Property Law and Taxes
Property law and taxes in Mexico in November 2026 require foreign buyers in coastal and border zones to use a bank trust (fideicomiso) under Article 27 of the Constitution, with closing costs ranging from 4 to 8 percent of the purchase price. Acquisition taxes (ISAI) vary by municipality in Quintana Roo—Benito Juárez (Cancún) and Cozumel charge 3 percent, Solidaridad (Playa del Carmen) and Tulum charge 4 percent—and non-resident owners pay a flat 25 percent income tax on gross rental income and capital gains. Outside the restricted zone, foreign nationals hold direct title with a permit from the Secretaría de Relaciones Exteriores (SRE).
Property law and taxes in Mexico in November 2026 require foreign buyers in coastal and border zones to use a bank trust (fideicomiso) under Article 27 of the Constitution, with closing costs ranging from 4 to 8 percent of the purchase price. Acquisition taxes (ISAI) vary by municipality in Quintana Roo—Benito Juárez (Cancún) and Cozumel charge 3 percent, Solidaridad (Playa del Carmen) and Tulum charge 4 percent—and non-resident owners pay a flat 25 percent income tax on gross rental income and capital gains.
Source: Constitución Política de los Estados Unidos Mexicanos, Article 27, 4 November 2026
By Daniel Ortega, MDI · Last reviewed 4 November 2026 · Next review 4 March 2027
Property law and taxes in Mexico: the short answer
Foreign buyers acquire property in Mexico's restricted zone (within 50 kilometers of any coastline or 100 kilometers of any international border) through a bank trust (fideicomiso) that lasts up to 50 years and is renewable, with the buyer holding all beneficial rights. Outside the restricted zone, foreigners take direct title with an SRE permit. Annual property tax (predial) is low, typically 0.1 to 0.2 percent of cadastral value, while acquisition taxes range from 2 to 5 percent depending on the state and municipality.
Taxes by town in the Riviera Maya
Municipal revenue laws · 4 November 2026| Town | Acquisition tax (ISAI) | Predial / year | Total closing costs | Local guide |
|---|---|---|---|---|
| Cancún | 3% | progressive tariff by value | 4.3–7.5% | Cancún taxes & closing costs |
| Playa del Carmen | 4% | 0.19% | 5.3–8.5% | Playa del Carmen taxes & closing costs |
| Tulum | 4% | progressive tariff by value | 5.3–8.5% | Tulum taxes & closing costs |
| Cozumel | 3% | 0.11–0.77% progressive | 4.3–7.5% | Cozumel taxes & closing costs |
Cancún
3%
progressive tariff by value · 4.3–7.5% · Cancún taxes & closing costs
Playa del Carmen
4%
0.19% · 5.3–8.5% · Playa del Carmen taxes & closing costs
Tulum
4%
progressive tariff by value · 5.3–8.5% · Tulum taxes & closing costs
Cozumel
3%
0.11–0.77% progressive · 4.3–7.5% · Cozumel taxes & closing costs
Buying as a foreigner
A foreign buyer purchasing property in Mexico pays an acquisition tax (Impuesto Sobre Adquisición de Inmuebles, ISAI) set by each municipality, ranging from 2 to 5 percent of the declared value or cadastral value, whichever is higher. In Quintana Roo, Benito Juárez (Cancún) and Cozumel charge 3 percent, while Solidaridad (Playa del Carmen) and Tulum charge 4 percent. Notary fees run 1 to 2 percent of the purchase price plus 16 percent value-added tax (IVA), and the notary collects and remits all taxes and registry fees on the buyer's behalf. Foreign buyers in the restricted zone pay a one-time fideicomiso setup fee ranging from USD 1,500 to 3,000 and an SRE permit fee of MXN 21,650, bringing total closing costs to 4 to 8 percent of the purchase price. Outside the restricted zone, buyers pay an SRE permit fee of MXN 5,250 for direct title. The Public Registry of Property charges 0.5 to 1 percent to record the deed, and a commercial appraisal costs MXN 3,000 to 8,000.
