The restricted zone and why fideicomiso exists
Under Article 27 of the Mexican Constitution, foreigners cannot own land in their own name within 50 km of the coast or 100 km of a national border โ the 'restricted zone'. Tulum sits squarely within this zone. To allow foreign investment while respecting the Constitution, Mexico created the fideicomiso โ a bank trust structure that grants the foreign buyer 100% of the beneficial rights while a Mexican bank holds the bare legal title as trustee.
How a fideicomiso actually works
- Trust duration: 50 years, renewable indefinitely (unlimited renewals)
- You (foreigner) = beneficiary with all rights: use, lease, sell, transfer, inherit
- Bank = trustee holding bare legal title in name-only capacity
- Successor beneficiary can be named โ no probate required on death
- Sellable to another foreigner (transfer beneficiary rights) or a Mexican (dissolve trust)
- Mortgageable in Mexico or offshore against the beneficiary interest
Setup + annual cost
| Item | Cost | Frequency |
|---|---|---|
| SRE permit application | USD 1,300โ1,500 | One-time |
| Fideicomiso setup fee (bank) | USD 500โ1,000 | One-time |
| Notary + registration | USD 2,000โ3,500 | One-time |
| Annual trustee fee | USD 500โ650 | Every year |
| Acquisition tax (ISABI) | 2% of purchase price | One-time |
The 8-step buying process
- Sign offer letter (Oferta de Compra) with 5โ10% earnest money escrowed
- Notary orders title search (Certificado de Libertad de Gravamen) and property tax certificate
- Draft the promise contract (Contrato de Promesa) with closing conditions
- Apply to the Ministry of Foreign Affairs (SRE) for the trust permit โ takes 4โ8 weeks
- Bank issues the fideicomiso trust deed once permit received
- Wire the balance of purchase price + closing costs (typically 6โ8% of price all-in)
- Sign the escritura (deed) at the notary; bank registers title as trustee
- Receive certified fideicomiso deed + register with tax authority (RFC) for future rental/sale
Taxes on ownership and sale
| Tax | Rate | When paid |
|---|---|---|
| ISABI (acquisition tax) | 2% of purchase price | At closing |
| Notary fee | 1โ1.5% of purchase price | At closing |
| Predial (annual property tax) | 0.05โ0.4% of assessed value | Annually, in January |
| Rental income tax | 25% withholding (or resident rate) | On each rental payment |
| Capital gains on sale | 25% of gross, or 35% on net gain | At sale โ election available |
| ISR on sale for tax residents | Sliding 0โ35% | Only if Mexican tax resident |
Frequently asked questions
Is a fideicomiso 'real' ownership?
Yes โ economically and legally you have every right of ownership. The trust is a form-not-substance structure that satisfies the constitutional requirement while giving foreigners full beneficial rights. Tens of thousands of homes on Riviera Maya are held this way.
Can I set up a Mexican company instead?
Yes, and this is common for rental-business buyers or portfolio investors. A Mexican company (sociedad) can own land in the restricted zone directly โ but requires ongoing accounting (USD 100โ200/month) and files monthly tax returns.
What happens after 50 years?
The trust is renewable indefinitely by paying a small renewal fee. There is no cap on renewals under current Mexican law.
Can I inherit to my children?
Yes โ you name a successor beneficiary in the trust deed. On your death, ownership transfers directly to them without probate. This is faster and cheaper than inheritance under Mexican succession law.
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