Buying Real Estate in Mexico
Since 1973 foreigners (non-Mexicans) have been able to purchase coastal and border properties through a trust deed known as a “Fideicomiso”. The Mexican banks act as a trustee on behalf of the foreigner purchaser and the purchaser holds all rights of ownership. For foreign citizens, purchasing an owning real estate in Mexico has never been safer or more viable than it is today.
Cash offers on property are still the most common purchase contract but the recent entrance of General Electric into the mortgage market for USA buyers is increasing purchasing power. We hope Canadian buyers will be eligible in the near future. In addition, First American Title Company and Stewart Title will insure title and hold monies in escrow which makes purchasing a home in Mexico an even more secure process.
Analysts predict a continuing trend in foreign investment in Mexico and the large number of retirees wants a warm weather home further supports continued market interest and expansion. Indeed twice as many foreigners own property in Puerto Vallarta as Cabo and Cancun combined. Puerto Vallarta is clearly positioned as an ideal place for those considering a second home in Mexico with great weather, a fine international airport, medical services and friendly people who often speak English if you don’t speak Spanish.
Closing costs to the buyer tend to be roughly 2 to 4 times higher in Mexico than they are in the U.S. or Canada, averaging 4 to 7 percent of the purchase price. Notaries are the official agents that record and close all real estate transactions to be registered in the Public Registry office. It will be part of the buyer’s closing expense. To date, there are no home inspection agencies or home warranty policies available in Mexico. Other types of insurance, including property, liability, damage and earthquake, are all readily available, at low cost, and policies can be written to pay claims in U.S. dollars.
Real estate taxes tend to be very, very low. Known as the “Predial”, the tax is calculated as a percentage of the assessed value determined at the time of sale, paid bi-monthly or yearly (in advance). If you pay for the whole year in advance, before February 15th, you get a 12.5% discount). It offsets closing costs and fees at purchase nicely.
In Mexico real estate agents are not subject to any certification or educational requirements. Coldwell Banker La Costa does. We are a founding member of a voluntary professional association in Mexico called A.M.PI. Coldwell Banker La Costa cooperates with other professional realtors in Mexico to represent buyers interested in property listings not just ours at CB La Costa. Visit: www.cblacosta,.com for more information and other listings.
Office Phone: (322) 223-0055 Fax 223-0025 In Canada and USA precede w/ 011+ 52 .
Zoli Hargitai, Sales Associate. USA: 1-949-544-1773 zoli@cblacosta.com
