Questions to Ask When Buying Land in Belize

Thinking of Buying Land in Belize?  

The news on Belize is out. The Caribbean & Central American country of Belize has entered the worlds radar and is no longer a “secret.” Since Belize and Ambergris Caye are no longer secrets the Belize real estate market has been attracting a lot of attention from investors and people looking to relocate to a tax-friendly, english speaking, tropical destination.

Belize is full of opportunities; from residential properties that people intend to use for their own personal use (moving or retirement) to developing investment properties. When investing in Belize and buying land in Belize there’s something for everyone.

If you’ve been considering purchasing property and real estate in Belize, it helps to understand and be knowledgeable on what you can and can’t do. When buying Belize Real Estate or Ambergris Caye Real Estate you ultimately want to consult and work with a real estate professional. Our team at RE/MAX Belize are here to help with your Belize real estate search.

If you are considering buying land in Belize, you will likely have a lot of questions, and hopefully the answers to a number these questions will help you get started.

 

Do I Have to be a Citizen or Resident to Purchase Land in Belize?

Unlike other countries in the region (Central America & Caribbean), when buying property or buying land in Belize you do not have to be a citizen or have residency. In Belize, foreigners have the same ownership rights as nationals (citizens). Belize offers full foreign ownership and the strongest property ownership rights (fee-simple title). You do not need to be a citizen or have residency when buying land in Belize.

There are certain requirements and criteria a closing company will request for the property transfer, but it is very easy and straight forward. There are some taxes and fees that do apply. But when you are buying land in Belize, you own the land outright.

The fees and taxes when buying land in Belize often must be paid separately and cannot be bundled into the sale or whatever financing arrangement you’ve made. To reduce the fees and simplify the process, a lot of foreign investors buy Belize property in an IBC.

To get a better idea of how those fees and taxes apply to you, and the property/land you are looking to buy, you should consult with your Belize real estate agent. Different properties (depending on their ownership structure) have different fees and taxes. Working with a Belize real estate professional (with experience) will ensure that you aren’t caught with surprises in the middle of the transaction and end up scrambling for additional money to cover the taxes and closing costs.

 

What Type of Land Can I Buy in Belize?

One of the major draws for foreign investment in Belize is the few restrictions on foreign ownership. Belize does not have limitations on foreign ownership or impose limits on the ability to purchase land that’s zoned for residential or commercial use. Even if you are not a Belizean citizen or resident, you have the ability to purchase land without restrictions or an overly complicated process.

By working with a Remax Belize Real Estate agent, it’s easier to focus the Belize real estate search and find the right property/land in Belize.

When buying land in Belize you want to make sure you know how a given tract of land is zoned and make sure it is surveyed and titled before spending any time trying to acquire it. Some properties may have restrictive covenants in place and zoning limitations (zoned for commercial and residential). People often purchase a property with titling conflicts, because of this we suggest working with a reputable realtor like RE/MAX.

Like anywhere in the world, some properties and pieces of land are set aside for one purpose or the other. Knowing what you can (or can’t) do with a property is important. Some owners/investors want a property or are looking to buy land in Belize without any restrictive covenants. Others are looking for something with some community or development restrictions (like Mahogany Bay) to secure the property value and continuity. Knowing what you want from your property or land in Belize will help narrow down the search.

A “fee simple” is real property held without a limit of time. This means absolute and permanent ownership of property under the governing common law. A Fee-Simple Title and Freehold Ownership is the highest possible form of property ownership. There are also properties that are known as a “fee simple absolute,” which is without limitations on the land’s use.

To learn more about the different types of property ownership in Belize check out our other blog post.

 

Is There Types of Land or Properties That Aren’t For Sale?

There are certain properties and classes of land that are not for sale or cannot be purchased. There are also other properties and types of land that a person can purchase if they meet certain criteria. Some types of land and properties have restrictions. 46% of Belize is national park or marine reserve. If the land is in a protected area, it cannot be sold or bought (these properties won’t have title). In Belize, a foreigner can only purchase land that has title.

In Belize, nature reserves are an example of land that is not for sale. There are some areas and pieces of land in Belize that can be sold, but the purchaser is prohibited from constructing certain types of structures on the property.

