Tuesday, June 25, 2024

How To Buy Property Within The Restricted Zone In Mexico

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Canadians, Americans and Europeans can legally buy and own properties in Mexico enjoying full titles over them. If you are looking forward to invest in Mexican properties located in restricted zones, here is how you must go about it. The term ‘Restricted Zone’ refers to all the land located within 100 kms of the national border and within 50 kms from the ocean line.

A foreigner looking forward to property for sale in Mexico in the restricted zone must buy it either through a Mexican corporation or through a bank trust (fideicomiso). Therefore, investing in Mexican properties has become easier than ever for foreigners and this process has helped attract a lot of foreign investments.

Property buying through the Fideicomiso (bank trust)
Fideicomiso has been created by the Mexican government to facilitate foreign investments in desirable areas, particularly in the regions adjacent to the coastline. It is simple to understand what isFideicomiso and how to buy property through Fideicomiso.

A real estate, Trust, Fideicomiso is held with a Mexican bank that you might choose, Santander or HSBC for example.

The objective of Fideicomiso is to permit foreigners invest in prime properties located withing the restricted zone of Mexico.

In this deal, the bank functions as the Trustee.

This one functions like a Living Trust in the US and you have the complete control over the trust.

Fideicomiso gives the buyers the complete control over the property including selling leasing, renting mortgaging or improving upon.

The Fideicomisofunctions as the steward of the trust. The trust is considered as the property of the beneficiary and the bank can never use it in any way.

The tenure of the trust is for 50 years and it can be renewed for 50 more years anytime with the necessary costs paid.

The government guarantees every trust indirectly.

Property buying by setting up a Mexican Corporation
While property buying in Mexico popularly happens through Fideicomiso, it is also possible to set up a corporation if this route meets your needs. Especially if you want to use the property for commercial reasons, it is advisable to buy it through a corporation. It is also possible to use the property in summer and rent it out or lease it during the other seasons. Buyers looking forward to invest in multiple properties are also seen choosing this method. Here is how you can set up a corporation in Mexico.

Corporations are of two types in Mexico real estate namely LLC (limited Liability Corporation) and the LLP (Limited Liability Partnership).

Only foreigners can set up and mange Mexican corporations. No corporation investor can be a Mexican.

A corporation in Mexico enjoys the legal capability to buy Mexican properties even in the restricted zone.

Foreign owned Mexican corporations concerned with real estate dealings in Mexico have several advantages.

Take away
Due to several alluring reasons, Mexican real estate has become one of the most preferred destinations for foreign investments. While looking for property for sale in Mexico, do some good research and find great options that will meet your requirements and expectations.

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