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Destinations, FAQ, Real Estate

Key Parties in Buying Mexican Real Estate at the Beach

When non-Mexican nationals buy Mexican real estate at the beach there are four key parties involved in the process in addition to the buyer. Buying Mexican real estate at the beach means that you will be purchasing within the restricted zone that is applicable when the property is within 50 km of the beaches and borders of the country. While it is still totally possible for foreigners to purchase Mexican real estate at the beach within the restricted zone, it requires an extra step, as you will see explained below.

Key parties in Buying Mexican Real Estate at the Beach

● A realtor (optional)
● Buyer’s Attorney (optional)
● Fideicomiso Bank trust (obligatory for foreigners)
● A Notary (obligatory)

A realtor for buying Mexican real estate at the beach

The real estate company offers much needed support and guidance when it comes to finding and buying your home, but also when it comes to the processes, laws, and regulations of real estate in Mexico. Each and every country has it’s own process when it comes to buying property so it never hurts to have the help of experienced and knowledgeable individuals. Nevertheless, using a realtor is not essential and you may well find a property for sale by other means.

Buyer’s attorney

Like using a realtor for buying Mexican real estate at the beach, hiring a buyer’s attorney is not essential, though very reassuring and useful. An attorney will represent and protect you in all legal dealings. In this case they can draw up contracts and reviews the terms and conditions of the sale as well as providing advice. However, only a licensed Mexican attorney should provide such advice as foreign attorneys are not licensed to practice law in Mexico and will not be qualified to provide you with advice on these matters. An attorney may also help you save money as they will be aware of the standard costs and fees and will be able to work to get you the best prices at each stage.

Notary

A Notario Publico (Notary) is a licensed Mexican attorney who has been certified by the state and federal governments to act as an unbiased and official representative for the Mexican government. There is no way that you can purchase Mexican real estate at the beach (or anywhere else in Mexico) without the services of a notary. And that goes for both foreigners and Mexican nationals. Notaries in Mexico have similar duties to those performed by Canadian notaries and have great responsibility (more than a notary would in the US, for example). A Notario Publico has to pass stringent exams and is considered a governmental official; their duties include providing strict security when it comes to original records and documents. They record all documents with the Public Registry of Property, and could be held liable in a court of law if something goes seriously wrong! The role of the notary is so important that any real estate transaction not ratified before one (and duly recorded) is considered invalid and unenforceable! In real estate transactions the notary is equally responsible to the buyer and seller, but ultimately works for and answers to the Mexican Government.

Fideicomiso bank trust

Finally, if you want to buy Mexican real estate at the beach you are going to be buying a property within the restricted zone. This means that you will require a Trustee Bank to act as a fideicomiso (trustee) for you. You can choose any established and qualified bank so long as they are registered in Mexico and have a Trust Department; the bank will ensure that the closing is legal and appropriate and will issue a trust for the real estate for your use alone. The bank cannot transfer ownership, change beneficiary rights, or do anything with the property without your written instruction, too, so you can be sure it is totally legitimate and safe. Better yet, Mexican banks have the protection of the government when it comes to warding off bankruptcy; the trust is guaranteed indirectly by the government.

If you buy property in Mexico you’re likely to deal with these four key parties at some point or another.

by VLEAdminRE,
FAQ, Real Estate

What is a Fideicomiso? – Q&A Real Estate in Puerto Vallarta

What is a Fideicomiso?

A Fideicomiso is the name of a real estate trust in Mexico which enables foreign nationals to own property within the restricted zones in Mexico. The Trustee is a Mexican bank of the individual’s choosing, though the foreign national remains the named beneficiary of the trust. This means that the beneficiary retains all control of the leasing, improvement, assignment, and sale of the property; it’s not a lease, but similar to a Living Trust in the US. Simply put, the property is placed into a trust owned by the individual, but administered by the bank.

Why do I need a Fideicomiso?

