Real Estate

Ejido Property

Most people that may be interested in real estate in Puerto Vallarta would be obtaining regularized land known as a fideicomiso, in which title can not actually be obtained directly by a foreigner, but title can be placed in trust with a bank the next best thing. This system has been in effect for many years and has worked very well with literally thousands of people purchasing Mexican property without any problems.

However there are lands, generally outside of Puerto Vallarta, especially to the north in popular areas such as Sayulita and San Pancho, that have not been regularized and which are Known as Ejido properties. This type property was established in 1917 after the Mexican Revolution to break up the large landholdings of foreigners and wealthy Mexicans the land is still owned by the government but control is given to an assembly of Ejidatarios or community members of the ejido. They can apportion the property to individuals, but up until 1992 when some changes were made to the system no one individual could have title to a particular piece of ejido land.

The 1992 Agrarian law changes recognize the individual property rights within the ejido and under certain conditions allow for the lease and sale of property to non-ejido members. This allows the land to transfer from government control and places it in the public land registry where it can then be leased or sold. With over 50 million acres of land presently in ejidos, this would open up substantially the amount of land available for development in Mexico.

However, very little of this transfer has actually taken place, and it will not take place at all if an Ejido Assembly does not wish it to happen. Secondly, this was established primarily for agricultural reasons, not so those foreigners could buy a parcel of land to build upon. It is especially uncertain how this effects ejidos with tropical land forests - will the government allow this type of land to enter under the agrarian law adaptions? Thirdly, it is presently illegal to promote or sell ejido land, and there are severe penalties that could be enforced to those that do so.

Our recommendation and that of the realtors we spoke to be careful. There are still many uncertainties and no one can promise you for sure that your interests will be protected or indeed the ejido land you’re interested in will become regularized. If you aren’t comfortable with this, stick to regularized property, there's plenty of that in and around Puerto Vallarta.

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