Your home’s interior design has the potential to inspire and lift you every day, and when you’re creating your dwelling spaces in Mexico, it makes sense to take inspiration from the natural habitats that surround you, as well as the local environment, and regional culture.

Interior design for your house in Mexico

Daniela Bahena is a professional interior designer with degrees in architecture and interior design. She brings her knowledge and expertise in these disciplines to interior home decoration projects, combining beautiful aesthetics with in-depth awareness about construction, use of materials, and appropriate approaches and techniques for the surrounding environment.

She’s passionate about creating interior spaces that transform a house into a home, blending her clients’ priorities and lifestyles with the warmth and charm of authentic Mexican design.

Daniela helps you to define the intention and purpose of each space you want to transform. Her design approach focuses on harmony and balance to create functional spaces you’ll enjoy and feel well inside, every day.

By applying her background in architecture and interior design, Daniela offers solid advice that considers your house build, the local surroundings, and climates through the seasons; selecting appropriate materials and including design elements that are aesthetic and durable.

Daniela’s experience and support help you avoid making material mistakes and falling into common pitfalls by providing a structured approach to your home’s interior design.

Benefits of working with an interior designer

When you’re making plans for the transformation of the interior spaces in your Mexican home, working with a professional designer offers key benefits, including:

• Taking command of your interior design project, guided and facilitated by an experienced professional who composes a detailed schema with step-by-step support to help you through each stage of the design and implementation.
• Carefully structured consultations that help you to define your intentions, give your project a clear direction, and enable you to visualize the look & feel of your home spaces.
• Have a design schema created for your individual situation and that meets your lifestyle and functional requirements, and that matches your budget.
• You’ll also save time and obtain value for your budget with a reference list of suppliers in Mexico that sell the materials and elements needed to realize your design project—included in the final schema.
• Whether you intend to undertake the interior design work yourself (DIY), hire local professionals to help, or a combination of these, having a carefully thought out plan and defined schema will help you to make the most of your budget and avoid material mistakes that can cost considerable time and money to put right.

Most people begin their search for property online, and a cursory glance at the main property portals suggests that there are ~100,000 residential properties for rent in Mexico right now.

Searching the market for a rental property

With plenty of inventory to choose from, securing a rental should in theory be straightforward; but when you begin a search in earnest, you’ll discover the practicalities of securing an adequate rental home in an appropriate locale will present challenges and force you to make compromises.

A search for property in Mexico normally begins online. Realty agents and word-of-mouth are two other popular ways to find a home here. When you begin to search, you’ll find that while there’s lots of inventory, the quality and/or situation surrounding many homes offered for rental is not ideal.

Searching for Mexico home rentals online

Classified ads for property have proliferated in recent years through online sites that specialize in this market. The most popular sites to search properties and connect with owners or the agents representing them are Vivanuncios, InMuebles24, MetrosCubicos and Homie.  These sites also help you to get an indication of rental prices in a given locale, which is helpful when you come to negotiate the rent.

Finding home rentals through local realty agents

Realty agents operate in every town and city and some can help you find a rental home in Mexico.  Some agents are professionally established, others work informally and/or part-time.  Agents’ fees emanate entirely from landlords paying them a commission; tenants do not pay any fees directly to the agent.  The realty agents only earn a small fraction from property rentals in comparison to what they earn from property sales, and homes for rent are often represented by multiple agents all vying for a limited pool of potential renters. Experienced agents often won’t deal with rentals unless they sense that the people renting might eventually become buyers in the same locale.

Finding a rental by local word-of-mouth

If you’re already in Mexico, or have a friends or family network here, you might be able to find a rental by word-of-mouth. These can often work out to be the best arrangements as people renting decent houses prefer to have them rented through a personal referral.  You usually end-up dealing directly with the landlord, who might or might not draw-up a formal contract.  If you deal direct, we suggest you get agreements in writing, whether those are formal or informal, to avoid misunderstandings later.

Short term rental options in Mexico

If you’re searching for something short-term on the ‘turn-key’ basis, perhaps while you search for a long term rental, consider renting a serviced apartment, which are available for rent in Mexico’s larger towns and cities.

Serviced apartment rentals in Mexico

These are ideal for short visits, or when you need a ‘turnkey’ furnishing arrangement that includes phone and internet connections with self-catering facilities to avoid the higher cost of hotels and eating out every day.  The rent usually includes all utilities and the services of a cleaner/housekeeper once a week.

There are lots of different companies offering serviced apartments.  To find companies specializing in serviced apartments, go online and search for ‘serviced apartments in [location name]’ depending on where in Mexico you want to stay.

Room rentals in private homes

Another option for short-term rentals is to rent a room or annex in someone’s home, or a serviced bungalow.  People renting rooms or other spaces (e.g. annexes, or bungalows) in their homes in Mexico advertise these on Airbnb, as well as Homestay and Tripping.

These accommodations are intended for shorter periods and can be useful when you need a place to stay to scout longer term options in Mexico with accommodation that is less expensive than a hotel or serviced apartment—and potentially more personable, too: the homeowner renting the room might also have local contacts who can help you find a longer term rental in Mexico, if that is your intention.

Housing types available for rent in Mexico

The selection of property types available depends where in Mexico you’re seeking a rental.  The most common types of rental properties are apartments, condos, and houses on their own land within a residential neighborhood.

Apartments and condos

In Spanish, these are called departamentos and condominios. These are the two most common type of property for rent; some condos are classed as ‘condominios horizontales’ which are single or two-story homes joined together at the sides instead of being stacked.  Condos and apartment blocks may also be part of gated communities.

Houses and family homes

Casas. These are usually family homes situated on their own plot of land, usually within a residential area or defined neighborhood of the town or city.  They might face a public road; or they may be part of a fraccionamiento, that is a gated community; or be inside a cerrada or privada, that is a gated or private road.

Countryside properties

Some locations offer specialist or unusual homes, usually away from urbanized centers, although close enough to a significantly-sized town or city for access to services and amenities.  Typically, these offer:

• rustic casitas, in essence, a rudimentary country cottage;
• bungalows, that can be on their own property, on a shared property with other bungalows, or shared within the grounds of a larger home; and
• country houses, that can range in size from 1-2 bedrooms, to larger estates with at least 3 or 4 bedrooms (and possibly more), ample reception areas (which may also include features like terraces and roof gardens) as well as extensive well-tended gardens; they might also have their own swimming pool.

Some countryside properties may be situated near or on a golf course, or overlook a lake or the ocean; others may be situated in quiet neighborhoods of a small village or town.  These countryside property types are more often found tucked away in a rural idyll, a short (or long) drive away from the nearest town or city.

Rental costs in Mexico

Rents vary depending on the house type, location, seasonal demand, as well as other factors.  Mexico has a range of property portals that list properties for rent (and purchase) in Mexico.

These are the principal sites to check when you’re scouting for a property and to gauge rental prices:

Physical state of rental houses in Mexico

Mexico’s house rental market is diverse and the physical state of the property will vary tremendously—along with the fixtures, fittings, and other features of the home.

Condos and apartments offer modern convenience

Most people rent contemporary apartments and condos as these are the most convenient and well-appointed homes on the market: usually of recent build, they include a range of modern amenities, their fixtures and fittings are in good shape, and security and maintenance are taken care of when they are part of a gated community. (Note that gated community fees may or may not be included in the rent; you should check this to avoid surprises.)

Older properties with more character

If you’re seeking something less ‘boxy’ and more charismatic, you’ll find that older homes in traditional Mexican neighborhoods (perhaps rented by families who no longer occupy them) can offer charm but can also exhibit dilapidation with fixtures and fittings that are old, dated, and which may not be in full working order.

Property owners don’t tend to reinvest very much of the rent in these types of older properties, and are seldom willing to spend money on significant upgrades (they might simply not have the capital).

If you’re interested in the charms of a charismatic property that has dilapidations and is being offered for rent, you might ask if they are willing to invest in renovating key rooms of the house, or you might try offering a lower rent in lieu of dilapidated conditions, perhaps on the basis that you’ll undertake some minor repairs or some improvements to make it more comfortable for your stay.