Another thing to be aware of, that most foreigners do not realize is the “Queen’s Beach” or “Queen’s Land.” The Queen’s land is another type of land that cannot be sold or purchased (by a citizen or foreigner). The Queen’s land in Belize is also commonly known as Crown Reserves. The first 66 feet from high-tide surrounding any major body of water (ocean or sea) is public property and cannot be owned or developed.

All beaches in Belize are public access and the first 66-feet from high-tide is considered public land and public property even if it’s adjacent to private property. All docks are also public property (even if it is adjacent to private property or built by the owner).

While an owner of beachfront property is free to use the first 66-feet from high tide (Queen’s Lan), the use of the land must be open and nonexclusive. A resort or home can install a seawall, beach chairs, etc, but they cannot claim it as “private property.”

In Belize, there is a law regarding the ownership and usage of beaches or land along the coasts. This type of property, known as Queen’s Land. The Queens Land is 66 feet of land at the shore of any large body of water and cannot be purchased or developed. The first 66-feet from high-tide is considered public land, even in the case where it is adjacent to private property.

If you own beachfront land you are not legally able to construct any type of permanent building or structure. An owner of beachfront property is also not allowed to restrict the access of others to the property.

In Belize, even though a property may not have a physical “road” there is still likely a road reserve. Road reserves refer to the land found on each side of a public road. When are area is zoned and titled, there are often road reserves put in place. There are also setback from the road reserve that must be met. If you own property or land, you cannot build over the setbacks as there is land set aside for potentially widening the road in the future.

If you own land in Belize or considering buying land in Belize you will likely want to develop the property. If you plan on developing the land and building a fence or wall around it, it is important to make sure you know where the road reserve ends, and your property line begins. This is why we always suggest a property owner has their land resurveyed before the start construction.

A resurvey will ensure the structure and construction meets the setbacks. If a property is not resurveyed and you build on the land, the day could come when your fence or structure has to come down.

 

Do I Have to be in Belize to Purchase Land?

If you are buying land or property in Belize you do not have to physically be in the country. The entire property purchasing process can be done remotely and without physically being in Belize. When buying land in Belize it is not necessary to be in Belize when you buy property. Everything from sharing information, signing, and closing can be done remotely.

Much of the work needed to buy land in Belize can be done through your real estate agent and the closing company. At RE/MAX Belize, most of our clients buy property remotely (many site unseen). Our team of Belize real estate agents can coordinate the sale with the seller, the closing company, financing/payment processing company (if needed) and even ensure that everything is in order to pay the property taxes.

Using technology and online resources neither the buyer or the seller of a property need to be in Belize. The closing and transfer of property can all be done remotely.

It is important to note that current laws do require that a person purchasing property in Belize has a valid passport or form of government ID. When buying land in Belize, be prepared to provide the Closing Company with a photo of your passport and a utility bill. They will likely need proof that you do have identification and that it’s up to date.

It is also assumed that you will want to visit your Belize property at some point and a passport is needed for international travel. An ID or passport is needed for closing and transfer of property (even if a property is in an IBC or corporation).

 

Can I Get Financing For Buying Land in Belize?

In Belize, we do not have the same bank financing or mortgages people are used to in the US or Canada. Traditional bank financing is difficult but there are some Belize real estate opportunities with seller/vendor financing available. Most real estate transactions in Belize are cash sales. But real estate opportunities like Mahogany Bay or Secret Beach have seller financing available.

Some local or international banks will provide financing for purchasing land and/or residential and commercial properties in Belize. However, the banks in Belize have less desirable financing terms than what people are used to in the US or Canada. This is why a lot of people looking to buy land in Belize look for opportunities with seller or vendor financing.

When buying land in Belize, you can add provisions that allow you to work out a purchase agreement with a seller with financing. The terms and financing arrangements can vary. Seller financing options are often a non-recourse loan without credit checks. Seller financing is available on some properties, and it depends on the land and your circumstances. The type of property you want to purchase, and the seller of the property will determine the financing.

For the most part, real estate in Belize is paid for in cash. If you are financing a property, there will be a financing agreement. In a typical owner financing arrangement, the purchaser will provide the seller with the agreed on a down payment. After the agreement is signed by both parties, and the down payment is made, the seller will provide monthly payments which will be outlined in the agreement of sale until the debt is discharged in full.

