Mexico

Registering Property in

Mexico

Below is a detailed summary of the steps, time and cost involved in registering property in Mexico. It assumes a standardized case of an entrepreneur who wants to purchase land and a building that is already registered and free of title dispute.

This information was collected as part of the Doing Business project, which measures and compares regulations relevant to the life cycle of a small- to medium-sized domestic business in 189 economies. The most recent round of data collection was completed in June 2013.

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  • Standard Property Transfer

  • Property Value: MXN 6,396,225.11
  • City: Mexico City
No. Procedure Time to Complete Associated Costs
* 1 The notary obtains a certificate of good standing with the water service

Article 27 of the Fiscal Code for the Federal District establishes that the interested parties shall provide the notary evidence that there are no outstanding fees concerning water supply service and property tax of the property subject to transfer, for the five years preceding the granting of the public deed.

In order to obtain a certificate of good standing with the water service, the interested party must submit before the SACM the following documentation in original and copy:

- Application for certificate of good standing with the water service.
- Official ID of the owner of the property.
- Proof of domicile no older than 3 month.
- Proof of payment of fees established in article 248, section VIII.
- If the procedure is not carried not by the owner of the property, it must also submit a proxy letter or a power of attorney, as applicable.







Agency: Sistema de Aguas de la Ciudad de México (SACM)
15 days (simultaneous with procedures 2, 3, 4 & 5) MXN 130
* 2 The notary obtains the Zoning Certificate of the property

The Public Registry of Property and Commerce will require the zoning certificate together with the application to register the transfer of property. The notary shall request the zoning certificate at the Ministry of Urban Development and Housing (Secretaría de Desarrollo Urbano y Vivienda). The cost is established in article 235, section III of the Fiscal Code for the Federal District.

The applicant must submit an original and copy, the documents below with the corresponding delegation’s single-counter service. The authority will retain only the copies.

- Form AU-01
- Proof of payment of property taxes to date.
- Proof of payment of fees.
- Official identification.
- Relotificaton or subdivision license, if applicable.
- Street number designation and boundry alignment certificate (certificado de alineamiento y número oficial), if applicable.
- Public deeds, if applicable.

Agency: SEDUVI (Secretaria de Desarrollo Urbano y Vivienda del Distrito Federal)
15 days (simultaneous with procedures 1, 3, 4 & 5) MXN 891.50
* 3 The notary obtains a non-encumbrance certificate

Pursuant to article 3016 of the Civil Code for the Federal District, the notary before whom the transfer deed is being formalized must request a non-encumbrance certificate to the Public Registry. Likewise, such request shall be considered as a preventive notice.

The applicant must submit before the Public Registry of Property and Commerce the following documentation:
- Application for request in triplicate, including the name and signature of the of the applicant, term of the certificate, location of the property and real estate folio.
- Proof of payment of fees established in article 198, section I of the Fiscal Code for the Federal District in duplicate.
- The application for request may also be made via internet, as well as the payment of fees.

This procedure can be done online at the following website: http://187.141.34.93/RPPyC/

Agency: Public Registry of Property of the Federal District ("Registro Público de la Propiedad y del Comercio del Distrito Federal")
7 days (simultaneous with procedures 1, 2, 4 & 5) MXN 485
* 4 The notary checks the good standing of the seller on the property tax (predial)

The certificate of good standing of the seller on the property tax (predial) is one of the documents to be provided by the interested parties under art. 27 of the Fiscal Code of the Federal Disctrict; the receipts of payments of the predial (boletas) are no longer required.

To obtain the certificate, the applicant must submit at any Treasury office the following documents:
- A written request (there is no official application form), that fulfills the requirements established in art. 430 of the Fiscal Code of the Federal Disctrict, which include but are not limited to the name of the applicant, her/his address, to whom the request is addressed, the "predial" account.
- Copy of an official identification document of the applicant.
- If the request is presented by a legal representative, a copy of her/his power-of-attorney.

The cost is established in the Fiscal Code of the Federal District (article 248, section VIII). The applicable Treasury office will take 10 working days to process the certificate.

The notary would double check this information online at: http://ovica.finanzas.df.gob.mx/

Agency: Secretaria de Finanzas
1 day if checked online or 13 days if certificate of good standing ("constancia de no adeudo") is requested. (simultaneous with procedures 1, 2, 3 & 5) MXN 130 if certificate of good standing ("constancia de no adeudo") is requested
No cost if information is checked online
* 5 The notary requests a commercial valuation of the property

A commercial valuation is required under the Fiscal Code of the Federal District to determine the taxable value of the property subject to transfer. Article 116 of the Fiscal Code of the Federal District establishes that the property tax shall be calculated taking in to account the highest of (i) the purchase price, (ii) the cadastral value, and (iii) the value resulting from the commercial valuation by the fiscal authorities or authorized appraiser.

