The Mexican Real Estate Market is really booming; especially Baja California Sur, in and near La Paz, Todos Santos and Loreto; Playa del Carmen, Puerto Vallarta and other areas. The reason for this is because there is a limited amount of affordable and attractive beachfront left in the US, leaving folks who are looking for their own place in the sun without opportunities.
Opportunities also extend to some non-beachfront properties, f.e. in towns where there is a shortage of in-town, long-term rental properties such as in Puerto Vallarta. It’s not just the sunshine that lures people but the recreational activities, such as diving, kayaking, boating, wildlife, scenery, etc. and proximity to the U.S. and Canada .
With rising health care costs and a rapidly rising cost of living in the US and Canada and with real estate prices leveling of dropping off, many investors and retirees are looking to Mexico for a better investment and affordable way to continue or improve their lifestyle. Baby boomers and investors in the United States and Canada are looking for their second home or retirement home in Mexico. Most areas can be easily reached with many airlines competing for business.
Investors and retirees should be excited because it is still affordable. There is a lot you need to know about hot to buy real estate down there. It’s a bit like the wild west and you have to be careful who you are working with down there. The person advertising and listing a property might not be the right person to work with. I think there are great opportunities for appreciating property down there but as with any investment, do your due diligence and research; and work with professionals who know what they are doing and who will represent your best interest.
Brooks & Heinze Team
Remax NW Realtors
300 NE 97th St
Seattle, WA 98115
206.528.4471
www.propertysalesmexico.com
Wednesday, May 7, 2008
Friday, March 7, 2008
Ejito land or ejidal property: Bargain or not?
Ejito land or ejidal property: what is it? is it a bargain? what you need to know before you buy!
Ejito land - what is it?:
The state has ownership of these lands. The state grants usage rights to peasants, or farmers, who have the right to use the land, to live on the land and grow their crops. The rights of usage pass from father to son, but ejidal properties cannot be sold as private property.
Ejidal land can be converted to private property through a process called procede. This is a lengthy process that may take as much as five years to accomplish.
How is ejido land converted to private property?
Following are the required steps:
- Resolution within the ejido. A two-thirds majority must decide to convert parcel lands to
private property. This does not pertain to human settlement or communal property, also a part
of ejidal land. This pertains only to the individual parcels.
- Mapping, allowing for streets, gardens, other donated lands, human settlements and
communal lands.
- Allotment of a parcel to each ejiditario (farmer).
- Application to Agrarian Reform, Mexico City.
- Approval by the Agrarian Reform.
- Transfer of parcels to the individual ejiditarios.
- After this process is completed and registered with the Agrarian Reform, the ejiditario who wishes to sell to an outsider must first notify other family members, those who have worked the property for more than one year, then other ejiditarios in the group, neighbors, and the ejidal government before completing a sale to the outsider. These parties have the right of first refusal and notifications must be made following a specific procedure.
- Only after all correct notifications have been made does the ejiditario receive a deed and can then transfer in fee simple to third parties, nationals or foreigners.
A word of caution then:
If the price of the property seems too good to be true, it probably is and it may be because someone is trying to sell you ejito land that has not been converted to private property. Buyer beware! Make sure you are working with professionals who can help you with determining if a seller can legally transfer fee simple private ownership to you or not.
This blog entry would not have been possible without the extensive knowledge of Linda Neil at the Settlement Company in LaPaz, Mexico who greatly contributed to my understanding of what ejidal property is and how it is converted to private property.
Kerstin G. Brooks, ABR, Realtor
Brooks & Heinze Team
Remax NW Realtors
Cell: 206.276.5827
Email: kerstinbrooks@earthlink.net
Web: http://www.propertysalesmexico.com/
Ejito land - what is it?:
The state has ownership of these lands. The state grants usage rights to peasants, or farmers, who have the right to use the land, to live on the land and grow their crops. The rights of usage pass from father to son, but ejidal properties cannot be sold as private property.
Ejidal land can be converted to private property through a process called procede. This is a lengthy process that may take as much as five years to accomplish.
How is ejido land converted to private property?
Following are the required steps:
- Resolution within the ejido. A two-thirds majority must decide to convert parcel lands to
private property. This does not pertain to human settlement or communal property, also a part
of ejidal land. This pertains only to the individual parcels.
- Mapping, allowing for streets, gardens, other donated lands, human settlements and
communal lands.
- Allotment of a parcel to each ejiditario (farmer).
- Application to Agrarian Reform, Mexico City.
- Approval by the Agrarian Reform.
