Since it was announced that a 100-year restriction on direct foreign ownership of seafront land could be revised, demand for luxury coastal property in Mexico has gone through the roof.
Currently, foreign buyers cannot own land within 31 miles (50 km) of the coast or 62 miles (100 km) of Mexico’s international borders, as decreed by the post-Revolution constitution introduced in 1919. Foreign buyers have, however, found a way to bypass the law by buying property through a 50-year renewable bank-held trust, known as a “fideicomiso”, which names the foreign investor as beneficiary. 49,000 foreign nationals – mainly Americans and Canadians – are estimated to own beachfront Mexican property this way. George Clooney is among the most recent investors in a luxury property on the Mexican seafront, having built a villa next door to his friend, Cindy Crawford, overlooking the Sea of Cortez in Los Cabos.
Mexico’s 1919 laws are now considered outdated and the country wants to encourage foreign investment in tourism, so the constitutional amendment to allow coastal investment by foreigners is awaiting approval by the Mexican Senate.
In anticipation of a law change, mainly British and American buyers are fuelling a rise in interest for Mexican beachfront homes, with the coastal resorts of Cancun and Playa del Carmen set to benefit most.