Things to watch for when considering older properties include:

• State of the electricity supply.  Old homes may have old electricity wiring and old breaker boxes: these can cause issues especially during the rain season when electricity supplies can fluctuate and older electrical installations might not protect your appliances.
• Kitchens and bathrooms: Some older homes or rustic casitas, even relatively expensive ones in desirable locations, may have old or makeshift kitchens (some ‘kitchens’ will have a basic sink and little else); and bathrooms may be old and outdated—functional but might exhibit drainage and other issues.
• Roof tiles and roof sealant: Most homes in Mexico have flat roofs with tiles on top, or have the concrete roof sealed to prevent water seeping through during heavy rainstorms.  Check the state of the roofing when you visit the property and if it looks worn or weathered, ask questions about when it was last sealed, or when the tiles were cleaned/cleared of mold, moss and debris.
• Corrugated roofing: Some roofing and side awnings (for example, for laundry areas) present on older properties are created using corrugated roofing: metal or fiberglass are popular; roofing in very old properties might be asbestos.  Take note that corrugated roofing is very noisy during heavy rain storms that are prevalent in many regions across Mexico between May and October.

Luxury home rental market in Mexico

Luxury homes, and brand-new properties being rented for first-occupier use are available in many locations and will usually be presented in excellent shape, but the rents for these are considerably higher.

These homes offer comfort, convenience, modern amenities, and some offer a ‘turn key’ solution with furnishings and other homewares in place, ready for you to move in and live with a minimum effort.

Some luxury rentals also offer ‘all inclusive’ utilities (often with exception of electricity that is charged extra), although in these cases the utilities are managed on your behalf, so there’s no need for you to call the telephone and other utility companies to arrange and manage your service supply, as this is taken care of for you.

If you are on a limited budget, you might consider the advantages of renting a less expensive house that you can spend some money ‘making comfortable’ for yourself, and that will work out less expensive if you intend to rent longer term.

Services and utilities available at the house

Check to see what services and utilities are available at the house you intend to rent before you pay a deposit or sign a contract.

Electricity and gas supply

Virtually all homes for rent in Mexico, except those in very rural or secluded areas, will have electricity and most will have a natural gas tank to heat water and for cooking.

Check the source of water supply

Water supply will depend on where the property is situated: in urban areas this will usually be via mains water feed; in outlying and rural areas this might be from a local well, or you might have to take water deliveries from a truck—check this with the agent or landlord before you agree to rent. Drainage will either be via mains sewerage in urban areas, or a self-regulating septic tank system in rural areas.

Telephone and internet services

Internet services are widely available in urban areas but cross-check this if the house is situated in a (semi)rural area, or in a new or recently developed area.  If there are no telephone or cable lines available, wireless home internet service might be available.

Gardens, maintenance, and security in a rental home

When you take on a rental house in Mexico, you’ll need to consider how you will take care of the property to ensure your deposit is returned.

Large gardens offer attractive outdoor spaces which are ideal in Mexico’s agreeable climates, although they do require time, effort or money (to pay a gardener) to look after. Reasonable wear-and-tear is accepted in the home, but you’ll have to make-good any damages, plug-holes in walls and cover marks when you leave.

If the rental property is not situated inside a gated community, you may need to take extra measures to defend against burglary.

Download and read our free eBook about home maintenance and security for details.

Renting a house with pets in Mexico

If you have pets, particularly dogs, your choice of available rental properties will be more limited in Mexico. Many property owners here explicitly forbid pets on the property as part of the rental contract, usually due to potential damage pets may cause as well as the issue of having to clean the property afterwards.

If the property you intend to rent is a house on its own with a garden, there is a higher likelihood that pets will be accepted.  Homes inside gated communities and condo buildings tend to be the most restrictive. (Often the restrictions are due to covenants associated with the building itself; for example, pets may be banned from certain condos.)

If you have one cat, you might be able to persuade an owner who otherwise does not allow pets to let you rent. In any event, if pets are allowed, you might be asked to pay additional damage and cleaning deposits when you move in.

If you are using the services of a real estate agent to find a rental property, then be up-front about having pets from the start to prevent you both from wasting time  scouting for and reviewing properties that will not allow pets.

Dealing with house-related issues while renting

Appliances included in the rent may fail, fixtures and fittings may break, and events like electrical storms, hurricanes and earthquakes can cause significant issues to arise that you’ll need to deal with.

If the home you are renting requires some improvement or repair and you want to do this yourself, the landlord might negotiate to have specific work undertaken in lieu of rent —in Spanish this is termed as ‘a cuenta de renta’— and we suggest you get any agreement for proposed works in writing before committing to the expense.

For more serious issues caused by floods, storm damage, or earthquakes, you’ll need to deal with the landlord on a per-case basis.  In the event of a force majeure, the landlord will need to make-good any structural matters, but your personal goods are your own responsibility.

Home insurance for renters

You can protect your own personal furnishings and items for loss caused by burglary, storms, and earthquakes by purchasing a renter’s home insurance coverage—these are less expensive as they only cover the tenant’s belongings, not the structure of the property.

End of rental term, checking-out, and deposits

Review your contract to determine when you need to start renegotiating the rental agreement, the rent to be paid, and any notice you need to give to the landlord before you vacate the property.

Provided that the house is returned in the good order —allowing for domestic wear-and-tear— your deposit should be returned to you. Some agents provide an ‘escrow’ service between the landlord and tenant in regard to rental deposits; but this is not very common in Mexico and your deposit is often paid directly to the landlord on trust of its return. Some landlords will accept the last month(s) of rent in lieu of the deposit they hold.

Renting versus buying in Mexico

We recommend that people moving to Mexico rent first before buying—unless you have good prior knowledge and experience of the area and feel confident that you want to live there.

Some people come to Mexico and rent a home for many years through a long-term and stable contract. However, rental contracts are often subject to unforeseen termination: two common reasons include a family member needing use of the property, or the owner or family deciding to sell it.

Renting almost always requires compromises to be made

Whatever rental home you find in Mexico, it’s unlikely to deliver everything you want; and any improvements you make will remain with the house when you leave—whether or not the landlord paid for them in lieu of rent.  If you’re in Mexico for the long-haul, you’ll need to buy a home here to get the property you really want, benefit from any improvements you make to it, and have the peace of mind to know that a landlord’s whim or personal circumstances won’t force you to move.

Learn more about property rentals in Mexico

We publish extensive local knowledge about real estate and property rental to help you find a suitable home for rent in Mexico:

• Finding suitable accommodations for your lifestyle in Mexico
• Finding and managing your property rental in Mexico
• Latest articles about property rental in Mexico

Policy wording for Mexican property insurance

Property insurance policies sold in Mexico differ from policies you are used to seeing in your home country. The policy wording is unique, and the types of coverage offered by insurance companies is different here, so some things that you would expect to be included as standard, might not be present if you purchase your insurance in Mexico directly from a Mexican insurer.

Familiar policies, fully underwritten in Mexico

To help foreign residents who own property in Mexico to purchase insurance products familiar to them, specialist companies based in the U.S. have developed property ownership insurance policies which reflect the wording, terms and covers included on US and Canadian policies.

The insurance policy is fully underwritten by a Mexican insurance company (by law, it has to be this way), but the U.S. companies work in partnership to create a product that is familiar to those purchasing insurance in the US and Canada, and which is legally sound under Mexican law.  The premiums are paid in US dollars and any pay-outs are also paid in US dollars.

Policies to suit your situation and needs

The home insurance policies available in the market offer a wide range of options, and you can choose what to include and what to exclude as part of your coverage plan.

Depending on where your home is situated in Mexico, the risks (and coverage) you need to insure against will vary. For example, homes near the coast should be insured against hurricane damage and earthquakes, whereas inland only cover for earthquakes (and perhaps flooding, if you home is situated near water) will be needed.