- Transfer of parcels to the individual ejiditarios.
- After this process is completed and registered with the Agrarian Reform, the ejiditario who wishes to sell to an outsider must first notify other family members, those who have worked the property for more than one year, then other ejiditarios in the group, neighbors, and the ejidal government before completing a sale to the outsider. These parties have the right of first refusal and notifications must be made following a specific procedure.
- Only after all correct notifications have been made does the ejiditario receive a deed and can then transfer in fee simple to third parties, nationals or foreigners.
A word of caution then:
If the price of the property seems too good to be true, it probably is and it may be because someone is trying to sell you ejito land that has not been converted to private property. Buyer beware! Make sure you are working with professionals who can help you with determining if a seller can legally transfer fee simple private ownership to you or not.
This blog entry would not have been possible without the extensive knowledge of Linda Neil at the Settlement Company in LaPaz, Mexico who greatly contributed to my understanding of what ejidal property is and how it is converted to private property.
Kerstin G. Brooks, ABR, Realtor
Brooks & Heinze Team
Remax NW Realtors
Cell: 206.276.5827
Email: kerstinbrooks@earthlink.net
Web: http://www.propertysalesmexico.com/
Friday, February 15, 2008
Puerto Vallarta, Mexico - How to buy property in Puerto Vallarta
So, you have decided to buy property in Puerto Vallarta, México because you have just returned from a visit to this paradise but you have no idea how to invest or buy safely and profitably in this beautiful foreign land.
There is a lot to learn and consider before committing yourself to a purchase because buying in Mexico is different from buying in the U.S. Law, finance, taxation, title, etc. are all handled a little differently than you are used to.
We like to focus our local Seattle blog and our Mexico blog on education more so than sales. So, today's entry might seem a little more self-serving but we are actually quite excited to offer potential buyers a great opportunity to attend an educational event in Puerto Vallarta, as well as exposure to six terrific developments.
Together with a developer in Puerto Vallarta we are adverting a three-day-discovery-seminar that will educate you on the process of buying in Mexico and also give you an opportunity to purchase property. The emphasis will be on education but if you are ready to buy, there will be great choices for you to chose from.
These educational events in Puerto Vallarta are hosted monthly. You are responsible for airfare and approximately $200/person fee. Your accomodations are provided, as well as several meals. You may extend your stay at an additional fee. It's really a great value at a very reasonable cost.
To find out more or to register, please contact us at 206.276.5827 or at info@propertysalesmexico.com .
Not ready to get on a plane to Puerto Vallarta to learn more about how to buy in Mexico? No problem, we also offer monthly presentations in Seattle where you will learn the basics. Click here to register for the Seattle Seminar.
Kerstin G. Brooks, ABR, Realtor
Brooks & Heinze Team
Re/max NW Realtors
http://www.propertysalesmexico.com/
There is a lot to learn and consider before committing yourself to a purchase because buying in Mexico is different from buying in the U.S. Law, finance, taxation, title, etc. are all handled a little differently than you are used to.
We like to focus our local Seattle blog and our Mexico blog on education more so than sales. So, today's entry might seem a little more self-serving but we are actually quite excited to offer potential buyers a great opportunity to attend an educational event in Puerto Vallarta, as well as exposure to six terrific developments.
Together with a developer in Puerto Vallarta we are adverting a three-day-discovery-seminar that will educate you on the process of buying in Mexico and also give you an opportunity to purchase property. The emphasis will be on education but if you are ready to buy, there will be great choices for you to chose from.
These educational events in Puerto Vallarta are hosted monthly. You are responsible for airfare and approximately $200/person fee. Your accomodations are provided, as well as several meals. You may extend your stay at an additional fee. It's really a great value at a very reasonable cost.
To find out more or to register, please contact us at 206.276.5827 or at info@propertysalesmexico.com .
Not ready to get on a plane to Puerto Vallarta to learn more about how to buy in Mexico? No problem, we also offer monthly presentations in Seattle where you will learn the basics. Click here to register for the Seattle Seminar.
Kerstin G. Brooks, ABR, Realtor
Brooks & Heinze Team
Re/max NW Realtors
http://www.propertysalesmexico.com/
Thursday, January 10, 2008
Investing in the Baja - especially Baja California Sur
The market in the Baja is really exploding right now. Especially Baja California Sur, in and near La Paz, Todos Santos and Loreto. The reason for this is because there is a limited amount of affordable beachfront left in southern California, leaving folks who are looking for their own place in the sun without opportunities.
