The Modern Day Gold Rush--The New Frontier of Home Ownership in Mexico

Before you jump on the next bandwagon south of the border to drop your stake in the ground, it helps to know a the basics about how ownership in Mexico works. There are complications beyond the standard language barrier (and the fact that it might be a wee bit difficult to cross the border in a covered wagon these days).

If you picture a country that has been dominated by foreign owners since the early 1500’s, you will begin to see why Mexico is so protective of its most valuable resource…land.

Timeline:

1517:


Hernandez de Cordoba sailed from Spain and laid claim to Mexican lands. Spain decided that since they had landed here, it was now theirs.


1822:
Mexico declared independence, the lands were still owned by wealthy foreigners.

1930’s:
President Lazaro Cardenas disassembled the large property holding & distributed them in the form of cooperative farms or “Ejidos”. Although it is farmed by the people, it was still owned by the Federal Government.

1992:
The Mexican people are finally allowed to sell the properties. The 1992 Agrarian Law recognizes property rites within the Ejido and allows for the owner of record to sell or lease property to a non-Ejido member.

1994:
Amendments to the Constitution permitted foreigners to purchase and own real estate in Mexico located within the “restricted zone”. This Law permitted ownership through a land trust or “Fideicomiso”.

Today:
How the “Fideicomiso” works: The Dept. of Foreign Affairs in Mexico City is issues a permit to a Mexican Bank, allowing the bank to act as purchaser for the property. The bank acts as a “Trustee”. Much like Living Wills or Estate Trusts in the U.S., the Mexican Bank, takes instructions only from the Beneficiary of the Trust (You). You have the right to use, occupy and possess the property, including the right to build on it or otherwise improve it. You may sell the property by instructing the Trustee to transfer the rights to another qualified owner, or bequeath the property to an inheritor. The initial term is 50 years, and it can be renewed for additional periods of 50 years indefinitely, providing for long-term control of the asset.

Source: www.la-cscada.com.mx