When buying a property with financing there’s also likely to be a requirement to pay all property taxes and fees related to the property.

 

With Owner Financing, When Does the Ownership Transfer?

When you buy a property with owner financing, an agreement of sale is drafted and signed by both parties (the buyer and the seller). The agreement will be an agreement of sale with financing terms. Unlike bank financing (where the bank carries the note) with the owner financing model, the seller acts as the bank and carries the note on the property. The owner financing process is also much easier when a property or Belize land is held in a corporate entity like an IBC.

After agreement of sale with financing is signed by the buyer and the seller and the down payment is made, the owner gets full use and enjoyment of the property and the new purchaser can build and use the property from the closing or completion date.

One major difference between bank financing (like in the US or Canada) and the owner financing with the seller is who holds the physical title to the property during the financing period. With traditional bank financing, the purchaser is the physical owner of record with the bank holding a claim (note) on the property. That claim is released when the mortgage is paid in full to the bank.

With owner or seller financing in Belize, the seller acts as the bank until the final installment payment is made. At that time, the title to the property is transferred to the new purchaser. When a property has owner/seller financing, a mortgage contract is issued with the Central Bank of Belize which protects the buyer and the seller during the financing period.

 

Why Should I Use a Closing Company?

In Belize, a Closing Company handles all the due diligence and transfer of property (including a title search). When buying any property (domestic or off-shore) you want to ensure the process is done correctly. That includes initiating a title search, so you know what you are buying, you also want to ensure that there are no liens or encumbrances on the property. 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. It is a small fee (often $1,000 or 1% of the purchase price) and something we urge our clients to use. 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 ensure 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.

 

Buying Land in Belize

The most important thing to know when buying land in Belize or purchasing Belize property is that you can own property in Belize outright with a fee simple title. Belize has full foreign ownership. Even with the favorable laws and easy process it is important to do it the right way. That is why our team at RE/MAX Belize is here to help. When you work with RE/MAX Belize you have a team of professionals to ensure nothing is left undone and that you understand what sort of commitment you’re taking on (purchasing with cash or financing). With the right approach and process, everything will be seamless and you will own your own piece of paradise!

Things to Know When Buying Land in Belize

Buying Land in Belize

Belize is known for its amazing landscapes; from lush jungles to pristine beaches and vibrant reefs. Belize is home to some of the best diving, snorkeling, and fishing in the world. Belize is picturesque and diverse, the country of Belize has lots of beautiful characteristics that draw in tourists from around the world. Beyond the beauty, Belize is also a popular investment destination, especially for foreign investors looking to secure land in the emerging destination.

One of the major draws to owning land in Belize is the incredibly low property tax rates. The taxation and ownership structure makes owning land in Belize very inexpensive with little to no costs of ownership or carrying costs. Belize has a lot to love (for investment, beauty, and lifestyle), and even though the country is growing and emerging as a top destination in the region, there are still opportunities to purchase land (to develop or land bank).

The affordability and low cost of ownership draw many investors, expats, and retirees to purchase land in Belize. Whether you are looking in Belize for an investment property or to develop a personal home (for vacation or full-time residence) there is an abundance of opportunities and benefits when buying land in Belize. Nevertheless, before indulging in purchasing land here, you should educate yourself a little more about Belize and learn about the important details of buying land in Belize. 

First, you may ask yourself, do I need to be a citizen to be able to purchase land in Belize? The answer to that is no. You do not need to be a citizen to be able to own land in Belize with it having full foreign ownership (foreigners have the same ownership as locals) and when you buy land in Belize, you own it outright with a fee simple land title. Other countries in Central America & the Caribbean require permanent residency or citizenship to purchase land and especially for investment purposes. This is not the case in Belize.

In Belize, a foreigner has the exact same ownership rights as a local. A person does not require citizenship or residency to own property in Belize. The ownership rights and structure are the major draws of owning land in Belize. As long as you have the capital or funds for the property, you are able to purchase land in Belize. You also have full control of the property and unless there are restrictive covenants in place, you are able to build what you want when you want. then you can go right ahead and purchase land and build on it.

