How long can I stay in Mexico if I buy a house?
November 21, 2025
If you’re asking, “Do I have to pay taxes if I buy a house in Mexico?” the short answer is yes, but the picture is different from what most U.S. buyers expect. 🏠 Mexico has a mix of low annual property taxes based on government-assessed values, one-time transfer taxes at closing, possible capital gains or rental taxes when you sell or rent, and extra costs when foreigners buy in restricted coastal or border zones.
Below we explain the main taxes, typical costs, paperwork and the long-term bank involvement you should expect so you can plan with confidence.
Yes. Buying property in Mexico triggers several tax and fee obligations, both at purchase and during ownership. Annual property tax (Predial) is normally small because it’s calculated on the municipal cadastral (assessed) value rather than market price.
You’ll also face a one-time acquisition tax at closing, notary and registry fees, and—if you sell or rent—the applicable income or capital gains taxes. If you buy in the restricted maritime/border zone, you will also set up a fideicomiso (bank trust) which adds setup and annual trustee fees plus ongoing bank oversight.
Here are the main taxes and fees you’ll see when purchasing and owning property in Mexico:
● Predial (annual property tax). This municipal tax is calculated on the cadastral value, not market value, making it much lower than typical U.S. property taxes in many cases. Rates vary by municipality but commonly sit in a low range (for example, often between 0.05% and around 0.3% of cadastral value, depending on the city). Early-payment discounts are common, and there are penalties for late payment — but note that municipalities usually don’t mail bills, so owners must remember the due date
●ISAI / Acquisition tax (one-time at closing). The property transfer or acquisition tax differs by state and municipality and is generally a percentage of the assessed value (typical ranges are ~2%–4.5%, though some localities use slightly different scales). This tax is usually paid at the notary closing.
●Notary & registration fees. Notaries (notarios) handle the deed and registration; their fees and other closing costs (registry, certificates of no liens, etc.) commonly add several percent to the sale price. Total closing costs—including ISAI, notary, registration, and other charges—frequently range from roughly 4% to 10% of the purchase price depending on location and transaction complexity
●Fideicomiso (bank trust) fees. If you are a foreign buyer purchasing in a restricted zone (within 50 km of the coast or 100 km of an international border), the title is held in a bank trust (fideicomiso). Setup costs and annual trustee fees vary: setup is commonly in the low thousands of USD and annual maintenance fees typically fall in the several-hundred–to–low-thousand-dollar range. Expect paperwork, bank involvement, and ongoing administrative fees for the life of the trust.
●Taxes when selling (capital gains / ISR). If you sell in the future, Mexico taxes capital gains for non-residents. Common rules cited in tax guidance include options such as a flat withholding on gross proceeds or tax on net gain with different applicable rates; non-resident sellers should consult local tax counsel to compute their liability precisely because calculation methods vary and can be done in pesos.
●Rental income tax. If you rent the property, rental income is taxable in Mexico. Filing, withholding and allowable deductions depend on whether you register for a Mexican tax ID (RFC) and your chosen tax regime, so many short-term rental owners seek local tax advice to avoid surprises.
There aren’t broad, automatic exemptions simply because you’re a foreigner, but a few important exceptions or reliefs may apply depending on your status and use of the property:
●Primary residence rules. Mexican tax rules provide specific exemptions or reliefs for primary residences under certain conditions (for residents or citizens, or when rules are satisfied). Foreign buyers who become legal residents or who can demonstrate the property is their principal residence can sometimes access exemptions or reduced capital gains liability at sale, but requirements are strict and documentation is critical. Always confirm specifics with a notary and tax advisor.
●Citizenship / permanent residency benefits. Mexican citizens (and sometimes long-term residents) do not need a fideicomiso and therefore avoid the trust setup and ongoing trustee fees in restricted zones; that can lower long-term costs. Inheritance and transfer procedures are also simpler for citizens. If you have eligibility for Mexican nationality (for example, by descent) this can meaningfully change ownership rights and tax positioning — and many legal teams help clients resolve document issues to pursue citizenship.
●Early-payment discounts for Predial. Many municipalities reward early payment of annual Predial bills (commonly a January/early-year discount of a percentage). This is a simple, recurring saving that many foreign owners miss if they are not aware of local deadlines.
Taxes and legal structures matter, especially when you’re buying across borders. Jaguar Tulum Real Estate works with trusted bilingual notaries, tax advisors, and legal partners who specialize in international clients. We help you:
●Understand which taxes apply to your transaction and provide realistic cost estimates.
●Coordinate notary and registration steps so the deed is clean and correctly recorded.
●Introduce reliable fiduciary/bank-trust partners when a fideicomiso is required and explain setup + long-term fees.
●Connect you with binational legal teams who assist with citizenship, document correction, and inheritance planning when relevant.
📩 Your first consultation is completely free. Let us guide you in making an informed, confident decision—without pressure, and always with your best interest in mind.
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