Landlord and Tenant Laws (Property Laws) in Mexico

A landlord is a person who lets a tenant use a property, structure, or apartment. In other words, a landlord is a proprietor or manager of a boarding house, apartment, or business. On the other hand, a tenant lives on land or other property rented from a landlord. Property Laws are laws that are formulated, enacted, and passed to regulate, govern, and serve as guidelines when dealing with a property. The field of law known as Property Law is responsible for regulating the numerous types of real estate and personal property ownership. Legally recognized rights to resources, including real estate, personal property, and intellectual property, are referred to as property. Accordingly, Property Laws refer to the standards by which property disputes are settled and how property transactions are made. Property law differs from other types of law because it focuses on the connections between and among people in a society concerning “things,” which are either physical objects like land, structures, or establishments or intangible objects like stocks and bonds. Therefore, property law deals with the distribution, utilization, and transfer of wealth and the wealth’s things. A real estate investor who knows Mexico’s Property Laws will have leverage over real estate investors that are not knowledgeable of Mexico’s Property Laws. Engaging in the real estate business in Mexico entails excellent knowledge of Mexico’s Property Laws. Moreover, a real estate investor who knows Mexico’s Property Laws undoubtedly promotes the best interest in the real estate business.    

Mexico Required Landlord Disclosures, Security Deposit Limit and Return, Mexico’s Constitution of 1917 Article 27, and Landlord Access to Rental Property are among the laws for landlords in Mexico. The President, the members and senators of the Federal Congress, the state legislatures, and Mexican citizens have the authority to propose laws or decrees. In reality, the executive branch is the one that suggests most bills. With a few rare exceptions, both the Senate and the Chamber of Deputies must discuss and approve a draft bill for the bill to move through the legislative process. The state and the federal district civil codes are substantially similar to the federal civil code because Mexico’s legal system is founded on civil law. The primary distinction between the legal systems of Mexico and the United States is that Mexico adheres to “civil law,” while the United States follows “common law.” A US Citizen should be aware and familiar with the laws for landlords in Mexico to understand the process of acquiring or renting a property in Mexico. Moreover, real estate investment necessitates any citizen considering investing in real estate to at least study the laws concerning the business and the investment. Mexico Property Laws favor tenants, making it challenging for landlords to evict tenants when a lease expires. 

Provisions concerning rental agreements in Mexico are in the Civil Code of Mexico’s Federal District. Tenants elsewhere in Mexico should consult the Civil Code of the state where the tenant is renting. Below is a list of the laws for tenants in Mexico.

• Mexico’s Constitution of 1917 Article 1: Mexico’s Constitution of 1917 Article 1 ensures the entitlement of all individuals, including tenants, to the human rights granted by the republic. Including treaties signed by the Mexican State and the guarantees for protecting of these rights.   
• Mexico’s Constitution of 1917 Article 4: Mexico’s Constitution of 1917 Article 4 assures that men and women in Mexico are equal under the law. Moreover, the same law promotes the protection of the organizing and development of the family. Furthermore, the same article provides that any family has the right to enjoy a decent and respectable house. The law will set the instruments and support necessary to achieve such an objective.     
• Mexico’s Constitution of 1917 Article 6: Mexico’s Constitution of 1917 Article 6 provides for the Right to Information. The same provision of the constitution states that the expression of ideas shall not be subjected to judicial or administrative inquiry, except for those cases when a such indication of ideas goes against the moral, privacy, or rights of third parties, causes the perpetration of a felony or disturbs the public order.
• Mexico’s Constitution of 1917 Article 8: Mexico’s Constitution of 1917 Article 8 promotes the Protection of Consumers, which the Federal Consumer Protection Law was anchored. Article 8 of the Mexican Constitution states that public officers and employees will respect the exercise of the right to petition, provided that the petition is made in writing and peacefully and respectfully. 

