Seller FAQ
Selling in San Miguel de Allende — commissions, timelines, capital gains and what to expect.
How long will it take for my property to be promoted on your website?
After you sign a listing contract with one of our agents, the agent will have your home professionally photographed.
Once the photographs are finished, it usually takes only one to two days to upload your property to our site.
How are capital gains taxes calculated and paid?
The Short Answer
The notario who is managing the sale of your property will decide how much capital gains are due and is responsible for collecting and paying those taxes at closing.
Helping sellers understand and minimize the tax consequences of selling is something that all of our agents have been trained in. It’s important that you understand how the sale of your property will affect your taxes before you start the selling process.
To understand how the notario calculates these taxes and for more details see The In-Depth Answer to this question.
Should I leave room in the price for negotiations?
This very much depends on current market activity. The market goes in cycles, and our data shows that in the best years the sold price often averages only 2%-3% below the asking price. However, when the market is moving much slower, the average sold price can often be 10% below the asking price.
So, in booming times when prices are going up, it is probably wise to leave room for negotiations.
However, in slower and more competitive times, our experience is that pricing your home closer to your bottom line price will make it stand out among the competing homes. For example, if most sellers are pricing their homes 10% more than their bottom line price and you price your home closer to the bottom line price, buyers will realize that yours is a better value.
Who chooses the notario we will use for closing?
In theory, it is the buyer who has the right to choose the notario they want to work with. If you work through Realty San Miguel, we have notarios that we recommend and prefer to use.
However, sometimes sellers who will be subject to substantial capital gains taxes "shop around" their sale to various notarios until they find one that gives them the most favorable tax results. When this is the case, a seller may specify that they want to use a specific notario when the house is being shown. Sometimes, this issue doesn't come up until they are negotiating an offer.
Bottom line: although technically speaking the buyer chooses the notario, it is not uncommon that the choice of notario becomes a point of negotiation between the buyer and the seller.
Do I have to be in San Miguel for closing?
The Short Answer
No. However, you will need to give someone a Power of Attorney (POA) so that they can sign on your behalf, in person, on closing day.
If you are a buyer, there are some occasions where someone can sign on your behalf as gestor oficioso with no POA required, but a seller always has to have a POA.
A POA can be completed both within and outside of Mexico.
To learn how to create a POA and for more details, go to The In-Depth Answer.
How do I give someone a power of attorney?
The Short Answer
You’ll need to work with the notario who will close your transaction. If you are in San Miguel de Allende, the notario’s office will draft the power of attorney (POA) for you, and you can sign it at their office.
If you are outside of the city, it can be sent to you. From there, the steps necessary to complete the process depend on your home country.
To learn all the details, go to The In-Depth Answer.
How long will it take to sell my home?
The In-Depth Answer
There are four major factors that influence how fast your home will sell.
- Location - You’ve probably already heard that real estate is all about location, location, location. It’s true.
- Condition - Homes that are in great condition, both in terms of design and maintenance, always sell faster than those homes that are lacking along these lines. If you have any deferred maintenance it would be wise to take care of those issues.
- Price - Since your home will be competing against other homes for sale, it’s important that your home is priced so that it stands out compared to homes in a similar location and condition.
- Exposure - You may have heard the saying, “Doing business without advertising is like winking at a girl in the dark.” Realty San Miguel has invested a lot to bring our sellers incomparable exposure for their properties. Our website receives over 3,000,000 page views a year.
Many sellers are shocked to learn that the average time on market in San Miguel is measured in months, compared to days in the US and Canada. Since 2007, the average time on market has ranged between 6 months in boom times to over 24 months in the slower times.
Of course there are always properties which will go under contact within days or a few short weeks after they are listed. This usually happens because of its location, condition, attractive price or a combination of all three.
The current inventory also plays into this. When inventory is high, your property will be competing against a lot of similar homes. When the inventory is low your property may be only one of a few in your price range or area and it will sell faster.
