| | |  Puerto Vallarta Real Estate | April 2009 
Ejido Land FAQs
 Mike Hansen - Riviera Property Group
Can I Buy Ejido Land?
Yes, it is possible to safely purchase ejido land. However the process of purchasing ejido land is exact and it must be completed correctly. It is never recommended that anyone purchase ejido land without qualified legal assistance.
Is it Safe? I’ve Heard Rumors.
Yes! Purchasing ejido land is safe, however most investors are sure to hear a different story. Ejido horror stories have been broadcasted by investors that have failed to understand the importance of working with a qualified attorney.
Most of these ‘horror stories’ seem to originate from Baja California, and date back to the mid 1990’s, just after the Mexican constitution was changed to allow for the privatization of ejido land. Unfortunately for investors, this was a time when the entire concept of buying and selling ejido land was new to everyone, legal assistance was not available, and many investors made major mistakes.
Almost all ejido problems can be classified in one of three categories.
1. Dominio Pleno Problems
It is important to understand that ejido titles can only be sold, or transferred to other members of the ejido community. Individual ejido members must obtain a full title through the Domino Pleno process before the title can be transferred to a foreign buyer. Many foreign investors made the error of purchasing ejido property before the ejido land owner had completed the Domino Pleno process.
It is important to understand that foreigners purchasing ejido land are not really purchasing ejido land. If the process is completed correctly, a foreigner will usually secure the deal with a small secured deposit. After receiving the deposit the ejido land owner will start the Domino Pleno process. Upon the successful completion of the process a full ejido title will be issued, the land will then be deleted from the ejido registry, re-registered with the Public Registry of Properties, and a new fully transferable private property title will be issued.
Any transfer of title to a foreigner before this process has been completed is null and void.
2. Restricted Zone Problems
Most investors with the Dominio Pleno problems described above also made the major mistake of attempting to purchase land in the “Restricted Zone”. In Mexico, foreigners can not own land 100km from the border, or 50km from the coast. If investing in the “Restricted Zone” a foreigner must purchase the property through a bank trust, or Mexican company.
The direct transfer of title to a foreigner in the “restricted Zone” is null and void.
3. Rights of First Refusal Problems
Many investors also made the mistake of purchasing ejido land before the Rights of First Refusal process was completed correctly. This process is exact, and gives the entire ejido community an opportunity to purchase the property before it’s sold to a non- ejido member.
If this process is completed correctly investors have no need to worry, the land can even be insured against ejido claims. However, if the process has not occurred, or has not been completed correctly any ejido member could make a legal claim to the land even years after it has been sold to a foreigner.
It is very important that the Rights of First Refusal are completed correctly. Many foreigners made the mistake of purchasing property before the Rights of First Refusal process was completed correctly.
Summary
In Summary, ejido land can now be purchased safely, however it is always recommended to hire a qualified attorney. Any bad press concerning ejido land is usually outdated, or a story about an investor that has made some very careless decisions.
In the mid 1990’s it was much easier to make mistakes, especially when qualified legal assistance was not available. Nowadays investors have far fewer worries, legal assistance is now available, and problems are easy to avoid.
Note: Many investors are fooled by sales people that appear to know what they’re talking about, or ejido members that believe their status in the community allows for special provisions. Please understand that this is not the case, everyone is required to follow the exact same process when purchasing ejido land, and very few sales people are even remotely qualified to ensure that your investment is safe. EVERYONE needs a qualified attorney to oversee the entire process of purchasing ejido land.
Riviera Property Group has specialized in ejido dealings for the past ten years, and has successfully purchased and developed hundreds of ejido land parcels. Our extensive experience ensures that your investment is safe and problem free. For more information about Riviera Property Group click HERE or visit the website at visit EjidoLand.com.
Why Ejido Land?
Ejido land can offer investors a variety of incentives and benefits; however, location, price, affordability, and opportunity are the principal reasons why investors choose ejido land.
Location
It’s no secret that most visitors to Mexico are interested in fun, sun, and beach activities. And considering that most of land on the Mexican coast is classified under the ejido regime it is obvious why ejido land is so important.
Almost all of the most beautiful beaches and properties in Mexico are located within ejido communities, and the Mexican real estate market is almost at the point where any major development on the entire coast will require the acquisition of ejido land.
Ejido land provides both holiday home owners and developers the perfect spot for their next project.
Price
Besides the physical location, the price is what attracts most investors to ejido land. Many ejido parcels are sold at a fraction of their true value, and many properties could be sold for up to ten times more if a private property title existed.
As with almost any product or service, supply and demand also sets the price for ejido land. And with so much misinformation circulating about ejido land and an overall ignorance to the importance of ejido land, and ejido dealings there is almost no demand.
Even today very few lawyers, notaries, or real estate agents truly understand ejido dealings, creating a situation where very few investors are exposed to ejido land opportunities, and those that are, are usually scared away with false information.
However, savvy investors realize that investing in ejido land is safe, and have identified a unique opportunity to purchase private property titles at ejido prices. Remember, if purchased correctly investors will defer the final payment for ejido land until the ejido title is canceled, and the property is re-registered with the Public Registrar of Property.
Affordability
Ejido land provides investors possibility. Development projects and holiday homes become a lot more affordable when land can be purchased at a fraction of its value. For investors on a limited budget the acquisition of ejido land can mean the difference between a spot on the beach, or a spot ten minutes away.
Opportunity
Mexican ejido land has been described by some as the world’s largest untapped real estate market. It’s available, it’s undervalued, and it can be safely purchased with qualified legal assistance.
Overall it’s a win/win situation: developers are making a fortune, holiday home owners are closer to the beach, and foreign investment provides Mexico a source of sustainability.
Forward thinking investors realize that the ejido land sector is positioned for prosperity and abundant growth. Its location is perfect; its infrastructure is supportive, and it can be safely purchased at a fraction of its value.
While most investors understand that investing in property is a sure way to build wealth, most buy property at retail prices then wait for capital growth. However, ejido land offers investors the opportunity to purchase property at wholesale prices and lock in immediate profits.
With Riviera Property Group you can invest with confidence. Our full service legal firm has specialized in ejido land for close to a decade, and we have successfully purchased, secured, and developed hundreds of ejido land parcels. For more information about Riviera Property Group click HERE or visit the website at visit EjidoLand.com. |
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