Home insurance policies cover a wide range of eventualities and the most common coverages include reimbursement of costs related to:

• Damage caused by hurricanes and earthquakes
• Damage caused by and wind storms and floods
• Injuries to housekeepers and other workers in your home
• Burglaries and vandalism
• Damages to third parties, e.g. falling trees
• Coverages for owner-specific liabilities, e.g. in condos

You can cover all risks or named perils

Policy options and choices include all risks versus named perils, whether to cover assets like outbuildings surrounding the main property, and the option to insure your personal goods.

• The better policies will include coverages for third party liability: this is  helpful in the event that someone who does not live at your home meets with an accident on your property, or where some damage is caused to a neighbor, e.g. by a falling tree.
• This article about third party liability in relation to your home shares more details.
• Other considerations to take into account when you’re assessing your insurance needs include purchasing cover for any watercraft you may own, as well as special arrangements for condos, where some liabilities are shared and some are owner-specific.

Regardless of the type of insurance you choose, the insurer underwriting the policy is far more important than the broker or agent selling you the product: in the event of a claim, the integrity of the underwriter will determine pay-outs, not the insurance broker.

Learn more about caring for and insuring your home in Mexico

Mexperience publishes extensive information to help you plan and care for your home life in Mexico through guides, articles and free eBooks:

• Free eBook: House maintenance and home security
• Latest articles about property insurance
• Articles about real estate in Mexico

Get your property transaction independently examined

An independent examination of your sales contract and transactional procedures provides cross-checks as you navigate your way through a property purchase or sale in Mexico.

Linda Neil and her team at The Settlement Company® are experienced real estate professionals who can:

• Explain the procedures, legal matters, and tax rules to you in detail, independently of parties who have a vested interest in the transaction.
• Examine the details of your property purchase/sale contract to ensure that it does not contain clauses that may cause adverse effects and/or create undue risks.
• Ensure that the fees you are being asked to pay for professional services are reasonable, and that the tax calculations are aligned with current tax rules.
• Offer you a direct line for independent verification of matters which arise that you are unsure about as you make your way through the property transaction.
• Act as liaison between you, your real estate agent (if you are using one) and other professionals—for example, the Notary Public or local attorney situated in the State where the transaction is taking place.

Benefits of hiring an independent professional

Personalized service: This independent consulting service is formed around your individual needs. Furthermore, you can order practical support through the procedures to ensure professionalism and integrity in your transaction.

Overcome language issues: Property purchase/sale contracts are often written in Spanish and the seller’s deed is written in Spanish—by law. The legal terminology and clauses can be obscure or confusing. This service will help you to understand what you are committing to within the context of the sales/purchase contract. Linda and her team will explain what you are committing to in terms of Mexican law.

Oversee your investment: Hiring an independent assessor can protect your investment through an examination of the proposed transaction. This can help to ensure that agreements are realistic and are able to be fulfilled, legally.

Avoid pitfalls and hidden costs.  The costs of dealing with improper procedures or adverse contract terms after a property deal is closed can be substantial. An independent review and examination of your property deal prior to signing or payments being made can help you avoid to the costs and inconvenience of dealing with problems afterwards.

How the support service works

Linda and her team at The Settlement Company® provide an initial consultation, and can offer you a package of support services as you make your way through a property transaction in Mexico.  These services include:

• An initial consultation to talk about your situation and the proposed transaction.
• A review and examination of your sale/purchase contract and the Seller’s deed.
• Explain what you are committing to contractually, with highlights of any clauses that may be unusual or risky, as well as remarks about matters which you might want to consider renegotiating before you sign.
• An independent assessment of the professional fees, transaction fees, and property taxes you should be paying—whether you are the buyer or the seller.
• Advice and information about what structures need to be in place to ensure the property closes efficiently for tax purposes: when you are buying, ensuring that the contract and title are properly documented; when you are selling, how to claim current tax allowances on capital gains.

Service Fee: For the initial consultation and review with a written report, the fee is US$560.

The fee includes the support service as described above and will also include an estimate to supervise the entire transaction including Foreign Relations permits, appraisals, escrow fees, bank trustee fees, (if applicable) no liens and property tax certificates and full registration in the state where the property is registered—which are optional additional services you can purchase if you want or need these.  Fees are billed directly by The Settlement Company® who accept payments in the US, or in Mexico.

Comprehensive guide to real estate in Mexico for buyers, owners, sellers and renters—continually revised and updated.

Extensive and detailed guide to real estate in Mexico

Our comprehensive guides to real estate in Mexico introduce you to essential information about property in Mexico whether you are:

• Renting property in Mexico;
• Buying a home in Mexico;
• An owner who needs to insure and maintain the property;
• An owner who plans to rent a property in Mexico;
• Selling your home in Mexico; and
• Working with Real Estate Agents in Mexico.

Property rental in Mexico

We publish detailed guides about all aspects of property in Mexico, including renting residential property here.

Property purchase in Mexico

Connect to detailed and exhaustive guides about buying and owning property in Mexico.

Owning and maintaining a property in Mexico

Browse detailed information that helps existing property owners manage, maintain, and insure their property in Mexico.

Insurance for your home in Mexico

Helpful guides and insights to help you consider how to get the right level of coverage for your home and property in Mexico, including coverage against third party liability damages.

Selling your home in Mexico

When you come to sell your residential property in Mexico, our guides and articles give you practical insights to help you prepare, market and sell your property.

Working with realty agents in Mexico

Insights and tips for finding and working with a local realty agent in Mexico, whether you are renting, buying or selling a property.

Learn more about real estate in Mexico

We continually update our guides and articles about matters related to property and real estate in Mexico.  Connect to further resources for insights and connections:

• Latest insights about real estate in Mexico
• Latest insights about renting property in Mexico
• Tips and insights about insurance for your Mexican home
• Latest insights about realty agents and agencies
• Connect to professionals who can help with property closings

This article describes the principal ways in which homes for sale are typically marketed in Mexico.

Using a realty agent to market and sell your home

Most sellers will enlist the services of a real estate agent to help them sell their home—either on an exclusive or non-exclusive basis.

The better realty agents in Mexico are expert at ‘networking,’ and you ideally want to find one that has been operating for a considerable time, knows the local market, and has an extensive network of relevant contacts. Some agencies are affiliated with agencies outside of Mexico and might market your home to foreigners seeking property here using these affiliate networks.

How will the agent market your property?

Ask the agent how they intend to market your property before you sign-up with them.  These are the types of services good agents will offer sellers:

• Visiting your home to take professional photos and video of your property for use on your listing.  Some agents will use a drone to take aerial footage of the property as well.
• Adding a professional and attractive listing to their own website with a full and accurate description of the property.  The listing ought to be published and read well in Spanish and English to maximize the potential pool of buyers.
• Using their social media and other contact networks to promote your listing and get your property seen by as many potential buyers as possible.
• Promoting your property to the list of potential buyers they are working with.
• Adding your property as a listing on Mexico’s main property listing websites—see the section below for a list of these.
• Advertising your home as integral part of their regular ad placements in local magazines, newspapers, and newsletters.
• Featuring your property in their window showcase displays at their local offices.
• Some agents might also market your property through overseas agents’ sites offering property for sale in Mexico, if they are affiliated to other agencies internationally.

Exclusive and non-exclusive contracts

If you sign an exclusive contract with a realty agent, you ought to be clear about what active marketing the agent will do on your behalf, and the exclusivity should have a reasonable time limit set before it expires (6-12 months is common).

Non-exclusive contracts enable you to enlist several agents to market your property at the same time, which may give you a wider reach to potential buyers, but agents typically ask for a higher commission on non-exclusive contracts and they might invest less in advertising your home for sale if they don’t have an exclusive listing.

Realty agent commissions

Commissions are paid by the seller on the closing price.  Rates are set by negotiation on a per-case basis and will typically range between 4% and 8%, plus Mexican sales tax (IVA) at 16%.

Most agents charge around 6%, with the lower range (4%-5%) offered to more expensive houses and the higher range (7%-8%) charged on the lowest valued homes.