Not only does Belize have strong property ownership rights that allow for full foreign ownership, but the country also does not recognize squatting rights and is also one of the only pro-landlord countries in the region. These factors further protect your off-shore investment. 

 

Is it Easy for a Foreigner to Buy Land in Belize?

Yes. It is exceedingly and almost unbelievably easy to buy land in Belize. Especially when compared to other markets like; Mexico, Costa Rica, St Thomas, Panama, Honduras, etc. Belize is one of the most pro-foreign direct investment countries. Belize also incentivizes investment and foreign ownership of land. In Belize, when buying land a foreigner has the same rights as a Belizean citizen to property ownership.  

If you are doing research on buying land in Belize and/or other Caribbean destinations you might find reference to an “alien landholding license” or the Alien Landholding Act, please note that the Act was abolished in 2001. Since then, when buying land in Belize foreigners have equal property ownership rights.  If you’ve done research on other jurisdictions, and comparable destinations in the region, you know that full foreign ownership is quite rare in much of the Caribbean & Central America, and rarer still in emerging markets like Belize.

 

How Do I Buy Land in Belize?

It is very easy to buy land in Belize! The first step, when buying land in Belize, is to submit an offer to the seller. To write an offer or agreement to purchase land, your Belize real estate agent your full name and address. The offer form is legally binding to both parties (the buyer & the seller) and includes a due diligence period for the buyer.

Once the offer and/or agreement are accepted by the seller and the buyer, the agreement will go to a Closing Company which will do all the due diligence, title search, and transfer of property. It is common for land transactions and land purchases to be done through a corporation (IBC or Chapter 250) for tax advantages. 

Once a satisfactory title search is completed (i.e., the seller actually owns the Belize property in question), and all due diligence is performed, the property is transferred to the purchaser. if the property is in an IBC (International Business Company) the purchaser will receive the shares of the corporation that owns the property (which makes for a much faster closing), if the property is not in a corporation, a Transfer will be requested and the property transaction will go through the Belize Lands Department.

Be careful when a realtor or seller says they can do their own closings. It is always recommended to use a Closing Company. At RE/MAX Belize, we use Capital Corporate Services

When buying land in Belize, the payment amount (either down payment or full purchase price) will be received by an Escrow Agent at the time specified (Closing Date) on the Agreement of Sale. The Belize property transfer documents (for the land) are then executed and delivered to the buyer.

The Closing Company will finalize the documents and funds are released from escrow to the seller. If the property is not held in a corporation (IBC or Chapter 250) the executed documents will be processed at the Belize Lands Registry and an original title or certified copy of the Agreement of Sale will be presented to the purchaser. Overall, real estate and land transactions in Belize are far less complicated than in other countries. It also helps to have all documentation in English with full ownership (fee-simple title). 

 

Can Land in Belize be Owned by a Corporation or Company?

Yes. It is actually very common and advisable. Many of the Belize land purchases that RE/MAX Belize has done have been with a company or corporation. It is very common for people purchasing an off-shore investment to want to own the property in an IBC (International Business Company) or a Chapter 250 company.

Most clients we work with want to own the property through a corporate entity. There are various reasons and a number of benefits for owning a property and/or land in a corporate entity (off-shore or domestic), but one primary factor is having little to no stamp or transfer tax when buying the land. 

 

What is an IBC and Why Should I Use One When Buying Property in Belize?

An IBC is an “International Business Company” and functions much like an LLC in the US but operates in a foreign country. There is no stamp or transfer tax when a property is in an IBC. It is one of the tax optimization laws Belize has in place for off-shore investment.
 
If a property is not held in an IBC, there is an 8% stamp/transfer tax when you buy or sell the property as a foreigner or non-resident and a 5% if you are a resident or Belizean (or Belizean corporate entity). When the property is in an IBC, you don’t pay the stamp or transfer tax, you have an added layer of asset protection (if someone sues you in the US, they can’t touch your Belize asset), and you have improved liquidity when you sell the property and remove liability. You own the IBC and the IBC owns the property with fee simple title. 
 