It’s not just the sunshine that lures people but the recreational activities, such as diving, kayaking, boating, wildlife, scenery, etc and proximity to the U.S. and Canada.
Baby boomers and investors in the United States and Canada... (especially from the West Coast, like Washington, Oregon, California and British Columbia) are looking for their second home or retirement home in the Baja California Sur area. The area can be easily reached with many airlines offering daily flights, such as Alaska Airlines.
Investors and retirees should be excited because it is still affordable. There is a lot you need to know about hot to buy real estate down there. It’s a bit like the wild west and you have to be careful who you are working with down there. The person advertising and listing a property might not be the right person to work with. I think there are great opportunities for appreciating property down there but as with any investment, do your due diligence and research; and work with professionals who know what they are doing and who will represent your best interest.
For more information on properties in the Baja California Sur area, please contact us at 206.276.5827 or at kerstinbrooks@earthlink.net
Kerstin G. Brooks, Brooks & Heinze Team
Remax NW Realtors
www.propertysalesmexico.com
It’s not just the sunshine that lures people but the recreational activities, such as diving, kayaking, boating, wildlife, scenery, etc and proximity to the U.S. and Canada.
Baby boomers and investors in the United States and Canada... (especially from the West Coast, like Washington, Oregon, California and British Columbia) are looking for their second home or retirement home in the Baja California Sur area. The area can be easily reached with many airlines offering daily flights, such as Alaska Airlines.
Investors and retirees should be excited because it is still affordable. There is a lot you need to know about hot to buy real estate down there. It’s a bit like the wild west and you have to be careful who you are working with down there. The person advertising and listing a property might not be the right person to work with. I think there are great opportunities for appreciating property down there but as with any investment, do your due diligence and research; and work with professionals who know what they are doing and who will represent your best interest.
For more information on properties in the Baja California Sur area, please contact us at 206.276.5827 or at kerstinbrooks@earthlink.net
Kerstin G. Brooks, Brooks & Heinze Team
Remax NW Realtors
www.propertysalesmexico.com
Tuesday, January 8, 2008
Real Estate Acquisition in Mexico
The following is a reposted article written by John M. Vernon, Esq. and was published by the CIPS Network of the National Association of REALTORS®
In representing U.S. clients in the acquisition of real estate to Mexico, a common question I am asked is whether Americans can own real estate in Mexico. Generally speaking, the laws of Mexico regarding the purchase of real property are similar to those of the U.S. For example, Mexican law recognizes real estate mortgages and various types of security interests in personal property.
In addition, in most real estate transactions, Mexican banks can act as escrow agents or trustees. However, there are a number of differences as well. Often, when Americans participate in their first real estate purchase in Mexico, they are surprised to learn that title insurance is not widely available.
Foreign purchasers should take steps to ensure they have full title insurance.1 Also, there is no widespread use of purchase and sale agreements as such documents are understood in the U.S. In the U.S., we are accustomed to an escrow period, a closing date subject to certain conditions precedent, the transfer of title, and the payment of the previously negotiated purchase price.
The Role of NotariesIn Mexico, notary publics play a critical role in the closing of real property transactions that is vastly different from their role in similar transactions in the U.S. Also, the tax implications of real estate transactions are much different than in the U.S. and non-Mexican individuals are restricted from holding “fee simple title” to real estate property in a defined area known as the Restricted Zone (Zona Restringida) along the coasts and borders.
Finally, as a result of the above factors, Mexican title to real property is often held and transferred through the use of trusts. The transfer of title to real property in Mexico is regulated by both the Civil Code and by the Commercial Code. In the U.S., the parties normally execute a purchase and sale agreement and a warranty deed evidencing the fact that title to the real property has been granted.In Mexico, the purchase and sale agreement is the deed and no other document exists evidencing title to the real property. Title to the property is transferred automatically upon the execution of the purchase and sale contract. Once executed, the transfer document is recorded in the Public Registry of Property where the real estate is located. Most real estate transactions in Mexico involving the transfer of real property require the notarization of the executed purchase and sale agreement.
Notary publics in Mexico are attorneys licensed by the local authorities to practice as notaries. They have a unique role in the conveyancing of real estate and the authentication of documents in Mexico. They are considered legal experts in real estate. Their primary function is to grant “public faith” that what they notarize is true and correct. They certify the identity of the person signing the documents, the veracity of the signatures, as well as the contents of the documents being signed.
