Are the permits that Article Twenty Seven requires of
foreigners hard to get?
A: The foreigner applying for permission to
buy land must prove his immigrant status in Mexico.
Non-residents and tourists can buy land through a trust.
If the foreigner resides in Mexico, he can acquire
directly the property as long as it is not within
thirty-one miles from seashores or sixty-two point five
miles from the borders.
Q: What about condominiums or houses
located in Acapulco, Puerto Vallarta, Cancun, or any of
the resorts of Mexico'?
A: The Constitution forbids direct ownership
by foreigners inside thirty-one miles from the sea or
sixty-two point five miles from the borders. However, they
have always been permitted to buy on a trust basis. In
this type of purchase, a bank is the trustee, or owner,
of the real estate. The beneficiary, having all the
rights to use, enjoy and sell, is not considered the
owner of record. This is not a violation of what the
constitution forbids. The trust is established for thirty
years and can be extended for one additional thirty year
Q: Are time shares legal to obtain by
foreigners in Mexico?
A: It is legal for the foreigner to obtain a
time share as long as he does not reside in that time
share permanently. The foreigner must obtain a copy of
the property ownership when he buys the time share and
club memberships are illegal.
Q: What happens if a foreigner decides
to sell after some years?
A: He may do so, and he should profit by an
Q: Can the foreigner rent or sublet
his apartment in these condominiums or trusts?
A: Yes, he may rent to anyone he desires,
keeping the rent for periods not exceeding ten years.
Q: What happens if the beneficiary
A: At the time the trust is set up, a
substitute beneficiary is named. This person has the same
rights as the first beneficiary in case of his death. No
Will need be probated in this case.
Q: How is a trust set up?
A: The trust agreement is drawn up before a
notary public. The Ministry of Foreign Affairs and the
Commission on Foreign Investments must have approved the
operation, with the trustee requesting this
authorisation. The participants in the transaction are
the seller who must have clear title to property, the
bank as trustee, and the buyer or beneficiary of the
true, or his representative.
Q: How much does it cost to buy
properly in a trust?
A: There are expenses for the authorisation
from the Ministry of Foreign Affairs, the registration in
the Registry of Foreign Investments, and the fees of the
notary public. The bank charges one percent of the amount
of the transaction for the preliminary studies and the
drawing up of the agreement. The total expenses for the
transaction should be between 11-1/2 percent and 12-1/2
percent. In addition, there is a yearly fee of one
percent of the property value charged by the bank for its
services as trustee.
Q: What are the responsibilities of
A: He must pay the trust annual fees
punctually. Also, he must pay property taxes, water, and
other utility bills when due.
Q: Is it true that the new law that
regulates foreign investment is against new investments?
A: Not at all. The new law is not only fair,
but even positive in the sense that now everybody knows
where he stands. In the long run, it is going to create a
better atmosphere for mutual respect and understanding.
Prospective foreign investment from now on will require
permission from the Commission of Foreign Investments.
Q: Can foreign investors come to
Mexico and buy an established industry?
A: As long as they acquire forty-nine percent
(49%) of that corporation, there is no required
Q: What activities are reserved to
A: The new law dictates that in radio and
television, urban and inter-urban transportation, gas distribution, and forestry, only Mexican individuals, or
Mexican corporations with a clause that forbids any
foreigners to own shares, can participate.
Q: Which are the activities where
capital is welcome?
A: In almost every thing else.
Q: Are the percentages to be owned by
A: No. In those fields where foreign
investment is permitted the National Commission on
Foreign Investment might decide to increase the
percentage if it is in the national interest.
Q: What happens with investments
already made by foreigners not linked with foreign
centres of decision?
A: Foreign residents not linked with foreign
interests or with foreign centres of decision are
considered equal to Mexicans with respect to investments
and are not subject to any percentages.
Q: What should you do when buying a
A: After you make the decision to buy, a
first-class notary public of your choice should take
charge. It is customary for the buyer to select the
notary public. The Public Registry of Property has to be
checked to ascertain if the property in question has any
liens or encumbrances and if the title is in good legal
standing. The notary does this and also presents the
application to the Ministry of Foreign relations when a
foreigner is the buyer. If everything is clear, then the
sale proper takes effect. It is also recommended that you
hire an attorney to review the contract.