Feb. 12, 2022
We want to report that yesterday we walked away from the deal to buy the sweet house we showed you in La Paz. We are sad, but at the same time are a bit relieved.
For the past couple weeks we have been immersed in the complicated process of buying a home in a foreign country. They certainly don’t do things in Mexico the same way as in the US, so there’s a steep learning curve and lots of due diligence required to keep things moving and in your favor. It’s been a journey, and one that is not for the faint of heart!
All Mexican real estate transactions to foreigners are cash-only, so there’s a lot on the line. If you’re buying within 50 miles of the coast, your closing attorney fees are another $20,000 up front to set up a “Fidelcomisio” trust with a Mexican bank and register it with the government Notario. The bank then co-owns the property with you and allows you exclusive use for 50 years, renewable for another 50 years, and fully transferable to heirs.
The escrow process takes at least 3 months to set up the trust, but could close weeks or months later at their discretion, with no protections for the buyer. Once it closes you will be able to move in but must wait an additional few months to have the Notario officially stamp your ownership papers to make it legal. There are lots of expats here, (over 30,000 in La Paz alone!) so if you’re willing to make the effort, there are lots of gringos waiting to welcome you.
We got as far as the inspections and contingencies yesterday before we decided to bail out. The house was beautiful and passed inspection with flying colors, but after a huge amount of due diligence on our part, our deal breakers were large, unresolvable issues of privacy and security that couldn’t be ignored.
Baja is still on our radar as a wonderful location for a vacation home but we haven’t found “the one” yet. In the meantime, it’s sunny, near 80 here, and the lobster and margaritas are great. Have a wonderful weekend! (We’ll be back in Santa Fe March 1st.)
