Buying property in Mexico as a Canadian: All you need to know

Mexico has long been a favorite destination for Canadians looking to buy property—whether for vacation, investment, or retirement. With its tropical climate, affordable cost of living, and thriving real estate market, Mexico offers an attractive alternative to Canada’s colder and more expensive housing market.

If you’re a Canadian buying property in Mexico, understanding the legal process, advantages, and potential challenges is key to making a successful and secure investment. This guide covers everything you need to know before purchasing your dream home in Mexico.

Can Canadians Own Property in Mexico?

Yes! Canadians can legally own property in Mexico, but there are some regulations to keep in mind, especially if you’re buying within the Restricted Zone.

Understanding Mexico’s Restricted Zone

The Restricted Zone includes land located within 50 kilometers (31 miles) of the coastline and 100 kilometers (62 miles) of an international border. According to Mexican law, foreigners cannot directly own land in these areas.

However, there are two legal ways for Canadians to buy property in the Restricted Zone:

Fideicomiso (Bank Trust)

1. This is the most common method for foreigners purchasing coastal properties.
2. A Mexican bank holds the title on your behalf, but you retain full rights to rent, sell, remodel, or pass it on to your heirs.
3. The trust is valid for 50 years and can be renewed indefinitely.

Mexican Corporation

1. If you’re looking to buy multiple properties or invest in commercial real estate, you can establish a Mexican corporation.
2. The corporation can be 100% owned by foreigners and allows you to purchase property anywhere in Mexico, including the Restricted Zone.
3. This method is ideal for rental investments or those planning to develop property.

For properties outside the Restricted Zone, Canadians can own real estate directly without the need for a trust or corporation.

What Are the Main Advantages of Owning a Property in Mexico as a Canadian?

Buying property in Mexico as a Canadian offers numerous benefits, whether you’re looking for a second home, an investment opportunity, or a place to retire. Here are the top reasons why Mexico is a great choice:

Lower Property Prices

Real estate in Mexico is significantly more affordable than in Canada. You can buy a beachfront condo or a luxury villa for a fraction of the price of a similar property in cities like Toronto or Vancouver.

Year-Round Warm Climate

Say goodbye to harsh Canadian winters! Mexico offers tropical and temperate climates depending on the region, making it an ideal escape for snowbirds and retirees.

Strong Investment Potential

1. Popular areas like Tulum, Playa del Carmen, and Puerto Vallarta have seen consistent property value growth.
2. Rental demand is high, especially in tourist destinations, making it an excellent income-generating investment.

Lower Cost of Living & Property Taxes

1. Mexico’s cost of living is much lower than in Canada, making homeownership and daily expenses more affordable.
2. Property taxes (Predial) in Mexico are minimal compared to Canada—often just a few hundred dollars per year.

Easy Residency and Visa Options

1. Owning property in Mexico does not require residency, but it can make obtaining a temporary or permanent resident visa easier.
2. Canada and Mexico have strong bilateral agreements, allowing Canadians to stay up to 180 days per visit without a visa.

What to Consider Before Buying Property in Mexico as a Canadian?

Before you purchase a property in Mexico, there are key factors to evaluate to ensure a smooth transaction and a wise investment.

Location Matters

• Beachfront destinations: Cancun, Tulum, Playa del Carmen, Puerto Vallarta

• Colonial towns: San Miguel de Allende, Mérida, Oaxaca

• Quieter, more affordable areas: Puerto Morelos, Bacalar, Mazatlán

Choose a location that fits your lifestyle, budget, and investment goals.

Legal Framework & Fideicomiso Requirements

• Understand how the fideicomiso works if purchasing within the Restricted Zone.

• Work with a trusted notary and real estate attorney to verify the title, avoid scams, and ensure a legal transaction.

Budgeting & Additional Costs

Besides the purchase price, consider:

• Closing costs (4%-6% of the property value)

• Annual fideicomiso fees ($500-$700 USD per year)

• Maintenance & property management fees if renting the property

Due Diligence & Property Inspections

• Hire a professional inspector to check for structural issues.

• Confirm that the property has a clear title with no outstanding liens or debts.

Steps to Buy Property in Mexico as a Canadian

Research & Choose Your Location

• Visit different areas and compare property prices, amenities, and safety.

• Work with a local real estate agent who specializes in helping foreigners buy property in Mexico.

Hire a Real Estate Attorney

• A lawyer will review contracts, ensure a clear title, and protect your interests.

• Avoid direct deals with sellers without proper legal guidance.

Make an Offer & Sign a Sales Agreement

• Once you’ve chosen a property, your attorney will draft a promissory agreement outlining the price, payment terms, and conditions.

• A deposit (usually 5%-10% of the price) is required to secure the property.

Set Up a Fideicomiso (if in the Restricted Zone)

• Choose a Mexican bank to manage your trust.

• The bank acts as a trustee, but you retain full ownership rights.

Conduct a Title Search & Due Diligence

• Ensure the property has no legal issues, debts, or restrictions.

• Verify that all property taxes and fees are up-to-date.

Finalize the Purchase & Pay Closing Costs

• Sign the final deed (Escritura Pública) in front of a notary public.

• Pay closing costs, including notary fees, registration fees, and transfer taxes.

Register the Property & Receive Your Title

• The notary registers the property with the Public Property Registry.

• You receive official proof of ownership.

Enjoy Your New Home in Mexico!

Whether you’re using it as a vacation home, rental property, or future retirement home, your Mexican property is now yours to enjoy!

Looking to Buy Property in Mexico? We Can Help!

Navigating the Mexican real estate market as a Canadian doesn’t have to be complicated. At Jaguar Tulum Real Estate, we specialize in helping international buyers find, purchase, and manage property in Tulum, Playa del Carmen, and the Riviera Maya.

Contact us today for a FREE consultation and let our experts guide you through every step of the buying process! Your dream home in Mexico is closer than you think!