The marketing preparation, project management and paperwork required to sell a $100,000 dollar home is almost identical to that required to sell a $5 million dollar home, and so the scale of commissions is negotiable for this reason.

When you factor in the sales tax added (“IVA”), a 6% sales commission rate will add just under 7% of the home’s final sales value to your closing costs.

Seller-led property marketing

Some sellers choose to bypass the services of a local realty agent and do all the marketing themselves.  This is feasible, but be aware that the agents undertake the project management related to the property transaction and if you don’t hire an agent, you’ll need to do this yourself.

When you put your home up for sale, let all your friends and family know, and direct them to your agent’s website or to you personally if there are any interested buyers.

If you want to use an agent and invest in some additional marketing, you can pay to advertise your own home in various places, asking potential buyers to contact your agent if you don’t want to deal with buyers, or to contact you directly. In the case where a buyer contacts you directly, you might negotiate a lower commission with the realty agent to manage through the sale for you.

Some ways that sellers market their own home for sale include:

• The hanging of of a large polythene printed banner (in Spanish called a ‘rótulo’ or ‘lona’) draped on a door or wall of your home to advertise it for sale to passers-by. (Some agents provide these with their own branding and contact details.)
• Free and paid inserts on Mexico’s principal property listing sites—see the next section for a directory of these.
• Using social media, some sellers pay to ‘boost’ posts about their property for sale; these can be targeted at people situated in or interested in Mexico.
• Some sellers will pay to run ads in physical or digital magazines, newspapers, or newsletters that are distributed in the area or location where the property is situated.
• If sellers are looking for buyers living outside of Mexico, they might also list or pay for advertising in popular overseas listing sites like Zillow and Truilla.
• Local listservs and community groups may be another way to promote the house for sale, if the moderators on the listserv will allow this (some, but not all, do).
• Some sellers set up their own website to sell their home, creating a form of ‘electronic brochure’ to present the property in detail, and support the sales effort, whether they are using the services of a realty agent or not.  While this is an excellent way to present your home in its best light, in addition to the cost of creating and hosting the site, you will also need to actively promote it, typically using agents, seller-led (paid) advertising, word-of-mouth and social media—or a combination of these.

Property sales listing sites in Mexico

These are the principal sites to check when you’re scouting for a property to rent and to gauge sales prices for homes across Mexico.

Learn more about property in Mexico

Mexperience offers detailed insights about property in Mexico for buyers, owners, renters, and sellers.

• Latest articles and insights about real estate in Mexico
• The value of Mexican real estate
• Tell-tale signs of a good realty agent
• The costs and taxes of buying a home in Mexico
• The costs and taxes of selling a home in Mexico
• Insuring your Mexican home
• Enjoying your home and home life in Mexico

The information published in this article is provided for general information in good faith and is not intended as personal, legal, financial or investment advice.

Realty markets are localized in Mexico

Mexico is a vast country with wide regional variations in lifestyle, topography and climate, infrastructure, transport links, and local amenities.  The country’s real estate markets are highly localized, and accurate data in regard to prices and historical trends is not easy find in aggregate as it is in the US, Canada, and Europe.

Property portals give you insights into asking prices and rents

In recent years, a series of Mexican property portals have emerged which aggregate property listings nationally: MetrosCubicos, VivaAnuncios and InMuebles24 are the principal ones you ought to review to gauge current asking prices.

The portals also feature extensive listings for home rentals in towns and cities across Mexico, so if you’re planning to rent a home here, the portals are a good way to assess rental prices and find a home to rent.

These sites are helping to bring additional data together for buyers and sellers, but remember that asking prices and sale prices are rarely the same. Real estate agents tell us that closing prices on property here are typically between 10 and 15 per cent lower than market asking prices, depending on the location, state of the property, as well as individuals’ situations surrounding the transaction.

House price data is not centralized

There is no publicly-accessible ‘official’ central register of house prices in Mexico, and even some of the ‘informal’ registers which exist may peddle doubtful data, as sellers are not always forthcoming about the full details concerning the prices at which properties changed hands.

Official registers do exist —on records at local government and Notary Public offices— but getting access to these data is tricky, and generally has to be undertaken in-person on state-by-state (or even municipality) basis, making it near-impossible for any individual to build a precise picture of what is trending regionally or nationally.

Note also, that transactions of untitled properties sold on agrarian terms won’t appear in any official statistics, and the buyers’ pool in this market is smaller because these properties cannot be financed or used for collateral.

Some private firms and government agencies exist that commission data-gathering exercises and compile reports based on those data. The depth and scope of their data may be limited, but they add perspective and insights for potential buyers.

Other sources of house price data in Mexico

In the absence of a central register of prices showing current trends, potential buyers, and sellers seeking to set a price on their property for sale, can repair to a variety of other data sources for guidance.

Local real estate agents

Locally based and well-established realty agents are among the better people to talk to for an indication of prices in a given market.  The good ones will have been operating in the market for some while and will have a balanced perspective about the price levels similar houses in specific local neighborhoods have been listed at and sold for.

The disadvantage of this information source is that agents are inevitably vested in talking-up the price of the product they sell; some agents may represent the buyer and the seller simultaneously (this is not illegal in Mexico as it is in some US states) and so it’s prudent for buyers especially to check other information sources to cross-check price levels.  You can learn more about this on our comprehensive guide to working with realty agents in Mexico.

Live locally for a while, and get a feel for the market

An excellent way to gauge local prices is to base yourself locally for a while (see also: renting) in the area where you are interested in investing.  There is no substitute for getting to know the locale, talking to the locals, and probing friends and local contacts about recent market activity, scoping-out the different neighborhoods, and in doing so obtaining a first-hand sense of the local market. Doing this can also help you to negotiate a better price.

Consider how sellers in Mexico are valuing their properties

Another way to arm yourself with local knowledge is to consider how existing home owners in Mexico are valuing the properties they want to sell.  This article on Mexperience describes typical methods that sellers use to assess residential property values in Mexico, and outlines the key factors that tend to influence sellers’ listing prices.

Reviewing this information can help you to gain additional perspectives as you research prices and consider the value of property for sale in Mexico.

Hire a property assessor

Homeowners in Mexico can hire the services of a property assessor —a valuation agent— who, for a fee will compose a detailed valuation report that will be founded on an array of factors including research of recent sale prices in the area, the desirability of the locality, local access and other amenities the property offers, the size and topography of the land plot, and the condition of the current construction.  This article (Spanish) shares some insights into how valuations work and are priced in Mexico.

Typically, the fee for a valuation is based on a peso-per-thousand rate of the assessed value of the property—and thus higher value properties pay higher valuation fees. For example, if an assessor quotes a rate of $3 pesos per thousand, and your property’s assessed value is $5m pesos, then your valuation fee will be $15,000 pesos. ($5m / 1000 x $3.)  You might be able to negotiate a fixed rate, or lower the rate per thousand if the property is larger, or situated in a more expensive area.

Valuation reports have different purposes.  Lenders may ask for a formal valuation of the property before agreeing to release funds, and sellers use valuations as supporting evidence for their asking price —and some sellers might assert that the valuation is Gospel— but remember that these valuations constitute a professional opinion, not a buyer’s tangible offer.

Offers and direct negotiation are key tools

While various disconnected data sources exist to help sellers and buyers gauge the present market value for real estate, the price of a piece of land or a property in Mexico is most-often determined somewhere between “what the current owner is willing to accept” and “what a buyer is willing to pay.”

Cash buyers have leverage

Most foreigners who have been purchasing real estate in Mexico over the years have purchased using cash, by trading down from —or out of— property markets in their home countries and exchanging these for a home in Mexico, oftentimes as part of a retirement plan.

This form of direct capital investment has provided an additional support mechanism for the residential property market in Mexico, and with buyers not subject to the usual pressures of property repayment schedules and interest charges, the market can remain stable even as prices soften or fall.

Serious interest deserves an offer

The asking price is almost always negotiable, except perhaps in very buoyant periods where buyers far outstrip sellers bidding for local properties.

If you are seriously interested in a property you have viewed, then you should make an offer based on your research and intuition.

