Introduction to Real Estate Law in Mexico

Introduction
Mexico operates under a civil law system in which real estate ownership is classified into three main categories: public property, ejido (communal) property, and private property. The regulation of real estate ownership is primarily established by the Mexican Political Constitution, along with applicable federal and local laws, including the civil codes of each Mexican state.

Public Property
Public property belongs to the Mexican nation as a sovereign entity and may be held by federal, state, or municipal governments. It is governed by:

• The Constitution
• The National Assets Law
• The Acquisitions, Leases, and Services of the Public Sector Law
• Other relevant local laws and regulations

All public real estate must be registered with the Public Registry of Property and Commerce. As a general rule, public property cannot be sold, transferred, or encumbered unless a formal disincorporation process is followed or a concession is granted for its use.

Ejido (Communal) Property
Ejido property is land granted by the government to agrarian communities, primarily for communal or productive use. While ejidos have full legal ownership over their land, they do not constitute public or private property. This type of ownership was established in 1917 following the Mexican Revolution and is governed by the Constitution, Agrarian Law, and other relevant regulations.

Originally, ejido land could not be sold or transferred. However, legal reforms now allow its conversion into private property if specific legal requirements are met. Ejido property is registered with the National Agrarian Registry, rather than the Public Registry of Property and Commerce.

Private Property
Private property is owned by individuals or entities, including domestic and foreign individuals, companies, or investment vehicles. It is regulated by:

• The Constitution
• The Federal Civil Code
• Local laws and regulations, including the civil code of the state where the property is located

All private real estate must be registered with the Public Registry of Property and Commerce.

The Public Registry of Property and Commerce
This public entity records and discloses the legal status of real estate, including:

• Ownership rights
• Easements, liens, and encumbrances
• Other restrictions affecting real estate

For a transfer of ownership or the creation of a lien to be legally effective against third parties, it must be registered with the relevant Public Registry of Property and Commerce. Registration generally has a declarative effect, meaning it confirms but does not create ownership rights. However, in some states—such as Quintana Roo—registration does not constitute a legal right but only serves as public notice.

The registry is accessible to the public, allowing any interested party to review a property’s legal status, ownership history, and any existing encumbrances. If a property is not registered, legal ownership may not be enforceable against third parties, potentially affecting future transfers or liens.

Applicable Law in Real Estate Transactions
Under Mexican civil law, real estate transactions are generally governed by the laws of the state where the property is located. However, the parties involved may agree to submit disputes to courts in a different jurisdiction, such as the courts corresponding to their place of residence. In such cases, the laws of the state where the property is located will still apply to resolve the dispute.