If you are intending to buy real estate in Mexico’s “restricted zones,” which includes land around the coasts and borders of Mexico you will need to enter this arrangement. The purpose is to protect Mexican land and prevent the kind of massive land loss that was experienced in the past whilst still allowing for foreign nationals to own land in the restricted areas of the country. This was made an option as an alternative to amending the Mexican Constitution; homes over 62 miles from the coasts and borders can be bought without a Fideicomiso, though some people opt to have one anyway as there are some additional benefits.

Is your trust an asset of the bank?

No. If you have a Fideicomiso the trust is not an asset of your chosen bank. The bank are stewards of the trust, and you and those you designate are the beneficiaries of this trust. This means that, because your trust is not an asset of the bank, it is not exposed or vulnerable to any legal action against the bank.

For how long does the Fideicomiso last?

The trust is initially established for 50 years after which it can be renewed with a simple form and fee. All trusts are set in 50-year increments and the possibility of renewal is guaranteed in perpetuity.

How much does a fideicomiso cost?

At present, it costs around $500 USD per year.

Can the Government take my property?

Not without good reason, fair compensation, and a legal condemnation proceeding, just like any land in Mexico.

Foreigners often worry about their land and property being vulnerable to expropriation by the Mexican Government, but under the North American Free Trade Agreement (NAFTA) Mexico may not directly or indirectly expropriate property except for a public purpose like road building. Fair compensation means the inclusion of accrued interest and market values.

Can I get a fideicomiso for ejido land?

No. Any land dubbed “ejido” is land that only a Mexican National can own legally, and even then only when they meet strict criteria and in certain circumstances. Ejido land is the only land in Mexico without a title and is intended for those Mexicans who work the land.

by VLEAdminRE,
Destinations, FAQ, Real Estate, Residences

Is Living in Mexico Safe for Foreigners?

Although there are isolated incidents of violence that occur, they are almost exclusively related to drug cartels who retaliate against their rivals, most often happening around border towns like Ciudad Juarez where cartels battle for power. The media has sadly and unfairly given Mexico a bad reputation, but huge numbers of expats and retirees who live there know there is another side to this wonderful country. If you are thinking about living in Mexico, here are some tips on how to stay safe:

Make Your Home in a Well-traveled Region

Mexico is home to several coastal areas and cities found all over the country that have drawn large expat communities. Places like Cabo and Puerto Vallarta are particularly appealing to people because they are famously safe and welcoming.

Use Common Sense

Although the unfortunate reality is that drug-related violence can be a problem in certain parts of Mexico, if you are not friendly with anyone in a cartel or buy illegal drugs, it is highly unlikely that you would ever become involved in a dangerous situation. Rather than choosing random victims, cartel members attack their rivals or their families for vengeance, not for the thrill of committing a crime. Keep in mind that no matter where you are in the world, you can never totally safeguard yourself against random crime. In fact, there are many cities worldwide with much higher crime rates than Mexico, including some in the United States. As long as you don’t hang around in certain areas known for danger in big cities or border towns, you should be fine.

Driving Through the Country

Be sure to do some research ahead of time if you have decided to drive across the border from the United States. Only cross the border during the day and pick a border area known for its safety. After you have crossed into Mexico, driving in daylight hours and stopping before dark is highly recommended. One more safety tactic is to choose toll roads which should filter out most, if not all, undesirable roadmates.

Ensure Your Safety

If you want to take it one step further, you can even look for a home within a gated community or hire your own personal 24 hour security. You will enjoy peace of mind whether you are home or away knowing that your home is being looked after.

Head south of the border and move to Mexico, where you can live safely and have a great time doing it!

Recommended article: Why Mexico Tops the List for Happiness

by VLEAdminRE,
Destinations, FAQ, Fractional Vacation Ownership, Full Ownership, Real Estate, Residences

Is it possible to Purchase Real Estate Legally in Mexico?

You might have heard that there is no way for a foreign national to legally purchase real estate within Mexico. This is largely due to the constitutional limitations put upon the ownership of land and real estate by foreign nationals within 50 km (31 miles) of the coast and 100km (62 miles) of the international borders. Nonetheless, it is more than possible to purchase real estate legally in Mexico as a foreign national; you simply need to have the land held in trust through a fideicomiso. Thankfully, this process is very simple and straightforward since there are plenty of top Mexican banks willing to get involved these days.

