Buying Real Estate in Belize Process

Buying Real Estate in Belize Process Posted on January 16, 2023By Dustin RennieIn Belize Property, Belize Real Estate, Investing in Belize Belize Real Estate Buying Belize Real Estate is very easy and the process is much like in North America (USA & Canada). Belize is one of the few countries in Central America & the Caribbean where foreigners enjoy the same property ownership right as nationals in land ownership and tenure. When a foreigner buys property in Belize, they own it outright with a fee-simple land title. The preferred practice of owning Belize real estate is through a fee-simple title which is clear title freehold ownership. Foreigners can own property in Belize as an individual or through a Belize Chapter 250 (Limited Liability Company) or with an International Business Company (IBC). A property (like Belize land) will have a title that would be issued by the lands department. Condominiums in Belize are purchased through a “Strata” title or co-op share ownership. There are a few types of property ownership in Belize and it is important to learn the differences. Belize Real Estate Purchasing Process The property purchasing process in Belize is similar to Canada or the US (countries with fee-simple titles). Before you purchase property in Belize or buy Belize real estate it is important to know and understand the process. Belize Property Search Before buying in Belize, make sure you know the area that is best suited for you, your lifestyle, and your investment goals. Check out the different areas and districts in Belize; Ambergris Caye, San Pedro, Caye Caulker, Cayo, Placencia, etc. Belize has a robust landscape from the island beaches of Ambergris Caye to the jungle mountains of San Ignacio. When searching for Belize property, decide what is most important to you; the beach, mountains, inland, river, etc. Ambergris Caye real estate is popular due to the fact that the island and San Pedro Town is the country’s most popular destination with the highest level of growth. Let the Remax Belize team help you with your Belize property & Belize real estate search. We can help go over the different options and opportunities available in Belize. There are a lot of opportunities in Belize and a diverse real estate market. In Belize, we do not have a formal MLS, so a real estate agent’s job is a little different. If you are looking at buying or investing in Belize, a Remax Belize real estate agent can help with the search. Offer to Purchase Belize Property After the Belize real estate search, and once you find the property you want to purchase, the next step is to put in an offer or draft up an agreement of sale. The real estate agent will require your full name and address to be able to draft up the agreement/offer. Most real estate transactions in Belize are cash sales. That said, there are opportunities with financing available. Most real estate opportunities in Belize with financing available are through seller or vendor financing. Belize does not have the standard bank financing or mortgages people are used to in the US or Canada. If you are wanting to purchase Belize real estate with financing, talk to your agent and find opportunities with financing. Or include the financing terms in the offer/agreement. When writing an offer or agreement, make sure you add any contingencies, clauses, or addendums you require. Or include details required for the closing and include any additional services needed for the property transaction to go through. In Belize, we do not have traditional home Inspectors or property appraisals. If required, you can an hire engineer or trusted home builders to inspect the property of interest and write up a report. If you are purchasing raw land, you can request a copy of the land title and/or a property survey. You are also able to purchase Belize real estate through a Self-Directed IRA or 401K. Be sure to let your RE/MAX Belize real estate agent know if you want to use a Self-Directed IRA or 401K when you are purchasing the property. After the agreement is signed by the purchaser and the seller, a color copy of your passport will be needed as well as a utility bill matching the address on the offer to purchase. Escrow Down Payment or Deposit If you are purchasing a property with financing, you will have to send the down payment to an escrow account or escrow agent. Even cash sale transactions it is suggested to use an escrow account and closing company. After all the documentation is signed, everything will go to a Closing Company for the due diligence and transfer of property. When buying any property in Belize you want to ensure the process is done correctly. That includes initiating a title search and ensuring there are no liens or encumbrances on the property. When buying Belize real estate you also want to make sure that the seller is legally able to sell the Belie land. The property history as well as corporate and IBC registration is also something that the Closing Company will take care of. A Closing Company will make sure past transfers of ownership were done properly and that the whole process is done correctly. You also want the Closing Company to look over the proposed purchase agreement, making sure the information is correct and ensuring it’s in full compliance with the local and governing laws of Belize. A Closing Company is particularly important if you are choosing to finance a property with the seller because a payment processing company is often needed. It is also common in Belize for a closing company to use an Escrow Agent and/or Escrow Account. This helps to protect the buyer and the seller during the real estate transaction. Since most real estate transactions in Belize are done in USD it is common for the Escrow Account to be in the US and with a US Bank account. Real estate transactions in Belize are in US dollars and use a US escrow agent or account (a US account or US intermediary is needed for any transaction in USD). The closing costs are paid by the buyer. The seller is responsible for the real estate fee and commission. All money is sent to a US escrow and a closing company releases funds upon closing. When an offer or sales agreement is submitted a down payment for escrow is required. If it’s a cash sale, it will be the entire balance on the property which will go to escrow during the closing process. If it is a financing agreement, the down payment (20% to 25%) will be sent to escrow during the closing process. The closing costs are between 1% – 1.5% of the sales price. Due diligence consists of a title search and a company search if the property is in a company name. This is all handled by the Closing Company. Property Closing & Transfer Once all the legal processes and closing have been completed along with a title search and closing documents. The legal documents are signed by all parties and original copies are sent to the purchaser. With a financing agreement, the seller will carry the note on the property (similar to a bank in the US). If it is a cash sale agreement, all original documents will be sent to the purchaser (the new owner of the property). If the property is not in an IBC there is a one-time Stamp Duty Fee of 8% paid to the Government of Belize (GOB). Stamp/Transfer Tax is a tax of 8% on the total sale price and the Government of Belize gives you the first $10,000.00 USD exemption. GOB reserves the right to reassess the Stamp Tax and if they feel you paid too little for the Belize property, if this is the case the purchaser will require you to pay the difference. If a property is held in a corporate entity like an IBC all the shares will be transferred to the purchaser. IBC property ownership means there is no stamp/transfer tax and the transfer of ownership is much faster. To learn more about the closing process for land and properties held in an IBC vs not in an IBC contact us at RE/MAX Belize. In Belize, you own a property outright with a fee-simple title. Foreigners have the same ownership rights as locals. If you are interested in Belize property and/or buying Belize real estate, contact us at RE/MAX Belize! We are here to help with your Belize real estate search. We can help find your dream home in paradise or investment property in Belize! Second home ownership in Belize is very safe and easy experience. If you are interested in Belize Land or Belize propertyand/or buying Belize real estate, or Ambergris Caye Realestate contact us at RE/MAX Belize