Investing in México does not have to be a hassle. Like in any investment, you have to do your “due diligence”, work with the right professionals and be aware that you are conducting business in a place with different laws and culture.
The process of transferring title of a property is similar to the one you might know, but with some variations. You do not have to be an expert, just make sure you are familiar with the rights and obligations you will have when investing in the vehicle known as the Fideicomiso (bank trust). This banktrust will not only register you as the owner of the property on State Records, but will allow you to sell the property (to another foreign citizen of a mexican national), lease it, leave it as part of your Estate or donate it. These are pretty much the same rights a Mexican citizen has over property here. You will pay the same property taxes as everyone else, you will however pay a yearly fee to the Bank (Fiduciary). In topics like these its where experience is golden. Feel free to reach out and if you like we can put you in contact with one our investors that can provide their experience with title ownership.
As long as you pay your trust fee and yearly taxes you will have a hassle free investment.
Over time if you decide to get Mexican citizenship you could cancel the banktrust and just own in fee simple or Escritura.
Regarding your closing costs, as a rule of thumb for anyone buying with full title will come out to be 5.5% of the registered price. If the person or persons buying are not Mexican Nationals, the % will increase to somewhere between 6.5 to 6.8%. This percentage will include ou will pay an average of 6.7% of the property’s registered value** as closings costs, these will include: Purchase tax, Fee for a “Notario Publico” (very different role than a public notary in US), register of operation in State Archives, permit from Mexico’s Foreign Relations Department, bank trust opening fee, bank trust first year fee, closing coordinator fee -appraisal, certificates of no lien, survey map, among other documents.
When purchasing I always ask my clients to think of an exit strategy. Decisions you make while buying will impact when you or your beneficiary sells. Even if you are buying as a second home or with retirement in mind, always research the rental market behavior. Plans change, it is invariably positive to have a wide range of options in this long term investment.
