Buying Property as a Foreigner: Country Restrictions American Expats Actually Face

# Buying Property as a Foreigner: Country Restrictions American Expats Actually Face

An American who wires a deposit for a beachfront condo in Tulum will never see her own name on the deed—and that is entirely legal and routine. Mexico's Constitution (Article 27) bars foreigners from directly owning land within 50 kilometers (about 31 miles) of any coastline or 100 kilometers (about 62 miles) of any international border—the so-called *restricted zone*. Since that strip contains nearly every beach town and border city Americans actually want, most U.S. buyers there hold their property through a bank trust instead of a title deed ([Fredrikson & Byron](https://www.fredlaw.com/alert-sun-sand-and-caveat-emptor-buying-real-estate-in-mexico)).

That single example captures the reality of buying abroad: the rules are rarely a flat yes or no. They depend on *where* in a country you buy, *what* you buy (land versus a unit in a building), and *whether* you hold residency. Below is how the restrictions actually break down, with the specific laws, percentages, and dates that govern them.

Direct ownership is the global default—until it isn't

In most of the destinations Americans favor, a U.S. citizen can buy and hold real estate in their own name with the same rights as a local. France, Italy, Portugal, Spain, Panama, and the non-coastal interiors of Mexico and Costa Rica all permit foreigners to take freehold title ([World Population Review](https://worldpopulationreview.com/country-rankings/countries-where-us-citizens-can-buy-property)). Portugal, for instance, lets foreigners purchase property freely through standard freehold ownership, even though it closed its real-estate-based "golden visa" route in October 2023 ([Global Citizen Solutions](https://www.globalcitizensolutions.com/portugal-golden-visa-changes/)). Buying a home and getting residency are two separate questions—conflating them is one of the most common expat mistakes.

So the headline is reassuring: in much of the world, your nationality alone is not a barrier. The complications start at three specific fault lines—coastlines and borders, the land-versus-building divide in Asia, and a recent wave of outright national bans.

The coastline-and-border carve-out

Several countries treat their most desirable land—the coast and the frontier—as a matter of national sovereignty and wall it off from direct foreign ownership.

**Mexico.** Outside the restricted zone, foreigners take direct title (an *escritura*) just like a Mexican citizen. Inside it, residential property is held through a *fideicomiso*, a 50-year renewable bank trust in which a Mexican bank is the trustee and you are the beneficiary with full rights to use, rent, renovate, sell, and bequeath the property. Expect setup costs of roughly $2,000–$3,000 and annual trustee fees of $500–$1,000 ([Fredrikson & Byron](https://www.fredlaw.com/alert-sun-sand-and-caveat-emptor-buying-real-estate-in-mexico); [TheLatinvestor](https://thelatinvestor.com/blogs/news/mexico-foreigner-rights)). The trust is the normal, government-sanctioned path—not a loophole—but it adds cost and a layer of due diligence most U.S. buyers don't expect.

**Costa Rica.** The Maritime Zone Law (Ley 6043) classifies the first 200 meters inland from the high-tide line as national patrimony. The first 50 meters is a public zone that cannot be owned or built on at all; the next 150 meters is a restricted *concession* zone. Foreigners must have held Costa Rican residency for at least five years to hold a concession in their own name, and any company holding one cannot be more than 50% foreign-owned ([GLC Legal](https://glclegal.com/blog/maritime-zone-concessions-costa-rica/)). Outside that coastal strip, foreigners and Costa Ricans have identical rights to buy, sell, rent, and inherit titled property.

The practical lesson: in these countries, a property's distance from the water or the border can matter more than the price.

Asia's land-versus-building rule

Across much of Southeast Asia, the law draws a hard line between the land itself—reserved for citizens—and the structure built on it, which foreigners may sometimes own.

**Thailand.** Section 86 of the Land Code prohibits foreigners from owning land outright. Foreigners can, however, own a condominium unit in full freehold—provided foreigners hold no more than 49% of the building's total sellable floor area (the Condominium Act's "foreign quota"). Once a building hits that 49% cap, the only route left is a registered leasehold capped at 30 years. You must also prove your purchase funds were wired in from abroad, documented on a Foreign Exchange Transaction Form (the "Tor Tor 3") issued by the receiving Thai bank ([ThaiLawOnline](https://www.thailawonline.com/buying-property-in-thailand-as-a-foreigner/)).

**The Philippines.** The 1987 Constitution limits land ownership to Filipino citizens and to corporations that are at least 60% Filipino-owned—regardless of a foreigner's visa, length of stay, or investment size. The exception is the Condominium Act (Republic Act 4726), which lets foreigners fully own condo units so long as foreign ownership of the entire project stays at or below 40% ([Respicio & Co.](https://www.respicio.ph/commentaries/foreign-ownership-limits-in-philippine-condominium-units-under-ra-4726)).

**Indonesia (including Bali).** Under the Basic Agrarian Law, only Indonesian citizens can hold freehold (*Hak Milik*); land acquired by a foreigner must be relinquished within a year. Foreigners with a valid residence permit (KITAS/KITAP) can instead hold *Hak Pakai* (a registered right to use), while leasehold (*Hak Sewa*) arrangements—commonly 25–30 years with renewal options—are the most widely used path ([Emerhub](https://emerhub.com/indonesia/laws-and-regulations-for-buying-property-in-indonesia/)). The "freehold villa in Bali" marketed to foreigners almost never means freehold in the legal sense.

The new wave of outright bans

Since 2018, several wealthy, English-speaking countries—precisely the ones many Americans assume are open—have banned most foreign buyers outright, driven by domestic housing-affordability politics.

