annually in Los Cabos are property taxes (Impuestos Prediales). These municipal taxes are published at the end of January and must be paid at the local tax office located in downtown San Jose del Cabo, and in Cabo San Lucas in the municipality offices. If payment is made early you may be eligible for a discount. These taxes are much lower than they are in the Unites States or Canada. Your property taxes are not affected by how much you paid for the home.