Changes to foreign ownership laws in Mexico expected to generate a surge in sales
The historical amendment to Mexican Constitutions´ 27th Article, has stirred the interest in   properties along the Baja Riviera, as evidenced by the surge of real-estate activity along the Northern Baja Coast. “We have seen an important increase in the number of inquiries by potential clients since discussion about the reform hit international media outlets”, said Maday Valdenegro, Sales Manager at Santa Barbara in Bajamar.

Manlio Fabio Beltrones - Mexican Federal Senator

Manlio Fabio Beltrones – Mexican Federal Senator

The amendment to article 27 was approved by the Mexican Senate on April 23rd, “but it still needs to be approved by a majority of Congresses of each of the States in Mexico for a reform of the law to be final”, noted   Javier Troncoso, an Attorney at Law based in Los Cabos

The reform would now allow foreigners to acquire real estate within the “Restricted Zone” (100 kilometers wide from the borders and 50 kilometers wide from the coastal shores).

“Historically, once an amendment has passed in the Mexican Senate, the State Congresses have approved it. An amendment to the Law of Foreign Ownership would still be needed”, added Troncoso.

The effect of the legal reform on Baja real-estate sales
Baja´s Peninsula is considered a “Restricted Zone”, thus, experts predict a boom in sales in the Region once the law is reformed. “We are advising potential buyers to act now before activity rises considerably and prices go up”, said Max Katz, owner of Baja Real Estate Group, Broker of the Beachside Realty Mexico office in Rosarito.

High quality real-estate offerings, such as Santa Barbara, a boutique condo in northern Ensenada, are sure to be benefit from the surge in sales.

“We recently announced new amenities, such as a new swimming pool with tanning cabanas and a 24 hour concierge service” said Valdenegro. “Legal changes have built on the interest that the upgrades had already created”.

For decades, Americans have been relying on a fideicomiso, or  Mexican Bank Trust, to acquire real-estate along the Baja Coast. Such Bank Trust assures the buyer all the rights and privileges of Ownership. It can be sold, inherited, leased, or transferred at any time. Since 1994 the Foreign Investment Law stipulates that the Fideicomiso must be to a 50 year term with a 50 year renewal anytime with a petition.

Though the fideicomiso requires minimal paperwork and fees, outright ownership is sure to lure new real estate clients into Baja, and heat up the market.

The constitutional amendment includes the following provisions:

  • Real estate  must be used solely and exclusively for residential purposes
  • Real estate may not have a commercial, industrial, agricultural or any other use (other than residential)
  • The foreigner must obtain a permit from the Foreign Affairs Ministry to acquire real estate and must agree to be subject to the Mexican laws and not invoke the protection of their foreign government
  • Sanctions for properties used for other than residential purposes, may forfeit ownership of the real estate in favor of the Mexican government.

Contact Baja Real Estate Group at for more information.

Javier Troncoso, Attorney  at Law
Los Cabos, Baja California Sur, Tel. (624) 142-4435