To give you some perspective, the lowest inventory we've seen since 2007 was in late 2017 when there were only 175 properties listed for sale, which represented around 6 months of inventory. The highest inventory we've seen has been 1,350 properties for sale in mid-2024, and when compared to the rate of actual sales, represented 42 months of inventory. This means that at the current rate of sales and assuming no more properties were put on the market, it would take 42 months to sell off all of those properties.
All of this makes who you list your property with of utmost importance. Our agents will give you an honest and accurate evaluation of both your property and the current market so that together you can determine the price that best suits your immediate needs.”
"A well priced property will always sell" is a truism that still applies today.
How long will it take to sell my home?
The Short Answer
There are four major factors that work together to influence how fast your home will sell. These factors are location, condition, price and exposure.
To increase your chances of selling your home quickly, you’ll want to make sure that the condition of your home is appealing. Our agents will help you price your property competitively. After that, we take care of the exposure - our website receives over 3,000,000 page views a year.
For more details and to learn how market trends might affect your sale, go to The In-Depth Answer.
How much is the commission on a sale?
In San Miguel de Allende, most agencies charge 6% commission plus IVA (value added tax). With few exceptions, it is the seller who pays the real estate commissions.
Once paid, the commission is usually split equally between the seller's agent/agency and the buyer's agent/agency.
How are capital gains taxes paid?
It is the notario who is responsible to calculate the capital gains taxes due, retain them, and then pay them on your behalf.
If you have capital gains due, they will be paid to the notario at closing. If you are using escrow, the escrow company will transfer the funds to the notario. If not, then you will make a direct transfer to the notario.
How do I authenticate, or apostille, a document when I’m outside of Mexico?
An apostille is a certificate that authenticates all of the following:
- the signature of a public official (e.g, a notary public) on a document for use in another country.
- the capacity in which that public official acted, and
- when appropriate, the identity of the seal or stamp which the document bears, e.g. a notary public seal.
Apostilles are usually provided by the Secretary of State (or equivalent) of the state where you signed the document. Apostilles are accepted by all of the countries that signed the Hague convention, which include both Mexico and the U.S.
There are at least two ways to get a document (such as a power of attorney) apostilled.
1. It is possible to do it yourself. First, find a notary public to sign and seal the document. Then you either send it or carry it into the Secretary of State Department (or equivalent) in your state. They will verify the document, which is actually verifying that the notary public that you used is licensed and is who they say they are. This is usually done by attaching a verification page from the State Department.
The fee in this case is typically $10-25 USD for the apostille and a small amount for the notary, typically $2 - $25 USD.
2. Depending on where you live in relation to your state's State Department office, it may be easier, faster and perhaps cheaper to use an apostille service. An apostille service will often come to your house or meet you in a public place and notarize your document and then send it to the State Department on your behalf. Apostille services charge a fee of $300 USD and up.
Whether you are completing this process yourself or using an apostille service, search the internet with the word apostille and the name of your state. Several options will come up. If you are pressed for time, get on the phone and talk directly to the State Department or an apostille service. We have seen State Department websites that say their turnaround time is only 7 days, but when talking to them on the phone we find out that they are running three weeks behind.
Since Canada is not a signatory of the Hague Convention, which authorizes the use of an apostille, Canadians and other citizens from non-Hague Convention countries need to have their POA authorized at a Mexican Embassy or Consulate.
What if the square meters of construction are not correctly reflected on my tax bill (predial)?
This is a common problem that our agents can help you correct before closing.
This error can occur for a few different reasons: a property has had additional square meters added and the builder never completed the process, the addition was built without a permit, or the tax office never recorded the addition. In these cases, your tax receipt (predial) can show substantially fewer square meters of construction than what actually exists.
The problem comes when an appraiser is sent by the notario's office to confirm the measurements of your property before closing. If these measurements are not correctly reflected on your tax bill, the tax bill has to be corrected by an appraiser and can often delay closing.
If you have any doubts about whether the number of square meters of construction is accurately represented on your tax bill, talk to your agent, so that if necessary, this measurement can be corrected as soon as possible.
Does Mexico recognize a document that has been notarized in the US or Canada?
