Owning Property in Mexico - the legal process

Beginning When the property is located inside the restricted zone, which is within 62 miles of a border or within 31 miles of the coast, there are special considerations.

A 100% foreign-owned Mexican company may directly acquire property within this zone to perform non-residential activities such as industrial, commercial or tourism endeavors.

If the property is for residential purposes, it must be held in a bank trust, or fideicomiso. Only banking institutions authorized and regulated under Mexican banking laws can serve as trustees, with the main concern of the trustee being the management of the such property for the benefit of the owners.

The foreign owner of the real estate acquires the rights of full use and economic benefit that accompany equity ownership of the property, and is the beneficiary of the trust. They can treat the property as if it were owned with a fee simple title, which means they retain use and control of the trust, and make the investment decisions with respect to the property, i.e. sell it, rent it, build on it, or live on it.

The trust is established initially for 50 year periods and can be renewed indefinitely for additional 50 year periods. Foreign owners, as beneficiaries of the trust may at any time transfer their interests to any person and keep the profits from the sale of the property subject to applicable taxes. In addition, these beneficiary trust interests may be passed to future generations without the burden of inheritance taxes.