The notaries usually have their own appraisers. Nevertheless, the parties may hire the appraiser they choose. When banks are involved in the transaction, they will usually bring in the valuers they usually work with. Sometimes parties have a previous valuation, and the notary can have it reviewed to see if it suffices. However, these previous valuations are usually not fiscal ones and therefore another one has to be done to determine the value of the property for the ISAI tax, but also for the VAT tax to which commercial constructions are subject to when transferred (please note that the land is not taxable under VAT, just the commercial constructions).
Agency: Licensed valuer
7 days (simultaneous with procedures 1, 2, 3 & 4) MXN 3000 - MXN 5500
6 The notary formalizes the sale purchase agreement

The notary public will request from the seller:

• Property title (escritura), which the seller already has
• Receipts evidencing the payment for real estate taxes for a period of five years (boletas del impuesto predial)
• Receipts evidencing the payment of water fees for a period of five years (boletas del servicio de agua)
• Public deed(s) containing the incorporation and by-laws of the seller company (escritura constitutiva), together with copy of any public deed(s) containing amendments to the by-laws of the seller company
• Public deed(s) containing the powers of attorney granted in favor of the seller’s representatives (for acts of domain and acts of administration in terms of the second and third paragraph of article 2554 of the Civil Code of the Federal District)
• Copy of the official identification of the seller's and buyer's representatives

The notary will procure on behalf of the parties:
• The zoning certificate (obtained in Procedure 2)
• The valuation (obtained in Procedure 3)
• Certificate of good standing with the water company (obtained in Procedure 1)
• Certificate of good standing in the property tax (obtained in procedure 4)

The buyer is subject to pay the acquisition tax ("Impuesto sobre Adquisiciones o Transmisión de Dominio"). In this respect, on the date of execution of the real estate purchase agreement before the notary public, said notary public will retain the above mentioned taxes and pay them before Treasury Department.
The scale of notary tariffs is with respect to the Notary Publics of the Federal District only. Other Mexican states have varying scales.
The seller will also have to pay the income tax and the value added tax as follows:
The applicable Income Tax for transferors resident in Mexico is 28% on the gain (the excess of the sale price over the adjusted tax basis). The tax basis of real estates is in general terms the original cost of acquisition as updated for inflation.
The value added tax (16%) is applicable only with respect to the constructions that conform to the property and therefore an allocation of the price to the land and constructions should be made in the sales agreement based on an appraisal. The value added tax will be shifted to the buyer.

The notary public shall calculate its fees as set forth in Article 15 of the Notary Fees of the Federal District (Arancel de Notarios), taking into account the highest of (i) the purchase price, (ii) the cadastral value, and (iii) the value resulting from the commercial valuation by the fiscal authorities or authorized appraiser.
3 days Property Acquisition Tax, according to the following scale, from Art 113 of the Fiscal Code of the Federal District:
Lower Value Higher Value Fixed Fee Rate over excess
MXN 0.12 $87,159.70 $164.31 0.00000
87,159.71 139,455.47 164.32 0.03163
139,455.48 209,183.01 1,818.43 0.03261
209,183.02 418,366.13 4,092.25 0.03261
418,366.14 1,045,915.32 10,913.71 0.03696
1,045,915.33 2,091,830.65 34,107.94 0.04565
2,091,830.66 Hereinafter 81,853.96 0.04565
Notary Fees as officially published on March 12, 2013, according to the following, which are established on art. 15. of the Notary Fees of the Federal District (Arancel de Notarios).
I. In transactions up to MXN $132,791.00, a fixed quota of MXN $4,829.00
II. In transactions from $132,791.01, the fixed quote established above plus the amount which results applying the previous table to identify the amount under following table:
More than MXN up to the excess of Rate
the lower value
$ 132,791.01 $ 265,584.00 1.125 %
$ 265,584.01 $ 531,168.00 0.975 %
$ 531,168.01 $ 1,062,333.00 0.825 %
$ 1,062,333.01 $ 2,124,670.00 0.675 %
$ 2,124,670.01 $ 4,249,340.00 0.578 %
$ 4,249,340.01 $ 8,498,680.00 0.420 %
$ 8,498,680.01 $ 16,997,358.00 0.257 %
$ 16,997,358.01 Hereinafter 0.086 %
7 Registration of the transfer of title at the Public Registry of Property of the Federal District

The notary public will proceed with the registration of the first testimony of the public deed containing the formalization of the purchase agreement of a real estate and the transfer of title, before the Public Registry of Property of the Federal District. After registration, the buyer will have to give notice to the corresponding water department, and any other company that provides any service to the property (i.e. electric company, water, etc.)
Agency: Public Registry of Property of the Federal District ("Registro Público de la Propiedad y del Comercio del Distrito Federal")
30 - 90 days
* Takes place simultaneously with another procedure.

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