Buying as a foreigner
A foreign buyer purchasing property in Mexico pays an acquisition tax (Impuesto Sobre Adquisición de Inmuebles, ISAI) set by each municipality, ranging from 2 to 5 percent of the declared value or cadastral value, whichever is higher. In Quintana Roo, Benito Juárez (Cancún) and Cozumel charge 3 percent, while Solidaridad (Playa del Carmen) and Tulum charge 4 percent. Notary fees run 1 to 2 percent of the purchase price plus 16 percent value-added tax (IVA), and the notary collects and remits all taxes and registry fees on the buyer's behalf. Foreign buyers in the restricted zone pay a one-time fideicomiso setup fee ranging from USD 1,500 to 3,000 and an SRE permit fee of MXN 21,650, bringing total closing costs to 4 to 8 percent of the purchase price. Outside the restricted zone, buyers pay an SRE permit fee of MXN 5,250 for direct title. The Public Registry of Property charges 0.5 to 1 percent to record the deed, and a commercial appraisal costs MXN 3,000 to 8,000.
Owning and renting out
Annual property tax (impuesto predial) in Mexico is paid by all owners and calculated as a percentage of the property's cadastral value, which is typically lower than market value. In Quintana Roo, rates vary by municipality: Solidaridad (Playa del Carmen) charges 0.19 percent, Cozumel uses a progressive tariff from 0.11 to 0.77 percent depending on value, and Bacalar charges 0.1 percent. Foreign owners with a bank trust pay an annual fideicomiso maintenance fee ranging from USD 500 to 1,200, depending on the bank. Non-resident owners earning rental income pay a flat 25 percent income tax (ISR) on gross rental income with no deductions allowed, plus 16 percent IVA on furnished short-term rentals. Quintana Roo requires short-term rental owners to register with the state tourism registry (RETUR-Q) and collect a 5 percent state lodging tax, or 6 percent when guests book through a digital platform. Failure to pay predial or other taxes can result in liens, fines, and in extreme cases, foreclosure.
Owning and renting out
Annual property tax (impuesto predial) in Mexico is paid by all owners and calculated as a percentage of the property's cadastral value, which is typically lower than market value. In Quintana Roo, rates vary by municipality: Solidaridad (Playa del Carmen) charges 0.19 percent, Cozumel uses a progressive tariff from 0.11 to 0.77 percent depending on value, and Bacalar charges 0.1 percent. Foreign owners with a bank trust pay an annual fideicomiso maintenance fee ranging from USD 500 to 1,200, depending on the bank. Non-resident owners earning rental income pay a flat 25 percent income tax (ISR) on gross rental income with no deductions allowed, plus 16 percent IVA on furnished short-term rentals. Quintana Roo requires short-term rental owners to register with the state tourism registry (RETUR-Q) and collect a 5 percent state lodging tax, or 6 percent when guests book through a digital platform. Failure to pay predial or other taxes can result in liens, fines, and in extreme cases, foreclosure.
Selling and inheritance
A non-resident seller in Mexico pays capital gains tax (ISR) calculated one of two ways: 25 percent of the gross sale price with no deductions, or 35 percent of the net gain after deducting the inflation-adjusted purchase cost, documented improvements, and selling expenses. The notary withholds the tax at closing and remits it to the federal tax authority (SAT). Mexican tax residents holding an RFC (Registro Federal de Contribuyentes) may claim a primary residence exemption for gains up to 700,000 UDIs—approximately MXN 5.8 to 6.2 million in 2026—if the property was their principal home, the exemption was not used in the prior three years, and they provide utility bills and other proof. Non-residents have no access to this exemption. Sellers also pay notary fees and may incur real estate commissions, though PropertyMex listings allow sellers to avoid agent commissions entirely. The seller typically does not pay ISAI or registry fees; those fall to the buyer by custom.
Selling and inheritance
A non-resident seller in Mexico pays capital gains tax (ISR) calculated one of two ways: 25 percent of the gross sale price with no deductions, or 35 percent of the net gain after deducting the inflation-adjusted purchase cost, documented improvements, and selling expenses. The notary withholds the tax at closing and remits it to the federal tax authority (SAT). Mexican tax residents holding an RFC (Registro Federal de Contribuyentes) may claim a primary residence exemption for gains up to 700,000 UDIs—approximately MXN 5.8 to 6.2 million in 2026—if the property was their principal home, the exemption was not used in the prior three years, and they provide utility bills and other proof. Non-residents have no access to this exemption. Sellers also pay notary fees and may incur real estate commissions, though PropertyMex listings allow sellers to avoid agent commissions entirely. The seller typically does not pay ISAI or registry fees; those fall to the buyer by custom.
