Yes, you can buy property in Los Cabos, Mexico. Cabo property ownership includes a fideicomiso for foreigners.
“FIDEICOMISOS”
The Mexican Constitution prohibits direct ownership of real estate by foreigners in what has come to be known as the “restricted zone.” The restricted zone encompasses all land located within 100 kilometers (about 62 miles) of any Mexican border, and within 50 kilometers (about 31 miles) of any Mexican coastline. However, the Mexican government created the “fideicomiso,” (FEE-DAY-E-CO-ME-SO) which is, roughly translated, a real estate trust. A Mexican bank must be designated as the trustee and, as such, has title to the property and is the owner of record. This allows foreigners, as beneficiaries of the trusts, to enjoy unrestricted use of land located in the restricted zone.
This type of trust is similar to trusts set up in the United States. The bank acts on behalf of the foreign buyer, taking title to real property. The bank, as trustee, buys the property for the foreigner, then has a fiduciary obligation to follow instructions given by the foreigner who is the trust beneficiary. The trust beneficiary retains and enjoys all the rights of ownership while the bank holds title to the property. The foreigner is entitled to use, enjoy, and even sell the property that is held in trust at its market value to any eligible buyer.
A fideicomiso is not a lease. The beneficiary can sell or lease the property at any time. The beneficiary can use and develop the property to his or her benefit, within the provisions of the law.
There is a common misconception among foreigners investing in Mexico that once the fideicomiso expires, the beneficiary loses all rights and benefits of the sale of the property held in trust. On the contrary, the beneficiary has a contractual right under the trust agreement with the Mexican bank to all benefits that may result from the use or sale of that property. Under Mexican Law, the bank, as trustee, has a fiduciary obligation to respect the rights of the beneficiary.
There is an MLS for Los Cabos, to begin your search.
