Annual property tax is one of the recurring costs that most surprises foreign buyers about owning real estate in Mexico — surprises them pleasantly. Predial rates in Mexico are typically a tenth or less of what you'd pay on comparable property in the US or Canada. But the variation between states is significant, and the payment process has quirks worth understanding.
What is predial
Predial is the annual municipal property tax. It applies to all real estate — homes, condos, lots, commercial properties — and is calculated as a percentage of the cadastral value (valor catastral), not the market value. The cadastral value is assigned by the municipal cadastre and is typically 30-50% of market value.
This is why Mexican property taxes feel so low: a 0.15% rate on a cadastral value of $750K MXN (for a property that sold for $1.5M MXN) means $1,125 MXN annual tax — about $66 USD per year. Compare that to the US where a comparable home might owe $4,000-$15,000 in annual property tax.
2026 rates by state (key markets for foreign buyers)
| State / Region | Rate range | Annual on $1.5M MXN cadastral | Early-payment discount |
|---|---|---|---|
| Mexico City | 0.05% – 0.40% | $1,500 – $2,200 MXN | 8% (Jan), 5% (Feb) |
| Quintana Roo (Tulum/Cancun) | 0.30% – 0.45% | $4,500 – $6,750 MXN | 15% (Jan), 10% (Feb) |
| Baja California Sur (Cabo) | 0.20% – 0.45% | $3,000 – $6,750 MXN | 10% (Jan) |
| Jalisco (PV, Guadalajara) | 0.18% – 0.32% | $2,700 – $4,800 MXN | 15% (Jan), 10% (Feb) |
| Yucatan (Merida, coast) | 0.15% – 0.30% | $2,250 – $4,500 MXN | 20% (Jan), 10% (Feb) |
| Nayarit (Sayulita, Punta Mita) | 0.20% – 0.40% | $3,000 – $6,000 MXN | 15% (Jan) |
| Guerrero (Acapulco, Ixtapa) | 0.20% – 0.35% | $3,000 – $5,250 MXN | 10% (Jan) |
| Oaxaca (coast) | 0.12% – 0.25% | $1,800 – $3,750 MXN | 15% (Jan) |
USD ≈ MXN ÷ 17 (approximate 2026 exchange).
How foreign buyers pay predial
Three practical paths, in descending order of convenience:
Option 1 — Pay online from abroad (best for hands-off owners)
Each municipality has its own portal. The main ones:
- Mexico City:
finanzas.cdmx.gob.mx - Tulum:
tulum.gob.mx/predial - Cancun (Benito Juarez):
cancun.gob.mx/tesoreria - Playa del Carmen (Solidaridad):
solidaridad.gob.mx/tesoreria - Los Cabos:
loscabos.gob.mx/predial - Puerto Vallarta:
puertovallarta.gob.mx/tesoreria/predial
You'll need your cuenta predial (predial account number) — it's on your original deed (escritura). Most portals accept international Visa/Mastercard. Some quote in MXN only, others give USD equivalent.
Option 2 — Bank counter (you or someone in Mexico)
Print your predial slip from the municipal portal and pay at any major Mexican bank counter (Citibanamex, BBVA, HSBC, Santander). The bank charges a small commission ($20-$50 MXN). Useful if you have a friend or family member in Mexico.
Option 3 — Hire a property administrator
If you also have an Airbnb manager, lawn maintenance person, or pool service, they often handle predial payment for an annual fee of $500-$2,000 MXN ($30-$120 USD). Make sure they give you the official municipal receipt — it's needed if you ever sell.
The early-payment discount (pay in January)
Almost every municipality offers a discount of 8-20% if you pay the full annual predial in January or February. This is the easy money — there's no reason not to pay in January. The discount applies automatically to the online payment if you do it within the window.
Special discounts that foreigners can also claim
Beyond early payment, several discounts apply equally to foreign owners:
- Seniors (65+): 30-50% additional discount in Mexico City, State of Mexico, and many other states. Show your passport or INM card with date of birth.
- Persons with disability: 30-50% discount in most states. Requires medical certification.
