The Costa Maya Times
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TOP 10 MYTHS ON OWNING OCEAN FRONT PROPERTY IN MEXICO
There are many misconceptions regarding the purchase of ocean front property in Mexico. As a brokerage company, we are well informed about your rights to own property in Mexico, and would like to share the following with you:
Myth # 1- I am a foreigner; therefore, I cannot own ocean front property in Mexico.
Fact- Beginning in 1994, the Mexican Government has allowed foreigners to own ocean front property in Mexico, via their own Mexican Corporation. The Corporation, being a legal entity, holds title to the property, and you own the Corporation. You need at least two people as stockholders, you and a colleague; attorney; accountant; family member; etc. Your Mexican Corporation can own ocean front property, even if, its owners are foreigners to Mexico.
Myth #2- I need to have a Mexican National as a shareholder, to own property in Mexico.
Fact- This is no longer true. Non-Mexicans can now own 100% of a Mexican Corporation, and this Mexican Corporation can own 100% of the purchased ocean front property.
Myth #3- I need to have a Bank Trust, and pay high annual fees to purchase property in Mexico.
Fact- Before the Mexican Corporation system was passed into law, the only way to own property on a Mexican beach was to form a Mexican Trust. The Bank is the Trustee and you are the Beneficiary.
You would then need to pay the bank $300-$700 a year to administer the trust. In addition, in the trust system you need to hire a lawyer to do the paper work. The lawyer will charge about $2,000. U.S. for the paperwork, and then the bank will charge you another $2,000 U.S. for the creation of the Trust. If you wanted to sell your land, you need specific permission from the bank to do so. Once again, you would need to hire a lawyer, pay him/her again, pay the Bank, etc…
Myth #4- The Mexican Government can take my land after I purchase.
Fact- Not true. The Mexican Government can only
Foreign investment is a major part of the Mexican economy, and is so, because land ownership in Mexico is very stable.
Myth #5- The properties in Mexico do not have a clear and transferable Title and I cannot build on the land I purchase.
Fact- Having a clear and transferable title is very important, not only in Mexico, but all over the world. All of the properties Trans Caribbean Trust Company represents have a clear and transferable title and are buildable. We guarantee this in our transactions. If we are not representing certain properties on the Costa Maya, it is because the seller could not provide us with a clear and transferable title.
Myth #6- The seller of the property will get my deposit before the closing of the property has taken place, and if this happens I lose my entire deposit.
Fact-There are many sellers who conduct business in this manner. This is not the case with Trans Caribbean Trust Company. We hold the buyer’s deposit in our escrow account. The transfer of the deposit is given to the seller once the property has gone through closing, and a clear title is transferred to the buyer. We do request a 10% deposit to take a property off the market. This is to show the seller your good faith in purchasing his/her property.
Our policy states, that if for any reason you do not wish to complete the purchase of your property, we will refund to you the entire amount of your deposit.
Myth #7- Closing costs are very expensive in Mexico.
Fact- Closing costs can be very expensive in Mexico, but it depends entirely on who handles the closing. Trans Caribbean Trust Company has worked to make closings as efficient as possible. We have negotiated with the sellers, to have them pay for the entire closing expense including the formation of your Mexican Corporation. The price you are quoted on a property, is the price you pay. You will have no surprises.
Myth #8- I am only leasing the land, I don’t actually own it, and after 99 years I have to give the land back to the Mexican Government.
Fact- This is not true if you form a Mexican Corporation. The Mexican Corporation is the system we recommend to our clients.
Myth #9- I have to build a structure on my ocean front property within five years.
Fact-There is no time limit for construction on property in Mexico. Typically, an area which requires construction within a certain time period, is trying to artificially boost the value of the property with these improvements.
Myth #10- Annual taxes are extraordinarily high on the Costa Maya.
Fact- Real estate taxes are remarkably low on the Costa Maya. At least we think so. The tax rate is about $50USD for an average ocean front lot. So, if you have a double lot, the taxes would be about $100USD, or the cost of taking your family out to dinner. What do you think?
Now that we have cleared up all of those doubts about owning an ocean front property on the Mexican Caribbean, what are you waiting for? Become part of the Costa Maya today!
Yury DiPasquale, Sr. Correspondence Administrator
Look for the Costa Maya Enchilada recipes in our next Issue of the Costa Maya Times.
In our last issue of the Costa Maya Times I promised we would have a Costa Maya Margarita recipe. If you would like to receive a copy of this recipe, please e-mail me. Also, if you would like to set up an appointment to view properties with us, or if you have questions, please feel free to e-mail me at: