Of course it can! There are a couple of conditions. After Mexico went through a difficult period, it was stipulated in the Mexican Constitution that there are restricted areas where foreigners cannot buy land.
For example: The restricted area would be all land within 100 km (62 miles) of the international border and 50 km (31 miles) of the coast. But as the world developed, it is now much easier to monetize and control the situation, so in 1973 Mexico changed its laws and now foreigners can buy property anywhere in Mexico. And although Playa del Carmen is within the restricted area, there are 2 options to buy real estate:
1. With a Mexican financial institution through a Trust.
2. Open a company in Mexico: what foreigners can do without any problem.
In addition, it is important to know that if you are buying to invest your money in vacation rentals, the management company may have the right plan, which means a savings in the annual Bank Trust fee.
The Trust means that a bank acts on its behalf, declaring itself the first beneficiary with all the legal rights over the property, be it the house or the apartment acquired. Paying a fee to establish such a contract, as well as an annual fee. Both will be determined by the value of the property that is being purchased. The Trust is valid for 50 years and is renewable. Actually, you have 10 years after this period for such renewal.
First, let's talk about the real estate market in general. Home is a tangible asset to invest in. There are minimal risks compared to other types of investment, such as stocks, for example, which are intangible and run the risk of losing value quickly. On the other hand, real estate is a medium or long-term investment, which is easy to control. Mexico is a popular place for foreigners to buy property, especially for North Americans and Europeans, as it offers the perfect combination of location, potential, and lifestyle. Especially, Playa del Carmen is not only a beach destination that attracts many tourists, it is also positioned in the 10 most important real estate markets in the world. Having a great development in recent years, with a growing demand, Playa del Carmen has a very stable real estate market without rapid fluctuations and, most importantly, with an annual return on investment of up to 20%. The most favorable investment is to buy an apartment for vacation rentals. Tourism continues to grow and there is a great demand in this sector, especially in the center of the city, near the beach. So, to answer your question, in a nutshell, investing in Playa del Carmen would be a smart way to generate income without doing a lot for it.
It is well known that location is a determining factor when buying your real estate asset. Above all, if your purpose is vacation rental. Everyone who travels to Playa del Carmen has one thing in common: they want to stay close to the beach and the main attractions, without the need to spend money on transportation to enjoy their vacation to the fullest. This makes downtown Playa del Carmen the best location for vacation rentals. Being more specific, the limits that comprise: Avenida Constituyentes, Avenida Benito Juárez, between the highway and the beach. In this area, there are the most important points of interest, such as: Fifth Avenue full of shops, restaurants and entertainment venues, as well as bus stations, the ferry to Cozumel and, most importantly, the beach. Olympus Playa is located exactly at these coordinates, on 6th street between 15th and 20th avenues. Strategically located, just 4 minutes walk from the beach, 2 minutes from Walmart and 3 minutes from 5th avenue.
In Mexico, not all properties on the market are listed online, so to find out about all possible opportunities it is essential to have a real estate agent. There are many English speaking agents in Playa del Carmen, some are even American or Canadian.
Yes, you need to work with a certified notary to make sure that everything is in order and that there are no debts on the property to be acquired. Likewise, the deed will be signed at the notary's office and he will be the one who carries out the paperwork when transferring the title to the property. NOTE: They charge individual rates, so be sure to compare several before hiring one. The seller will provide you with a copy of the property deed, which must be evaluated and verified by the notary. Which will also collect all the necessary documents from the seller, as well as the original property deed, current tax records, utility bills paid, and details of zero-balance land service fees.
Yes, as explained above, of course the property can be rented. And by doing so, generate income with this investment!
Besides obviously you and the seller, you will have to work with several professionals to make sure everything is done the right way and to your satisfaction. Real estate agent. Of course, you can also try to find your dream apartment on your own, but we recommend that you go with an English-speaking real estate agent. Because the online world in Mexico is still developing, and if you only search by that means, you will lose many properties. The rates of real estate agents in Mexico are not very high and it is common to negotiate them. You can ask for a reference to make sure you work with an agent who has the best of your interests in mind. Mexican financial institution. To establish a bank trust and act on your behalf. Lawyer. They trust you to accompany you through the procedure and, if necessary, a translator to make sure everything is clarified, especially the contracts to be signed. Local tax advisor. To ensure that you will validate all tax requirements for your home country. Notary. To verify all documents and ensure that there are no debts on behalf of the property. As we mentioned earlier remember that they charge individual fees, so be sure to compare several before hiring one.
This part is not as regulated in Mexico as in other countries and depends mainly on the value of your real estate. In this list you will find the rates that will be produced: Fee for your real estate agent, variable.
Rate for the notary and the lawyer, also variable, within 16% VAT.
Acquisition tax, between 0.2 and 4.5%.
Registration fee, between 0.02 and 1.8%.
Title insurance around 0.5%.
Property tax, called Predial, paid annually. Calculated as a percentage of the appraised value determined at the time of sale. Currently at 0.25%.