Foreign Ownership of Property in Mexico: 2023 Guide for US Citizens & Foreigners
Mexico is a popular destination for US citizens looking to invest in property, whether it be for vacation or retirement purposes. However, many foreign investors wonder if they can legally own property in Mexico. In this blog post, we'll explore the questions like: "Can foreigners buy property in Mexico ?", "Can a US citizen own property in Mexico?", “How to buy property in Mexico as a US citizen” and provide a guide for US citizens looking to invest in Mexican real estate.
2023 Legal Requirements for Foreign Property Ownership in Mexico
Under Mexican law, foreigners as well as the US citizens can own property in Mexico with certain restrictions. The Mexican Constitution prohibits foreigners from directly owning property within 50 kilometers of the coastline or 100 kilometers of any international border, known as the "restricted zone". However, foreigners can still own property in these areas by setting up a fideicomiso, or trust, through a Mexican bank. The fideicomiso allows the foreign owner to control the property while the bank holds legal title to the property.
Taxes and Fees for Foreign Property Ownership in Mexico
When buying property in Mexico as a foreigner, there are taxes and fees to consider. These include a value-added tax (VAT) of 16% on the sale price of the property, as well as a transfer tax of 2-3%. In addition, there may be other closing costs and fees associated with setting up the fideicomiso and maintaining it over time.
Financing Options for Foreign Property Ownership in Mexico
Financing a property purchase in Mexico can be more difficult for foreigners than in the United States. However, some US banks and international lenders may offer financing for Mexican property purchases. It's also possible to obtain a mortgage through a Mexican bank, although the process can be more complicated for non-residents.
Conclusion
Buying property in Mexico as a foreigner, like a US citizen, is possible with some restrictions and legal requirements. By setting up a fideicomiso Mexico and working with a reputable real estate agent like Plano, US citizens can own property in Mexico and enjoy all the benefits of ownership.
However, it's important to understand the taxes and fees associated with property ownership in Mexico and to consider financing options carefully. With the right research and preparation, if you are seeking is buying property in Mexico as a good investment then we must say buying property in Mexico can be a smart and profitable investment for US citizens. At Plano, we can provide guidance on the legal and financial aspects of buying property in Mexico as a foreigner.
