Buying Real Estate in Mexico vs. the US and Canada: How It Really Differs

Yes, US and Canadian citizens can buy real estate in Mexico, but the way you take title differs fundamentally from what you are used to back home. In most of the country you can hold direct fee-simple title. But in the coastal and border areas where expats most want to live, the Mexican Constitution bars foreigners from owning land outright, so you buy through a bank trust called a fideicomiso. It is legal and common, and it gives you full ownership rights — just not the raw deed in your own name.

This is one of the most common questions we get at City Laws. A buyer from Toronto or Dallas assumes a purchase in Playa del Carmen works like one back home, then meets a constitutional restriction, a bank trust, a state-appointed notary and sometimes communal land that cannot be sold at all. The rules do not keep foreigners out; they channel them through a specific structure. Below we walk through it, then contrast the very different rules now in force in Canada and the United States.

The starting point: the restricted zone (article 27)

Everything begins with article 27, section I, of the Mexican Constitution. It prohibits foreigners from directly owning land or water within a strip 100 kilometers wide along Mexico’s borders and 50 kilometers wide along its coastlines, known as the zona restringida, or restricted zone. The Foreign Investment Law repeats this definition in its article 2, section VI.

Here is why this matters so much: nearly every town on the expat “dream list” sits inside that zone. Cancun, Playa del Carmen, Tulum, Puerto Vallarta, Los Cabos and Rosarito are all coastal, so they fall within the 50-kilometer band. The US and Canada draw no equivalent constitutional line. You can still own there — through a trust.

How the fideicomiso works

Inside the restricted zone, the lawful path to residential property is a bank trust, the fideicomiso. A Mexican bank holds legal title as trustee (fiduciaria) while you, the foreign buyer, are the beneficiary (fideicomisario) with the rights that matter: to occupy, rent, renovate, sell and bequeath it. It requires a permit from the Secretaría de Relaciones Exteriores (SRE), Mexico’s foreign ministry, under article 11 of the Foreign Investment Law. Two features surprise buyers who have heard only half the story.

• The 50-year term is renewable, indefinitely. Article 13 of the Foreign Investment Law sets a maximum term of fifty years and states that it “may be extended at the request of the interested party.” This is not a one-time extension: the trust renews in fresh 50-year blocks, so it is not a countdown to losing your home.
• It is the workaround, not a loophole. It has been the government-authorized mechanism for restricted-zone buyers for decades, and the property still passes before a notary and gets recorded.

There is a corporate alternative. Under article 10 of the Foreign Investment Law, a Mexican company (which may be 100% foreign-owned) can hold restricted-zone real estate directly if the property is for non-residential use, after notifying the SRE. A pure home to live in cannot use this route; it goes through the fideicomiso. A company carries its own tax obligations, so weigh the trade-offs with a real estate lawyer in Mexico first.

Outside the restricted zone: direct title

If the property sits outside the 100/50-kilometer bands, a foreigner can hold direct fee-simple title with no trust. In return, the “Calvo clause” — article 27, section I, and article 10-A of the Foreign Investment Law — requires you to file a written agreement with the SRE to be treated as a Mexican over the property and not to invoke your own government’s protection. So a city in the interior can be bought much as you would at home, while the beach town cannot.

The ejido trap

Some of the cheapest “land” offered near the coast is not private property at all. It is ejido land: communally held agrarian parcels that cannot simply be sold to a foreigner, and a private-looking contract over them transfers nothing you can record.

To become sellable, ejido land must first leave the ejido regime and become ordinary private property (dominio pleno, or full ownership). Under articles 81 and 82 of the Agrarian Law, the ejido assembly authorizes the change, and only after the National Agrarian Registry (RAN) cancels the ejido registration do the lands, in the statute’s words, “cease to be ejido land and become subject to common law.” Until then, no fideicomiso and no notary can turn it into something a foreigner may own.

Even at dominio pleno, there is a catch on the first sale to an outsider. Article 84 of the Agrarian Law grants a right of first refusal (derecho del tanto), in order, to relatives of the seller, anyone who has worked the parcel for over a year, other ejidatarios, resident non-members (avecindados), and the ejido nucleus, exercisable within 30 calendar days of notice. If they were never notified, the sale can be annulled later.

Who really owns the beach: ZOFEMAT

This surprises almost every “oceanfront” buyer: nobody owns the beach, Mexican or foreign. The Federal Maritime-Terrestrial Zone (ZOFEMAT) is a strip 20 meters wide alongside the beach, defined in article 119 of the General Law of National Assets. Under articles 6, 7 and 13 of that law it is federal public-domain property: inalienable and imprescriptible. What a hotel or beach home can obtain is a concession to use the strip, granted by SEMARNAT (the federal environmental ministry), not the municipality. A concession is temporary and revocable and creates no property right, so “beachfront” means your property runs up to the ZOFEMAT and you may hold a concession to use it, not that you own to the waterline.