The laws behind it
- Constitución Política de los Estados Unidos Mexicanos, Article 27
- Ley de Inversión Extranjera (Foreign Investment Law)
- Ley del Impuesto Sobre la Renta (Income Tax Law, ISR)
- Ley de Hacienda de los Municipios de Quintana Roo (Municipal Tax Laws)
- Ley del Impuesto al Valor Agregado (Value-Added Tax Law, IVA)
- Código Fiscal de la Federación (Federal Tax Code)
Guides in this topic
Notaries and lawyers in the Riviera Maya
A notario público in Mexico is a government-appointed attorney who verifies title, calculates and collects all taxes, prepares the deed (escritura), and files it with the Public Registry of Property. The notary's fee is set by state tariff schedules and typically ranges from 1 to 2 percent of the transaction value, plus 16 percent IVA. The notary also handles the SRE permit application for foreign buyers, requests the cadastral certificate and tax clearance (no adeudo), and ensures the seller's capital gains tax is withheld and remitted at closing. Buyers do not choose a notary; the seller typically proposes one, though the buyer may request a different notary if there is a conflict.
Property law and taxes FAQ
Can a foreign buyer own property in Mexico directly?
A foreign buyer can own property directly outside the restricted zone (50 kilometers from any coastline or 100 kilometers from any border) with a permit from the Secretaría de Relaciones Exteriores. Inside the restricted zone—which includes the entire Riviera Maya—foreign buyers must use a bank trust (fideicomiso), in which a Mexican bank holds title and the buyer has all beneficial rights for up to 50 years, renewable indefinitely.
What is the annual property tax rate in Quintana Roo?
Solidaridad (Playa del Carmen) charges 0.19 percent, Cozumel uses a progressive tariff from 0.11 to 0.77 percent, Bacalar charges 0.1 percent, and other municipalities set their own rates. Cadastral values are typically lower than market prices, so annual bills are modest compared to the United States or Canada.
How much are closing costs for a foreign buyer in Mexico?
Closing costs for a foreign buyer in Mexico range from 4 to 8 percent of the purchase price. The largest components are the municipal acquisition tax (ISAI) at 2 to 5 percent, notary fees at 1 to 2 percent plus 16 percent IVA, Public Registry fees at 0.5 to 1 percent, and for restricted-zone purchases, a fideicomiso setup fee of USD 1,500 to 3,000 and an SRE permit fee of MXN 21,650.
What is the capital gains tax rate for a non-resident seller in Mexico?
A non-resident seller in Mexico pays capital gains tax (ISR) of either 25 percent of the gross sale price with no deductions, or 35 percent of the net gain after deducting the inflation-adjusted purchase cost, documented improvements, and expenses. The seller chooses the method at closing, and the notary withholds the tax. Non-residents do not qualify for the primary residence exemption available to Mexican tax residents.
Do foreign property owners in Mexico pay income tax on rental income?
Non-resident foreign owners pay a flat 25 percent income tax (ISR) on gross rental income with no deductions for expenses, management fees, or depreciation. Furnished short-term rentals also incur 16 percent value-added tax (IVA), and Quintana Roo requires owners to register with the state tourism registry and collect a 5 percent state lodging tax, or 6 percent for digital-platform bookings.
How long does a fideicomiso last and can it be renewed?
A fideicomiso for property in Mexico's restricted zone lasts up to 50 years under Article 13 of the Ley de Inversión Extranjera and may be renewed indefinitely upon request by the beneficiary. The beneficiary holds all rights to use, rent, sell, mortgage, or pass the property to heirs, and the bank trustee cannot revoke the trust or claim the property.
What taxes does a property buyer pay at closing in Quintana Roo?
A property buyer in Quintana Roo pays the municipal acquisition tax (ISAI)—3 percent in Benito Juárez (Cancún) and Cozumel, 4 percent in Solidaridad (Playa del Carmen) and Tulum—plus notary fees of 1 to 2 percent with 16 percent IVA, Public Registry fees of 0.5 to 1 percent, and for foreign buyers in the restricted zone, a fideicomiso setup fee and SRE permit fee totaling approximately USD 2,500 to 4,000.
Is there a property tax exemption for foreign owners in Mexico?
No property tax exemption exists specifically for foreign owners. All owners, Mexican and foreign, pay annual predial at the same municipal rates. A primary residence capital gains exemption of up to 700,000 UDIs is available only to Mexican tax residents holding an RFC and meeting strict documentation requirements; non-residents and owners of investment properties do not qualify.
Written and reviewed by
Daniel Ortega
Real-estate writer · Maestría en Dirección Inmobiliaria (MDI)
Born and raised in Mexico City, living in Cancún since 2015.
Sources
Constitución Política de los Estados Unidos Mexicanos, Article 27 · Cámara de Diputados, federal laws · Cámara de Diputados, federal laws · Congreso de Quintana Roo, state laws · Government of Mexico · Not tax or legal advice.