How does a Foreigner buy Real Estate in the Restricted Zone of Mexico?
The most common way to buy property as a foreigner in the restricted zone of Mexico is through a bank held trust, called a Fideicomiso.
What is the restricted zone?
If you want something near the beach you need to know about the Restricted Zone, which is 50 km from the coast and 100 km from the border. Anything outside that area doesn’t require a trust.
How does the Bank Trust work?
You are the beneficiary of the trust and can use, rent, renovate, sell, or pass your property down to your heirs.
The property is yours, not an asset of the bank.
The bank trust protects you from anyone taking the property away from you and also has a built in will so that ownership of the property can be transferred easily if anything happens to you.
The trust is good for 50 years and is renewable for every 50 years forever.
Costs of the Trust
You have to pay an annual fee of about $550 USD
It cost about $2500 to establish the trust, which includes a one time setup fee. You may also need to pay money to extinguish the trust if you sell to a Mexican or a Corporation.
Buying through a Company
You can also purchase property through a Mexican Corporation, which would make sense if you’re planning to have a business, own multiple properties, or buy a mixed use property.
You can designate a foreign company to be the beneficiary of a trust if you want to buy through a company or IRA. Many people invest in real estate with their IRA’s by setting up an LLC.
Of course you need to understand the tax laws and regulations to know if that would make sense for you.
Is it really safe to buy real estate in Mexico?
Yes, it’s completely safe to buy property in Mexico, but you need to protect yourself by having an experienced buyer’s representative and a real estate closing attorney to help you with due diligence.
There are people that get ripped off or make bad investments and 9 out of 10 times that’s because they didn’t have someone to educate them on the risks and help them steer away from problems.
Book a call and get educated by An Experienced, Ethical, Buyer’s Representative.
If you’re serious about owning a property in the Riviera Maya Mexico and you want to get the process started Click here to book a Free, No Obligation, 30 Min Consultation. It’s never too early to plan and having a quick conversation can save you a lot of time, frustration, and money.