The Transfer of Ownership of Property

The Transfer of Ownership of Property

By Angel Marin Díaz


What do we mean by property transition? It is precisely the transfer of property rights from one person to another either through a sale or transfer of rights, but in this case we are talking about when you want to acquire a property. 


Whether you want to build on it or carry out agricultural projects on the land you obtained, the effects of this act are that the person who obtains the property rights can take advantage of the property as soon as the legal transfer of the real property is carried out, but always within the obligations and limitations that the laws provide. 


The transfer of ownership of a property can be done by contract between one person or numerous buyers and the seller(s) without having to formalize it before an authority or it can also be done before a public notary, so what are the differences? 


To carry out the transfer of the rights and obligations of a property in the presence of a legal authority the requirements are: 1) the certainty that what you are acquiring is legal and free of encumbrances; 2) that you will be known by all authorities as the owner of the property, as it is registered in the Municipal, State and Federal Registry. 


On the other hand when a contract is made only between the interested parties (Private Contract), this act only obliges the parties to comply with the agreement, which does not include the ability to transfer possession of the property, since there is no certainty that it belongs to whomever transfers the property. This regularly results in future legal disputes. 


Examples would include buying ¨Ejido” property (restricted to foreigners); or using an old method of ¨Presta Nombre¨ (name lender).


As you can see the transfer of ownership of real estate not only entails the satisfaction of having acquired a property, but also imposes the necessity to do so legally with respect to the obligations of the buyer to pay the corresponding federal and municipal level taxes which are essential to complete the transfer of ownership. Taxes are calculated on a sliding scale ranging from two to four percent of the purchase price for the buyer.


Finally, do not forget that if you are a foreigner you must process your permit at the Ministry of Foreign Affairs to be able to acquire real estate in the country. In addition you must prove your stay in Mexico is legal; make the acquisition of the property of your choice before a public notary; and pay the applicable taxes. Once completed, you are then able to exercise dominion over the property that you have acquired as the legitimate owner and consequently you can take advantage of it as a proprietor–to carry out residential, commercial, industrial, or agricultural uses, or as collateral for a capital contribution in commercial negotiations. 


For more specific information on the matter, including all Legal due diligence for residential and commercial closings, fiscal planning and Capital Gains, please contact the author:


Angel Marin Díaz at:, 415-121-9005