Some of the advantages of owning a property in an IBC are;
  1. Tax optimization as you don’t have to pay stamp or transfer tax.
  2. Asset protection
  3. Improved liquidity
  4. Faster transfer of ownership
  5. Keep owner’s privacy and ambiguity

You own the IBC and the IBC owns the property with a simple title. The International Business Companies Act 1990 of Belize created a special category of a company known as an International Business Company (IBC). Today Belize is one of the largest leading centers for international banking in the world. 

The IBC laws were created and enacted to permit asset protection and tax minimization planning at competitive rates. Some of the attributes of an IBC are:

  • IBCs have an exemption from all forms of local taxation including Stamp Duty.
  • Speedy and simple registration. Also faster transfer of property.
  • Only one shareholder and one director are required.
    • Limited filing requirements (certificate of incorporation, memorandum, and articles of association).
    • No exchange control.
    • Low registration fee for new corporations.
    • Low continuation fee.

The list of off-shore countries and jurisdictions that use and practice IBCs is pretty long: Antigua and Barbuda, Anguilla, Barbados, Bahamas, Belize, Brunei, British Virgin Islands or BVI, Cook Islands, Comoros, Dominica, Grenada, Gambia, Mauritius, Marshall Islands, Montserrat, Nauru, Saint Lucia, Samoa, St. Kitts and Nevis, St. Vincent, and the Grenadines, Seychelles, and Vanuatu. An IBC is an offshore company that is usually formed as a tax-neutral company meaning that it is not taxable in the country of incorporation.

We suggest to all of our clients that they purchase land in an IBC or have the property put in an IBC. If you would like more information on IBCs, have any questions about IBCs in Belize, and the benefits of owning property in an IBC please contact us at RE/MAX Belize. 

 

Do I Need to Be in Belize to Buy Land?

No, you do not have to physically be in Belize to buy land in Belize. Most of the real estate and land transactions we do at RE/MAX Belize are done remotely using drone footage (video and pictures), title searches, etc. We also use DocuSign so buyers can sign the agreements from the comfort of their homes. 

Many Belize real estate transactions (land and homes) are completed when one or both of the parties (the purchaser or the seller) are outside of Belize. The real estate transaction documents are sent to the absent party or parties via DocuSign and email. The original documents (land and corporate) are sent via FedEx. Purchase offers can be submitted through DocuSign or other e-signature platforms, which is legally binding in Belize. 

The majority of the clients we work with at RE/MAX Belize are in the US or Canada. We are very familiar with the transaction process and everything can be done remotely without physically being in Belize. 

 

Do I Require Title Insurance When Buying Land in Belize?

The short answer is, No. Purchasers do not require Title Insurance when buying land or property in Belize. If you have a reputable Belize real estate professional, that is using a Closing Company or Real Estate Attorney for the land transaction then title insurance is not necessary. That said, title insurance is available in Belize, from reputable sources. In fact, Belize is the only Central American country that has ‘A+’ American title companies offering to insure to guarantee the title. This is due to the ownership rights in Belize. Belize Land Certificates or clear Deeds of Conveyance are guaranteed by the Government of Belize and are as secure titles as any Commonwealth, European, or North American country (including the US & Canada).

If a title search is done properly before or after the agreement of sale is done, title insurance in Belize is not needed.

 

Land & Property Taxes in Belize

Belize property taxes are affordable and the cost of land/property taxes is next to nothing. The low taxation and cost of ownership are one of the driving reasons so many investors are looking at Belize and securing land in Belize. Most properties are taxed at 1% to 1.5% of their assessed value. What is even more appealing is that property or land assessments are usually 10-30% of the property’s actual resale or market value. For example, property taxes for land around Belize Secret Beach start at $75 per year. Property taxes in Mahogany Bay are $108 per year. Property taxes in Belize are paid annually in April. 

When you compare property taxes in Belize with other countries you will see why so many people are buying and investing in Belize real estate and Belize land. If you are looking at buying Belize land and/or buying Belize property be sure to contact us at RE/MAX Belize. We are the Belize real estate & Ambergris Caye real estate experts. 

 

Can I Finance Land in Belize?

Financing in Belize is more difficult than in domestic markets. We do not have the same standard mortgages and bank financing people are used to in the USA or Canada. Most real estate transactions in Belize are cash sales. There are however real estate opportunities in Belize with seller or vendor financing. It is also important to note that it is far more common to find land opportunities with financing than it is to find a home or condo with financing.

