FAQ: Buying Real Estate in the Yucatán Peninsula
FAQ: Buying Real Estate in the Yucatán Peninsula
Can foreigners buy real estate in Mexico?
Yes, foreigners can buy real estate in Mexico, but there are certain restrictions in border areas and coastal zones. That’s called the “Restricted Zone”.
Do I need to be a resident of Mexico to buy real estate?
No, you do not need to be a resident of Mexico to buy real estate.
Can I obtain financing to buy real estate in Mexico as a foreigner?
Yes, some banks and financial institutions in Mexico offer financing to foreigners to buy real estate in Mexico; however, it is important to note that interest rates in Mexico currently range around 12%.
Do I need a lawyer to buy real estate in Mexico?
While hiring a lawyer is not strictly necessary, it is advisable to hire one to guide you through the purchasing process and ensure that the property has all legal documents in order. A lawyer can also help you establish the trust (fideicomiso).
Can I buy properties in the coastal zone as a foreigner?
Yes, foreigners can buy properties in the coastal zone of Mexico, but special permits from the Secretariat of Foreign Relations (SRE) are necessary; and the purchase must be made through a trust (fideicomiso). You can learn more about this on our blog.
What are the restrictions for buying properties in the coastal zone?
By law, the “Restricted Zone” includes land within 100 km of the borders and 50 km from the coastline. In these zones, foreigners cannot acquire direct title but can do so through a fideicomiso.
Are real estate buyers in Yucatán mostly foreigners?
No. Real estate buyers in the Yucatán Peninsula are mostly Mexicans. Foreign buyers in the area mainly come from the U.S. and Canada.
Can I sign my contracts in English or a different language?
Private contracts can be drafted in English or another language, but certified translations into Spanish are required for legal purposes. All legal documents and proceedings in Mexico must be in Spanish.
How can I buy a property in the coastal zone as a foreigner?
To buy property in the coastal zone, you must obtain a permit from the SRE and establish a fideicomiso through a notary public.
What is a fideicomiso?
A fideicomiso is a legal structure that allows foreigners to acquire rights over property in the Restricted Zone. It’s a tripartite agreement involving a Mexican bank (trustee), a foreign buyer (beneficiary), and the seller (trustor). The foreigner has full rights to use, sell, or inherit the property, while the bank holds legal title.
How much does a trust cost?
The cost depends on the property’s value and the bank. Expect to pay an opening fee, annual fee, and closing fee. Additionally, you’ll need to pay around MXN 20,000 for the SRE permit.
What documents do I need to buy property in Mexico?
You’ll need your passport, official ID, proof of address, and in some cases, an SRE permit. If you’re a resident (temporary or permanent), you’ll also need your CURP and Fiscal Situation Certificate.
Can I pay in U.S. Dollars or another currency?
Yes, but U.S. Dollars are not legal tender in Mexico. Transactions must be recorded in Mexican Pesos using the exchange rate set by the Bank of Mexico on the transaction date. Currency conversion fees and exchange fluctuations may affect the final amount.
What taxes do I have to pay when buying real estate?
You’ll need to pay the Real Estate Acquisition Tax (ISAI or ISABI) and other fees. For commercial properties, Value Added Tax (IVA) also applies.
Can I rent out my property as a foreigner?
Yes, you can rent it for short or long-term stays. You must register with the SAT and pay taxes on rental income.
Can I sell my property as a foreigner?
Yes. You’ll need to cancel the fideicomiso with the bank and pay capital gains taxes on the sale.
How can I protect my real estate investment in Mexico?
Hire a lawyer who specializes in real estate law in Mexico. They’ll help you validate the documents and ensure the process is done properly. It’s also key to work with a reputable real estate agent.