Experienced local agents tell us that “the most important thing is to make an offer.” Sometimes “low-ball” offers are rejected without further discussion; and sometimes the sellers engage.  We’re told that sometimes relatively-high asking price offers are accepted by buyers without negotiation, and conversely some exceptionally low-ball offers are accepted by sellers.

The negotiations tend to pivot between:

• the underlying reasons current owners may have for selling which may never become apparent to the buyer but which influence the negotiations and the price sellers are willing to accept; and
• underlying reasons buyers might have for wanting a property that can include things like an emotional feeling they encounter in relation to a house they have viewed, or a hurried moving schedule.

Some homes are overpriced

Some homes listed for sale are simply overpriced with owners quite unwilling to budge or negotiate on the matter—and they often appear in no hurry to sell.

Some homes stay on the market (or see-saw on and off of it) for many years when current owners hold a firm belief that the value of the property is far higher than buyers are currently willing to pay—thus creating an impasse.

In these situations it’s prudent for potential buyers to consider alternative properties and ‘move on’ from any notions they may have about buying an overpriced property held by an unyielding seller.

Price trends and lifestyle priorities

As elsewhere, buoyancy in Mexico’s property markets ebbs and flows, driven by a wide variety of factors and influences.  Waves of buoyancy tend to be localized, with certain regions or locations increasing or waning in popularity over time, influencing demand. Prices are ultimately determined by the same factors which often drive house markets  —primarily capital flows and demographics— although broader influences can also cause prices to surges or decline.

Price buoyancy continues in popular places

Popular places like southern Baja California, Puerto Vallarta, and the Riviera Maya have experienced property booms that appear to have no end, fueled by high demand as Americans and Canadians look south for beachfront property of the type that has become unaffordable in the US and Canada to all except the ultra-wealthy.

Foreign buyers are also turning their attention inland, beyond the coasts to highland colonial cities where the year-round climate is temperate and improving transport links and local amenities increase the appeal of these locations.  This is driving demand (and raising prices) in lesser-known and under-explored towns and cities which hitherto experienced relatively low house price inflation: among these are Querétaro, Guanajuato, Valle de Bravo, Puebla, Tepoztlán, Pátzcuaro, and Mérida.

Considering your true lifestyle needs

As the capital cost of acquiring property increases, we recommend you consider reading this article about your lifestyle needs as you scout for a place to live and especially when you intend to make a significant property purchase in Mexico.

The advice in that article shares some helpful insights about the types of areas which are likely to continue benefiting from investor interest: they are the typically the ones that offer value for money, have strong local communities, the location’s character and potential, and local services and amenities which people commonly seek when moving to a new place.

Total cost of property ownership in Mexico

Residential property in Mexico continues to attract buyers from abroad for another reason: the total cost of ownership is lower than it is in the US, Canada, or Europe.  Ownership costs are mitigated by lower property taxes (although these have been rising in recent years, albeit from a low base); lower construction costs (but land prices and materials costs have been rising significantly of late); lower ongoing maintenance fees; and a lower cost of living.

Learn more about real estate in Mexico

We publish detailed and continuously updated information about real estate in Mexico that shares valuable local insights and knowledge about property markets for buyers, owners, renters, and sellers.

Resources for Living & Lifestyle in Mexico

Mexperience offers you a comprehensive online resource of information and local knowledge to help you discover Mexico, explore choices, find opportunities and plan a new life in Mexico.  Our resources include:

• Insightful articles about living and lifestyle in Mexico
• Complete guides to aspects of living in Mexico
• A regular Mexico Newsletter you can subscribe to for free

The information contained in this article is published in good faith and is not intended to constitute personal, professional, legal, financial or investment advice, nor replace the services of professional advisors.

The three main costs when you’re selling a property in Mexico are:

• Marketing and selling fees;
• Professional service fees; and
• Taxes.

Marketing and selling fees

Some people put their home on the market and sell their property without the assistance of a real estate agent.  If you have the skills and confidence to market your own home, you can sell your property without the services of a local realty agent; however, as we explain in our Guide to realty agents in Mexico, a good realty agent provides a marketing service, a conduit between the negotiating parties, and someone who will help to work through the paperwork to bring a property sale to successful completion.

Their services come at a price to sellers and real estate agents in Mexico typically charge between 5% and 8% of the sale price in commission, and you need to add Mexican sales tax (IVA) to this (16%), so if the agent’s commission is 5%, the tax-inclusive payment will be 5.80% of the final sales price; and if the agent’s commission is 8%, the tax-inclusive payment will be 9.28% of the final sales price.

You can learn more about how sellers value their home and marketing & selling your home for sale in Mexico here on Mexperience.

Professional fees

Sellers will typically pay a range of professional fees when they are selling their property. These are the most common:

Notary Public

In Mexico, the role of the Notary Public is paramount in property transactions. As we describe in our Mexico Real Estate Guide, a Mexican Notary Public is a legal professional with very important statutory roles, especially in matters related to property transactions.

If the seller hires a real estate agent to assist with the sale, the agent will typically write-up the sales contract related to the sale as part of their service.  If the seller is not working with an agent, the seller will typically hire the services of a Notary Public to compose the sales contract that is presented to the buyer.

The buyer might hire a different Notary Public, or an independent lawyer or advisor specializing in property, to review the contract and negotiate any clauses in it.

The seller pays for the professional advisors it chooses to hire to help prepare the paperwork related to the property’s sale, and the buyer pays for the professional advisors it might hire to review the sales contract and any other matters related to the sale.

Bank trust fees

If the property you own and are selling is held in a Bank Trust (fideicomiso), then you will also need to budget for a ‘trust cancellation fee’ that is levied by the bank. The closure fee varies, but you should budget for around US$1,000-US$1,500 to cover this.

Taxes on the sale of residential property in Mexico

Taxation on residential property sales is a complex area of Mexican tax law and every case will be slightly different depending on the circumstances.  Also, keep in mind that tax laws are subject to reform and because house purchases tend to be long-term investments, the tax laws which apply today might apply entirely, in-part, or not at all when you eventually sell your property.

This section of the guide describes the key principles of residential property taxation as of the date of this article, and guidelines here are intended to help you compose an estimate of the taxes you will be expected to account for when you sell a residential property in Mexico. (Different tax rules and rates apply when you sell commercial property.)

We recommend that you seek professional advice from a Notary Public, tax accountant, or other professional/legal service firm in Mexico to get a detailed appraisal of your situation.

Note also that if you are not a Mexican national then you might also be liable to taxes in your home country and you should seek advice from a specialist tax accountant in that respect, too.

Capital Gains Tax

Mexico applies a capital gains tax on residential property of 25% on the gross sales value of the transaction without any deductions, OR between 1.92% and 35% on the value of the gain (purchase costs less allowable exemptions and deductions): the percentage is calculated on a sliding scale in relation to the gain and we recommend you assume 35% as residential property sales with a gain above $250,000 Mexican pesos will be subject to this rate.

One-time tax allowance exemption

A tax allowance exemption is available under Article 92, Fraction XIX a) of Mexican income tax law that reduces the tax liability for many family homes, although you and the property must meet certain criteria to qualify for the exemption:

• you must be resident in Mexico* with a Mexican tax ID (known as a RFC, or Registro Federal de Contribuyentes); and
• the property you’re selling must be your primary residence in Mexico; and
• the land subject to the sale must not exceed three times the size of the construction on that land (measured in square meters); and
• you can only claim this exemption once every three years.

The flat-rate exemption is the peso equivalent of 700,000 UDIs; the value of UDIs fluctuates and you can get current UDI exchanges rates on the Bank of Mexico website. At the time of writing, 700,000 UDIs equates to approximately $5.9 million Mexican pesos and you can deduct this amount from the sale price if you qualify.

Co-titled property

If the same home is properly co-titled with your spouse or other family member and they are resident in Mexico* with a Mexican tax ID, and the house is their primary residence too, you can deduct an additional 700,000 UDIs in their name.

