Land for sale in Mexico, should I buy it?

As an agent I get asked this question quite often. Unfortunately I also all often hear "don't buy real estate in Mexico, you can't legally own land." Luckily, this is not true, but there is more to the story. As with any country, there will always be cheats and charlatans trying to sell you something that is not theirs to sell. The illegal sale of government land became an issue in Mexico for one main reason - article 27 of Mexico's constitution.

Article 27 of Mexico’s Constitution allows the federal government of the United Mexican States to create agrarian lands for the benefit of their citizens. With its constitutional inception in 1917, Mexico began the process to provide “campesinos” (farmers) a beneficiary interest to land owned by the government. Entitled under “La Ley Agraria” (the Agrarian Law), these government parcels, known as “ejidos”, are recorded with the Registro Agrario Nacional (National Agrarian Registry) in Mexico City.

The ejidatarios can live, farm, homestead and construct dwellings on the property but they do not own it. Under Agrarian Law, the ejidatarios can not sell, lease, subdivide, joint venture, contribute, mortgage or encumber the property. In essence, they have the use and benefit of the land, but they do not have title to it. In 1992, recognizing the inherent value ejidos presented due to their geographic, border or coastal location, coupled with the development potential they created, the Mexican government enacted a Constitutional Amendment in order to “regularize” agrarian lands. The Mexican government could now provide a process of legal entitlement transforming the ejidal regimen to one of “regimen de domino pleno o privado” (regimen of full dominion or private land). In other words, ejidatarios had the right to take the land that they didn’t own and convert it to private property thereby allowing them to benefit monetarily from the ensuing regularization process. This is not a simple process and can take years to formalize.

As a result there have been numerous cases and examples of Americans, Canadians and other non Mexicans "buying" ejido land that has not been properly regularized. You, the buying public, may have paid money for a lot on the beach with the promise that you would receive a bank trust only to find out years later that the land has not been properly privatized. The end result is that you can not have a legally recorded and recognized beneficiary interest to the property nor can you have a valid lease as a legal alternative to use the property.

The good news is Mexico is not the “wild west” that some Americans believe to be. With formality of law, as in other real estate matters, regularization of an ejido is a legal process requiring time, procedure and lots of patience. It is doable, but difficult. Responding to "Land for Sale - $10,000 USD! Private message me for more details" is really asking for trouble. That said, it does not mean that you cannot legitimately buy real estate directly from an owner. The first question you need to ask is does this land or property have an escritura (deed) and move forward from there. By utilizing an AMPI (Asociacion Mexicana de Profesionales Inmobiliarios) registered agent and by staying away from "For Sale by Owner" deals you can properly protect yourself from these kinds of mistakes.

The ultimate goal is to get private title to each parcel that can then be conveyed to a trust or Mexican corporation for the benefit of non-Mexican purchasers. However, there are a number of steps along the way that you, the buying public, should be aware of in order for ejido land to be privatized. You need to consult a notario or an AMPI registered agent to help guide you through this process. In the meantime, there are plenty of non-ejido real estate offers available out there that can be purchased simply and easily with the aid of your agent. To download a detailed legal summary of this type of land, click the Download PDF below.

Illegal_Practices_and_the_Re-Enchantment_of_Govern

.pdf

Download PDF • 171KB

---

If you have any questions at all about owning real estate in Mexico we are here to help you. Feel free to email or Whatsapp us at nik_valcic@coldwellbanker.com.mx or 52- 322-274-7775