By Rodrigo Manterola

You finally made the move to Mexico and you want to go to the next level, or you want to invest in a vacation property or an investment as an economic move. Is buying a property in Mexico a good idea? 

You must have tons of questions now and there are so many different stories of people buying a property in Mexico, some great and inspiring, some others very scary and confusing. 

We dug around to answer some of these questions as we are also looking to buy property in Mexico.

So far this is what we’ve found and we are happy to share it in the hope this can make it easier for you to make the decision, so here some of the most common questions ex-pats and people from other countries ask about buying a property in Mexico.

Thinking about moving to Mexico? Read our article about it here

In short, yes.

Buying the right property in Mexico is a good investment due to its geographical location, weather, economy, travel-friendly policy, and many other reasons, investing in Mexico is and will always be a good idea, if you know where and when.

Some people think Mexico is growing so fast that if you don’t invest now you will never be able to invest in Mexico at all.

The fact is that Mexico is still full of opportunity and new development is always on the horizon.

Not only prime holiday locations are good investment opportunities, but there are also opportunities in agricultural and urban centers in full throttle where the real estate business is booming.

No matter what your line of investment is, Mexico has a good option for you.

How can you buy property in Mexico?

To own a property in Mexico you need to choose one of three legal options, and which option you take will depend on where the property is located.

Options to own property in Mexico:

  • Direct Deed ( if the property is not located in the Restricted Zone)
  • Fideicomiso ( a bank trust fund, necessary when the property is located in the Restricted Zone) 
  • Mexican Corporation (for Commercial property, necessary when the property is located in the Restricted Zone) 

 So how does this work? 

To explain this we need to know what the Restricted Zone is or better yet, where is it?

Mexico’s restricted zones are everything within 50 kilometers (some 30 miles) from the shoreline and 100 kilometers (about 60 miles) from any international borders, whether this is North or South borders. 

This means that if you are looking to buy a property in San Miguel de Allende or Oaxaca City, as an example, you can buy it via Direct Deed, with the same rights and responsibilities as any Mexcian national.

On the other hand, if you want to own property in Playa del Carmen, Cabo, or Merida, you could choose either Fideicomiso or Mexican company, depending on what your plan is for that property.

If you are looking for a residential property or just a Real estate investment, then a Fideicomiso is the best option, unless you are looking for a commercial property, if this is the case, then a Mexican company is the way to go.

What is a Fideicomiso?

After the Mexican-American war of 1847-1852 where Mexico lost about 50% of its territory including California, Texas, and New Mexico amongst other territories, the Mexican constitution was altered to prevent the “Texas” incident once again. More on this soon.

Anyways, the Mexican constitution forbids foreigners from owning land in Mexico’s Restricted zone (shoreline and international borders), or at least it did until the 1970s when some amendments to these articles in the constitution were made.

Since the 1970s, a foreigner who wants to own property within Mexico’s Restricted zone needs to do it through a Mexican bank in the form of a Fideicomiso, some sort of Bank Trust.

As the beneficiary of this Trust, you maintain full control of the property and make all pertinent decisions about the property: whether to build on it, live on it, sell it, rent it, or pass it down to your heirs, family, or unrelated.

Advantages of a Fideicomiso in Mexico to own property

Fideicomiso is a very attractive option as one characteristic of this method is that you can list more than one beneficiary, this is great as husband and wife can both be co-owners of the property.

Another good characteristic of Fideicomiso is that you can name an heir of your choice, whether it’s a family member or anyone else, this is very attractive especially for couples in a second marriage with children from previous marriages, or for same-sex couples, or friends who want to own a property together.

This means that if one co-owner dies, the control passes down to the other owner/owners, and as the succession goes there is always a beneficiary of the trust without having to go through a long and expensive property ownership change, deed, etc.

How long is a Fideicomiso last in Mexico?

Fideicomiso trusts are issued for 50 year periods and are renewable. Should you be interested in buying a property currently held in a trust, you could, either establish a new trust for the next 50 years or take over the existing Fideicomiso. 

Trusts can be renewed at any time by simple application.

Maintenance fees can be from $600 to $900 per year. The initial cost for set-up may cost a couple of thousands of dollars.

A Fideicomiso allows the simple and easy transfer of control over the property and avoids the messiness of sorting out ownership in the Mexican courts. Plus, it also allows you to avoid inheritance taxes.

Is it a Fideicomiso safe and legit?

Yes, despite the common myth, Fideicomisos are very safe to own and keep and the Mexican Government can’t take it from you.

There have been some cases in which foreigners have been involved in a conflict over land in Quintana Roo and Baja California, but in all of these cases the property of the land wasn’t properly acknowledged nor acquired and people who lost property did so because they couldn’t prove legal ownership of the land.

