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Buying Property

Belize - Buying Property


Anyone with sufficient funds can purchase property and land in the Central American country of Belize, regardless of residency status or nationality. Migrant landholding restrictions were abolished almost 20 years ago. You do not even need to be present in Belize in order to purchase a property there.

You can purchase property under a company’s title holding, including offshore financial instruments. This has tax and privacy advantages, although there are costs to running a company which must be assessed if you are just buying a holiday home for yourself. Seek expert financial advice about the options available for your personal circumstances.

Belize was once a British colony. Even after a change of name from British Honduras to Belize and achieving independence, the country remains a part of the British Commonwealth, with Queen Elizabeth II as Monarch. Despite being on a European Union ‘non-cooperative jurisdictions’ tax haven blacklist, Belize receives millions of pounds from the UK overseas aid budget to invest in infrastructure, such as roads and ports.

Because of these historic and ongoing close ties to the UK, Belize has a legal system based on English common law. All legal documents are in English, and the long established legal system is upheld by the country’s constitution and independent jurisdiction. The currency has been pegged to US dollars since 1978, with one Belize dollar being worth two US dollars.

This combination of legal and financial stability gives assurance to prospective buyers.

Local interest rates for mortgage loans are very high compared to international standards, and the loans work differently to most Western countries’ mortgage systems. Specialist advice from a financial provider who thoroughly understands international financial methods and instruments would be highly advisable if you do not have sufficient funds to purchase a property outright.

Your property search will probably involve the services of an estate agent, or real estate agent. In Belize, anyone can become a real estate agent. No minimum educational, training or employment barriers exist. This means the buyer must be particularly cautious; referrals from trusted local sources and friends are strongly advised.

Once you have found a property you wish to buy, you will submit a legally binding offer to the seller. This will include a due diligence period so that your attorney can undertake searches prior to completion. If you are not physically present in Belize, your offer can be made electronically, and will still have the legally binding status of a written offer made in the country.

Once the seller has accepted your offer, you cannot withdraw from the purchase without penalty, unless something significant is found during the attorney’s searches.

You may prefer to employ a local attorney, as they will understand the processes and pitfalls of the local property market better than an international firm. You should seek out referrals from trusted sources wherever possible, though be aware that an estate agent may be making a referral in order to receive commission for it.

An attorney will charge about two percent of the property purchase price; in return you need an investigation of all potential issues connected with the property and a correct submission of official paperwork.

You may wish to employ the services of a paralegal rather than an attorney, and there is no legal reason to stop you doing this. If the individual or firm you select to do this has plenty of experience and an excellent track record, they are likely to perform the job well.

Your attorney or paralegal will check that the property comes with a clear title. They will inspect the lands registry, and if the property is held in a company name they will also inspect the registration information for the company. All liens, judgements and encumbrances should be identified at this point.

No dispute over the ownership of land can be made once 30 years have passed. Therefore, if the property being sold is not registered under the modern registration system, the attorney or paralegal must complete additional work to prepare an abstract of title which covers the past 30 years.

If you are looking to buy a condominium, be aware of the legal complexity this may involve. Strata titles, which allow you to own a unit within a building without owning the footprint of the land it stands on, are available only within the new registration locations. Elsewhere, such units will be sold under corporate share certificates, which citizens of the US refer to as co-ops, even if the developer refers to them as condominiums. You should also consider the long term maintenance issues of any shared building, as you may receive hefty unexpected bills or find that routine maintenance is neglected.

A survey of the property will be undertaken, which you will pay for. Surveyors have to be well trained in order to obtain a license. Many are Western expats who have moved to Belize.

Once the attorney has completed the necessary searches, an agreement for sale will be drawn up. You will pay the attorney a deposit or down payment for the property, which will be held in a client or escrow account.

Once all documents have been completed to the satisfaction of both the buyer’s and seller’s attorneys, and the parties have signed, the full payment will be completed. The majority of property purchase transactions are made in US dollars.

Copies of the sale documents will be processed at the Lands Registry. A stamp duty payment of 5 percent will be paid to the government, which is substantially lower than the 15 percent paid more than 10 years ago. The seller does not pay any capital gains tax.

As the new owner, you will receive the original copy of the agreement for sale document.

Annual property taxes are charged at 1.5 percent of a property’s assessed value.

Annual insurance costs average 1.5 percent for a concrete property and 2.5 percent for a wooden property. There are several companies who will provide a good and reliable insurance product, including insurance against fire and hurricanes. You will often have an excess built into the policy, meaning that in event of a claim, you will have to pay a specified percentage of the losses yourself. Make sure you are aware of this percentage when assessing which insurance policy to buy.

If you will be absent from Belize for much of the year, squatters are unlikely to be a problem because the anti-squatting laws are strict. A squatter would have to have continuous and undisturbed possession of your property for 30 years on national and conveyed lands, or 12 years on registered lands, before they could try to claim title to the land via the supreme court of Belize.

Increasingly, expats are building custom homes in Belize. Access to affordable land and building costs make this a realist ambition for some people, but the laid-back nature of the community can make it a frustrating experience for those who have yet to adjust to the new pace of life.


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