To be recognized by Mexico, a document notarized in the US or Canada also has to be apostilled or notarized at a Mexican Consulate.
How much is IVA?
In Mexico, IVA is a value added tax (Impuesto al Valor Agregado) that functions much like a sales tax in the US. The tax rate is 16% and is added to the purchase of any product or service, with the exception of food and drugs. It is not charged on your real estate transaction, but is added to the fees that the lawyers, notarios, and real estate agents/agencies charge for their services.
What is an apostille?
An apostille is a document authorized by international treaty that authenticates a legal document signed in one country for use in another.
In the US, it is easily obtained from the Secretary of State in each state (or the equivalent) or through an online service.
Can I have a document notarized online?
I know of a few clients who have been successful with having a document notarized online for leasing agreements and some banking documents.
However, if you need a document notarized and apostilled for closing on a property, you will need to check with the apostille service that you are using - in most cases, the apostille service will require you to be there in person to notarize a document. The notario might require you to be there in person as well.
Should I offer owner financing for my property?
Much depends on where your property is located and how robust the market is. The fact is that many potential buyers have sufficient cash flow to service a loan or we have also met many who are waiting on an inheritance.
If the market is robust, there would be little advantage to offer seller financing unless you would rather receive the money over time.
When the market is slower, it could give you an advantage. When a buyer comes with a cash offer during slower times, they will more than likely be negotiating hard on the price. But if a buyer comes who is dependent on partial financing to be able to buy, they are more likely to be willing to pay more for your property in exchange for you helping them.
To clarify, by partial financing, we mean that you, as the seller, receive a certain percentage of the total property price up front, e.g., 50%, and then collect the rest in payments over time. In contrast, (full) seller financing means that you as the seller will be accepting payments for the entire amount due.
So in the scenario of a buyer needing assistance to purchase, if you are willing to offer partial financing for 1-5 years with interest, you don’t need to accept a lower price. An additional bonus is that your home will be one of the few options available to those buyers who are short on cash.
The location of your property also plays a role in deciding to offer partial financing. As a general rule, properties that are well located and in excellent condition are the ones that sell first, while those homes that are in a less than ideal location and/or condition are harder to sell. Every year our agency sees many potential buyers arrive who want to purchase now but don’t have all of the money they need. This group is limited to either looking only for the few properties that offer partial financing or looking at homes priced way below their preferred budget. So if your home falls into the less-than-ideal location and/or condition, it could receive a lot more attention if you were to offer partial financing.
Do note, however, that there’s a huge difference between offering partial financing and agreeing to fully finance the purchase of your home.
For example, it may be fairly safe to extend financing to someone whose parent has recently died and they can prove that in the next 12-24 months they will receive a substantial inheritance, or who has more than ample cash flow. On the other hand, it may feel too risky to extend financing to someone who you discover is already overburdened with debt.
Although we have seen a few homes successfully financed and amortized for a 10 -15 year period, most are more like a bridge loan for a shorter period of time.
The portion financed can be paid with interest only payments and a balloon payment at the end of the term. Or, for example, the loan would be amortized as though it were for 15-20 years, but a balloon payment will be due at the end of the term.
The downside is that if your contract has been poorly written, Mexican law will favor a non-paying buyer and limit the damages you can collect if you have to take the property back. So it is important to ensure that the deal is structured well and that the contract is air-tight so that you are protected if the buyer ends up not fulfilling their side of the deal.
We would recommend that you first spend some time with the buyer wanting you to offer financing and decide if you feel comfortable with them and their financial situation.
Unless you know the buyer personally, we generally recommend financing only if the buyer can come up with 50% or more as a down payment and the terms fit your needs and goals.
If you are considering offering partial financing we also recommend that you come in and talk to one of our brokers who has experience structuring this type of deal.
What is IVA?
IVA is a value added tax that Mexico collects on ALL sales for products and services, with the exception of real estate, food, drugs and medical care. It is similar to what the US and Canada charge as a sales tax.
