Cross-Border Living
Buying in Puerto Vallarta as a foreigner: the fideicomiso, explained
Yes, you can own on the coast. Here is how the bank trust works, who closes the sale, and what to ask first.
By Lance Fulford2 min read
Most people who fall for Puerto Vallarta ask the same question within a day or two: can I actually own something here? The short answer is yes. The longer answer involves a structure called a fideicomiso, and it's worth understanding before you start looking seriously.
The restricted zone
Article 27 of the Mexican Constitution does not allow foreigners to hold direct title to land within 100 kilometers of an international border or 50 kilometers of the coast. Puerto Vallarta sits entirely inside that coastal band, so every foreign buyer here meets the rule.
How a fideicomiso works
A fideicomiso is a bank trust. A Mexican bank holds legal title as trustee; you are the beneficiary, with the right to use, occupy, rent, improve, sell or pass on the property. The trust is granted for up to 50 years and can be renewed. A permit from the Secretaría de Relaciones Exteriores is part of setting it up, and the bank charges an annual trustee fee.
In practice, a fideicomiso gives you the rights you would expect from ownership. What changes is the paperwork, not what you can do with the home.
Who closes the sale
Real estate transfers in Mexico are formalized before a notario público — a senior lawyer appointed by the state, quite different from a notary in the United States. The notario verifies title and liens, calculates and withholds taxes, and records the deed. Choosing an experienced notario, and having your own representation, matters.
What to ask before you make an offer
- Is the property already in a fideicomiso that can be assigned to you, or will a new one be created?
- What are the HOA dues, what do they cover, and is the reserve fund healthy?
- If you intend to rent, what are the building's rules and the unit's actual rental history?
- How will you hold, transfer and repatriate funds, and in which currency is the price set?
None of this should put anyone off. Thousands of Americans and Canadians own in Vallarta this way. It simply rewards working with people who do it every week.
This article is general information, not legal or tax advice. Confirm specifics with a Mexican notario and qualified advisors.