Fideicomisos and Bank Trust Institutions

If you wish to purchase real estate in the restricted zones around Mexico (such as in Puerto Vallarta, Riviera Nayarit or Cabo) you will need to establish a fideicomiso, or trust deed, through a bank. The bank will then act as a trustee on your behalf; they will manage and oversee the trust in question, but you will retain all of the rights of ownership to the property in question. This means that you will be able to occupy, rent, transfer, sell, or bequeath in a will the property. The requirement to have a fideicomiso in place for property around the coasts and borders of Mexico does not, however, make it illegal for foreign nationals to own land or property in these area.

Renewable Bank Trusts

The initial life of a fideicomiso bank trust is fifty years, and at the end of this term the trust can be renewed for another fifty years, and so on in perpetuity. If you choose to sell your property at a later date to another foreign national the fideicomiso can be transferred, or cancelled so that they can set up their own, and if you sell to a Mexican national the fideicomiso can be terminated.

Appointing Beneficiaries

When you purchase land through a fideicomiso in Mexico you will be required to appoint substitute beneficiaries when the trust is finalized so that if the worst should happen and you pass on before the fifty year lifespan of the fideicomiso, your heirs will be given all ownership rights to the property. This means that your heirs will not need to follow any probate proceedings with the Mexican courts, thereby saving them time, money, and stress in already stressful times.

If you wish to know more about the legality of buying real estate as a foreign national in Mexico, contact us on 1 877 499 1901 or 1 866 843 7005.

Related article: Are Foreigners Allowed to Purchase Real Estate in Mexico?

by VLEAdminRE,
FAQ, Fractional Vacation Ownership, Full Ownership, Residences, Riviera Nayarit

Interesting Facts about Banderas Bay

Banderas Bay is one of the most stunning and desirable vacation spots in Mexico, and there is no doubt that Puerto Vallarta and Riviera Nayarit provides the best base from which to sample all the delights of this region. If you read on you’ll find out some really interesting facts about Banderas Bay with which to impress your friends when you get together again.

Los Muertos Beach

Los Muertos beach is one of the most beloved beaches around Banderas Bay, but many people are a little put off when they realise that the name translates, literally, to The Beach of the Dead. Legend has it that, centuries ago, locals fought off a pirate raid on this beach, and did so with such ferocity that many pirates died on the sands. If you talk to locals in the bars they’ll happily tell you about how many skeletons were found when the first hotels were being built on the beach! Nonetheless, any party you have here is sure to be lively so don’t give Los Muertos the swerve!

Banderas Bay

Banderas Bay is the biggest bay in Mexico, but it’s also one of the deepest and largest bays in the world as a whole! Sitting at over 900 meters it is practically fathomless, and at 42 kilometres wide it is in amongst the 10 largest in the world. The name Banderas, too, has significance as it is based on the Spanish word for flag! It is said that the Spanish Conquistadores, upon arrival, faced 20,000 armed natives with feathered flags, ready to defend their territory!

Las Peñas

The town of Puerto Vallarta, that sites at the heart of Banderas Bay, used to be called Las Peñas, in the 1800s, but was renamed after state governor Ignacio Vallarta in the 1900s.

Source of Income

Today, Puerto Vallarta’s 9 billion peso economy is based most upon tourism and the service industry, but before it became such a hotspot the town was a fishing centre. In those days the main source of revenue for Puerto Vallarta was the export of Corn, Coconuts, Beans, and Bananas to the USA (and, of course, feeding the local market).

The Movie Industry

Many famous faces have graced the shores of Banderas Bay for business and pleasure, and Puerto Vallarta, arguably, became what it is today because of one special movie. The Night of the Iguana, starring Richard Burton, put Puerto Vallarta on the map and the romance of Burton and Elizabeth Taylor made it infamous! This is, arguably, why so many big budget films (like 2011’s Limitless) have been filmed here since. These sands have seen the likes of Robert De Niro and Arnold Schwarzenegger!