As it relates to your real estate transaction, IVA is not charged on the sale of your property, but is charged on the fees and commissions that the lawyers, notario, and real estate agents/agencies charge for their services. IVA in Mexico is currently 16% and has been for many years.
Does Realty San Miguel use print advertising?
Print advertising used to work great for finding buyers. In the late 2000's, Realty San Miguel would often have five or more pages of print ads, and we had buyers coming into our office almost weekly asking if they could see the properties that they had circled in the paper.
Although we know it’s exciting to see your property in a print ad, what you might not realize is that since 2014, those ads have been producing very few buyers. In fact, more than 85% of buyers have shifted to shopping for real estate digitally. That’s why we’ve chosen to spend our time and money investing in the platforms that provide the most exposure to potential buyers, specifically, our website and social media channels. In 2023, our website alone received 2.7 million page views!
The Realty San Miguel website is also responsive, which means it’s specifically designed to seamlessly transition from a cell phone display to a large desktop display without losing any formatting, text or photos in the process. This ensures that folks searching on their cell phone or tablet will be able to easily view your property. Research shows that 68% of web traffic is coming from these small devices, so we’ve made sure that everything displays perfectly on devices of all sizes.
How are capital gains taxes calculated and paid?
The In-Depth Answer
Mexico's capital gains taxes are assessed at the federal level and are retained and paid by the notario at closing. It is the notario who determines the capital gains that are due for each property.
Capital gains are always calculated in Mexican Pesos (MXN) and typically range from 20% - 35% of the gain. The maximum tax can not exceed 25% of the value of the whole transaction.
Here’s a simplified explanation of how capital gains are calculated:
-Your basis is the price you paid for your property in pesos on the day you purchased.
-The notario will adjust this basis for inflation, using software that accounts for the official government inflation rate during the period that you owned the property.
-This adjusted basis will be subtracted from the sales amount, represented in pesos.
-If you or others named on the deed qualify for a capital gains exemption, then the exemption amount will be subtracted.
-Sales commissions paid to your real estate agent (without IVA) can also be deducted.
-The balance is the amount of your gain and what you will be taxed on.
Note: Assuming you purchased in dollars and are now selling in dollars, these calculations more than likely will not produce the same results when calculated in pesos. The tax basis is always calculated in pesos.
Helping sellers understand and minimize the tax consequences of selling is something that all of our agents have been trained in. Connect with an agent if you need help. It is important that you understand how the sale of your property will affect your taxes before you start the selling process.
What is the capital gains exemption?
The In-Depth Answer
You may be entitled to a partial exemption from capital gains taxes If you meet the following criteria:
• you have not sold another property in the previous three years in which you claimed the exemption from the capital gains tax (ISR)
• the property you are considering selling has been your primary residence in Mexico
• you have residency status in Mexico.
Although similar to a homestead exemption in the US, the capital gains exemption is slightly more complicated.
Every qualifying person named on the deed who has residency in Mexico can receive the exemption. The exemption amount is based on the whole transaction value and not just the capital gain. It is also based on a Mexican financial index which fluctuates over time, often daily. In the last few years, we’ve seen the exemption as high as $310,000 USD and as low as $225,000 USD for every qualified person named on the deed.
If you are the only person named on the deed the exemption will be in the range stated above. If there are two people named on the deed the amount of the exemption will be doubled.
For more details, see How are Capital Gains Taxes Calculated?
If you are selling soon, connect with one of our agents who can help you receive a capital gains tax estimate and develop a strategy to minimize or eliminate the capital gains tax that will be due when you sell.
Do I have to be in San Miguel for Closing?
The In-Depth Answer
No, it is not necessary to be in San Miguel for the closing. However, you will need to give someone a power of attorney (POA) so that they can sign on your behalf, in person, on the day of closing. These powers of attorney are usually drafted by one of the attorneys in the notary's office and, unless otherwise specified, allow the person with the power to also sign off on the distribution of funds from the escrow company.
A power of attorney executed in San Miguel is fairly straightforward, costs less than doing one outside of Mexico, and only requires a day or two's notice to the notary to draft it for you.