- Widows/widowers: 25-50% in some municipalities (Mexico City, State of Mexico). Requires death certificate of spouse.
These discounts are NOT applied automatically — you need to apply at the municipal tax office (tesorería municipal) each year with your documentation.
Why predial matters when buying
- Verify no outstanding balance before closing. Ask the seller for a "constancia de no adeudo de predial" — a no-debt certificate. If the property has 3+ years of unpaid predial, that debt stays with the property and becomes yours. The notario will require this certificate before scripting.
- Check the cadastral value vs market value. If cadastral value is unusually high relative to market, you'll pay more predial annually. This is rare but worth checking — some Tulum properties have aggressive cadastral re-valuations.
- Budget for predial in your monthly costs. Even at low rates, $3,000-$6,000 MXN annual predial means $250-$500 MXN monthly reserve. Combined with HOA (cuota condominal), utilities, and maintenance, recurring costs add up.
What if I forget for a few years
Late predial accrues surcharges (1.5-2.5% monthly) plus inflation adjustment. After 5 years the municipality can technically begin embargo, but in practice rarely does for occupied residential property. The real problem is that:
- You can't sell or transfer the property until predial is paid in full
- If you sell, the notario will deduct the predial debt from your sale proceeds
- You can't refinance or use the property as collateral
- If you want a fideicomiso renewal (foreign-owned property in restricted zone, every 50 years), past-due predial blocks it
Translation: predial is small but persistent. Pay it.
Summary for foreign buyers
- Annual predial in Mexico is roughly 0.05%-2.5% of cadastral value — very low compared to US/Canada
- Cadastral value is typically 30-50% of market value, so effective rates are even lower
- Tourist zones (Tulum, Cancun, Cabo, Vallarta, Sayulita) have the highest rates (0.30-0.45%)
- Pay in January for an automatic 8-20% discount
- Pay online with international credit card via municipal portal
- Verify no outstanding predial before buying — it transfers with the property
- Seniors, persons with disability, and widows can claim additional discounts even as foreigners
Frequently asked questions
How much is the property tax in Mexico in 2026?
Mexico's annual property tax (called predial) ranges from 0.05% to 2.5% of the cadastral value depending on state and municipality. Mexico City averages 0.10-0.15%; State of Mexico 0.20-0.35%; Jalisco 0.18-0.30%; Quintana Roo tourist zones (Tulum, Cancun) 0.30-0.45%. For a $1.5M MXN (~$88K USD) home in Mexico City, annual predial is roughly $1,500-$2,200 MXN ($88-$130 USD).
Why is Mexican property tax so much lower than in the US or Canada?
Two reasons. First, predial is calculated on cadastral value (assigned by the municipality), which is usually 30-50% of market value — not market value itself. Second, Mexican municipalities collect most of their revenue from federal transfers, not local property taxes. The result: even prime real estate often pays 10-20% of what a comparable US home would pay.
Do foreigners pay the same predial as Mexicans?
Yes — predial rates are the same regardless of nationality. If you own property in Mexico (directly or via fideicomiso bank trust for restricted-zone properties), you pay the same tax as a Mexican owner. Some municipalities offer discounts for seniors, persons with disability, and widows that apply equally to foreigners.
How do foreigners pay predial from abroad?
Most municipalities now have online payment portals where you can pay with international credit card or bank transfer. Mexico City uses finanzas.cdmx.gob.mx; Quintana Roo uses portals per municipality. You need your cuenta predial (predial account number, 8-12 digits, on your deed). Some banks (Citibanamex, BBVA, HSBC) accept payment at counters with the predial slip; you can also hire a local administrator or property manager.
What happens if I don't pay predial?
Late predial generates monthly surcharges of 1.5-2.5% plus inflation adjustment. After 5 years of non-payment the municipality can begin embargo procedures, though in practice they rarely seize occupied residential property. However, you cannot sell, transfer or refinance the property until predial is fully paid. Foreign buyers especially need to keep predial current — unpaid balance reduces your property's marketability and shows up in due diligence when you sell.