Population

In the 1880s Puerto Vallarta had a population of around 1,500 people; today there are over 300, 000 inhabitants in Puerto Vallarta. The population boom was sudden and exponential. In the last 20 years the population has grown by a staggering average of 7.5% each year!

Mariachi Music

If you’ve been to Mexico before you’ll know that this is a culture which loves to party, and mariachi music is a key part of this! The state of Jalisco, where you can find Banderas Bay and Puerto Vallarta, is the epicentre of mariachi and in Puerto Vallarta alone you will find dozens of talented groups. There’s even a kids mariachi band in the city!

Recommended article: Top Tips for Finding the Best Real Estate in Puerto Vallarta and Riviera Nayarit

by VLEAdminRE,
Destinations, FAQ, Real Estate, Residences

Life in Mexico Compared with USA

It’s becoming more and more common for residents of the USA to consider a move to the sunnier climes of their closest southern neighbour, Mexico! If you are one such American you will no doubt have done plenty of research into your chosen towns, and you may even have vacationed across Mexico before. If you want to have an idea of the lifestyle you’re buying into you’ll need to think like a local. Here are some things you might not realize about the life in Mexico:

Slower Pace of Life

Everything seems to be done at a much slower, more relaxed pace in Mexico, and for some people this is a true blessing. Retirees, in particular, love this, and if you’re seeking to get away from the harried pace of life that some of the bigger cities in the USA offer you’ll definitely love it.

Punctuality

With the exception of work and medical appointments, punctuality is somewhat less of a priority for many in Mexico. If you’re meeting for dinner at 7 you can reasonably expect that some members of your group will not show up until 8:00, or even later! Likewise, if a handyman is coming to fix something the same mentality will apply; if you’re planning construction work be prepared for it to outlive the quoted time. No disrespect is meant, it’s simply the way life goes here. If this is really going to stress you we suggest that you plan for it by showing up later yourself, or even just accept that it will happen and pack a book.

Priorities of the life in Mexico

Some people are very surprised to find that the average working week for most Mexicans is actually 6 days long! That’s right – the average person in Mexico has only one day off each week. To those of us who are used to a longer weekend this may seem like cruel and unusual punishment, but in fact most Mexicans don’t let it get in the way. Downtime is precious here, so when people aren’t working they pack their social lives full with family feasts, social gatherings, and adventures. You may be required to work more hours when you move to Mexico, but you won’t be expected to take your work home or be a slave to your job; your social life will no doubt thrive!

Transportation

This one is especially key for drivers; be prepared for a culture shock when you begin driving in Mexico! Transport laws are not heavily enforced, so drivers, especially experienced drivers, tend to make up their own rules. From passing anyone, anywhere to driving the wrong way down a one-way street, Mexico can be a wild ride. Just stay alert, use common sense, and pass with caution, and you should be fine.

Public transport isn’t much less exciting, either, and in fact it may be more so! The buses in Mexico let all kinds of characters on board from beggars and street performers to animals (though this is at the discretion of the bus driver). In cities public transport can get very crowded at peak times, too, so be prepared for some jostling. You’ll get used to it pretty quickly, but be ready for the culture shock and please, please don’t forget your seat belt!

Keep this in mind and you should settle into life in Mexico without too much trouble.

Related articles: 

Mexican Benefits for Foreigners Over 60

Checklist for Relocating to Mexico

by VLEAdminRE,
Destinations, FAQ, Full Ownership, Real Estate

More Flights to Mexico

Great news for people who are looking to purchase real estate in Mexico, the Air Transport Agreement announced at the end of 2016 shows that the aviation markets are opening up even further between the USA and Mexico, starting in August 2017. In response, a number of airline companies have taken advantage of this agreement, announcing new flights to and from Mexico.

Interjet Flights from USA to Mexico City

Firstly, one of Mexico’s most popular budget airlines, Interjet, announced added flights from Chicago, Los Angeles and Las Vegas to Mexico City. Interjet is Mexico’s second largest airline.