If you are a buyer, there are times when someone can sign on your behalf as an officious agent without requiring a POA. a power of attorney, but a seller should always have a power of attorney. A power of attorney can be given to a trusted friend or family member; some clients prefer to give the power of attorney to one of the attorneys at the notary’s office.
Whether you signed in or out of San Miguel, we recommend that your real estate agent work with the notary or one of his attorneys to draft the POA for you so that the notary will accept the language as is on closing day.
A power of attorney written by a notary in San Miguel will be in Spanish. When you go to the notary's office to sign, there will be a translator to translate the document for you if you don't speak Spanish.
Completing a POA from Outside of Mexico
If you're outside of Mexico, you'll want to have someone from the notary's office draft the document. Often, it will be sent to you in English on one side and Spanish on the other.
Once you receive the document, you have two options:
Option #1: If you live in the U.S. or a country that signed the Hague Convention, you can print out the POA document provided by the notary and take it to any notary public in the U.S. (or your country) and have it notarized. Once it's notarized, you also need to get that document apostilled and then overnight mail it to your agent or the notary.
If you live in the U.S. near a Mexican consulate, you can also simply go there and have them notarize the document.
Option #2: If you live in Canada or another country that is not a party to the Hague Convention, you will need to go to a Mexican Consulate. You will take the document that the notary sent you and have it validated. Each Mexican consulate has different rules and deadlines for validating a document. Some consulates will want to rewrite the document and ask you to come back in a few days to sign it. Others will actually use the document that you take. Check with your Mexican Consulate nearest you for requirements.
If you are a buyer, in addition to giving someone power of attorney to sign on your behalf at closing, you can also give a POA permission to have someone in San Miguel sign on your behalf to obtain your SRE permit and sign for the distribution of funds at closing.
Work closely with your agent, who can guide you through this process.
How do I give someone a power of attorney?
The In-Depth Answer
Creating a power of attorney (POA), which gives someone else the authority to sign for the purchase or sale of a property on your behalf, requires several steps.
1) We always recommend that the POA be drafted by the notario who will close your transaction, or one of the attorneys in his office, so that the language used will be acceptable to the notario when it's time to close.
2) If you are in San Miguel de Allende, the notario’s office can draft the POA for you and you will just have to go into their office to sign it. The document will be in Spanish, but if you do not speak Spanish, a translator will be called in to translate it for you on the day you sign. For both buyers and sellers, it will probably include language giving the person with the POA the ability to sign not only the deed but also the distribution of funds from the escrow company.
3) If you are not in San Miguel, after the document has been drafted by the notario, it will be sent to you and
a. if you are American or from a country that signed the Hague Convention, you will have it notarized and apostilled
b. if you are Canadian, from a non-Hague Convention country, or live near a Mexican embassy or consulate, you will take it to the Mexican embassy or consulate and sign before a consulate representative.
4) For buyers who are outside of Mexico and did not sign the application for a SRE permit while in San Miguel, the POA will probably also include giving someone else the authority to sign the SRE permit application on your behalf.
What is a notario?
A notario in Mexico is very different from a notary public in the US. In addition to having a law degree, a notario has completed additional legal studies specifically related to the work and responsibilities of a notario, and has even competed for the title. They are appointed by the governor of each state based on population.
Unlike regular attorneys, they are the only ones authorized to sign off on and record real estate transactions, last wills and testaments, and other legal documents. Their records are kept in their office for life and are property of the state.
By law, notarios are required to be neutral in every transaction.
Does San Miguel have an MLS?
Yes, the Realtor Association (AMPI) in San Miguel de Allende does have an MLS. In fact, the property must be listed in the MLS before it can be shared in AMPI’s Wednesday network meetings, or presented via the agents’ email group.
Every property listed by Realty San Miguel is uploaded into the MLS so that the other 240+ agents in AMPI can have access to it.
How do I obtain a resident visa?
