By Adrian Sánchez—

Buying a home in Mexico feels like a dream, ocean views, palm trees, slower days, and better weather. But behind every dream property, there’s one detail that can make or break your investment: the legal structure.

In countries like the U.S., Canada, or across Europe, purchasing real estate is fairly simple: sign, pay, and record. In Mexico, however, the rules change especially if you’re a foreigner. What you can own?, how you can own it?, where you can own it depends entirely on your nationality and the legal structure you choose.

The Constitutional Restriction
Under Article 27 of the Mexican Constitution, foreigners are prohibited from directly owning land within the so-called “Restricted Zone” that is, within 50 kilometers (31 miles) of the coast or 100 kilometers (62 miles) of any international border.
In other words, most of Mexico’s most desirable real estate from Los Cabos, Cancún, and Tulum, to Huatulco and Puerto Escondido lies entirely within this restricted area. So… how do thousands of Americans, Canadians, and Europeans legally buy beachfront villas and condos in Mexico every year?

The Legal Path: Fideicomiso (Bank Trust)
The answer lies in a legal mechanism designed precisely for foreign investment: the Fideicomiso. This 50-year renewable bank trust allows foreigners to acquire and control property within the restricted zone without violating the Constitution.
Here’s how it works: A Mexican bank holds the title as trustee, while you (the foreign buyer) are the beneficiary. You retain all ownership rights, you can live in, rent, remodel, sell, or even inherit the property. The property does not belong to the bank; it’s your asset, protected under Mexican law.

Setting up a fideicomiso involves a one-time setup fee and annual maintenance fees.

What You Need to Establish a Fideicomiso
To legally acquire property within the restricted zone, the process includes a few key steps and legal documents:
1. A Foreign Investment Permit issued by the Mexican Ministry of Foreign Affairs (Secretaría de Relaciones Exteriores, SRE).
2. Then there’s something called the “Calvo Clause.” As required by Article 27, Section I of the Mexican Constitution, foreigners must agree to be treated as Mexican nationals regarding property ownership and waive the right to seek protection from their home government in any dispute related to the property.
In simple terms: you accept Mexican law and Mexican jurisdiction — no international claims, no diplomatic involvement.
3. A Trusted Notary Public (Notario Público) to oversee and formalize the legal process.
4. A Mexican Bank authorized to act as the fiduciary institution (trustee).

Once those steps are complete and your lawyer ensures all due diligence your property is legally yours. The key to owning property in Mexico safely is understanding the legal foundation beneath your dream home. At Lead the Future Law & Tax Firm, our bilingual legal and tax experts guide you from acquisition to sale, ensuring that your investment remains as solid as the ground it stands on.

Adrian Sánchez | @MexicoLawyer | CEO, Lead the Future Law & Tax Firm Lawyer (Universidad Iberoamericana) | Corporate & Real Estate Law Specialist | Compliance Officer | Legal Columnist