Mexico Residency by Investment in Real Estate (Guide)

Mexico has long established itself as a popular holiday destination, thanks to its beautiful beaches, pleasant climate, delicious cuisine, and affordable costs.

However, many investors are now discovering that Mexico also offers an attractive residency by investment program. This program allows individuals to obtain permanent residency in Mexico in exchange for investing in property and real estate.

In this guide, we will explore what Mexico's residency by investment program entails, the eligibility requirements, and the benefits of investing in real estate in Mexico.

What is Mexico Residency by Investment in Real Estate?

Mexico's residency by investment program is a pathway to obtaining permanent residency in Mexico through an investment in real estate. 

The program is designed to attract foreign investors who are interested in purchasing property in Mexico for personal use, rental income, or both and is available to individuals who invest a minimum of $220,000 in real estate located in Mexico. Through investment in real estate, you will be able to obtain a temporary residency which can lead to permanent residency after 4 years.

Benefits of Mexico Residency by Investment 

1. Low Cost of Living 

According to Numbeo data, the cost of living in Mexico is 45.2% lower than in the United States. This means that investors can enjoy a higher standard of living for less, giving them more value.

2. Established Holiday Economy 

Mexico has a thriving tourism industry, with millions of visitors flocking to the country each year. There is a strong demand for rental properties in popular tourist destinations, which can provide investors with a steady stream of rental income.

3. Growing economy

Mexico is Latin America’s second-largest economy, and its GDP is expected to grow by 3% in 2023.

4. Diversification of Investment Portfolio

Investing in real estate in Mexico can provide investors with a way to diversify their investment portfolios and reduce risk. 

5. Retirement Destination

Mexico is a popular destination for retirees due to its pleasant climate, low cost of living, and high quality of life. By obtaining permanent residency through the residency by investment program, investors can enjoy all that Mexico has to offer as a retirement destination.

6. Riviera Maya Train

The construction of the new Riviera Maya Train route, which will connect Cancun and Tulum and start operations on December 1, 2023, is expected to drive economic growth and boost tourism in the region. Investments in real estate in areas along the train route will likely experience significant appreciation in value in the coming years.

7. Tulum Airport

The new Tulum airport is expected to be completed in 2024, which will provide easier access to the popular tourist destination as the currently the closest airport in Cancun, approximately a 1.5-hour drive. The perks of having an airport nearby are expected to increase property values in the region.

Types of Mexico Residency by Investment

Mexico offers various types of residency through investment pathways, depending on the source of the investment and your particular circumstances.

Based on Income

This program is available to individuals who can demonstrate that they have a regular income from a legitimate source, such as a pension or a salary. The minimum income required will depend on whether you are applying for a temporary or permanent residency and whether you have dependents such as your spouse and children.

Based on Savings 

This is available to individuals who can demonstrate that they have a certain amount of savings in a Mexican bank account.

Based on the Value of the Property in Mexico

Being the most attractive option, this pathway is designed for individuals who wish to obtain residency by investing in Mexican real estate. 

You may apply for Temporary Residency if you possess a residential property in Mexico with a market worth of at least 40,000x the Minimum Daily Wage or UMA*. This translates to: 

• If MDW is used in the calculation, Mexican pesos (MXN) $8,297,600 (roughly $437,000 US dollars); alternatively.
• If UMA is used in the calculation, MXN$4,149,600 (roughly $218,400 US dollars); and.

*UMA (Unidad de Medida y Actualización) is used to calculate payments, obligations, or fines owed to the Mexican government, whether under federal or state law. Its value is released once a year. This year the annual UMA is MXN $37,844.40 or roughly $2,090 US dollars.

Investment property must meet further requirements, such as:  

1. The property must be located in Mexico; 
2. The property valuation must be free of any liens (debts, charges, or mortgages); 
3. The value stated on the title deed/sale contract or the most recent official appraisal; 
4. The applicant's name must match the name on the title deed/sales contract.

An original and a photocopy of the Public Deed signed before a Commissioner of Oaths certifying that the foreigner is the holder of real estate with a value exceeding $8,579,640 Mexican pesos is needed.