New construction: consumer protection built in

Pre-construction is one area where Mexico is arguably stronger than the US or Canada. When the seller is a developer, subdivider or homebuilder, the transaction falls under the Federal Consumer Protection Law; under its article 73 those contracts must be registered with PROFECO, the federal consumer agency — a single federal layer of protection instead of a patchwork of state rules. For pre-sales (buying off-plan), article 73 BIS requires the developer to show the complete executive construction project, the model or sample unit and proof of title, and to disclose the unit’s characteristics (land and built area, structure, finishes, parking and common areas) plus full payment terms, including a credit projection with interest, commissions and charges.

Closing day: the Notario and the public registry

Closings differ from a US or Canadian settlement. Under articles 2320 and 2322 of the Federal Civil Code, a transfer must be formalized in a public deed (escritura pública) before a Notario Público once the value crosses a statutory threshold, and the sale has no effect against third parties until it is recorded in the Registro Público de la Propiedad. The Mexican Notario is not the clerk who stamps a form in the US: he or she is a state-appointed lawyer with public faith who drafts the deed, verifies the title chain, withholds taxes and records it. Because the notary does so much, Mexico traditionally has no separate escrow-and-title-insurance culture, though title insurance is available. Each state, such as Quintana Roo, has its own civil code and registry with equivalent rules.

How Mexico compares to Canada and the United States

The three countries sit on a clear spectrum: Mexico welcomes foreign buyers through a trust, Canada has largely shut the door, and the United States stays mostly open.

Canada is the sharpest contrast. The Prohibition on the Purchase of Residential Property by Non-Canadians Act makes it, in the words of section 4(1), “prohibited for a non-Canadian to purchase, directly or indirectly, any residential property.” It took effect on January 1, 2023, and after a February 2024 extension now runs until January 1, 2027. Even where a purchase is allowed, provincial surtaxes bite: Ontario applies a 25% Non-Resident Speculation Tax, Toronto added a municipal version effective January 1, 2025, and British Columbia charges an additional property transfer tax in designated regions. Mexico has no comparable federal ban or surtax.

The United States anchors the open end: no federal law bars foreigners from buying, and a non-resident generally buys fee-simple like any American, subject to tax and reporting rules on sale. A handful of states have recently restricted purchases by certain foreign nationals or entities.

A checklist before you sign

1. Check which side of the restricted-zone line the property is on — inside the 100/50 km bands means fideicomiso; outside means direct title.
2. Verify the title regime — private property with a recorded folio in the Registro Público de la Propiedad, not ejido land, and for beachfront ask about the ZOFEMAT concession.
3. Use a Notario and independent counsel. If a notary cannot lawfully deed the property to you, that answer alone tells you something.

If you would rather not do this alone, you can book a free consultation and have the property reviewed before any money moves.

Frequently asked questions

Is a fideicomiso safe, or do I really own the property?

The bank holds bare legal title as trustee, but as beneficiary you hold every practical right of ownership: to occupy, rent, remodel, sell and inherit. The 50-year term is renewable indefinitely under article 13 of the Foreign Investment Law, so it does not expire out from under you.

Can I buy beachfront land and own down to the water?

No one owns the beach in Mexico. The 20-meter federal maritime-terrestrial zone (ZOFEMAT) is public-domain land under the General Law of National Assets; it is inalienable and imprescriptible. Your property can run up to it, and you may hold a revocable SEMARNAT concession, but you never own it.

Why is that “ejido” lot so cheap, and can I buy it?

Ejido land is communal agrarian property and cannot be sold to a foreigner as-is. It must first be converted to full private ownership (dominio pleno) through the ejido assembly and the National Agrarian Registry, and even then the first sale carries a 30-day right of first refusal under article 84 of the Agrarian Law. A low price often reflects an unresolved regime, not a bargain.

Legal notice

This content is informational about the general legal framework for foreign buyers of real estate in Mexico and how it compares with Canada and the United States. It does not constitute legal advice, does not create an attorney-client relationship, and does not guarantee any outcome. The laws cited here, as well as state codes and the foreign-ownership rules of Canada and the United States, can change and may apply differently to your circumstances. Before signing documents or transferring money, consult a qualified attorney about your particular situation.

⚠️ General informational content, current as of its publication date. It is not legal advice and does not create an attorney-client relationship; laws change and every case is different. For your specific situation, book a free consultation.