For the investors with sharp views and better insights, Mexican real estate boom should have already been in your list for quite some time, which also might be the reason you are here. You are not wrong; Mexico real estate is seeing a significant boom for about half a decade and keeps continuing to grow. It is ideal for buying a property in Mexico with substantial tourism numbers and the conditions favoring freight investment.
Can Foreigners Own Home Properties in Mexico?
Yes, owning a home is made easy, unlike most other tourist countries on the west. Since 1995, any foreigner can buy or lease a home property in Mexico through a direct property deed. If owned under it, the owner gets all the rights to build, modify, rent, and pass it on to their heir as any other hard-owned properties. However, the system is even more changed with most of the people moving towards “fideicomiso.” As most foreigners seem to invest in tourism-rich areas that are either within 30miles of coastline or 60miles from the border, the bank holds the deed of the real estate as a trust agreement, and you still retain all of the rights on the property. The property does not add up to the bank asset and taxes or on you when you buy and sell property on Puerto Vallarta.
Taxes Regarding Land Properties in Mexico
Like a most foreign investment, buying a land property in Mexico triggers tax on both your residing nation and Mexico. Buying or selling Mexican property will inquire 3% – 6% of the transaction tax that you need to pay the Mexican government. Apart from that, around 1% of the property value is charged as property tax for foreigners every year. Sell properties in Mexico, and you will be charged with capital gains taxes in your home country. The tax on income through REITs on Mexico real estate company and rents of directly owned properties stand the same as ordinary incomes.
Can the Government take Your Lands Anytime?
The biggest negative that revolves around investing in Mexico is that “government can take over any land when they require” which is nothing but a myth. There is some truth about it, but that is nothing to bother. The actual thing behind the myth is according to North American free trade agreement from 1994; you cannot decline the government’s order in acquiring the land. However, that too comes with enough compensation on land value with additional interest. That is very since the expansion and regaining stability after the 2008-09 economic setback. Now the government is safe and open for foreign investors.
Hope you were able to imbibe all the data we packed in. Now with all favorable conditions and US dollars reaching all-time high to the Mexican Pesos, it is wise to invest as a homebuyer in Mexico and benefit the high ROIs it offers. However, you can take legal advice from real estate companies like PVR Real Estate. Furthermore, our experts can help you in finance and tax management as well.