There are three ways for purchasers to receive financing for Belize real estate:

  1. Local Belize Financing: Local banks in Belize do offer to finance land and/or property, though it is not easy (especially for foreigners). It is also important to note that the interest rates with Belize banks and terms for financing are usually higher than what people are used to at home. Local banks in Belize usually have much higher interest rates in the range of 10-18% interest with fixed terms of only 12 months. When you get financing from a local bank in Belize, the loan is closed every year and renewed at the new rate. When borrowing or lending from a local Belizean bank, it will be in Belize dollars, and most real estate transactions in Belize are in US dollars. Because most of the Belize real estate transactions take place with U.S. dollars, local financing is challenging. Local banks in Belize will also often only lend money to Belize residents or citizens. 
  2. Offshore or Domestic Financing: If you are not a resident or citizen of Belize and are looking for financing, you can borrow U.S. dollars through an offshore bank. In Belize, Caye International Bank is one of the only off-shore banks in the country. Interest rates with international banks in Belize are still much higher than people are used to in their domestic markets and are around 12% to 18% and most offshore banks when lending to people who are not Belize residents or citizens require a high degree of collateralization with a high down payment (often 50%). Some people do acquire domestic financing in their home country through a line of credit or refinancing their home/mortgage.
  3. Owner, Seller, or Vendor Financing: This is the most common way foreigners acquire financing for land in Belize. It is also far more common for someone to find land with financing than it is with a home or condo. Belize property owners and/or developers usually agree to property financing at better rates than the local banks. It is also very easy to qualify, as it is a non-recourse loan. The rates through seller or vendor financing are often less than what is available at local banks and financial institutions. Around Secret Beach, you are able to secure property with 20% down. Within Mahogany Bay, you can secure canal-front land with 25% down. 

For more information on financing in Belize and Belize real estate opportunities with financing available, contact us at RE/MAX Belize

 

Things to Consider

When purchasing land in Belize, there are some prerequisites that you must follow, for example, a closing company will likely as for a picture of your passport bio page and a past utility bill (that matches the name and address on the Agreement of Sale). When buying land in Belize, there are some minor fees or taxes but nothing too overwhelming. Closing costs are generally $1,000 to $1,500 or 1% of the property/land purchase price. The fees and processes can be discussed with one of our agents here at RE/MAX Belize.

Another question many people tend to ask is, do I need to be in the country of Belize to buy land? With technology nowadays, there is only one simple answer to that and that would be “no”. Most of the purchasers we work with are not physically in Belize. The whole land purchasing process can be done remotely without physically being in Belize. You do not need to physically be in Belize to buy land or close on a property, our team can share all the details and property options over the phone, via Facetime, Zoom meeting, text, and/or email. Once we narrow down a few areas and land options, we will prepare a video showing the property and surrounding areas. Land purchases are much easier than larger homes, condos, and villas. Everything can be signed through DocuSign or e-Signature.

Here at RE/MAX Belize, we have worked with numerous clients and have done the entire property and land purchase process remotely. Once everything is signed and submitted to the Closing Company a copy of your passport and a utility bill (matching the names and addresses on the agreement) will be required. Again, this can all be submitted remotely. With a little bit of paperwork and some digital signing then you are ready to go.

Some people may also wonder if all land here in Belize is for sale, and the answer to that is most land can be bought but some cannot be bought in Belize. A large portion of the country is protected national park and marine reserve.

There is also Queen’s land-land within 66 ft of high tide that can not be purchased. The first 66 feet from the high tide is public property which anyone can use at any time. It is important to note that all beaches in Belize are public access and the first 66 feet from the water at high tide is public property. This is one of the many draws to Belize as a destination and investment. It is also something many owners are unaware of and can be a detractor from paying the high prices of beachfront property. 

Belize is an emerging market with plenty of room for development. When you buy land in Belize, you own the property outright with a fee-simple title and full foreign ownership. You also have the added benefit of low property taxes and low cost of ownership. Whether you are looking at buying land in Belize for personal use or investment, the country has nearly endless possibilities. 

Contact the team at RE/MAX Belize for more information on buying land in Belize and Belize real estate opportunities.