The Acquisition Process

Step-by-Step through a foreign land we go

“If you put the government in charge of the Sahara desert, in 5-years there’d be a shortage of sand and then a tax.”
Milton Friedman

purchase feesWhether you’re a savvy investor or a first-time buyer, real estate investors have always been hit with additional costs and fees attendant to their purchases. The good news is that in Mexico, they’re, in a word, “reasonable”; significantly more reasonable than in the United States and California especially. And while there’s certainly no-escaping the premiums, the successful investor is always well-armed with information going into the acquisition. That which follows is an example of what investors at Rancho Costa Verde can expect.

The Numbers

Investing in Mexican real estate includes costs outside of the purchase price; fees set by both federal law and municipal statute. As a result, these fees vary from  state-to-state and municipality-to-municipality and depend on the size of the land and/or the structure thereupon. In general, they total between 4% to 10% of the purchase price. When considering Rancho Costa Verde in San Felipe, these costs were our costs for a 2500 sq ft beachfront property of $170k and are current to 12-2022. And while common consensus holds that payment of these fees is “always the responsibility of the buyer” while the seller is only responsible for “other” real estate fees and their capital gains taxes, this is untrue. Responsibility for the payment of these ancillary fees is always negotiable. 

-Property Fees

  • Transfer tax: 2% State Tax
  • Trust Permit (Department of Foreign Affairs): $1000 USD
  • Foreign Investment Registry (Department of Foreign Investment): $700 USD
  • Trustee Bank Acceptance Fee: $550 USD
  • Trustee Bank First Year’s Trust Fee: $550 USD
  • Appraisal for Future Tax Assessment: Varies by property size and the appraiser’s fees.
  • Non-Encumbrance Certificate (Land Registry Office): $15 USD
  • Preventative Notice Advice (Land Registry Office): $30 USD
  • Registration Fees (Land Registry Office): Varies between 0.5% to 1% in Jalisco/Nayarit.
  • Notary’s Fee: Varies between 0.5% to 1%, depending on the transaction size.

Unlike California and the other sun-drenched western-US states which have only recently seen the benefit of independent, residential, solar power/reserve generator systems and have mandated their use for all new California residential construction under 3-stories since 2020, Rancho Costa Verde was developed as a solar-only community; a design that avoided cluttering the views with unsightly power lines, maintained its committment to environmentally-sound development practices on the shore of the most protescted body of water in the world; the Sea of Cortez and eliminated residents’ dependence on “iffy” power supplies and ever-increasing rate hikes. And employing the same vision relastive to household waste and a governmental ban on septic systems proximal to the water, Rancho Costa Verde employed individual, residential, bio-organic treatment systems for each of it’s structures; the result being not only a cleaner environment, but the by-product creation of enough 99%-pure waste water to support individual, outdoor gardens of fresh fruits and vegetables. Environmentally sized to the needs of the indiuvidual residents and their custom homes, these costs of these two systems are incidental to the cost of construction and, like the homes, custom-designed to the specific needs of the owners.

-Construction   Costs

  • Organic aerobic waste treatment system: $4900
  • Rooftop solar power system: $30, 40, 50k USD
    • 8500KWh system: appropriate for family of 1-2 in-home year-round, rental/vcacation
    • 10,500KWh system: appropriate for family of 4 in-home year-roubnd, rental/vcacation
    • 12.5 KWh system appropriate for active family of 4 in-home year round, rental/vacation with entertainment system, pool and off-road toys.

NOTE: Because each Rancho Costa Verde home is custom-designed and built to the owners unique specification, and because the needs of each Rancho Costa Verde owner are equally unique, it would be wholly unfair to combine the $98/sqft cost of construction and the cost of supplying power and waste needs in to a blanket average.  The needs of a family of four living year-round in a 2500 sqft home with a combination pool / swim-up bar, workshop with several off-road vehicles, 80″ plasma entertainment system and the need for an ambient inside air temperature of 68* are going to be markedly-different than those of a single person who wants to build a modest, bungalow get-away to visit a few time a year and “AirBnB” it  the rest of the time. A blanket system cost averaged into a cost of construction would invariable mean that one person was paying more for his or her needs than another who was paying less for their needs. But, to gauge what your needs might be, let’s use a real-world example of what our cost-versus-needs was.


  • So. Cal. home with SCE

    • Family of 2 with occasional visiting friends and family
    • Property size: 3000 sqft home 4 Bd/3.5 Ba. quarter-acre fully-landscaped Los Angeles property, pool, spa, workshop, 2-working offices, 60″ entertainment system, 68* average interior ambient temperature
    • Sun exposure: full sun
    • 2022-year power use: 14,460KWh / $5,409.26
    • 2022-year avg. monthly power use: 1205KWh / $450.77
    • Solar System needed: 8.5KWh
  • San Felipe home with Solar 

    • Family of 2 with occasional visiting friends and family
    • Property size: 2500 sqft home, 2 Bd/2.5 Ba., 2-office, 5,000 sqft property, 60″ entertainment system, 68* average interior ambient temperature
    • Sun exposure: full sun
    • Solar System needed: 8.1KWh
    • Solar System purchased: 10.5KWh
  • Ammortization w/ Power & Waste Treatment

    • Cost of 10.5 solar – $45,000
    • Cost of SCE/yr: $5,000
    • Time to recover: 9 years
    • Monthly savings: $450
    • Yearly savings: $5,400
    • Plus Bio-waste treatment system: $5000
    • Adjusted Cost of Construction: $45k+$5k=$50k/2500sqft=$20/sqft $98+20=$118/sqft.
    • Adjusted Cost of Construction: 2500sqft x $118 = $295k
    • Original Estimated Cost of Construction @ $98/sqft: $110k+$250k=$360k
    • Adjusted Total Cost of Property @$118/sqft: $110k+$295k=$405k
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