Shopping for property in Belize is not as simple an undertaking as you might initially expect!
Firstly, estate agents as we know them are non existent! Real estate brokers that do exist are likely to be unlicensed, unregulated and certainly not trained or insured.
Secondly, the majority (and I mean the majority) of property for sale is not advertised!
But with property prices remaining affordable, the quality of property available attractive, the climate beautiful, the people welcoming, the quality of life incredible and the opportunities in Belize plentiful, more and more people need to know HOW they can go about procuring themselves their dream home in Belize.
This article should cover the tips, tricks and important points for your consideration, and go some way to helping you locate and purchase your ideal piece of Belizean real estate!
Part One: House Hunting.
As mentioned, many properties that are for sale often go totally unadvertised.
Sure, there are the occasional adverts in the San Pedro Sun or in the Belize City newspapers and some estate agents exist who keep up to date listings - either available upon request of via their internet sites - but seriously, the majority of properties that are for sale are not advertised - and I'm talking at least three quarters.
The only way to find out what's really available is to travel to Belize and spend time there among the local people and the expats.
You see, properties that are for sale are generally put up by their owners and they often choose to skip the middle man - the real estate broker. Therefore, with no brokers and no signs, the only way you'll learn about what's on the market is to get to know the local people and expats in the particular areas that you're interested in, and via word of mouth you'll begin to hear about what's really available.
As soon as word gets out that you're in the market, chances are you'll be inundated and have more properties and deals to choose from that you can cope with! Be prepared and don't agree to the very first opportunity presented to you!
Part Two: Real Estate Brokers.
Because anyone in Belize can be a real estate broker the quality you come across will vary immensely!
So please be careful - to become an estate agent there is no license needed, no insurance necessary, no experience or training required: therefore what you will find on the whole are expats, hoteliers, shop owners and taxi drivers as estate agents on the side.
Yes there ARE some professional agents who are honest and knowledgeable and whose agency businesses are legitimate, but there are also those out to make a quick killing selling anything and everything to unsuspecting tourists.
Listen to the experiences of others and if someone is recommended to you by a trusted adviser then all the better.
If you do purchase via an agent, commissions in Belize are typically 7% on residential property, and about 10% on land deals - chargeable to the vendor: and in some cases you as the purchaser may be charged for viewing property if it is remote and requires travel expense outlay. Make sure you're aware of any such charges that you may be liable for from the outset.
Part Three: Property Prices.
Despite a steady 20 year appreciation in real estate prices in Belize, property remains attractively priced - especially when comparing prices for similar real estate on sale in America or Western Europe.
There are still bargains plentifully available in this beautiful Central American country. But it isn't so much what you know as who you know when it comes to getting the best deal for your money.
There is a commonly held sentiment among the expat community in Belize - something along the lines of "the second house you buy or rent is twice as large as the first and costs half as much" - so don't part with any money until you are totally sure you know what you're doing!
Be prepared to spend time in Belize and be prepared to invest time in getting to know and making friends with the local people, any influential lawyers and business people and also the local expat community. It is through these people that you will find the best real estate at the best prices.
Another point worth considering is that Belize is a country where there are two prices - the local price and the foreigner price. Yes, from an expat's point of view this is unfair. But from a local's point of view the 'rich' foreigner who gets paid far more for his work in his country than a Belizean in Belize for the same work can simply afford to pay the higher price.
A way around this is to ask a Belizean friend to ask the price and do negotiating for you! Simple!
And yes, negotiation is key - property prices vary massively from region to region and city to city and vendor to vendor. There isn't really a set valuation structure on which someone can base the price of a property or piece of land.
This means that it is hard to say exactly how much real estate is worth and how much property prices have actually risen over the last few years. It is harder still to say what a property investor in Belize could expect year on year in terms of the appreciation of any real estate asset. So much so that the saying "you almost always make your money when you buy, not when you sell" goes doubly in Belize.
As a very general guide to property prices they are highest in Belize City, on Ambergris Caye and in Placencia, and lowest in the remotest most rural areas.
House prices go from USD 15,000 for a basic traditional home in a small undeveloped village to USD 500,000 and upwards for luxury beach front villas in San Pedro say.
Any agent or vendor you speak to is likely to talk up the potential returns on an investment in property or land in Belize - this is only natural! But what you need to consider is that: -
a) the economy of this country is linked to the US economy and
b) the time it takes to sell a property in Belize can be very long and drawn out (I'm talking years not weeks or months) - which is something you must bear in mind when considering purchasing a property you may one day want/need to re-sell
This shouldn't necessarily put you off - after all you can still buy far more for your dollar, pound or euro in Belize than you can in the US, UK, Mediterranean region or Western Europe - but it is important to have a realistic overview of the property market in any country you are considering investing in or relocating to. That way you enter with your eyes wide open...it's always better to be a savvy buyer!
Part Four: Foreign Ownership.
The Belize authorities are open to foreign investment and actually welcome it which means they impose very few restrictions when it comes to foreign ownership of immovable property in their country.
In Belize it is even possible for non-nationals to freely purchase prime beachfront property. There used to be a license requirement for a foreigner to buy land over 10 acres or 1/2 an acre in a major town or city but this requirement has been revoked.
The only rules and restrictions are: -
Foreign purchase of any island has to have Government approval via the Ministry of Natural Resources.
In certain protected coastal and caye areas purchase of land and property by non-locals has to be approved by the local village council.
Part Five: Legal and Financial Considerations.
I always suggest people seek qualified legal advice when it comes to such a large and far reaching undertaking as purchasing real estate!
Belize is no exception!
In fact, in Belize lawyers are usually considered to be trusted, well-connected, pillars of the community with real power! And their fees are usually in the region of 2% of the purchase price...this should cover title searches and the drawing up of transfer documents.
In terms of affording your real estate dream - the onus is going to be on you! It is extremely difficult for non-residents to get mortgages from banks in Belize therefore most purchasers are in the position to pay in cash for their purchase or they have finance from a non-Belizean financial source.
However, some new developments are springing up with mortgages attached by the developer - property developers are usually the first to be aware of a potentially untapped market.
Basically terms currently are available to purchasers of such properties are: -
The developer retains the title to the property until the purchaser has paid in full for the property.
The purchaser makes a 10% down payment with the remainder being paid back over 10 years at 10% simple interest per annum.
Terms will of course vary from this to say 50% down up front and the remainder payable over three to five years at 12 -15% interest.
Be aware however that the best prices will be for cash deals.
You'll need to factor in an additional 12 - 15% on top of the purchase price for fees and costs.
You have the land title transfer fee which is also known as "stamp tax." This is 5% compulsory for every purchaser regardless of nationality, with an extra 5% payable by non Belizean nationals - making 10% in total.
This is apparently being increased to 12% in the near future.
If you have become a Belizean resident via the Retired Persons Incentive Program you are exempt from the second 5% stamp tax for non-citizens.
Then you should have your lawyer's fee which will be around 2% of the purchase price.
Finally you'll have property taxes which actually vary from area to area based on the type of land or property purchased. Generally expect to have to pay around 1% annually of the value of the undeveloped land...but speak to your lawyer for more exact figures pertinent to the property or land you are interested in purchasing.
Rhiannon Williamson is an experienced publisher who has produced articles for leading travel and tourism guides and financial magazines. Her specialist knowledge about both travel and finance gives her site Shelter Offshore the unique ability to literally cover every single aspect of moving & living abroad - including the often less discussed offshore tax advantages that can be available when leaving our homeland. Check out her website to find out how you can escape from the rat race, relocate overseas, and profit from your move!