To put it simply, yes it is! Non-Mexicans can absolutely purchase real estate legally in Mexico, which includes land close to beach areas (which happen to be Federal Zones). It is a common misconception that people who were not born in Mexico are not able to own real estate in the country due to the constitutional restrictions that apply to owning land that is situated within 50 km (31 miles) of the coastline or 100 km (62 miles) from its international borders. To be able to make a legal purchase of one of these land types, a land trust, known as a fideicomiso in Mexico, is required. Fortunately, non-Mexicans seeking a real estate buy in Mexico will find that the process is fairly uncomplicated as it is incorporated in the purchasing process, and the service is offered by several banks.
Fideicomisos and Bank Trust Institutions
When a non-Mexican resident decides to purchase land inside one of Mexico’s federally restricted zones, including sought-after beach resort areas like Cancun and Puerto Vallarta, a trust deed has to be set up through a Mexican bank. From there, the bank will act as a trustee on behalf of the foreigner who wishes to buy real estate in Mexico. Although the bank behaves as an intermediary, all rights of ownership still belong to the non-national purchaser.
In short, the beneficiary (the foreign investor) enjoys the control over all of the rights to the trust, while the trustee (the Mexican bank) oversees and manages the trust. With this arrangement in place, you will benefit from the rights of ownership that allow you to occupy, rent, transfer and sell the property, which includes bestowing the property to someone else through a will.
Renewable Bank Trusts
A fideicomiso bank trust begins with a term of 50 years, and upon completion of the 50-year term may be renewed for another 50 years, a process that can continue indefinitely. If a Mexican national decides to purchase your property later on, you will be able to terminate your bank trust, and if you sell your property to another non-national, you will have the option to transfer the right to the trust to them or they can choose to create a new fideicomiso of their own.
Before a trust can be finalized, non-Mexican owners must appoint substitute beneficiary(ies). All of the rights of the trust will go to the substitute beneficiary(ies) in the event that the beneficiary does not live to see the end of the trust’s 50 year term. Because of this, a trust is quite beneficial for your heirs as they will not be required to follow any probate proceedings in the courts of Mexico, saving them both time and money.
To find out more about the legal processes involved in purchasing Mexican real estate, call 1 844 598 3564.