San Felipe, Baja, Mexico

The Mexican Land Lease

Can I get a 99 year land lease?
A land lease for more than 10 years is not legal and never has been. Nor the 10 + 10 + 10 year arrangement, either. If you enter into a 10 + 10 + 10 agreement with a Mexican land owner and at the end of the first 10 years the land owner decides he does not want to recognize that second ten year lease you thought you had, he does not have to do so. You have no recourse, because you entered into that agreement which was designed to circumvent Mexican Law, thereby giving you no legal status to use the Mexican Court System.

If you lease land, the lease should be 9 years and 11 months to stay within the lease land laws. It is possible and perfectly legal for the Mexican land owner to give you a new 9 year 11 month lease at the end of your first 9 year 11 months and so on.

When should I get a land lease?
It's been suggested a Lease Land arrangement is acceptable if:

  • you are limiting your second home investment to a smaller total purchase amount rather than a Bank Trust purchase
  • only if you can obtain a 9 year 11 month lease.

Just be sure the total investment you are willing to pay for the structure on lease land is an amount you can average over a 10 year period and be willing to “walk away” from at the end of your first lease period of 9 years 11 months. That may not be the case, but know it could be the case given the property values rising in this area at such a rapid rate, especially large parcels.

Lease Land Fees

How much are land leases?
Land lease rents run from about $50.00 to as much as $600.00 per month. Most leases have a “cost of living adjustment” at the end of your lease for the next lease term. Often there’s a 10% fee when you sell the structures that pass to the new land owner and your buyer will probably have a nominal increase in the rent as well. Usually a 10% increase.