Mexico, with its paradisiacal coasts and great real estate potential, attracts every year thousands of foreign investors interested in acquiring properties in destinations such as Cancun, Playa del Carmen, Tulum or Los Cabos. However, few know that the Mexican Constitution establishes restrictions for the direct acquisition of real estate by foreigners in certain areas of the country.
Trust in restricted zone.
What is the restricted zone?
The Restricted Zone includes:
- 100 km along the borders
- 50 km along the beaches
Within this strip, foreigners may not acquire direct ownership of property for residential or commercial purposes, in accordance with Article 27 of the Political Constitution of the United Mexican States.
How does a restricted zone trust work?
The legal solution is a bank trust authorized by the Ministry of Foreign Affairs (SRE), in which:
- A Mexican chartered bank acts as trustee.
- The foreign buyer becomes a trustee, with full rights of use, enjoyment, sale, rent, inheritance or modification of the property.
- The trust has an initial term of 50 years, renewable.
In other words, although the bank is the legal owner of the property, the foreign investor controls and benefits from the property.
What guarantees does this scheme offer?
A properly structured trust guarantees:
- Legal security for the foreign buyer.
- Access to all rights of possession, usufruct and transmission.
- Compliance with Mexican legislation without the need to nationalize or incorporate companies.
- Legal protection in case of death, by allowing the designation of substitute beneficiaries.
Requirements to establish a trust
- Copy of passport and valid immigration document.
- Permit application to the Ministry of Foreign Affairs.
- Contract with an authorized trust bank.
- Public deed before a notary public and registration before the Public Registry of Property.
It is essential to have specialized legal advice, The trust is not a legal entity, since any error in the documentation or in the terms of the contract may compromise the validity of the trust.
What properties apply?
The trust can be used for:
- Houses and apartments in front of the sea.
- Residential lots in coastal areas.
- Real estate investments for commercial or tourism purposes.
At BAC & Cía Abogados...
We have extensive experience in advising foreign investors in the legal acquisition of properties in the Caribbean Zone of Mexico. Our legal team is in charge of:
- Complete trust procedures, from the SRE application to the registration.
- Real estate due diligence to ensure that the property is free of conflicts.
- Review of contracts, inheritance clauses and customized legal structure.
Investing in Mexico as a foreigner is possible, legal and safe when done correctly.
We invite you to contact us.
