Guide · one of two
What a Lakeside home really costs to buy
The price you agree on isn’t the whole bill. Plan on roughly 4% to 7% of the price on top, paid by the buyer, mostly at closing. Here’s what each cost is, so nothing on the closing statement surprises you.
The costs, one by one
Purchase tax (ISAI)
A local tax on buying a home. It’s based on the sale price or the town’s own value for the home, whichever is higher. Around Chapala it’s been about 2%. It can’t be negotiated, and it’s usually the biggest single cost.
The notario
Usually about 1% to 2%, and the percentage gets smaller as the price goes up. A Mexican notario público isn’t like a notary in the US, and isn’t quite a lawyer either. It’s an official appointed by the state who checks that the seller really owns the home, makes sure taxes and debts are paid, collects the taxes, writes up the deed, and registers it. A good notario will refuse to close a sale that isn’t sound.
The appraisal (avalúo)
A licensed appraiser’s report, needed to work out the taxes. It’s a set fee, usually a few thousand pesos for a typical Lakeside home. It isn’t a home inspection. It’s simply a value for the tax office.
Registration
The fee to record your new deed at the public property registry (Registro Público de la Propiedad). Usually about 0.5%. Until it’s registered, the sale is final between you and the seller, but not yet on public record. Ask your notario when it will be filed, and check that it was.
Certificates and checks
A few small set fees: a certificate showing the home has no debts against it (libertad de gravamen), proof that property tax (predial) and water are paid up, and the notario’s own checks. Small on their own, a few thousand pesos together.
The form for foreign buyers
Lakeside is outside Mexico’s coastal and border zone, so foreign buyers don’t need a bank trust. Instead, your notario files a simple form with the Foreign Affairs office. There’s a modest fee, and the notario takes care of it. Our guide to owning in your own name explains what the form says.
An example
Say you buy a home for $300,000 USD. You’d likely add about $15,000 to $18,000 USD in costs, mostly the purchase tax and the notario. On a $180,000 home, the percentage is a little higher, because the set fees stay the same.
Ask for a written estimate early
Your notario will give you a written estimate of closing costs before you sign anything final. Ask for it as soon as your offer is accepted, not the week you close. That’s the figure to rely on. Everything on this page is a typical range from our experience, not a quote.
What the seller pays
The seller pays the agent’s commission, which is agreed when the home is listed. They may also owe capital gains tax (ISR). There are exceptions if the home was their main residence, with conditions, and the notario works it out. If you’re selling, it’s best to talk this through before you list, not at closing.
After you move in
Here’s the good news. Yearly property tax (predial) is low compared with the US or Canada, often just a few hundred dollars a year, and there’s a discount if you pay in January. Water is inexpensive too. Gated communities have their own HOA fee, which varies a lot, so ask about it before you fall in love with a home.
One more thing: dollars or pesos?
Homes here are priced in either dollars or pesos, and it changes what you pay. If a home is priced in pesos and your money is in dollars, a change in the exchange rate between your offer and closing can change your cost. Ask early. We’ll tell you which currency a home is really priced in.
This is a guide, not legal or tax advice. These figures are what we’ve seen at Lakeside, and they change over time. Every home is different. Your notario, a lawyer, or an accountant can give you exact figures. We’re happy to help you know what to ask them.