What ISAI is
ISAI stands for Impuesto Sobre Adquisición de Inmuebles (Tax on Acquisition of Real Estate). It's a state-level tax in Mexico paid by the buyer when acquiring real estate. The rate varies by state, from approximately 2% (Jalisco, Nuevo León low end) to 5% (Quintana Roo tourist zones, Tamaulipas).
For a $300,000 USD property in Tulum (Quintana Roo, 3.75%), ISAI is approximately $11,250 USD. For the same property in Mexico City (escalonado, ~3.5% effective at this value), about $10,500. Same property in Jalisco (Puerto Vallarta), about $6,750.
Who pays ISAI
The BUYER pays ISAI. This is by law, not by negotiation — ISAI is an acquisition tax (paid by the one who acquires). The seller pays a separate tax called ISR (income tax on capital gain). These are two different taxes paid by two different parties.
Foreigners pay the same ISAI rate as Mexican citizens — no difference. Whether you hold the property directly (outside restricted zone) or via fideicomiso (in restricted zone), ISAI is the same.
How and when ISAI is paid
The notario calculates ISAI at closing and collects it from the buyer along with notario fees, then remits it to the state treasury. The buyer doesn't deal directly with the tax office. The notario provides an official receipt that becomes part of the closing documents.
Without proof of ISAI payment, the Public Registry of Property (RPP) won't register the deed. So ISAI is paid before or at closing — never after.
ISAI rates by state (2026, key markets for foreigners)
| State | Who sets the rate | Effective rate on a 1.5M MXN home | On a 300K USD property |
|---|---|---|---|
| Ciudad de México | Ley estatal | 4.08% | $14,514 |
| Yucatán | Mérida | 2.97% | $11,389 |
| Jalisco | Guadalajara | 2.67% | $9,042 |
| Quintana Roo | Othón P. Blanco | 2.00% | $6,000 |
| Nayarit | Ley estatal | 2.00% | $6,000 |
| Estado de México | Ley estatal | 1.73% | $6,545 |
| Baja California Sur | La Paz | 1.71% | $5,762 |
| Guanajuato | León | 0.76% | $5,810 |
| Veracruz | ley estatal | 0.50% | $1,500 |
What value ISAI is calculated on
ISAI is calculated on the HIGHEST of three values:
- Price of the operation (purchase price)
- Cadastral value (assigned by municipality for fiscal purposes)
- Appraisal value (commercial or bank avalúo)
The notario checks all three and applies ISAI to the highest. This prevents buyers from artificially declaring low prices to pay less ISAI.
Discounts and exemptions
Several states offer ISAI discounts (apply manually at state tax office):
- First-home (primera vivienda): Mexico City offers up to 50% discount on first ~$2.4M MXN; Querétaro 40%; Nuevo León 40%
- Seniors (65+): 25-50% in some states (Mexico City, others)
- Persons with disability: 25-50% with medical certification
- Promotional/special zones: some municipalities offer reduced ISAI in development zones
Foreigners can claim these if they qualify (first-home, age, disability) — citizenship is not a barrier.
Why ISAI matters when buying
ISAI is the single largest closing cost in most Mexican real estate transactions — typically 30-50% of total closing costs. Buyers consistently underestimate it. For a $500K USD property in Cabo, ISAI is $17,500 USD — half of total closing costs of about $35K-$40K.
When budgeting for purchase, treat ISAI as 2.5-4.5% of purchase price depending on state. Add notario, RPP, fideicomiso (if foreign in restricted zone), and other costs. Total closing typically 7-10% non-restricted-zone, 10-15% restricted-zone.
Related terms
- Notario — calculates and collects ISAI at closing
- Escritura — the deed; not registrable without ISAI proof
- Fideicomiso — bank trust for foreign ownership; ISAI same regardless
- Predial — annual property tax (different from ISAI)