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A guide to buying property in Belize
Property values here on Ambergris Caye have been on a steady, and steep, increase during the past 25 years or so. Even the tough world wide recession hasn't slowed things down too much here on the island. Did you know that not one single bank in Belize went bankrupt or required a government bail-out during the worst of the Great Recession?
It's fair to say that if you purchase any property on Ambergris Caye at a reasonable price it will certainly be a good invesment for short, medium and long term planners.
Some commonly asked questions:
Can I, as a foreigner, own property free, clear and outright in Belize? Yes, your right to own property is the same as a Belizean. You own it free and clear. You do not need any special permits, licences or the like. You pay a Government Stamp Transfer Tax when you buy which is based on a little under 5% of the purchase price.
What happens when I sell my Belize property? The good news is that there is no Capital Gains Tax in Belize so what you get you keep.
How do I make sure I am going to own what I am buying...in other words, how do I know the property has clear title? This is handled by your legal representative who can be a lawyer or a paralegal or your real estate broker. They will do a "Title Search" to ensure the title for the property can quickly be transferred to you without impediment or delay. At Pelican Properties Ltd. we play our part by ensuring that any deposits paid do not pass beyond the Escrow stage until all paperwork is in order. This includes ensuring that the title for the property has been thoroughly researched and declared free and clear of all liens, judgements and encumbrances.
How many ways can I own a property in Belize? The first way of owning property is you get title free and clear, either in your name or in your company's name. The property can be mortgaged with a lending institution. Titles, free and clear, are issued for land, houses, and true condominiums. Condominiums are surveyed and each condo gets a "Strata" title.
The second way of owning property is via. a Corporate Share Certificate or "Co-op." Co-ops are used when buying a condo or house within a planned community where each condo or house represents a share or shares of the company that owns the property your condo was built on. We are seeing less and less of the Corporate Share Certificate kind of ownership these days but it's still around.
What other information might be useful?
1. Property prices in Belize are generally quoted in U.S. dollars.
2. Buying a property is fairly easy. From start to closing the process typically takes 7 - 90 days.
3. Some sellers offer seller financing. In most cases they will ask 9 - 10% interest. But, there is a slow trend towards lower interest rates being offered by sellers and recently we have seen rates as low as 6%. Most property purchases, though, in Belize are cash sales.
4. As a non-Belizean you can get some financing in US dollars from Belize offshore banks. But, typically, the maximum you can borrow is 60-80% of the value of the property. Expect to pay about 10% interest, sometimes more, and, of course, the payments have to be in US dollars.
5. If you like a property we have listed and want to make an offer you do have to place an Earnest Money deposit with Re/Max Southwind.. This is held in escrow for your protection. It can be as low as 2% and as high as 10% depending on the value of the purchase. We cannot submit an offer to the property owner without a deposit and of course the offer needs to be in contract format, something we'll draw up for you at the time.
6. The offer form is legally binding to both buyer and seller. If both parties sign both are bound by it. The Pelican Team at Re/Max Southwind will guide you through the buying process, always keeping you informed of progress.
7. Belize has experienced attorneys and paralegals to protect your interests if you feel you need one...or for that matter if your real estate broker advises that you hire one. Of course, your money will not be released to the seller until all the paperwork has been properly executed. If you have an attorney back home (in the USA for example) he or she can preview any documents before you sign them but they'll be underworked. Offers and Agreements to Purchase in Belize are written in plain English and are very simple and to the point. We like it that way, that's why we sell real estate here!
8. You do not need to be in Belize to place a property under contract or to complete closing. Having said that, we strongly recommend you NOT buy property "sight unseen" in Belize. Make sure you have seen your dream home, condo, villa or land parcel in person..we can always guide you through the purchase part if you have to return home before placing an offer on it.
9. Property taxes on Ambergris Caye are very affordable. For example, you might have a house or condo worth $300,000US or more. Your annual property tax will be under $1000.00US, sometimes considerably under!
10. Belize has very good property insurance. It is often referred to as "Fire and Allied Perils" insurance. One of the "allied perils" we have in Belize are hurricanes. Direct hits from hurricanes on Ambergris Caye are very rare. They can happen, though, but with proper insurance they should only be considered an inconvenience rather than a financial catastrophe. Expect to pay as little as 1% of the insured value for concrete homes going up to as much as 2.5% of the insured value for a mixed wood/concrete structure for one year of coverage.
11. When you purchase a property in Belize you do have to pay just under 5% Stamp Transfer Tax. This percentage is based on the value of your property purchase. If you bought a condo for $250,000US then the Stamp Transfer Tax will be around $12,000.00US. Note that when you sell the property you don't have to pay the Transfer Tax but the new buyer does. There is no Capital Gains Tax so your profits stay with you 100%.
After reading all of the above, why should you own property on Ambergris Caye? We can't think of a single good reason not to, particularly if you've fallen in love with our Isla Bonita! Welcome to Ambergris Caye, the Jewel of Belize and we hope to welcome you into our Belize family in the not too distant future!
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