The tax-deductible allowance is not automatic: you must qualify, you must apply, and you must prove the qualification. Talk to your Notary Public about how to arrange this and what you need to do to present the necessary records for proof.

Talk with a licensed accountant or other professional firm who is experienced in property matters about getting a RFC if you hold legal residency in Mexico but don’t currently have a RFC number and want to use this as a means to claim the tax deductible allowance when you sell your residential home.

* Mexican income tax law does not expressly state whether the foreign person selling a property must have temporary or permanent residency status to avail themselves of capital gain tax exemptions; it does, however, expressly state that the seller must be selling his/her primary residence in order to qualify for tax exemptions on capital gains. The Notary Public dealing with the matter will interpret the law; some will apply the capital gains exemptions only if the seller has residente permanente status; some Notary Public offices may apply the exemptions to foreign residents with residente temporal status.  You can read about the differences in these two residency statuses on our Mexican visas and immigration page.

Deductions allowed for capital improvements

You can deduct the costs of any capital improvements (e.g. building extensions, new flooring, swimming pools, new rooms) while you owned the property, as well as some closing costs commonly incurred when purchasing a home.

To claim these deductions, you must keep and show official receipts —in Mexico, these are known as ‘facturas’— for all services and building work, so be sure to take advice from your Notary Public and/or accountant on how to account for these over time—and follow it.

Any capital improvements made using a building firm or independent builders who didn’t issue you with facturas for the work cannot be deducted.  General maintenance and home improvements, like remodeled kitchens or new bathrooms, do not count as capital improvements.

The currency exchange rate effect

In most towns and cities across Mexico, home prices are quoted in Mexican pesos when they are offered for sale. However, a few places and most notably in Los Cabos, Puerto Vallarta, San Miguel de Allende, Ajijic/Chapala, and Cancun/Riviera Maya, home prices may often be seen quoted in US dollars.

Even though the home may be marketed in dollars and the transaction amounts may be quoted in dollars, the deed will show the amount in Mexican pesos at the exchange rate prevalent on the date of the closing. Any capital gains are calculated only in Mexican pesos and therefore, shifts in the exchange rate can affect the capital gain calculation as expressed in a foreign currency.

Learn more: Read Exchange Rates and Capital Gains on Your Mexican Home to understand how foreign exchange rates can influence capital gains calculations on property in Mexico, because your tax liabilities when you come to sell are calculated in Mexican pesos, not dollars.

Selling your Mexican home as a non-resident

If you are not a resident in Mexico and/or you don’t have a Mexican tax ID, you cannot claim the tax allowance exemption explained above, although you can claim qualifying deductions, so long as you have the official receipts (facturas) to prove the allowed expenditures which can be deducted.

Your Notary Public is a key contact

The Notary Public (in Spanish, Notario Público) is the most important professional person you will deal with when you buy and sell property in Mexico.  Don’t rely on hear-say and instead get the Notary Public to assess your individual situation and the taxes that will likely apply to it.

When you’re buying property, talk with the Notary about what you need to do to plan your estate efficiently, how to structure your arrangements, and how to keep the proper records you need to ensure that when you come to sell your property you (or your heirs) are prepared.

Every property transaction has its own quirks and unique characteristics; cultivating a good relationship with your Notary Public is a crucial aspect of successful property investment in Mexico.

Learn more about property in Mexico

We publish a wide range of guides and articles about property and real estate in Mexico:

• Learn about the costs and taxes of buying property in Mexico
• How do property owners value their Mexican house?
• What drives house prices in Mexico
• Putting your house on the market for sale
• Comprehensive guide to buying and selling real estate and renting property in Mexico
• View the latest articles about real estate in Mexico

The information published in this article is provided for general information in good faith and is not intended as personal, legal, financial or investment advice.

Mexico’s provinces, especially those colonial towns and cities that are within an easy drive of Mexico City, are well stocked with aging homes, many of which were constructed between the early 1950s and late 1970s—although some also date back to the colonial era.  They stand today in silent witness to eras long past and their owners (or heirs) remain custodians of these properties, responsible for their upkeep.

The idyllic countryside home in Mexico

These homes —typically country-style houses with attractive and colorful landscaped gardens, a swimming pool, and a terrace to while away long evening conversations with friends and family— often served as second homes owned by those holding significant professional, government, or corporate appointments, or by families with wealth bequeathed through generations.

These second homes would typically remain vacant save for the gardener and housekeeper taking care of routine upkeep until the owners and their family and friends descended upon the property at weekends and during holidays as a form of ritualistic retreat into the Mexican countryside.

The colorful gardens, the charming views, the refreshing pool, the invigorating morning air, and the laidback feel of the Mexican countryside extended a helpful escape from urban routines, and provided open spaces for children, their siblings and friends to play and etch some additional memories into the journey of their childhood.

Forty or more years later, the lives and situations of the owners and their children (or grandchildren) are often far removed from the memories that echo in the rooms and gardens of these old properties.

The demands of owning older houses in Mexico

Anyone who owns or occupies a country house with a large garden and a swimming pool knows that these require constant attendance and structures that remain empty or unoccupied for extended periods often decay in haste, however keen the hired housekeeper or gardener might (or might not) be.

In situations where the original owners have died, the estate usually passes into hands of the children, who now assume title and responsibility for the spaces where they once played unburdened by the weights of adulthood and property management.

They begin to discover that houses which might be listed for sale at online listing portals for several million pesos can call for hundreds of thousands of pesos in ready cash every year to upkeep.

These aging properties with their extensive gardens, pools, and outbuildings tend to hold less interest in the everyday lives of the original owners’ children and grandchildren usually because the offspring have neither the free time nor the economic means to inhabit them as they and their parents did during the era of their childhood.

Priorities shift in unforeseen ways and negotiating use of the space with siblings (and their own families), as well as arguments over the running costs and stewardship of the property adds to the complexity of holding title.

Quandaries can emerge for the present owners of these aged homes, for example:

• for some, it’s emotionally difficult to sell and accept the passing of one’s life time;
• disagreement about what to do with the property may exist between family members;
• legal documents might not be in good shape after parents die, making a sale more complex;
• arguments may ensue about the distribution of costs for essential upkeep; and
• if the property is part of a gated community, disagreement may arise about who pays the (ever-increasing) HOA fees;
• when the matter of selling the property is discussed, heirs might not agree on the price to sell at, or whether to sell at all, nor how to share occupation of the property in the meantime.

And thus, homes which were joyful retreats of weekend cheer and a place to while away school holidays might now lay mostly unoccupied, echoing with memories and ghosts of a lifestyle passed, and an era long departed.

These situations serve as reminders that properties, in kind with their owners, pass through cycles and that the habits and spoils of one generation are not promised to another.

New generations may rent the house to mitigate costs

Aging owners —and more often now, heirs— of these older properties may turn to the rental market to generate the cash they need to manage costs—ostensibly the property’s but more often, their own.

Some owners of older properties are using online marketplaces like Airbnb to offer their houses for leisure breaks, especially if the house is situated in a tourist town and has a swimming pool.  However, it takes considerable time and effort to manage short-term rentals, and the net income is less than most owners anticipate.

Long-term rentals promise owners a regular monthly income with fewer overheads, and people seeking to rent on a long-term basis might be attracted to an older property, marketed with ‘old-world charm and character’. Renters of these properties might also discover that the charms of renting an older property are entirely outweighed by the challenges of living day-to-day in an aging house.

Buying older properties in Mexico

For potential buyers, some of these properties offer attractive plots of land with mature trees and fine views—but buyer beware, there are more than just ghosts and memories lurking in the walls and foundations of older properties.

Experienced buyers shopping for an older home know that they’ll need to make a capital outlay over and above the agreed sale price to make repairs and bring structures and interiors up to date. They’re also mindful that the attention required to maintain and secure the property doesn’t go away, even after a refit.

The negotiated price ought to reflect the investment that will be required to restore the property’s structures if these have fallen into decay, with additional provision added for contingencies. Potential owners ought also to reflect on their own situation and intentions regarding the property and its location, considering their life stage, as well as current and future needs.

