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Purchasing Ejido or Communal Land in Mexico

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Harriet Murray Blogs for Expats In Mexico on Real Estate
Harriet Murray

Buying property in Mexico is very different than what you may be used to in your home country. Take purchasing ejido or communal land in Mexico, for instance.

Real estate professionals in Mexico caution against purchasing ejido land through an informal “promise” or “for a good price.” There are many stories of foreigners who thought they had clear title to former ejido land and were later surprised by a Mexican national knocking on their door declaring ejido ownership of land on which the foreigner’s home was built.

Before 1915, large haciendas held most of the land in Mexico. In fact, just 1 percent of the country’s population at that time owned 90 percent of the land. The Agrarian Reform Act of 1915 and the Constitution of 1917 created a unique form of ejido land ownership. This body of law gave the federal government the right to expropriate land and redistribute it to the communal groups, the ejidos. Group members or ejidatarios were each given the use of a parcel of land, which could be passed to heirs. It could not be sold, returned or used as collateral for a mortgage.

The ejido system remained unchanged for most of the 20th century. But over the years, as the parcels were handed down and further divided, the majority of ejidatorio land size shrank to below subsistence level, with average parcels of two hectares or less.

The system was radically reformed in 1992 with the creation of a process for privatization. Ejidos were given the opportunity to regularize the land and grant titles to members for individual parcels The expectation was that this reform would result in farmers buying additional parcels to increase their holdings. Ejidatarios were no longer required to work the land to maintain ownership. This process for privatizing land also meant it could be sold to an outsider of the ejido.

A major challenge to selling or regularizing ejido land is simply locating all the owners. This regularization requires a lengthy application process during which all members of the ejido must agree on privatization, and the parcels of land have to be defined. Even if the ejido land has been fully regularized, the group may maintain communal ownership for development land for parks, markets and town squares.

It cannot be overemphasized that buyers should never make an informal agreement hoping that the land will be privatized. Nor should they take someone’s word that ejido land has gone through the privatization process. If land is ejido, or in the process of regularization, it cannot be put into a fideicomiso trust for foreign beneficiaries.

A quick test to know if the land is communal or ejido is that it has no escritura. The land and home on it may have a titulo (title), but this does not mean the same thing in English as a clear title. Request a copy of the escritura to find out the truth.

If you want to buy any land that is ejido, you need a professional attorney educated in ejido law, as well as good deal of patience.

This article is based upon legal opinions, current practices and my personal experiences in the Puerto Vallarta-Bahia de Banderas areas. I recommend that each potential buyer or seller of Mexican real estate conduct his own due diligence and review.

3 COMMENTS

  1. This is so important. Foreigners who make assumptions about “legal title” are opening up to potential years of heartache. I am a naturalized citizen who has owned property on the coast 5 seperate times… some with and some without the legal papers. I have been lucky in all cases. The last piece took 13 years to get my escrituras. Every step of my life in Mexico 25 years has been a lesson in something. I have learned patience and courtesy above all. Getting things done via the bureacracy as it is take the patience of a saint and a cheerful attitude. I bought my current piece from an Ejidetario (member of an Ejido) with the same papers that they use to sell to each other and in a community that has a long history of honest dealings. Since I am willing to gamble and plan on never selling I do not feel that I am at risk… but I would NEVER consider it in any other circumstances.

  2. Help your clients to achieve their investment goals, buying real estate in Mexico ! It is possible to buy ejido land safely with the correct advise of an attorney, there are some law firms that may guide you through the legal process; but if you want legal certainty, effectiveness in the shortest possible time you better contact attorney specialized in Mexican Agrarian Law, they have plenty knowledge of law, institutions and programs in the Agrarian area. For further information please contact: http://www.juridicoagrario.com.mx

  3. Our real estate expert Harriet Murray says “In general, yes the average lawyer does not have this speciality. Lawyer must be vetted and even then there is still a high risk of the process being done wrong and wasting money.”

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