In Mexico, unlike in the U.S., notaries must calculate the taxes due and owing, income tax, value added tax and public registry fees. Also, they are given the duty of withholding taxes from the purchase price to pay the appropriate taxing authority. Notarized deeds which effectuate the conveyance of title to Mexican real estate usually include a narrative whereby the notary public describes all relevant information relating to the transfer of the real estate, such as any existing real estate liens, property descriptions, taxes owing and any encumbrances. The notaries’ duties also include the certification of all contents of the purchase and sale agreement, taxes to be paid, any special terms and conditions of transfer, and an appendix of all exhibits prior to recordation in the Public Registry.
Foreign Equity Participation. Acquisitions of real property by foreigners or by Mexican legal entities with foreign equity participation are regulated by the Mexican Foreign Investment Law. Mexican nationals may acquire real property anywhere in Mexico. Mexican legal entities with foreign equity participation may freely acquire real property anywhere outside of the Restricted Zone. Article 27 of the Mexican Constitution defines the Restricted Zone as land that is located in a path 100 kilometers wide along Mexico’s borders and 50 kilometers wide along the Mexican coasts. Within the Restricted Zone, such legal entities may acquire real property intended for non-residential use, as long as the acquired property is registered with the Mexican Foreign Affairs Ministry.
It is important to remember that registration with the Mexican Foreign Affairs Ministry must be completed before the purchaser obtains legal title to the real property in question. Foreign natural persons or legal entities acquiring interests in real property in Mexico's Restricted Zone may only acquire their interests through a trust.
In Mexico, a trust is a contract that has as a trustee a Mexican bank; a trustor who places the property in trust; and a beneficiary for whom the trust is intended to benefit. For acquisition of real estate like hotels or restaurants in the Restricted Zone, a trust is often used by foreign purchasers to acquire title to the beneficiary interest created by the trust.
Title to real property is actually vested in the trustee and the purchaser holds title to the beneficiary rights, not the real property. Title to real property is “indirectly” transferred to the beneficiary immediately upon execution of the agreement. Mexico holds many opportunities for acquisitions and expansion but you must be very careful when entering a new market for the first time.
The Brooks & Heinze Team can assist you with your real estate needs in La Paz, Loreto, Los Cabos, Puerto Vallarta and Merida (Mexico). For more information please contact us at 206.276.5827 or log on to http://www.propertysalesmexico.com/ .
In representing U.S. clients in the acquisition of real estate to Mexico, a common question I am asked is whether Americans can own real estate in Mexico. Generally speaking, the laws of Mexico regarding the purchase of real property are similar to those of the U.S. For example, Mexican law recognizes real estate mortgages and various types of security interests in personal property.
In addition, in most real estate transactions, Mexican banks can act as escrow agents or trustees. However, there are a number of differences as well. Often, when Americans participate in their first real estate purchase in Mexico, they are surprised to learn that title insurance is not widely available.
Foreign purchasers should take steps to ensure they have full title insurance.1 Also, there is no widespread use of purchase and sale agreements as such documents are understood in the U.S. In the U.S., we are accustomed to an escrow period, a closing date subject to certain conditions precedent, the transfer of title, and the payment of the previously negotiated purchase price.
The Role of NotariesIn Mexico, notary publics play a critical role in the closing of real property transactions that is vastly different from their role in similar transactions in the U.S. Also, the tax implications of real estate transactions are much different than in the U.S. and non-Mexican individuals are restricted from holding “fee simple title” to real estate property in a defined area known as the Restricted Zone (Zona Restringida) along the coasts and borders.
Finally, as a result of the above factors, Mexican title to real property is often held and transferred through the use of trusts. The transfer of title to real property in Mexico is regulated by both the Civil Code and by the Commercial Code. In the U.S., the parties normally execute a purchase and sale agreement and a warranty deed evidencing the fact that title to the real property has been granted.In Mexico, the purchase and sale agreement is the deed and no other document exists evidencing title to the real property. Title to the property is transferred automatically upon the execution of the purchase and sale contract. Once executed, the transfer document is recorded in the Public Registry of Property where the real estate is located. Most real estate transactions in Mexico involving the transfer of real property require the notarization of the executed purchase and sale agreement.
Notary publics in Mexico are attorneys licensed by the local authorities to practice as notaries. They have a unique role in the conveyancing of real estate and the authentication of documents in Mexico. They are considered legal experts in real estate. Their primary function is to grant “public faith” that what they notarize is true and correct. They certify the identity of the person signing the documents, the veracity of the signatures, as well as the contents of the documents being signed.