Some people argue that buying vacant land and building a home on it using new materials, the latest construction techniques, and applying modern building standards to one’s own design is preferable to taking ownership of an older home.  By the same token, older homes have stood the test of time; tend to be situated in established neighborhoods with ready access to local services and amenities, can occupy exceptional plots of land that may be difficult to find elsewhere, and have mature gardens with trees and other plants that may otherwise take many years to grow and flourish on newly developed land.

When purchasing an older home, especially where several heirs may share ownership, additional patience and flexibility will probably be needed as the decision-making process to sell is inevitably met by objections and discussions internally—deliberations which buyers tend to be oblivious about, and are often the core reason why a seller doesn’t immediately accept a full asking-price offer.  If one heir has a strong character and can steer the family into a constructive decision, this can help to expedite the transfer of the property to the buyer.

The cycle doesn’t stop with your purchase

As new buyers take possession of their provincial retreat, they begin to breathe new life into the spaces—remodeling, redecorating, and planting fresh flowers and saplings that will grow along with a new generation of people who muster and dwell together in these spaces.

Wise owners will make suitable provision for the asset without delay and take into consideration the changing cycles that touch all our lives, regardless of circumstance.  Being cognizant of this —especially if your heirs are or might be abroad— helps to consider the effects of the passage of time beyond one’s own.

Making appropriate provision and leaving instruction to others in matters of passing the torches you carried from one generation to another is part-and-parcel of responsible land and property custodianship in Mexico.

Learn more about property management in Mexico

Mexperience publishes a range of free eBook guides about property and real estate in Mexico:

• Changing cycles of neighborhoods in Mexico City
• Charms and compromises of countryside living in Mexico
• Key factors to consider as you plan your lifestyle in Mexico
• Learn about home maintenance and security in Mexico
• View the latest articles about real estate in Mexico
• Comprehensive guides to buying and selling real estate and renting property in Mexico

Protect your personal items and defend against litigation

Although home insurance is not obligatory by law in Mexico (if your property is mortgaged, the lender may insist the property is covered), it’s prudent to factor-in a property insurance policy to your annual budget to protect your assets and, importantly, to defend against third party liabilities.

Third party liability in relation to home ownership doesn’t seem as obvious a risk as it is with driving a car, but in the event of an accident or mishap involving your property, your liabilities as home owner to third parties will become apparent.

Storm damage can leave you liable

Consider the trees in your garden. Trees falling in a wind storm can come down with tremendous force, and will easily cause material damage to your own property—and possibly to your neighbor’s. In acute cases they can cause bodily harm or fatalities.  Mexico experiences stormy days, even in the highlands away from the coasts, and some of those storms will cause trees to fall down.  Garden walls can also be subject to sudden and unexpected collapse, especially during an earthquake, or if they are old or have weakened foundations.

Condo unit ‘bloc’ coverages are limited

A common situation where homeowners unwittingly become exposed to liabilities is when they own a condominium, or live inside a gated community. They think the insurance policy —paid for through their Home Owner Association fees— that covers the building or the estate also covers them personally.  It usually doesn’t.  For example, when a water leak from the kitchen or shower room in your condo causes damage to units below yours, the repair bill becomes your responsibility.

Domestic workers and accidents

Another situation where homeowners can become liable is in relation to the domestic help they employ.  A lot of foreign residents in Mexico hire maids and gardeners.  If your maid falls down the stairs when she’s cleaning, or your gardener hurts himself while working in your garden, you become responsible to them in those situations.  Read this article to learn more about insuring domestic workers in your home in Mexico and how an adequate insurance policy can cover you.

Home insurance as an integral part of  your budget

Home insurance policies are often overlooked and sometimes ignored as an unnecessary expense by foreign homeowners here in Mexico, especially those with homes situated away from hurricane-prone areas. While hurricanes are among the most apparent risks in relation to property, powerful wind storms inland can also cause serious property damage, and give rise to third party liability in relation to events and people related to your home: if for no other reason, you should consider your insurance arrangements to mitigate those liabilities.

Learn more about caring for and insuring your home in Mexico

Mexperience publishes extensive information to help you plan and care for your home life in Mexico through guides, articles and free eBooks:

• Free eBook: House maintenance and home security
• Latest articles about property insurance
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Estate planning for legal residents in Mexico

The estates of tourists and temporary visitors who come to Mexico for a short period are not affected by this issue as they are most likely to be legally domiciled in their home country, where their will would be read and interpreted, regardless of where in the world they die.

However, for residents living in Mexico (and those planning to make Mexico their primary residence, or legal domicile), it’s important to ask the question: How will my estate and loved ones be affected when I die in Mexico?

It’s a simple question with complex answers, and taking the time to consider your present circumstances and plan for your passing in Mexico will ensure that your loved ones will not be left dealing with complex legal matters, and that your assets and other interests are dealt with according to your wishes when you die.

If you already have a living will set-up in your home country, you also need to consider how that might be affected by your legal residence in Mexico; you might have to take steps to ensure that your wishes are legally enforceable under Mexican law.  Mexico’s legal system is markedly different from places such as the US, Canada, and other European countries, hence the importance for foreigners living in Mexico to acquaint themselves with local laws and customs—and prepare their estate accordingly.

Who needs to make estate planning arrangements?

Planning for your estate to be properly administered after your death is especially important if you:

• have legal residency in Mexico;
• own a home in Mexico;
• hold a bank account(s) in Mexico;
• have savings and investment plans in Mexico;
• own a company in Mexico;
• hold any trusts in Mexico;
• have assets split between Mexico and other countries.

Professionals who can help

You will need to hire some professional help to get this done properly.

Professional advisors

Professional law firms and property consultants can provide advice and either help you directly by writing a will, or referring you to a trusted source who can undertake the legal paperwork work for you.  See Professional Assistance services.

Notary Public

We have explained in these pages before now the importance of the role of the Notary Public in Mexico, and this person should be your first port of call as you begin to plan your estate.  Even if you use other services to structure your estate (e.g. financial planner), you will need to hire a Notary Public in order to get the necessary legal instruments in place.

Accountant

If you have business interests in Mexico, you should also consult with your accountant about matters related to any business accounts or assets, especially where these are held in company names, trusts, or jointly owned with others.

Financial planner

If you have a financial planner or investment manager, you should also involve that person in discussions about planning your estate.

Your country’s consulate offers limited support

As we mentioned in our article about consulate support, your home country’s consulate can only provide limited support in relation to personal matters, and in the event of a natural death, they will usually help to identify and contact the person’s next-of-kin in their home country.  They cannot and won’t become involved in any matters related to estate disputes, probate or any issues in relation to your personal assets in Mexico.

Don’t delay your estate planning work

If you’re living in Mexico and have any significant assets here or abroad, and have been procrastinating on matters related to your estate, or if you plan to move and create a new lifestyle in Mexico and want to ensure that your assets and personal interests are protected if you die when you’re here, you need to stop thinking about it and start taking some action.  By making adequate plans for the inevitable, your loved ones will be grateful and your assets will be properly administered.

Resources for Living & Lifestyle in Mexico

Mexperience offers you a comprehensive online resource of information and local knowledge to help you discover Mexico, explore choices, find opportunities and plan a new life in Mexico.  Our resources include:

• Insightful articles about living and lifestyle in Mexico
• Complete guides to aspects of living in Mexico
• A library of free Mexico guides you can download
• A regular Mexico Newsletter you can subscribe to for free

Your key contacts in a property transaction

All property transactions in Mexico ought to be agreed in writing with a well-scripted contract drawn up by a Notary Public or attorney specializing in Mexican real estate law.

As you move through the process, you are likely to to engage with the services of several key contacts to help you complete the transaction, and these may include:

The seller

Some sellers take a ‘hands-on’ approach to selling their property and deal more directly with the buyer; but most sellers do the opposite and interact through the realty agent and/or Notary Public.  Every case is unique.

As described in this article, some ‘sellers’ are more than one person and this can cause delays as you work through the procedures.  Patience is required, especially if the property you are buying is an older family home that’s being sold.