They fell for a scam and the government just took it to give it back to its legal owners.

Sadly for the foreign “owners” of these properties, there was no happy ending, they got scammed by defrauders who took advantage of them leaving them with nothing.

That’s why it is so important to look for the assistance of professional and reputable Real Estate operators and always seek the assistance of a Real Estate lawyer who can help you clear out all of your doubts.

There’s always the ghost of fraud hovering around all kinds of transactions, and even though Mexico’s legal system is not the best, with the help of the right professional you should have nothing to worry about as they know all the cracks and corners of Mexican Real Estate business.

Things to consider when buying a property in Mexico

Buying land within the Restricted area

As a foreign buyer, you can’t hold a deed directly in your name if such property is located within the Restricted zone, but you can hold a Fideicomiso or Bank Trust in your name giving you all the legal rights of the property.

Make sure you are dealing with an honest and professional Real Estate agent/Lawyer

This is a must no matter where you are buying property, but it can be particularly important in Mexico as the law is different as is the way it is enforced. Make sure you deal only with reputable and well-established agents and lawyers.

Escrow account 

In the US and Canada, Escrow agents are legally regulated by the government and are legally responsible for the funds, making sure all ends meet before releasing any money. 

When buying a property in Mexico the Real Estate agent or lawyer could act as the Escrow agent, if that’s the case, make sure you trust your agent/lawyer. Hire only reputable real Estate agents and lawyers. And most important, don’t give any money to the seller.

You can also set a third party to manage the escrow account

Don’t buy Ejido land

You can’t own Ejido land as this is government land given to local families in a trust. This is not private property and it cannot be sold or purchased by you.

If they offer Ejido land to you, no matter how tempting the offer is, just say no.

Get Title insurance

The Title Insurance company will make sure there are no discrepancies down the ownership line and will make sure no surprises will arise in the future. No scams.

One benefit of getting an insurance company is that they can also offer some sort of Escrow account services for the money to be managed instead of giving it to an agent/lawyer nor and most important, not giving any money to the seller before everything is in check; giving you an extra layer of security. 

If available and affordable, get one.

There are many other things to consider but these should be the basic ones to keep in mind when buying a property in Mexico

What is the best-rated area to invest in in Mexico?

All of Mexico is investment friendly both foreign investment and real estate investment but were in Mexico to invest?

  • The Mayan riviera
  • Los Cabos
  • Riviera Nayarita
  • San Miguel de Allende
  • Puerto Vallarta

The cities and regions listed above are some of the strong tendencies on foreign investment in Mexico, Los Cabos received some 4 Billion dollars from private investors both international and local to improve the touristic infrastructure of this destination and boost international high-level travel.

Where to invest will depend on personal preferences amongst other factors, but the cities and regions listed above are a good starting point for your research.

Are there property taxes in Mexico?


Acquisition Tax in Mexico is calculated at 2% of the assessed value of the property at the time of purchase.

There are also annual property taxes also known as predial. 

Property taxes in Mexico are in general very low compared to US property taxes; these are based on the location and size of the property. 

Taxes are calculated at a fraction of what your property is worth. 

Property tax is due at the beginning of every year, in January, and the Mexican tax office (SAT) offers substantial discounts if your predial is paid in advance. 

25% discount by paying your taxes in December before it is due, and even 20% discount if you pay in January.

If having financial difficulties, arrangements can be made to finance your debt.

If you rent out your property for any amount of time (Airbnb or similar vacation platforms) will be considered income and will be subject to rental income tax or “Impuesto Sobre la Renta ” and “IVA” Added Value Tax.

It is your responsibility to pay these taxes, failure to pay can result in fines, legal action, and even permanent deportation. 

These taxes are to be paid monthly to SAT “Servicio de Administración Tributaria” and can be electronically filed. An accountant or property manager can be very helpful in taking care of your rental and filing your taxes every month.

Should you sell your property capital gains tax will be assessed then. Basically, this tax is based on your profit from selling your property. 

How long you lived in the property will be considered when determining the amount of tax to pay. 

A tax law attorney in Mexico can be of great help advising you on ways and deductibles to help you reduce the capital gains tax.

Do expats pay other taxes in Mexico? Read in more detail about it here

Can I get a loan for a house in Mexico?

Yes, while this is not the easiest avenue, these are typically granted in Mexican pesos and up to 90% loan-to-value ratios with fixed-rate interest plans. 

A small amount of the real estate transactions in Mexico made by non-nationals have any kind of direct Mexican bank mortgage financing involved, most buyers prefer to get financing in their home country based on the assets they already have there.

Mexican current interest rates go from 7.9% to 10% per year. Some banks offer lower rates depending on credit history, ratings, and eligibility.

Are you moving to Mexico? Read our article here to dissipate some doubts