Interjet Flights from USA to Puerto Vallarta

Interjet has also indicated that it will add new routes from Los Angeles to Puerto Vallarta, which is already a popular flight from the USA to the leading tourist town on the Pacific Coast of Mexico.

Volaris Flights from USA to Mexico City

Another of Mexico’s popular budget airlines, Volaris has also started services from Houston to Mexico City.

Southwest Airlines Flights from USA to Puerto Vallarta, Cancun, Los Cabos

Southwest Airlines will be offering flights from Los Angeles to Cancun, Los Cabos and Puerto Vallarta, with flights pending approval from Oakland, California to Puerto Vallarta and Los Cabos.

American Airlines Flights from USA to Puerto Vallarta, Cancun and Merida

American Airlines has announced new services from Los Angeles to Cancun and Puerto Vallarta as well as services between Miami and Merida.

Delta Airlines Flights from USA to Cancun and Los Cabos

Delta will be running new daily services from New York to Cancun and from Los Angeles to Los Cabos, as well as flights on Saturdays from Kansas City to Cancun.

by VLEAdminRE,
Villa La Estancia Residences Nayarit - One Bedroom Suite
FAQ, Real Estate, Residences, Riviera Nayarit

What is a property manager?

You might have heard of property managers before, but there’s a chance you might not know exactly what it is they do. A property manager has many different responsibilities, but at the most basic level they are a third party who handle the day to day responsibilities of your real estate investment when you are not able to do so yourself. A property manager manages many different types of properties from small apartments to large complexes or family homes, and their specific responsibilities will depend on the salary you are willing to pay and the contract that you agree together.

Here are some of the services that a property manager can provide you with:

Responsible for Rent

If you are planning to rent out your property on a short or long term basis, you may require the services of a property manager. Property managers can be responsible for the setting of the initial rent level, adjusting it where necessary and even for collecting it, should the need arise.

  • Setting Rent – A good property managers knows how to set the rent at the right level to attract tenants while still making you a little profit. They will have an understanding of how your property compares to others in the area.

  • Collecting Rent – Property managers can play the role of collector, too, by ensuring that your rent is collected on the correct date each month and by enforcing late fees strictly.

  • Adjusting Rent – Making sure your rent is competitive is one of the key roles of a property manager and, as such , they can increase it by a set amount each year (according to state / municipal laws) or decrease it when necessary.

    • Responsible for Tenants

    One of the main responsibilities of any property manager is to manage your tenants. This means finding tenants, dealing with any complaints and even initiating evictions if needed.

  • Finding Tenants – Property managers are responsible for marketing the property to fill vacancies as well as making sure the apartment is as attractive as possible to tenants. They’ll know how and where to advertise for the best results.

  • Screening Tenants – A good property manager will be able to sort through prospective tenants to ensure that you get one that is a good fit for your property. Experienced property managers will have seen hundreds of tenants in their career and, as such, will be able to weed out the bad ones quickly.

  • Handling Leases – They can set the length of the lease and make sure that it has all the necessary provisions needed to protect the owner. This can include determining the security deposit required from the tenant.

  • Handling Complaints/Emergencies – Property managers are paid to deal with any complaints, maintenance requests, and have the necessary contacts and acumen to handle emergencies.

  • Handling Move Outs – When a tenant moves out your property manager will be responsible for checking it over to make sure that it has not suffered any damage during the tenant’s stay. They can determine how much, if any, of the security deposit should be withheld or returned.

  • Dealing With Evictions – If a tenant breaches the agreement or does not pay rent your property manager will know the proper way in which to file and proceed with an eviction (if you deem it necessary).

    • Responsible for Maintenance and Repairs

    Property managers can also be responsible for the physical condition of your property by keeping up regular maintenance and ensuring repairs are complete quickly.

  • Maintenance – Maintenance aims to keep current tenants happy and attract new tenants. They can take charge of preventative maintenance in your property in order to make sure it is performing at the top of its game. If given the right authority they can hire someone to deal with leaks, deal with exterminations, do landscaping or regularly remove trash.

