BiggerPockets

I've heard a lot of hype about Mexico as a great place for US investment money since there was a law passed in 1993 that allows foreigners to own land there. Has anyone had any experience with this market. Any ideas would be appreciated.

Thanks!

We purchased our first property in Mexico overlooking the Sea of Cortez earlier this year and our second in Aug.

There is a great growth potential here.

We are now involved with the project.

In 1992 the Mexican government amended the constitution allowing the Ejido's to convey title to their land to non-Ejido members. An Ejiod is a farm cooperative.

In 1993 the Mexican government passed the Foreign Investment Act of 1993 allowing foreigners to own land in the restricted zone. This permits foreigners to purchase and own real estate as well as own their own businesses by way of a land trust, a Fideicomiso and also by way of trust and forming Mexican corporations. The restricted zone is 100 kilometers or 62 miles from the border and 50 Km or 31 miles from the coast, from any sea or ocean.

In 1994 NAFTA, the North American Fair Trade Agreement was signed between the U.S., Canada and Mexico allowing free trade and stipulating non discrimination between Canada, U.S. and Mexico.

There are NO 99 year leases in Mexico, so if you buy one you will be very disappointed because they are not recognized by the Mexican government. There are 2 types of recognized leases in Mexico, a 10 year lease and a 30 year Ejiodo lease.

We were part of a team that owned a project in Veracruz several years ago. We used a legal team based in San Antonio to address the needed issues - there are several teams there that are very well versed the legal / adminstrative issues of investing in Mexico (and South America).

I bought my first condo in Cancun over 30 years ago. I now have 5-great cash cows!! Rich.

I have spent some time in Mexico consulting on some agriculture projects, as for the 30 year Ejiodo lease, it is basically a lease of a communal or cooperative center provided to the people of the area from the last civil unrest, as the lease holder you will find yourself resposible for the employee and care of the people of the area.

As for ownership within the restrictive corridors, many US investors have taken a Mexican national as a partner.

Either way the laws of Mexican real estate are volitile and have been for many years, and can be easily upset with a government change.

From a personal side my family had large land holdings in central Mexico, before my birth but the story goes the Mexican federal government showed up one day and basically sent them packing back across the border without regard to their land title or even allowing them to remove their farm equipment.

so the old saying goes, Buyer Beware!!

Is the reward worth the risk? the land in Mexico is cheap for a reason!

how does one learn how to invest in mexico real estate. I would actually prefer resort area but I know they are off limits to foriegners except through some kind of trustee arrangement. Someone please point to a resource I can use to learn about it.

yeah, I am not super excited about owning anything any place where I have to worry about getting kidnapped or killed! I would only consider buying in Mexico if I had already looked at every deal that was available in the United States.

I may be a little OCD though, I don't even feel comfortable going to resort in Mexico at this point. Any country that the drug lords out manpower out gone and have more money than the police force is not a cool place to be!

If you decide to go there though, you can probably hire some cheap bullet catchers for $.25 a day, that may give you enough time to get back across the border and released all you lose is a few bucks in your investment!

Hello Rob,

I agree with David that there are extreme situations or extraordinary situations that occur and make the headline news. But I have been living in Mexico City, now living in Playa del Carmen for nearly 18 years. and (knock on wood) those type of events aren't common. The ex pat community here is quite large and growing every 6 months you would be amazed. I noticed you are from Ohio, we have a guy on my team from the Dayton area, ( I am from Indiana) and sometimes it is good to talk to normal people. Check out Doug on this video.
http://www.topmexicorealestate.com/playadelcarmen-real-estate/LP/playadelcarmen-condos.php

he has about 3 videos and you can listen to his opinions of what is going on in Mexico...at least this region of Mexico.

cheers!

Thomas