Puerto Vallarta, Mexico - One question looms large over many property investors looking to buy in Mexico; "Is this home or property attached to 'Ejido' (agricultural co-op) land?"
And it's a fair question, especially given the plight of stories surrounding Ejido conflicts and expropriator actions – most recently in Tulum where long-time 'owners' and operators were informed that their properties may, in fact, not be their own, but that of an Ejido.
Ejido Land Transfers: A Brief History
The Ejido (agricultural) reform program began after the 1910 revolution in order to redistribute power and land to rural communities and peasants. Passed down from generation to generation, Ejido (pronounced eh-hee-do) land represented approximately 50 percent of Mexico, including coastal property on which many resort properties and coastal villages currently sit.
Prior to 1992, investing in Ejido property was difficult, if not impossible, as state laws prohibited the transfer of communal land. Land owners, ejidatarios, were permitted to rent portions to third parties but not sell it outright. Consequently, many investors and buyers entered into loosely-worded rental agreements, which later came back to haunt them.
1992: A Solution – 'Regularizing' an Ejido Property
To meet the needs of both Ejido sellers and buyers, in 1992, the state began establishing regulatory policy which permitted the legal transfer of Ejido land – a process called "regularizing" – opening the door to confident investing and secure property ownership.
Simply put, the new laws allowed Ejido co-operative owners to convert their communal, jointly-held property to private property, which could then be transferred to a buyer.
Ejido Land Transfers: Due Diligence and the Right Real Estate Agent
Despite the historical conflicts associated with Ejido property purchases, it is now possible to invest with confidence and security.
The regularization process, while seemingly complicated, requires a marginal investment of time and patience. These steps include:
• property surveys
• title checks
• buyer and seller identification process
• land reclassification (if necessary)
• title insurance
• procedural applications and certifications (with multiple state agents and departments)
If you are considering buying a property in Mexico and wish to navigate around the prospect of Ejido land, begin by contacting a real estate agent who is knowledgeable about the process. Do not try this alone.
For more information on real estate buying or selling in Mexico, contact us at +52 (322) 222-6678 or info(at)ronmorgan.net.Ron Morgan Properties specializes in luxury real estate in the Marina Vallarta area and beyond to La Cruz de Huanacaxtle and Punta de Mita, as well as along the southern shores of Banderas Bay, from the Romantic Zone, Amapas and Conchas Chinas down to Mismaloya and even Costa Alegre. For more information, visit RonMorgan.net.
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