The realty agent

If a realty agent is involved in the sale, that person ought to function as an intermediary between the seller and the buyer (and their legal representatives) and undertake the ‘project management’ of the transaction.

If you didn’t hire a realty agent, you will need to take on the role of ‘project manager’ for your property transaction—or hire someone to do that for you.

Realty agents often liaise between the seller, the buyer and other key contacts including the Notary Public.

This includes things like liaising about details of the contract as they are reviewed and (re)negotiated by the parties.

The realty agent will also help to overcome any obstacles that might emerge as part of the contract review process and/or administrative elements of the transaction—for example, reminding parties about documents they need to produce to progress the transaction.

The Notary Public

Even if you hire the services of a lawyer to support you with certain aspects of the transaction, you will still need to hire a Notary Public, as the transaction must be filed and recorded by the Notary as part of the legal process.

As the buyer, it’s important to choose your Notary Public independently: do not allow the seller to influence you or to pick one for you.

Realty agents usually have a list of Notary Public offices you can contact—but remember that in Mexico a realty agent often represents the seller and the buyer simultaneously.

The legal attorney

Although you can do everything through the Notary Public, some buyers like to hire a lawyer to provide legal counsel or additional legal support through the process—especially if there are complexities or unusual circumstances surrounding the transaction that require a ‘second legal opinion..

The property surveyor

When you buy property in Mexico, the seller does not provide any type of ‘sales pack’ that demonstrates the property is in good shape as sellers must, by law, do in some other countries.  Furthermore, it’s difficult to seek legal redress after you have closed the deal and paid your money.

Therefore, it’s prudent to hire a property surveyor to check over the property, especially if the property is older or situated in a rural or remote setting.  Some architect firms provide this service; check locally.

You will need to pay for this separately on your own account, whether you end up closing on the property or not.  Ask the seller for access to the property before the contract is signed.  If a seller objects to a survey being undertaken, or agrees and makes the process awkward or is obstructive in some ways, that ought to raise a buyer’s flag.

The architect firm

If you are buying land to build on, you’ll likely use the services of an architect to help you with the building.

Architects usually undertake tests on the land (before you complete the purchase) to ensure that the land is suitable for building on, and to assess the costs of building there. You will need to pay for any land tests and studies separately, regardless of whether the transaction completes.

Outline procedure for buying a property in Mexico

The exact process to complete a property transaction will vary in each case, and to some degree vary depending on what State in Mexico the property is situated in.

However, every transaction follows broadly the course outlined in this description—the realty agent and Notary Public will provide essential support throughout this process and provide specific procedural details based on your situation.

Property valuation

An official appraisal of the property’s market value, known in Spanish as an Avalúo, might be undertaken.  Some buyers commission a valuation report, and some sellers pay for an appraisal and show this document to the seller as ‘proof’ of the property’s current market value—however it’s only a professional opinion.

In some cases, an official appraisal of the property might be required, and if this is the case the Notary Public will advise you about it, and the fees involved.

Verbal agreement

When you’ve found a property you like, you agree a price (and loose terms, e.g. “including all the furniture”) verbally with the seller.  This is not binding, but sets in train the process that will lead to a contractual transfer of the property.

If you are buying a home from a real estate developer, and especially if you are buying ‘off plan’, advise the Notary Public about this as they ought to ensure that the developer’s permits are in order as part of the legal diligence.

Written contract

The realty agent (and/or Notary Public) will draw up a written contract citing:

• the agreed sales price;
• a detailed written schedule of everything that is included and excluded in the sales transaction;
• detailed terms and conditions related to the transaction; and
• any contractual deadlines as may be agreed by the parties.

This document is known in Spanish as a “Convenio de compra-venta” —a sales contract— at which time a deposit, typically 5% to 10% of the agreed purchase price, is paid by the buyer with cancellation penalties set out in the contract if either party withdraws from the agreement.

It’s normal for the seller to provide the contract, and it’s important that the buyer reviews the contract with great care, ideally with legal assistance, and understands what is being agreed and what the parties are committing to through execution of this document.

The written agreement ought to contain clauses that excuse the buyer from the contract without penalty on matters related to due diligence (for example, if a property survey is to be undertaken before closing) and force majeure—extraordinary events outside of one’s reasonable control, ocassionally referred to as ‘acts of God.’

Property Trust, if relevant

If the property is inside the restricted 50km border and/or 100km coastal zone, the Notary Public will ask the buyer to set up a Property Trust (fideicomiso); this is done through a local bank.

If the property is not situated within the restricted zone, no trust is legally required but remains optional for buyers who wish to use a property trust as part of their estate planning arrangements.

Closing costs and taxes

The seller and the buyer will have costs to pay as part of the transaction. Capital Gains Tax is paid by the seller and the Notary Public will calculate the sum and arrange for the correct amount to be paid to the Treasury.

The buyer has other closing fees and taxes to pay, that might also include the need to apply for a ‘foreign national acquisition permit’ to purchase land in Mexico.

Read more about the closing costs and taxes when you buy property in Mexico, as well as the costs and taxes of selling property here.

Payment for a land or property purchase in Mexico

Whether you are paying with cash or via some type of financing, you (or the person representing you) will need to have the agreed funds available for hand-over at the Notary Public’s office on the date that the deeds are scheduled to be signed across to you.  Payments are usually via a bank transfer, but other payment methods might be feasible—talk to the Notary Public about this.

Note that due to money laundering regulations, additional checks may be required to verify the source of the funds used to purchase a property in Mexico.

Legal due diligence

As part of due diligence in the purchase procedures, the Notary Public and/or the lawyer you hire undertake a series of checks on the property deeds and other records.

The Notary Public is legally responsible to ensure that all documents are in order and that all legal procedures have been adhered to.  The Notary is also charged with ensuring that property taxes, including property transfer taxes, are fully accounted for and paid.

There are many elements to check; this list is not exhaustive but outlines the key things the Notary Public will be looking for:

History and type of property

Checking that the property has a clean history, and that there are no liens on the land, for example an unpaid mortgage or other debt. Under Mexican law, liens are passed on with title of the land, so these checks are especially important. The Notary should also advise you whether the land has a title deed or whether it is untitled and being transferred on agrarian terms.

Verification of title or possession

The seller will need to furnish the original land/property deeds, unless the property is untitled, in which case you will need to ask about the Constancia de Posesión. The Notary Public will check these out and advise you whether the land is legally titled or whether you are obtaining possession instead of legal title.

Seller documentation

The seller will need to present to the Notary Public with other documents including (but not limited to): original property deed, up-to-date tax receipts for the property, public utilities bills (proof of payment), plus up to date details of any service fees, for example Homeowner Association fees, shown as paid.

Buyer documentation

The Notary Public will ask for key documentation from the the buyer, that may include but is not limited to: photo ID (e.g. passport), birth certificates, marriage certificates (if applicable), and proof that your stay in Mexico is legal: this can be a Visitor Permit, (you do not have to be resident in Mexico to purchase real estate here) and if you are resident here, then you will need to show your residency card.

Taxes and utilities current

Checking that all land taxes have been paid during the last five years (if applicable) and that utilities (especially electricity) have also been paid during the last two years. By law, you are not liable to any debts after these times.

Title structure, registers and permits

Other items to be checked can include verifying all buildings are on tax registers and have the required building permits (as may be applicable); utilities were legally installed, and payments are up to date; the property is not jointly owned, or if it is, that both (or all) owners agree to the sale; and that the named seller has the right to transfer ownership of the property.

Learn more about property in Mexico

Mexperience offers detailed insights about property in Mexico for buyers, owners, renters, and sellers.

• Latest articles and insights about real estate in Mexico
• Finding a Notary Public in Mexico
• Tell-tale signs of a good realty agent
• The costs and taxes of buying a home in Mexico
• The costs and taxes of selling a home in Mexico
• Insuring your Mexican home
• Enjoying your home and home life in Mexico

The information published in this article is provided for general information in good faith and is not intended as personal, legal, financial or investment advice.