Property Ownership in Mexico

Whenever I am talking to folks about buying and owning in Mexico, I inevitably get the comment, "I heard foreigners can't own property in Mexico". While this used to be the case, the laws have definately changed.
As foreigners, coastal properties had been off limits until 1974. At that time, the Mexican government made it possible for foreigners to own property in Mexico. They accomplished this with the "Fideicomiso". A Fideicomiso gives you the right to a 50-year title perpetually RENEWABLE BY LAW!

"Fideicomiso", or bank trust, is defined for real estate purposes as a transaction entered into between a Mexican bank and foreign individual or firm investing in areas otherwise restricted to foreign investment, with the bank serving as trustee or legal owner with respect to a certain real property interest and the investor serving as the legal beneficiary of the trust. The bank holds title to the property in trust for the beneficiary who retains the exclusive right to the use and control of the property.
As trustee, the bank acts on behalf of the beneficiary in transactions involving the property held in trust. However, the beneficiary controls and makes investment decision regarding the property, including the decision to transfer, assign or otherwise dispose of this or her interest in the property.

The trust is essentially a contractual arrangement which, in most respects, is identical to the type of trust commonly used in the United States . Trusts are established for initial 50 year periods and can be renewed indefinitely.

There are actually two ways a foreigner can own land near the coast in Mexico. One option is a 50 year automatically renewable bank trust called a Fedeicomiso as dicussed above.. A fedeicomiso is secured by international known title companies, we use Stewart Title Insurance Company.

The other way to own land is through formation of a Mexican Corporation that holds title to the land. You must be doing business in Mexico in order to form a Mexican Corporation. In the scenario, title is fee simple title held by the Mexican Corporation.