Communal Land or Private Property: What Expenses Will You Incur?

When buying land or property in an unfamiliar area, it is important to determine whether it is communal land or private property before completing the purchase.

Communal Land

Communal land is an extension of land that belongs collectively to a group of people or to a community.

In other words, it is collective land where all members have common rights, shared needs, grazing rights, common land use, and other collective uses.

In Mexico, communal lands are protected and recognized by law, since many belong to different Indigenous or rural communities. The Agrarian Law regulates the ownership and use of ejido and communal lands in Mexico.

The law establishes that communal lands are inalienable, imprescriptible, and not subject to seizure, except in specific cases where the communal assembly determines that it is clearly useful for the population center.

Main Expenses and Procedures for Communal Land

1. Researching the history of the land
   • First, it is essential to investigate the full history of the communal land. You need to know whether it has debts, legal limitations, or any litigation. This step gives you certainty that the land or property you are acquiring is in good legal condition.
2. Land appraisal
   • Before signing the contract, the value of the communal land must be determined by a certified appraiser. This professional will establish a fair price for the land and help avoid long-term complications.
3. Agreement with the community
   • Above all, because it is communal land, it is essential to reach an agreement with the community that administers the land. This ensures the consent of both parties and establishes the purchase clauses in a legal document.
4. Transfer of rights and purchase-sale agreement
   • The payment must also be made to the owner or community member who transfers their rights. All of this should be carried out with the advice of an agrarian lawyer to ensure that all clauses are beneficial and clear for both parties. In some cases, this is formalized before the Commissariat of Communal Property.
5. Minutes and certifications
   • Afterward, the assembly issues the minutes approving the transfer and the Commissariat issues a certification of rights.
6. Payment of taxes and fees
   • Before deed formalization, make sure all corresponding fees and taxes related to the purchase of the communal land have been paid. This will help avoid legal problems in the future and give you peace of mind that everything is in order.
7. Deed formalization before a notary public
   • Once the previous steps are completed, deed formalization must be carried out before a notary public. This process legally transfers the ownership of the land to your name and records you as the new owner.
8. Regularization expenses, converting to private property
   • Topography and boundary survey
     • The boundaries of the land must be precisely defined through an authorized surveyor, who prepares the survey and georeferenced plan. This will be used for all subsequent procedures. The cost can range from $5,000 to $15,000 MXN, depending on location and size.
   • Procedure before the National Agrarian Registry (RAN)
     • This step is used to obtain the property title or parcel certificate. To process it, you need to submit the assembly minutes, topographic plan, and certification request. The cost ranges from $2,000 to $8,000 MXN in fees and management services.
9. Conversion to private property
   • If you want to convert the land into private property, the land must be registered as private property in the Public Property Registry. The title issued by the RAN must be formalized before a notary, and registration fees must be paid. Registration fees may range from $1,000 to $3,000 MXN, while notarial fees may range from 0.5% to 1.5% of the cadastral or commercial value.
   • This step is essential to secure your rights as an owner and guarantee the legal validity of the transaction.

Private Property

Private property is the set of rights that individuals or legal entities have to acquire, possess, use, enjoy, and dispose of assets of any kind, such as land or houses, whose right of possession and use is protected by law.

These are properties that are already registered in the Public Property Registry, which grants them full legal validity, and they have a deed. However, it should be noted that this purchase process may take several months, especially when financing is required or when off-plan properties are involved.

Main Expenses and Procedures for Private Property

1. Legal investigation of the property
   • Before buying, it is essential to verify the legal status of the property. For this reason, you should request the Certificate of No Liens to confirm that the property has no mortgages, seizures, or debts, and that it is correctly registered in the Public Property Registry.
2. Commercial appraisal
   • To determine the real value of the property, a certified appraiser must perform an appraisal to establish a fair price. In the case of financing, this also helps calculate taxes and comply with the requirements of the banking institution.
3. Purchase-sale agreement
   • Once the price has been determined, a contract must be prepared to establish the conditions of the transaction, including payment method, amount, deadlines, and obligations of both parties.
4. Payment of taxes and fees
   • The buyer must pay registration fees at the Public Property Registry, as well as property tax and water fees. The buyer must also cover the Real Estate Acquisition Tax (ISAI), whose percentage varies by state, generally between 2% and 4.5% of the transaction value.
5. Registration before a notary
   • Finally, all property documentation is taken to the notary, where the identity of the parties is verified, the public deed is drafted, and the property is registered in the Public Property Registry. This final step includes notarial fees and administrative expenses, generally between 0.5% and 1.5% of the property value.

Conclusion: Buying Communal Land or Private Property

Both types of purchase, whether communal land or private property, can be good investments as long as you make sure that all documents are in order, there are no possession conflicts, and the property has an excellent legal status.

Remember that if your current option is communal land because of its attractive price, it should be viewed as a long-term plan due to all the procedures and regularization steps the land requires. You should also have proper legal advice and an agrarian manager.

Private property, on the other hand, involves a more accessible and faster process. It is ideal if you are looking for immediate legal certainty, access to credit, and easier resale.

At Viva México® Real Estate, if you still have questions about how to buy communal land or private property, we will guide you step by step to obtain the property you have always wanted.

We offer you the best properties in the area and will guide you step by step so you can make one of the best decisions of your life.

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