The advice for those who want to invest in Mexico – with success and happiness – is to hire a real estate agent with proven reliability and considerable experience. The “do it myself, especially in a foreign land, can be very disadvantageous in terms of loss of time and money. Without this major premise, here is some basic information to know before buying property in Mexico.
The public deed of sale is the appropriate legal instrument for the transfer of the property: the act must be entered in the Public Registry of Property of the location of the property. To be registered, the sales contract must be signed before a notary public and authenticated by them.
The notary plays a key role in the procedures relating to the sale of real estate in Mexico. He must first verify that the property subject of the sale is free from bonds and mortgages, and this is a particularly important and delicate. Before drawing up the deed, in fact, the notary obtains a certificate of no liens on the property issued by the Public Registry of the property where the asset is located. This certificate allows you to know by whom and when the property was acquired, and especially if the property is free of real rights of enjoyment (usufruct, right of way, surface or long lease) or guarantee (mortgage), which would limit the freedom to dispose of the future owner.
The Foreign Investment Law prohibits foreign individuals to purchase immovable property for residential use located in the so-called ‘Zone restringido, an area located within 100 km from the borders and 50 km from the coast. One area, however, very interesting, in fact many people would buy homes in Playa del Carmen and other beautiful places along the coast and along the Riviera Maya. The legal means necessary to overcome the prohibition mentioned is escrow ( “Fideicomiso” in Spanish), a very flexible formula that looks like a trust. Notary costs around 4 – 5% of purchase price (including notary fees, legal fees and registration number of the owner in the Public Registry of Properties). To this we must add the cost of establishment of the bank Fideicomiso that is about 3 thousand dollars.
An alternative to the “Fideicomiso” is the establishment of a company in Mexico to which register the property.