Property
Mexico — Property: Property Taxes
Mexico's annual property tax, Predial, is low by international standards — typically 0.05-0.3% of the cadastral (assessed) value, which itself usually runs only 20-60% of actual market value; on a 5 million MXN market-value home, this often means just 3,000-15,000 MXN (~$170-860 USD) per year. Rates are set by each municipality. The larger one-time cost is the Impuesto Sobre Adquisición de Inmuebles (ISAI), a buyer-paid transfer/acquisition tax of 2-5% of the property value depending on state/municipality (e.g. Quintana Roo 2%, Los Cabos 3%), calculated on the highest of the agreed purchase price, official cadastral value, or a mandatory bank appraisal. There are no additional surcharges targeting foreign buyers — ISAI applies identically regardless of nationality.
Key facts
- Annual Predial: 0.05-0.3% of cadastral value (cadastral value itself is only 20-60% of market value).
- ISAI (acquisition/transfer tax, one-time, buyer-paid): 2-5% of property value depending on state/municipality.
- ISAI is calculated on the HIGHEST of purchase price, cadastral value, or bank appraisal.
- No foreign-buyer surcharges — ISAI rates apply equally regardless of nationality.
Costs
- Annual Predial (property tax): 0.05-0.3% of cadastral value
- ISAI (acquisition tax, one-time): 2-5% of property value
Common mistakes
- Estimating Predial against market value instead of cadastral value, which is typically only 20-60% of market price.
- Underestimating ISAI by using the purchase price alone — it is calculated on the highest of three values, including a mandatory bank appraisal.