Today, the buying process is much easier and better protected. Long gone are the days when foreigners could only lease land. Nowadays, buyers safely purchase properties through professional real estate agencies that use U.S. escrow companies, secure their investments with title insurance and obtain an Escritura Publica–irrevocable ownership under the Mexican Constitution.
According to the Mexican Constitution, no foreigner can purchase directly within a restricted zone, which is defined as 100 kilometers (about 62 miles) from the borders and 50 kilometers (about 31 miles) from the coastal shores. This includes the entirety of Baja California. Foreign individuals are, however, permitted to own real estate through a Fideicomiso trust agreement, in which case a Mexican bank (the Trustee) receives authorization from the Ministry of Foreign Affairs to acquire a property. The purchaser then becomes the beneficiary of the Fideicomiso trust. This allows the beneficiary to practice the same ownership rights as a Mexican citizen, from improving, building, occupying, leasing and renting, to selling and obtaining profits.
An exemption applies to foreigners who own Mexican companies with 100 percent foreign investment for business purposes. In this case, there is no requirement to set up a trust agreement within the restricted zone. A notification of this acquisition is sent to the Ministry of Foreign Affairs.
As many as 1 million Americans live in Mexico, according to the U.S. Census Bureau, and the real estate market here is growing at a fast pace. Property values in Baja California Sur have appreciated by 50 percent on average, and even more in the past three years.
When buying a home in Mexico, it is important to understand the community you are interested in. While you spend time here, explore as much as you can. Have dinner at new places and try a different golf resort. Our “neighborhoods” in Mexico have distinct features. Amenities vary, types of villas or residential living vary, and even beaches vary. Look for the unique features of each community, compare options and explore now to own.
General real estate agents have the most intimate knowledge of what each beautiful town and development has to offer.
They are well versed in homeowner fees, property taxes and purchase amenities. Your agent can help you manage your time best by asking you a few questions to determine what is most important to you:
- What are the amenities of the development that are offered to homeowners?
- What is the development recognized for?
- What type of Real Estate exists among the entire community?
- Are there pre-construction prices?
- Is the developer offering financing?
- What memberships (golf or beach club) do I have the option of joining?
- If you are purchasing a home site lot, what are the building requirements?