Buying property in Mexico has never been easier or offered better return on investment, making right now an ideal time to fulfill lifelong dreams of owning a vacation home close to the best beaches in the world. Investors from around the world are permitted to legally buy property in Mexico, and foreigners also get full protection under the law when it comes to Mexico real estate transactions.
Here are five tips for buying property in Mexico as a foreigner to help you understand the process:
Tip 1: Residency Requirements & Property Ownership
Since you don’t have to be a resident in Mexico to own property here, there is no need to immigrate or even qualify for resident status in order to invest in real estate. Still, it’s important to note that the Mexican Constitution does have certain requirements that apply to foreigners who own land inside the “restricted zone,” which includes property that lies within 64 miles of an international border and within 32 miles of the coast. For properties located within the restricted zone, foreign buyers must simply use a bank trust known as a fideicomiso, wherein the bank acts as a trustee by holding the deed for the purchaser, who retains all legal rights of ownership. As with all other real estate transactions in Mexico, those involving properties held in a fideicomiso are governed by federal law.
Tip 2: Finding a Mexico Real Estate Investment Advisor
It’s always a good idea to work with a trusted real estate investment advisor who can help you find the best turnkey vacation rentals, luxury condos and/or standalone villas to suit your unique circumstances. One of the best ways to find a reputable realtor in Mexico is to see what other property owners have to say about their experiences, so be sure to ask for referrals. Using an experienced real estate investment advisor will make the entire process go smoothly and can also give the buyer access to investment properties that are not yet publicly listed and therefore offer incredible value.
Tip 3. Choosing the Right Property
Finding a great investment property in a fantastic location is just as important as understanding the rules of buying and working with an experienced real estate agent. Look for luxury condos designed to function as turnkey vacation rentals in top destinations if you want to avoid maintenance headaches, collect ongoing investment income and obtain great return on investment. Right now the Riviera Maya real estate market offers better value than comparable vacation hotspots worldwide, with vacation home rentals beating the stock market and providing annual returns of 8-14 percent.
Tip 4: Consider Buying with an IRA Account
It’s no secret that most Mexico real estate is bought and sold in cash transactions, but not all would-be investors have access to that kind of cash just laying around in a money market fund. Fortunately, it’s perfectly legal to buy real estate with IRA accounts, provided you follow the Self-Directed IRA rules laid out by the IRS. The benefits of this type of real estate investing include the ability to collect tax-deferred income and give your financial portfolio a hedge against inflation, as well protecting your hard-earned assets from ongoing stock market volatility.
Do you have other questions about Mexico real estate investment? Post them in the comments!
Click the link to download our free guide Buying Safely in Mexico and learn more about smart real estate investment in one of the world’s top destinations!