Famous for its history and beautiful beaches, Mexico is one of the most visited places in the world. According to the WTO, it is the 8th most popular destination among foreign visitors. Known formally as the United Mexican States, Mexico is the 5th biggest country in the Americas. Mexico is bordered with the United States on the north, Guatemala and Belize on the southeast, the North Pacific Ocean on the southwest and the Sea of Cortez on the east.

Mexico consists of 31 states, the capital being Mexico City. Mexico contains a variety of tourist attractions, such as archaeology sites, ancient cities, pyramids, national parks, and museums. Mexico’s mysterious history, specifically the Aztec and the Maya civilizations, also attracts numerous tourists worldwide. Mexico boasts lush natural resources such as jungles and deserts, as well as unparalleled biodiversity. Its expansive coastlines and beaches, such as Cancun and Acapulco, are popular destinations for spring break parties and other occasions.

Mexico offers diverse forms of entertainment for all people. These include unique food and drinks and great nightlife. A range of sports and activities are also available in Mexico, such as golf, fishing, scuba diving, Mexican rodeo (charreria), bullfighting and soccer. Various languages are used in the country, with the dominant language being Spanish. Mexican currency is the peso, with 1 US dollar amounting to approximately 10 Mexican pesos.

From the United States, there are various ways to get to Mexico, via air, land and sea. You can easily enjoy the richness and beauty of Mexico, with its natural wonders, strong culture and hospitable people if you purchase property in Mexico.

Mexico has become a popular location to own a second home or vacation property. Many people from around the world - and especially the United States and Canada - are actively buying real estate in Mexico. In recent years Mexico became an attractive place to invest. There are several reasons behind this trend:

1) The prices for Mexico properties are often favorable in comparison with other destinations. And, with more and more people discovering Mexico, many experts believe the long-term investment prospects remain attractive.

2) Mexico’s culture and services are increasingly welcoming foreigners. While Spanish remains the primary language in Mexico it is also true that more and more people speak English, enabling Americans and Canadians to have a more comfortable experience.

3) The long-term future of Mexico looks promising. The country itself is becoming stronger economically and the opportunity for long-term real estate appreciation in most regions continues to be favorable.

4) Mexico’s warmer climate is attractive to many tourists from the United States, Canada and other foreign locations. For decades many people have enjoyed vacationing in Mexico. Purchasing property is the natural next step.

5) There is growing inventory of condos, villas, homes and land plus a wide selection of resorts and developments with extensive amenities. This provides a steady inventory supply for interested buyers and investors.

The most popular destinations in Mexico offer an array of interesting and fun things to do. From beach life and fishing to golf and tennis people are excited with numerous ways one can recreate in Mexico. Those who enjoy exploring rich history and culture of Mexico find endless opportunities to explore the whole country. Each region has its own unique opportunities. And, of course, many people find Mexico as a perfect destination for simple rest and relaxation.

Marvelling at the 1300-year-old Maya palace at Palenque as parrots screech and howler monkeys growl in the sweaty emerald jungle around you. This is Mexico. Sliding from a palm-fringed sandy beach into the warm, turquoise waves of the Pacific Ocean. This is Mexico too. Dining with salmon enchiladas and chrysanthemum salad in Mexico City fusion restaurant, dancing through the night, kayaking at dawn past a colony of Baja California sea lions – all these is unique Mexican experience. Every visitor goes home with his own unforgettable images. Such a large country, straddling temperate and tropical zones, can hardly fail to provide a huge variety of options for human adventure.

Property purchases by foreigners in Mexico take place through the fideicomiso system. The Constitution of 1917 proclaimed that all land in Mexico would be “ejido” (communal), or owned by the Mexicans nationals only. Ejido land was given to every village and could not be sold.

In 1973 constitutional amendment known as the Foreign Investment Law allowed foreigners to purchase real estate anywhere in Mexico except the restricted zone that consists of areas within 100 km (64 miles) to international borders or within 50 km (32 miles) from the coastline at high tide. In 1993 Mexico amended the constitution which allows foreigners to purchase real estate within the restricted zone by means of a fideicomiso.

The fideicomiso is a bank trust wherein the bank (trustee) holds the trust deed for the purchaser (beneficiary). While the trustee is the legal owner of the real estate, the beneficiary retains all ownership rights and responsibilities and may sell, lease, mortgage, and pass the property to heirs. The fideicomiso is authorized by the Mexican Government under the Ministry of Foreign Affairs.

The bank is required to check ownership and insurance and to verify that the property is free of liens. The trust is granted for a 50-year period and is renewable at any time (for another 50-year period) by submitting application to the bank. If the 50-year period expires without renewal, the owner has another 10 years in which he may submit an application to renew the trust. If property is purchased that already has a fideicomiso, the existing trust may be transferred to the new owner and will be good for the remainder of its 50-year period, or the trust may be renewed. If property is already in the fideicomiso than probate and transfer tax are avoided when the property is transferred.

Any Mexican corporation may be 100% foreign-owned, and can purchase property in restricted zone without a fideicomiso. But property owned by the company is commercial property, and pay higher water, electricity, and telephone rates. However, a Mexican corporation can not own a single-family residence.

The Tax Authority may choose to perform commercial appraisal after the purchase. If appraisal value is 10% larger than the declared value, the difference between the two amounts is the base to 20% Appraisal Tax, payable within 15 days after the appraisal.

No Value Added Tax (Sales Tax) is payable on residential property. Commercial Property transactions are liable to VAT at the current rate in addition to the Acquisitions Tax. Once the property price has been agreed, a “Convenio de Compra/Venta” is drawn up, with included deadlines. This is the written initial agreement of purchase. A 5%-10% deposit is expected from the buyer.

A permit from the Foreign Secretary’s Office should be obtained. The buyer should sign the “Calvo Clause” stating that foreign jurisdiction will not be sought to deal with the property transaction. Then the seller will have to provide a copy of the Land/Property Deed. It is important to hire a lawyer to check all the document. Once the deed is transferred to the buyer, the buyer will have to transfer the payment to the seller. Cash or monetary instruments of any kind over US$10,000 must be declared when entering Mexico. There are no limits on how much can be transferred in or out of the country.

The whole process of registering property can be completed in approx 74 days.

Transaction Costs
Acquisition Tax       0.18% - 4.565%
Public Notary          0.08% - 3.6%
Registration Fee     0.02% - 1.82%
Other fees             0.50% - 1.00% 
Title Insurance       0.50% - 0.70%