The main categories of resident visas in Mexico are residente temporal (temporary resident) and residente permanente (permanent resident). Both require either proof of a minimum monthly income or a fixed amount of money in your bank account. For most people who can satisfy this financial requirement, they are not hard to obtain.
The process must start outside of Mexico in a Mexican Consulate. You first set your appointment online, and then show up in person to submit your application. The approval process is usually less than 30 days, and in some Mexican Consulates, it can happen the same day. Once you receive approval, you have a few months to bring your approval letter to the immigration office in San Miguel de Allende. There, you will be issued your photo ID visa.
Some of our clients have completed the process after arriving in San Miguel by making their appointment in the Mexican Consulate in Laredo, Texas. They take the overnight bus from San Miguel to Laredo, go to their appointment, receive their approval letter the same day and then return to San Miguel.
Although the resident visa process is fairly simple, each Mexican Consulate handles cases a little differently, and the rules over the past few years have changed frequently. Realty San Miguel recommends that you meet with one of our agents, who will connect you with a visa specialist. These specialists will be up to date on any rule changes, make the appointments for you, and help you gather the required paperwork. Their fees are generally very reasonable, typically only a few hundred USD, and well worth the time and trouble you'll save if an important rule has changed.
How does escrow work?
Escrow is a financial account that is shared between buyer and seller in which funds cannot be distributed without the consensus of both parties. In Mexico, the money is held in an account protected by a legal trust agreement.
The earnest money, or deposit (generally 10% of the transaction value), the balance due prior to closing, and the closing costs are sent to and held in this account.
At closing, the buyer and seller approve the distribution of funds to all parties involved in the transaction. Once the transaction is complete, the notario sends the distribution of funds document to the escrow company and authorizes the release of the funds. The escrow company transfers the funds accordingly and sends proof of the transfers to the notario and agents involved.
What precautions should I take when doing a wire transfer?
To ensure that you are not a victim of fraud, once you receive the wire transfer instructions, which you will need to send your deposit and final payment to the escrow company, talk to your agent over the phone and verbally confirm any wire transfer instructions before wiring funds.
The wire transfer instructions will not change between the time of your initial deposit and closing. Do not accept any change in instructions received via email or text.
Should I register the deed in more than one name?
Whether or not to put your spouse, partner, or children on the deed is really an individual choice and usually based on your existing financial planning criteria.
However, in general, the more people named on the deed who have resident status in Mexico, the more tax exemptions will apply. Additionally, if the value of your sale goes beyond the exemption amount, the more people on your deed, the lower your capital gains tax will be when you sell your property
Unless you have good reason to not name those close to you as an owner, we generally recommend also putting your spouse or partner on the deed as an owner, and occasionally, your children.
However, be cautious when putting minor children on the deed. To sell a property where a minor child is one of the owners requires approval from a judge and is rarely approved.
Who pays the sales commission?
The seller pays the sales commission. This cost is not something that the buyer needs to worry about.
Which lawyers can close a real estate transaction?
What documents do I need to list my home for sale?
To list your home for sale with Realty San Miguel, you will need to provide
- ID*
- copies of your deed
- property tax bill (predial)
- your CFE bill
* Copies of IDs need to be provided for every person named on the deed. The copies can be physical or digital.
By providing these documents, your agent will be able to help you check your potential capital gains taxes and find a strategy to minimize them if necessary. The agent will also make sure all of the construction at your property is properly reflected on your tax bill so that there are no problems which could cause a delay at closing.
Elsewhere in our FAQs you’ll find explanations of capital gains taxes and the importance of working with an agent who is experienced in helping clients minimize these taxes.
Do note that you should never sign a listing agreement for the sale of your home without having an estimate on your capital gains tax.
What is the capital gains exemption?
The Short Answer
Similar to the homestead exemption in the U.S., the capital gains exemption discounts the amount of capital gains taxes you’ll owe.
Sellers have to meet several criteria to qualify, and the amount of the exemption is based on a Mexican financial index which fluctuates over time.
To learn more about these criteria and other details of the capital gains exemption, see The In-Depth Answer.
Still have a question?
Ask an agent