Yes, landlords and tenants can determine deposits together according to Mexican Property Laws. The Civil Code requires that the lease agreement include any guarantees the parties have agreed, but it does not specify a maximum deposit amount. The landlord often demands a one-month security deposit when signing a residential lease. Although rent is frequently paid in advance each month, rental deposits are not typically a requirement for residential units. Additional guarantees like institutional bonds or solvent guarantors are required. Unless otherwise specified, the guarantor’s obligations end when the lease’s term expires. Ordinarily, the lease prohibits the tenant from using the security deposit to cover the final installment of rent. It stipulates that the landlord will not release the security deposit until the tenant has returned the property in the same condition as when the tenant rented it, with normal wear and tear excluded and that all utility payments at the tenant’s expense have been fully paid. The landlord typically demands a one-month security deposit when signing a residential lease. Most rules governing lease agreements are enshrined in Mexican civil regulations (each state has its applicable civil code). The parties, however, freely negotiate and agree on additional terms to govern the lease and its legal ramifications.  

Tenants pay the deposit at the time of signing. Tenants usually pay via cash, bank transfer, online payment methods, or debit/credit cards, depending on the agreed payment method between the tenant and the landlord. Otherwise, the landlord shall indicate the deposit payment method and nature of payment in the contract upon signing. A detailed inventory of the property is essential to keep track of any prior damage. After the rental agreement is signed, tenants have 30 days to notify the landlord of any preexisting severe damage. Unless an alternative time frame has been agreed and if the property is in good condition, the landlord shall refund the security deposit to the renter within 30 days of the tenant’s departure. Tenants have the right to ask the landlord for a letter at the end of the lease referring to all duties fulfilled.

To evict current tenants, one must invest time, energy, and money in legal fees. Mexico Property Laws favor tenants, making it challenging for landlords to evict tenants when a lease expires. A landlord must provide a time-limited lease notice before the termination of the lease; otherwise, the lease will become an indefinite-term lease. Once a particular procedure is done a judge should order the eviction of a tenant. If the renters disobey the order, the landlord should ask the judge to order police assistance so that, if required, the tenant must evict the property. The rights and obligations of the tenant and the landlord are stipulated in the Mexican Constitution of 1917 and in the civil code of every state in Mexico. It includes the responsibility of both the landlord and the tenant regarding eviction. Depending on the circumstances, evicting a renter in Mexico takes between two and seven weeks. The procedure takes longer if a tenant submits an appeal or asks for a postponement.      

Mexico Property Laws for rent raise stipulates that yearly rent increases in certain leases cannot exceed 85% of increases in the federal district’s general minimum wage for the year the lease is prolonged or renewed. The landlord is allowed to have a 10% increase from the prior rent, when a tenant renews a one year lease. It is common for rents under lease agreements  to have an annual raise under a specific Consumer Price Index that the parties have agreed on. The reference is typically made to the Consumer Price Index (CPI) of the United States of America if the rent is set in dollars or the INPC (Indice Nacional de Precios al Consumidor) if it is in Mexican pesos. Moreover, subject to validation of the rent raise recommended by Mexico Property Laws, the tenant and landlord should specify the agreed rent raise provisions in the leasing contract.

Since October 1932, the current Federal Civil Code has been in force after being published in the Federal Official Gazette on March 26, 1928. Mexico’s Property Laws have undergone numerous changes since then. Rent for properties that were rented at the time was frozen due to a momentous decree released on December 30, 1948, to extend lease terms in Mexico forever. Mexican government repealed the law on December 30, 1992. However, the law gave existing leases a grace period between 30 days and four years, depending on the property type and the rent amount. Mexican law made important changes to lease agreements for residential properties in 1993. However, the changes did not take effect for leases on residential properties at the time until October 19, 1998. Before this time, the renter could renew the contract for an additional two years as long as rent payments were up-to-date. The law removes the tenant’s rights concerning leases signed after October 19, 1998. The maximum mandatory lease agreement period is one year unless the parties voluntarily agree to end the lease early.

Landlords and tenants end a real estate-related contract by revisiting the contract itself. The landlord and tenants must fulfill their obligations with due diligence. Both parties must escalate the matter if one fails to deliver on a commitment in the contract. A real estate contract allows parties to terminate the contract at any time with the consent of  the landlord and the tenant. Putting the termination and ending of a real-estate-related contract in writing will safeguard both the tenant and the landlord. Landlords’ and tenants’ relationship ends when the time reaches of the leasing contract of a real estate property has been reached. So, if the tenants vacate by the time specified in the agreement, that ends the real-estate contract. Both the landlord and the tenant are no longer subject to each other’s obligations under the contract.  