  • Repairs – When there’s an issue your property manager will either attend to it themselves or hire someone who can. A property manager worth their salt will have a network of plumbers, electricians and contractors that they trust.

    • Responsible for Supervising

  • Other Employees – The property manager can set their salaries and even fire them. If you have other employees, such as a concierge or security, then your property managers will be responsible for making sure they’re doing their jobs properly.

  • Vacant Properties – A property manager can also be hired to look after vacant properties to make sure that there has been no vandalism and perform basic maintenance to keep it ready for tenants.
    • by VLEAdminRE,
    FAQ, Real Estate, Riviera Nayarit

    Can Foreigners Buy Real Estate in Mexico?

    Foreigners can easily buy real estate in Mexico, and many people from the United States, Canada and Europe have done so without any problems. There are certain restrictions that apply, which can be simply resolved but which should be taken into consideration so there are no surprises.

    Restricted Zone for Foreigners Buying Real Estate in Mexico

    The ‘restricted zone’ in Mexico for foreigners buying real estate is designated up to 62 miles from the borders and up to 31 miles from the coast. What this means is that foreigners are not allowed to hold the direct titles to land and property in these areas. So how do foreigners buy real estate in Mexico’s beach destinations? Well, that is where Mexico’s “fideicomiso” comes in to save the day. Essential the fideicomiso is a bank trust that holds the title of the land on your behalf in order to comply with constitutional restrictions.

    Background to Fideicomiso

    Since 1917, in response to the Mexican Revolution when the Mexican Constitution stated that all foreigners were prohibited from holding any ‘fee simple’ titles on property located in the restricted zones, it has not been possible for foreigners to buy property without a fideicomiso. In an attempt to avoid scams in the 1970s where foreigners would have to “borrow the names” of Mexican nationals to open their businesses, Mexico’s Foreign Investment Laws began allowing corporations to own the titles on properties in the restricted zones, but titles for residential properties were still restricted.

    Nowadays, Mexican banks support a law that now lets foreigners own and enjoy any property in the restricted zones legally. Foreigners can purchase the property without just being an investor under a fideicomiso trust.

    How does fideicomiso work?

    The Mexican fideicomiso will permit non-citizens of Mexico to purchase real estate in the restricted zone if they allow the bank to be the trust holder of the property. The Mexican banks would be the Fiduciary of the property or the trustee. The trustee will take the title of the property and hold it to meet all laws governed by the constitution in Mexico. The trustee is not allowed to sell the property, because you are still the owner. You are the beneficiary of the property, and you hold all rights to the property. The bank and trustee just holds the title of the property, so everything is legal.

    There is a fee that you will pay to the Fiduciary Bank for the trustee contract, which is usually somewhere in the region of $500 USD per year and you may also be responsible for any maintenance fees and land taxes. As the beneficiary of the property, you own all rights to the property in the restricted zones, and you can sell the property anytime, remodel, and even rent out the property. The Fiduciary Bank has to follow Mexico’s laws, and they cannot sell the property unless they have written consent by you, the beneficiary and owner.

    How useful was this article? Do you have any questions or doubts?

    Please leave your question in the comments box.

    by VLEAdminRE,
    FAQ

    FAQ: Can I sell my Villa La Estancia Residence share in the future?

    Yes, you may resell your fractional shares or full ownership at Villa La Estancia Residences just like any general real estate sale.

    The residences you buy at Villa La Estancia Residences are fully deeded for both full and fractional ownership. When purchasing fractional shares, you will receive the deeds for your fraction, which you can sell at a later stage, if you should so wish.

    Typically, resale shares are listed with a local real estate broker, who will promote the sale of your share the same way they promote any other property for sale. You may also sell your Villa La Estancia share privately by advertising in publications, newspapers or on the Internet at free real estate listing sites. You set the price and are in control of the sale, just like any other property sale.

    Just like any real estate investment, you can also leave your property in a will, rent it, sell it or simply enjoy it!

    by VLEAdminRE,