**New Zealand.** The Overseas Investment Amendment Act 2018 received Royal Assent on August 22, 2018, and took effect that October. It reclassified existing residential housing as "sensitive land" and barred most non-residents from buying it; citizens and permanent residents of Australia and Singapore are exempt under free-trade agreements ([Library of Congress](https://www.loc.gov/item/global-legal-monitor/2018-08-29/new-zealand-bill-banning-foreigners-from-purchasing-homes-passed/)). An American without residency generally cannot buy an existing New Zealand home.

**Canada.** The Prohibition on the Purchase of Residential Property by Non-Canadians Act took effect January 1, 2023, and has been extended to January 1, 2027. It bars non-citizens and non–permanent residents from buying residential property (buildings of three units or fewer, including condos) located within a Census Metropolitan Area or Census Agglomeration. Properties outside those defined urban areas are exempt ([CMHC](https://www.cmhc-schl.gc.ca/professionals/housing-markets-data-and-research/housing-research/consultations/prohibition-purchase-residential-property-non-canadians-act); [Aird & Berlis](https://www.airdberlis.com/insights/publications/publication/federal-government-extends-prohibition-on-purchase-of-residential-property-by-non-canadians-to-january-1-2027)).

**Australia.** From April 1, 2025 through March 31, 2027, foreign persons—including temporary residents—are banned from buying *established* dwellings, with the 2026–27 federal Budget extending that ban to June 30, 2029. Foreign buyers can still purchase *new* dwellings with approval from the Foreign Investment Review Board (FIRB). Permanent residents, New Zealand citizens, and spouses of Australian citizens are exempt ([Australian Taxation Office](https://www.ato.gov.au/about-ato/new-legislation/in-detail/international/banning-foreign-purchases-of-established-dwellings)).

The through-line: these are political instruments tied to local housing prices, with fixed sunset dates that keep moving. Verify the current status before you plan around any of them.

When the wall is a tax, not a law

Some countries let you buy but make it expensive enough to deter you.

**Switzerland** has restricted foreign buyers since 1983 under *Lex Koller*. Foreign non-residents need special authorization, and the federal government issues only about 1,500 permits a year, parceled out to the cantons; vacation units sold to foreigners are typically capped near 200 m² of living space on plots up to about 1,000 m². Foreigners who hold a Swiss residence permit and live there can usually buy a primary home without these constraints. A proposed tightening that would require permits for non-EU/EFTA residential buyers was out for public consultation through mid-2026 ([Deloitte Switzerland](https://www.deloitte.com/ch/en/services/tax/blogs/switzerland-plans-tightening-restrictions-on-property-acquisition-by-non-swiss-nationals.html)).

**Spain** stirred international attention in January 2025 when Prime Minister Pedro Sánchez floated, and the governing PSOE submitted as a draft bill in May 2025, a "Complementary State Tax" that would roughly *double* the transfer tax (ITP) for non-EU, non-resident buyers of second-hand homes. Despite the "100% tax" shorthand in headlines, it is a 100% *increase* in the rate, not a tax equal to the home's full price—and as of 2026 it is a proposal, not law. EU and EEA nationals are unaffected ([CNBC](https://www.cnbc.com/2025/01/14/why-is-spain-planning-a-100percent-tax-on-homes-bought-by-non-eu-residents.html); [Spain in English](https://www.spainenglish.com/2025/05/25/draft-bill-submitted-100-tax-property-purchases-by-non-resident-non-eu-nationals/)).

**Canada's provinces** add their own surcharges on top of the federal ban: British Columbia levies a 20% foreign-buyer tax in designated regions including Metro Vancouver, while Ontario's Non-Resident Speculation Tax reached 25% province-wide on October 25, 2022, and Toronto layered on a 10% municipal tax starting January 1, 2025 ([Mondaq](https://www.mondaq.com/canada/tax-authorities/1731144/bc-foreign-buyer-tax-vs-ontario-non-resident-speculation-tax-comprehensive-guide-to-rates-exemptions-key-differences-implications-and-compliance-for-canadian-real-estate-investors-and-foreign-buyers)). These bite mainly on properties outside the federal ban's reach or for buyers who later become exempt.

Practical takeaways

• **Pin down which zone the property sits in before you fall in love with it.** In Mexico and Costa Rica, the same listing carries completely different ownership mechanics depending on its distance from the coast or border.
• **Separate "can I own it" from "can I get residency."** Buying property rarely grants the right to live somewhere, and several countries (Portugal, Spain) have curtailed investment-residency routes while leaving ordinary purchases open.
• **In Asia, assume you're buying a building or a lease, not land.** Confirm a condo project's remaining foreign quota in writing (49% in Thailand, 40% in the Philippines) before paying a deposit, and budget for documenting that your funds came from abroad.
• **Check whether an outright ban or sunset date applies.** Canada (through 2027), Australia (through 2029), and New Zealand (since 2018) bar most non-residents from existing homes—but exemptions exist for new construction, rural properties, and certain residents.
• **Price in the tax layer, not just the sticker.** A 20–25% provincial surcharge in Canada or a doubled transfer tax in Spain can dwarf closing costs.
• **Budget for the structure.** A Mexican fideicomiso, an Indonesian Hak Pakai, or a Thai leasehold all carry setup and recurring costs your U.S. real-estate instincts won't anticipate.

Next steps

Start with the official source for your target country—national investment-review bodies (Australia's FIRB, Canada's CMHC), tax authorities, and the constitution or land code itself—rather than a brokerage's marketing page, since restrictions and their expiry dates change frequently. Then engage a local real-estate attorney who is independent of the seller and the agent *before* you transfer any money; in restricted-zone and leasehold markets, the legal structure is the deal. Finally, confirm the current rule in the same month you intend to buy: as the moving ban dates in Canada and Australia and the pending proposals in Spain and Switzerland show, foreign-ownership law is a fast-moving target.