In Mexico, unlike in the U.S., notaries must calculate the taxes due and owing, income tax, value added tax and public registry fees. Also, they are given the duty of withholding taxes from the purchase price to pay the appropriate taxing authority. Notarized deeds which effectuate the conveyance of title to Mexican real estate usually include a narrative whereby the notary public describes all relevant information relating to the transfer of the real estate, such as any existing real estate liens, property descriptions, taxes owing and any encumbrances. The notaries’ duties also include the certification of all contents of the purchase and sale agreement, taxes to be paid, any special terms and conditions of transfer, and an appendix of all exhibits prior to recordation in the Public Registry.
Foreign Equity Participation. Acquisitions of real property by foreigners or by Mexican legal entities with foreign equity participation are regulated by the Mexican Foreign Investment Law. Mexican nationals may acquire real property anywhere in Mexico. Mexican legal entities with foreign equity participation may freely acquire real property anywhere outside of the Restricted Zone. Article 27 of the Mexican Constitution defines the Restricted Zone as land that is located in a path 100 kilometers wide along Mexico’s borders and 50 kilometers wide along the Mexican coasts. Within the Restricted Zone, such legal entities may acquire real property intended for non-residential use, as long as the acquired property is registered with the Mexican Foreign Affairs Ministry.
It is important to remember that registration with the Mexican Foreign Affairs Ministry must be completed before the purchaser obtains legal title to the real property in question. Foreign natural persons or legal entities acquiring interests in real property in Mexico's Restricted Zone may only acquire their interests through a trust.
In Mexico, a trust is a contract that has as a trustee a Mexican bank; a trustor who places the property in trust; and a beneficiary for whom the trust is intended to benefit. For acquisition of real estate like hotels or restaurants in the Restricted Zone, a trust is often used by foreign purchasers to acquire title to the beneficiary interest created by the trust.
Title to real property is actually vested in the trustee and the purchaser holds title to the beneficiary rights, not the real property. Title to real property is “indirectly” transferred to the beneficiary immediately upon execution of the agreement. Mexico holds many opportunities for acquisitions and expansion but you must be very careful when entering a new market for the first time.
The Brooks & Heinze Team can assist you with your real estate needs in La Paz, Loreto, Los Cabos, Puerto Vallarta and Merida (Mexico). For more information please contact us at 206.276.5827 or log on to http://www.propertysalesmexico.com/ .
Wednesday, January 2, 2008
Buying Property in Mexico
Are you thinking of Buying Property in Mexico? Are you looking to retire in Mexico or purchasing a second home/condo in Mexico?
You may be wondering if Americans can buy property in Mexico and how safe is it to buy in Mexico.
The process for foreigners to buy property in Mexico is different than for locals, foreigners can enjoy all the rights of ownership when buying in Mexico. In the early 1990s, with significant changes in Mexican law and with the introduction of North American Free Trade Agreement (NAFTA), safely owning property in Mexico along the coast became a reality. Today, more than 1.5 million Americans own property in Mexico.
However, it is still important to work with qualified professionals to protect your interests. Together with our trusted partners on site, we can make sure that you obtain ownership rights by setting up a bank trust, similar to a U.S. family trust (known as a fideicomiso). Technically, you are the beneficiary. As such, you are allowed to use, lease, sell, will, improve or encumber your property. A new trust is established for 50 years and is renewable.
To learn more about purchasing property in La Paz, Los Cabos, Loreto, Puerto Vallarta, and Merida contact us.
Brooks & Heinze Team
Remax NW Realtors
Web: www.propertysalesmexico.com
Email: kerstinbrooks@earthlink.net
You may be wondering if Americans can buy property in Mexico and how safe is it to buy in Mexico.
The process for foreigners to buy property in Mexico is different than for locals, foreigners can enjoy all the rights of ownership when buying in Mexico. In the early 1990s, with significant changes in Mexican law and with the introduction of North American Free Trade Agreement (NAFTA), safely owning property in Mexico along the coast became a reality. Today, more than 1.5 million Americans own property in Mexico.
However, it is still important to work with qualified professionals to protect your interests. Together with our trusted partners on site, we can make sure that you obtain ownership rights by setting up a bank trust, similar to a U.S. family trust (known as a fideicomiso). Technically, you are the beneficiary. As such, you are allowed to use, lease, sell, will, improve or encumber your property. A new trust is established for 50 years and is renewable.
To learn more about purchasing property in La Paz, Los Cabos, Loreto, Puerto Vallarta, and Merida contact us.
Brooks & Heinze Team
Remax NW Realtors
Web: www.propertysalesmexico.com
Email: kerstinbrooks@earthlink.net
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