How to Buy Property in Mexico as a Foreigner: Everything you need to know about fideicomisos, taxes, and legal steps.

Thinking About Buying Property in Mexico? Here's What You Need to Know

Buying real estate in Mexico as a foreigner is not only possible—it's also safe, legal, and increasingly popular, especially in coastal destinations like Playa del Carmen, Tulum, Puerto Vallarta, and Los Cabos. With proper legal guidance and the right structure in place, you can own your dream condo, vacation home, or investment property with full control.

In this guide, we’ll break down how foreign buyers can legally purchase property in Mexico, including a clear explanation of fideicomisos, the legal process, and what to expect in terms of taxes.

Can Foreigners Own Property in Mexico?

Yes, foreigners can legally own real estate in Mexico, including beachfront and coastal properties. However, the Mexican Constitution restricts direct ownership by foreigners within the so-called Restricted Zone:

• 50 km (31 miles) from the coast

• 100 km (62 miles) from international borders

Playa del Carmen, for example, is within this restricted zone. But don’t worry—foreigners can still acquire property safely and legally through a special mechanism called a fideicomiso.

What Is a Fideicomiso?

A fideicomiso is a real estate bank trust that allows foreigners to buy property in the Restricted Zone. Here’s how it works:

• The property is held by a Mexican bank on your behalf.

• You (the buyer) are the sole beneficiary of the trust.

• You retain full rights to use, lease, remodel, sell, or inherit the property.

• The trust lasts 50 years and is renewable indefinitely.

• You can name heirs directly in the trust—no probate required.

Think of it as a legal and secure ownership structure, similar to a living trust in the U.S.

What’s the Legal Process?

Buying a property as a foreigner in Mexico involves several legal steps, but with a good attorney and real estate advisor, the process is smooth. Here's an overview:

1. Offer & NegotiationYou make an offer, and once accepted, a promissory agreement is signed.

2. Due DiligenceA bilingual lawyer checks the property title, permits, and existing debts.

3. Open the FideicomisoThe bank trust is created with a Mexican bank (e.g., Banorte, HSBC, Scotiabank). You are the sole beneficiary.

4. Transfer of FundsFunds are usually wired via escrow or directly to a notary’s account.

5. Notary & ClosingA public notary (Notario Público) in Mexico oversees the transaction, finalizes the trust, and registers the property in your name.

Timeline: From offer to closing, the process typically takes 4 to 8 weeks.

What About Property Taxes and Ongoing Costs?

One of the biggest advantages of owning real estate in Mexico is the low annual cost of ownership compared to the U.S. or Canada:

• Annual Property Taxes (Predial): Typically range from $100 to $300 USD/year

• Fideicomiso Maintenance Fee: Approximately $500 to $700 USD/year

• Closing Costs: Around 5% to 8% of the purchase price (including notary, registration, legal fees)

• HOA Fees (if applicable): $150 to $300 USD/month, depending on the property

Do I Pay Taxes on Rental Income?

Yes—if you rent out your property, you are required to pay taxes in Mexico on that income. But here’s the good news:

• You can deduct expenses like maintenance, utilities, HOA fees, and property management.

• Mexico has tax treaties with both the U.S. and Canada, which helps avoid double taxation.

• You can pay taxes as an individual or create a Mexican corporation if your rental activity becomes a full business.

A local accountant can help keep your taxes compliant and optimized.

Is It Safe to Buy Property in Mexico?

Yes. With proper due diligence, legal representation, and a formal fideicomiso, buying property in Mexico is secure and protected under Mexican law. Make sure to:

• Use a licensed bilingual real estate attorney

• Work with reputable agents familiar with foreign transactions

• Always verify the title, permits, and HOA rules

Many foreign buyers—especially from the U.S., Canada, and Europe—have purchased safely and continue to invest in Mexico’s growing real estate market.

Final Thoughts: Why Now?

With the rise of remote work, the strength of the U.S. dollar, and increasing global interest in lifestyle investments, now is one of the best times to buy real estate in Mexico.

You can enjoy:

• A beachfront lifestyle

• Solid rental income

• Asset diversification

• A property that appreciates over time

• And most importantly: peace of mind knowing it’s 100% legal

Interested in learning more or visiting a property in Playa del Carmen?Reach out to us today—we’ll walk you through the steps, help you understand your options, and make sure your investment is as secure as it is exciting.