NAVIGATING THE PATH TO YOUR DREAM PROPERTY IN LA PAZ
A COMPREHENSIVE GUIDE
Are you considering making La Paz your home, either seasonally or year-round? As you embark on the exciting journey of finding the perfect property in this coastal paradise, some key considerations and preparations can significantly enhance your experience. Here's a comprehensive guide to help ensure a smooth and informed property-buying process:
DOCUMENT PREPAREDNESS
Ensure all your documents are up-to-date before making an offer. This includes valid passports, not set to expire within the next six months, and obtaining an FMM (tourist card) at the border if you're not already a temporary or permanent resident. Be ready to provide copies of driver's licenses, a current utility bill in your name, and a marriage license if applicable.
REALISTIC BUDGETING
While La Paz real estate remains a good value, it's crucial to acknowledge the evolving market. Prices have risen steadily in recent years, so browsing local listings beforehand to understand the market trends is advisable. Plan your budget considering the current market conditions and the type of property you desire.
PROPERTY TITLE CONSIDERATIONS
Given Mexican law, property ownership within 50 km of the coastline generally requires a fideicomiso (bank trust) for non-Mexicans. Understand the implications of various title-holding options, whether a fideicomiso or a Mexican corporation, and choose the one that aligns with your goals.
CLOSING COSTS
Be prepared for closing costs, which can be higher than those in the US or Canada due to the title-holding mechanisms. Anticipate fixed costs around $5,000 USD, in addition to an acquisition tax equal to 2.5% of the purchase price.
FINANCING YOUR PURCHASE
Most property purchases by foreigners in Mexico are cash transactions. While limited financing options exist, it's essential to plan accordingly and explore alternatives such as selling your existing home or taking out a home equity loan.
FUNDS AVAILABILITY FOR OFFER
When making an offer, a good faith deposit (typically 10% of the purchase price) is required within 5-7 days of the signed offer. Ensure you have the funds available and can wire them to an escrow account promptly.
bENEFICIARY SELECTION
If opting for a fideicomiso, choose substitute beneficiaries who will inherit the property without probate. Start thinking about this early, ensuring your selected individuals have valid identification.
RESIDENCY TIMING
While you might consider obtaining temporary or permanent residency eventually, it's not a prerequisite for property purchase. In fact, owning property can positively impact your residency application. It's advisable to initiate the residency process after purchasing your property, leveraging your investment for a smoother application.
As you embark on this exciting journey, remember that we are here to guide you every step of the way. Our commitment is to make your La Paz dream home a reality. Feel free to reach out with any questions or to start your property exploration journey with us.
