Before buying a property you must be well informed of the expenses that this implies, beyond the price of the property. Here I tell you what the additional expenses are, so that you do not have surprises later. And so you can better calculate and plan your budget.
The Real Estate Acquisition Tax (ISAI) is applied when a person acquires a property and allows the Ministry of Finance to recognize the buyer as its rightful owner. On average, the percentage to be paid is 2 percent in some parts in Mexico,, however, depending on the entity where the property is located, this amount may increase or decrease. In the State of Quintana Roo it is 2% This is paid by the buyer.
Income tax (ISR), which is applied to the profit obtained on the sale of the property, in Quintana Roo is around 2% This goes by the seller and depending on your situation it may be exempt. individuals who sell a home cause ISR for the sale of a home. But the law recognizes that this payment can be exempted if the maximum value of the sale is 700,000 USD. You can enjoy this benefit once every three years.
‘Are you going to request a Credit? Then you are going to need a real estate APPRAISAL: One of the buyer’s obligations when applying for a mortgage loan is to carry out a real estate appraisal that validates the price requested for the house. Due to the large amount of money that financial institutions grant to applicants, it is necessary to verify that the amounts are fair and that you are not trying to overcharge for a property that is not worth it.
Deed: You should know that the deed expenses, due to the change in title of the property for sale, are normally paid by the buyer. The cost of the deed will depend on the value of the property, as well as the location in Mexico, in which it is located. The cost of the deed is around 5 and 7% of the property’s value. Investigate the percentage of the deed cost according to your state and take it into consideration for your budget.
Public Registry of Property: An important step after registering the house is to register it with the Public Property Registry, this is what will give validity to the deed and therefore will award you the right as the owner of the property, legally disposing of the property. The cost varies depending on the value of the property. It could vary between 10 and 15 thousand pesos.
For the entire process of deed of sale you will need a notary to guarantee legal security. Notary fees will depend on the professional you choose, and you should also include it in your budget. Investigate in different Notaries and find out who will give you the best price. In general, it is advisable to allocate for extra expenses between 5 -10% of the value of the property to cover expenses if the home is located in areas of high capital gain.
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