Purchasing Property in Mexico by NonMexican Nationals is Safe and Legal

Purchasing Property in Mexico by NonMexican Nationals is Safe and Legal

Over the past decades an increasing number of foreigners have invested in Mexico by purchasing property.

Most people not only want to own a home in this beautiful country, but they are looking to invest in any of the gorgeous beach towns and cities that Mexico has.

The number of expats migrating to Mexico has grown exponentially because the cost of living in Mexico for is lower than that of living in the United States, Europe and Canada.

What are Restricted Zones?

The 1917 Mexican Constitution did not allow foreign investment on Mexican lands. According to Article 27 of the Constitution, a non-Mexican citizen is unable to own property, hold real estate title, within certain areas determined as the “restricted zones”.

The restricted zones are any area within 50 kilometers of any coast, or 100 kilometers of any neighbouring border. However, without foreign investment, these areas like Acapulco, Puerto Vallarta, Los Cabos and the Riviera Maya would not grow as fast and steady as they have.

To allow foreigners to invest in the area, the Mexican government passed a law in 1973 called “Foreign Investment Law” which allowes foreigners to safely purchase land and properties in Mexico in two different ways: through a Bank Trust (Fideicomiso), or through a Mexican Corporation.

Fideicomiso / Bank Trust

The “Fideicomiso” is a bank trust where the bank, trustee, holds the trust deed for the purchaser, called beneficiary. The bank is the legal owner of the real estate and the purchaser/beneficiary has all ownership rights and freedom over the property to do as they please: sell, lease, mortgage, pass on to heirs, remodel…

The trust is granted for periods of 50 years and is renewable for unlimited 50-year periods. The trust can also be transferred to another beneficiary.

Mexican Corporation

Since 1995, foreigners can operate a Mexican corporation to purchase and develop land. The only commercial limitations are mining, airports and telecommunications to an extent as per current law reforms of 2015. Should a foreigner wish to invest in land or properties to sell, resell, or rent, a Mexican corporation allows them to do so with no limits as to where in Mexico they can invest.

There are options for types of corporate entities and choosing which works best depends on tax purposes both in the homeland and in Mexico. Once the corporation is established it is ready to purchase property and acquire title and title insurance.

To decide to use a Bank Trust or Mexican Corporations it is best to consult with a lawyer. A lawyer will discuss the pros and cons of each to help decide which method is best for legally and safely investing.


by Thomas Lloyd
Thomas, from Indiana, is a graduate from the prestigious Krannert School of Management at Purdue University, where he obtained a degree in Administration with the Financial Management option.

He has been working professionally in Mexico since 1995, and in 2011 he was the first person to ever attain a new nationally regulated Real Estate degree and professional identification number for the Country of Mexico.

In 2009 he was voted Realtor of the year, because of his professionalism, attention to customers and knowledge of procedures and the market. Also, he has been active in the real estate community serving on the real estate association’s Honor and Justice Committee.

Thomas founded TOP Mexico Real Estate to help non-Mexicans have an enjoyable and safe experience as they purchase and invest in real estate in Mexico.





Source: The Yucatan Times


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