Upon approval, the investors will be issued a Temporary Residency for one year, which they will be able to renew every year. After holding a Temporary Residency for a period of four years in a row, investors will be able to convert it into a Permanent Residency card.

Based on Capital Investment in a Company

This program is available to individuals who invest a minimum of 20,000x in the MDW or UMA.

This equates to:

• MXN$4,148,800 (about $218,000 US dollars) if MDW is applied to the calculation; or
• MXN$2,074,000 (roughly $109,200 US dollars) if UMA is applied.

Property Investment Destinations in Mexico

Tulum 

Tulum has become a popular destination for tourists and investors alike. The area boasts beautiful beaches, a bohemian vibe, and a growing number of luxury resorts and properties.

Real estate yields in Tulum have been consistently high; from 2019 to 2021, the average return on property investment in Tulum was 8-15%, making it an attractive option for investors.

Cancun

Cancun is a well-established holiday destination known for its stunning beaches, clear waters, and vibrant nightlife. The area is home to numerous luxury resorts and properties, which can provide investors with high rental yields.

Playa Del Carmen

Playa Del Carmen is a laid-back beach town that has become increasingly popular with tourists and investors. The area offers a range of properties, from affordable apartments to luxury villas, making it an attractive option for investors.

Cozumel

Cozumel is a popular cruise ship destination known for its crystal-clear waters and excellent diving opportunities. The island offers a range of properties, from beachfront condos to luxury villas, making it an attractive option for investors looking to capitalize on its growing tourism industry.

Who is Eligible for a Mexican Residency Visa?

Foreign nationals who invest a minimum of $220,000 in Mexican real estate are eligible for the residency by investment program. Applicants must also meet certain eligibility requirements, including a clean criminal record and a valid passport.

Requirements for Mexican Residency Visa via Property Investment

To obtain a residency visa through property investment, applicants must provide proof of the investment, such as a deed or a purchase agreement. 

They must also provide proof of income and demonstrate that they have the financial means to support themselves in Mexico.

Mexican Citizenship

One of the advantages of Mexico’s residency by investment is that it leads to citizenship.

Foreigners who can prove they have legally resided in Mexico for five years have the opportunity to apply for "citizenship." An aptitude test in Spanish and a test of knowledge of Mexican history and culture are part of the application process. 

The Bottom Line

Mexico's residency by investment program offers an attractive opportunity for investors looking to obtain permanent residency in a country that provides a high quality of life, affordable costs, and a thriving tourism industry. 

By investing in real estate in Mexico, investors can take advantage of the many benefits that the pathway offers, including increased property values, rental income, and diversification of their investment portfolios. As Mexico continues to develop its infrastructure and attract more visitors, the opportunities for real estate investment in the country are only set to grow.

FAQs About Mexican Residency By Investment 

What is the difference between Temporary and Permanent Residency in Mexico?

Temporary residency in Mexico is granted for a specific period, usually up to four years, and is suitable for those who want to stay for an extended period but not permanently. Permanent residency is for those who wish to live in Mexico indefinitely and provides the holder with the same rights as a Mexican citizen, except for the right to vote. 

Permanent residency requires a more extensive set of documents, including proof of financial solvency, a clean criminal record, and a minimum period spent as a temporary resident. However, if you hold a temporary residency for up to 4 years, you can convert it into permanent residency.

Can family members apply for Temporary Residency in Mexico?

Yes, family members can apply for Temporary Residency in Mexico. Foreigners can apply for Temporary Residency in-country if the foreign applicant is either the spouse, the parent (mother/father), or the son or daughter (under 18 years of age) of a foreigner holding a temporary or permanent resident card.

How long does the application process take?

Starting from the day you hand in all of your completed paperwork to the National Immigration Institute, the processing of your application for a Mexican Resident Visa typically takes anywhere from ten to fifteen working days. However, it could take as long as four weeks or longer as every application is dealt with on a per-case basis. 

Is Mexico a good place to invest in real estate?

Yes, property prices in popular tourist destinations in Mexico, such as Tulum, Cancun, Playa del Carmen, and Cozumel, have risen dramatically over the last decade, providing solid returns to investors.