In Puerto Vallarta and Riviera Nayarit the buyer pays most closing costs: acquisition tax, notary and registry fees and the bank trust setup. Annual property tax (predial) is charged on a low cadastral value, so it is usually a small fraction of US or Canadian property tax.
Buyers from the US and Canada are often surprised by two things here: closing costs are paid mostly by the buyer, and annual property tax is very low. Here is what goes into each, so nothing on the notary's statement catches you off guard.
What closing costs include
- Acquisition tax (ISAI), set by the municipality and charged on the property's value. Rates differ between Puerto Vallarta in Jalisco and Bahía de Banderas in Nayarit.
- The notario público's fees, plus registry and certificate fees, which the notary collects and pays.
- Setting up the fideicomiso with a Mexican bank, plus the trust permit from the Ministry of Foreign Affairs.
- An appraisal, which the notary uses to calculate taxes, and the registration with the foreign investment registry.
- Escrow fees, if you use an escrow company, and any translator or legal review you choose.
All in, buyers commonly budget a single-digit percentage of the purchase price for closing, with the exact figure depending on price, municipality, the bank and the notary. Always ask the notary for a written closing-cost estimate before you sign the promissory agreement.
What you pay every year
- Predial (property tax): charged on the municipal cadastral value, which is usually well below market value. For most homes it is a small fraction of what owners pay in the US or Canada.
- Early-payment discounts: municipalities usually discount predial paid in the first months of the year, so most owners pay in January.
- The bank trust's annual fee, charged by the trustee bank.
- HOA fees for condos, which vary with the building's services.
When you sell
The seller pays capital gains tax, withheld by the notary at closing. How it is calculated depends on whether the seller is a Mexican tax resident and on the documented cost of the property and improvements, so keep every official invoice (CFDI) from the day you buy.
My advice
Ask for three numbers before you commit: the notary's written closing estimate, the bank's trust fees, and the property's last predial receipt. Rates and fees change every year and differ by state, so treat everything here as general information, not legal or tax advice.
Jalisco or Nayarit: why the state matters →
Frequently asked questions
Who pays closing costs in Mexico?
Mostly the buyer. The buyer pays acquisition tax, notary and registry fees, and the bank trust setup; the seller pays their own capital gains tax and usually the real estate commission.
How much is property tax in Puerto Vallarta?
Predial is charged on the municipal cadastral value, which is usually well below market value, so for most homes the annual bill is a small fraction of US or Canadian property tax. Paying early in the year usually earns a discount.
Is there a yearly fee for the fideicomiso?
Yes. The trustee bank charges an annual administration fee, set out in the trust contract. Compare banks before closing.
