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 Mexican Real Estate
Mexican Law
Article 27 of the Mexican Constitution bars foreigners from buying real estate in what is called the “restricted zone” (sixty one miles from the international border and thirty one miles from the seacoast). However, foreigners can own real estate in the restricted zone by means of a Fideicomiso.
A Fideicomiso is essentially a trust agreement by which a bank takes legal title to the real estate for the benefit of a foreign buyer. It is not a lease, but expires in 50 years after which it can be renewed. The buyer, as the beneficiary of the trust, has a contractual right under the trust agreement with the Mexican bank to all of the usual benefits of ownership, including the benefits of use or sale of that property.
Do your Due Dilligence
As with any real estate transaction, you should research well the state of title of any particular property you intend to purchase. This usually means not only asking all the right questions, e.g., are there co-owners, easements, or is this an ejido property, but also asking a Mexican attorney to give an opinion of title. (Ejido properties are public lands to be expropriated for agricultural cooperatives and there are restrictions and limits on the sale of ejido land.)
In Mexico, the use of escrows and title companies has not been customary, although some American title insurance companies are now very actively involved in providing title insurance for many properties in Mexico that are purchased by Americans and if you are considering purchasing real estate, you should strongly consider using an escrow service and getting title insurance. In any case, one should get legal advice regarding Mexican real estate only from a qualified real estate attorney licensed to practice law in Mexico.
Note: Sin Fronteras Realty offers real estate brokerage services only and does not provide legal or tax advice. Buyers and sellers of real estate in Mexico should consult local qualified and licensed professionals for these services. Please also read the regulatory disclosures that follow below.
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Title Insurance
 Although title insurance is still not that common, you will find at least two major American title insurance companies, Stewart Title Insurance and First American Title Insurance companies,  are now very active in Mexico and issuing policies of title insurance on Mexican real estate.
Real Estate Contracts
Depending upon the circumstances, there can be several contracts involved in a real estate transaction:
- Offer and acceptance (oferta)
- Promissory agreement (contrato de promesa)
- Real Estate Trust Agreement (contrato de fideicomiso)
- Purchase-sales agreement (contrato de compraventa)
- Purchase-sales agreement with reservation of title (contrato de compraventa con reserva de dominio)
- Assignment of real estate trust rights (contrato de cesion de derechos fideicomisarios)
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In all cases, the final contract to purchase real estate must be formalized before a Mexican Notario Publico.
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The Mexican Notario Publico
The Mexican Notario Publico is different from a US notary. A Mexican Notario is an attorney who is commissioned by the Mexican government as a public notary holding office for life and fulfilling certain public functions.
The Notario is neutral and represents neither side in a real estate transaction. The Notario makes sure that all the necessary steps are taken including collecting and reviewing the sale contract, property taxes and certain duties pertaining to title of the property. There is no recourse against a Notario in case a mistake is made so it is wise to hire a Mexican attorney and/or obtain title insurance to protect your interests. See the Resources and Links section for websites with related information.
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