Yes, Mexico Property Laws favor tenants, making it challenging for landlords to evict tenants when a lease expires. To evict current tenants, one must invest time, energy, and money in legal fees. A landlord must provide time-limited lease notice before the lease’s termination; otherwise, the lease will become an indefinite-term lease. Fortunately, the agreement is canceled with a 15-day notice under the existing terms in force since October 19, 1988. The landlord needs not to justify the termination. The issue is that the landlord will have to go to court to ask for eviction if, notwithstanding the landlord’s notice, the tenant continues to reside in the property after the contract has ended. For example, the lease agreement will remain in effect if either the tenant or the landlord passes away. Therefore, the tenant’s husband, concubine, children, and other family members will be entitled to the lease benefits as long as they reside in the leased property while the tenant is alive. Concerning residential leases cannot waive this cause.    

Yes, Mexico has a rent control system. The federal district and a few other states are subject to Mexico’s only significant rent control system. It stipulates that yearly rent increases in certain leases cannot exceed 85% of increases in the federal district’s general minimum wage for the year the lease is prolonged or renewed. The landlord is allowed a 10% increase from the prior rent, when a tenant renews a one-year lease. According to the contract, it is very common for rents under lease agreements to be raised annually under a specific Consumer Price Index that the parties have agreed on. The reference is typically made to the Consumer Price Index (CPI) of the United States of America if the rent is set in dollars or the INPC (Indice Nacional de Precios al Consumidor) if it is in Mexican pesos.

Imprisonment, confinement, prohibition of going to a specific place, monetary sanction, warning, suspension or deprivation of rights, disablement, dismissal, or suspension from functions or employment, suspension or dissolution of business associations, and forfeiture of assets about illicit enrichment are among the punishments in the property law system. In general, according to the provisions of the Federal Criminal Code, when a person wishes or accepts the result of the behavior prohibited by law while knowing the components of the crime or anticipating its potential outcomes, an individual is guilty of committing the crime. Additionally, when a person fails the responsibility to anticipate the predictable repercussions of a crime or foresees such consequences but expects them not to materialize when the person should and could foresee them due to the circumstances or personal circumstances, that person is guilty of negligence. Fraud and identity theft are among the prominent crimes concerning the real estate business in Mexico.  

The heavy workload and other drawbacks of Mexican bureaucracy contribute to the general lack of efficiency of the Mexican Legal System and the Mexican courts. However, certain states and Mexico City have taken steps to enhance the administration of justice. For instance, tribunals with expertise in leasing disputes have been established in Mexico City to speed up resolution. Most states have adopted changes to procedural law to speed things up. Unlike American case law, Mexican case law does not serve as a precedent. Instead, “jurisprudencia” is only recognized after the Supreme Court and the federal collegiate courts have rendered five successive rulings that align with one another on a particular legal problem. The Mexican Legal System for Property Laws was directly concerned with governing property and other real-estate assets while upholding the parties’ best interests.

Yes, a real estate investor should know Mexico’s Property Laws. A real estate investor who knows Mexico’s Property Laws will have leverage over those real estate investors that are not knowledgeable of Mexico’s Property Laws. Engaging in the real estate business in Mexico entails excellent knowledge of Mexico’s Property Laws. Mexico Real Estate Investment will attract investors that know Mexico’s Property Laws. Understanding Mexico’s Property Laws will allow the investor to become flexible and master the requirements and needs of the landlord-tenant before coming into an agreement and signing a contract. Moreover, a real estate investor who knows Mexico’s Property Laws indeed promotes the best interest in the real estate business.   

Yes, Mexico’s Property Law changed based on the Mexico States. Each Mexican State has civil laws governing landlords, tenants, and property ownership in Mexico. Mexico is the Federal Republic. Hence, each country’s 31 states has its laws governing leases. The Civil Code of each state includes certain regulations. Thus, before entering Mexico’s Real Estate Investment, knowing and familiarizing the property law of a particular state engaged in the real estate business is advisable. An adequate orientation to Mexico’s state civil laws governing buying, renting, and owning a property allows an investor to check for the best Mexico locations to buy real estate.