Procedure for Buying Real Estate in Belize

Procedures for Buying Real Estate in Belize 

How Does One Go About Purchasing Real Estate in Belize? 

General Procedure

All things considered, purchasing real estate in Belize is a really simple and uncomplicated process. Due to the fact that various property types have distinct closing procedures, the process varies from property to property and transaction to transaction. However, the overall procedure is as follows:

Step 1: A suitable property must be identified and a title search done.

Step 2: The buyer must make an offer to the seller. This can be a simple purchase agreement; after the buyer signs it, the seller reviews it for approval. Remote signing and document completion are both possible. Most transactions are completed via e-signature or DocuSign. A remote closing follows the same process as a traditional closing, except that verification is completed digitally. All that the buyer needs is a valid passport or other acceptable form of Government ID. It is advisable but not necessary to hire an attorney.  However, a simple contract can be notarized by a Justice of the Peace in Belize for far less cost and is a valid, legally binding contract.

Step 3: A Belizean closing business will handle the deal after the seller accepts. The closing business will guarantee that the transaction is conducted and binding by providing all documentation. A recordable agreement for sale or original title transfer instrument will be drafted depending on the specifics of the initial purchase offer after a satisfactory title investigation is finished.

Step 4: The deposit will be due in the form of either the agreed-upon down payment or the whole purchase price. The purchase offer or agreement for sale will include information on the closing date. The buyer will be able to use and enjoy the property to the fullest extent as soon as the deposit is paid.

Step 5: The transfer documentation will be completed and given to the buyer for inspection. At signing, the remaining payment of the property is paid in full or a payment plan is agreed to. We use an escrow service in Belize. We welcome registered, verifiable escrow services in the US, Canada, CARICOM nations and other countries with established such services.

Step 6: The completed paperwork will then be handled at the Lands Registry if the buyer wishes to have the property title in their own name (which can take up to 3 months), and the new owner will eventually be given an original title or a certified copy.

Get in touch with us at Belize Property & Caribbean Land Development Corp. if you're considering purchasing real estate in Belize or would like more details about the procedure!

Note: 

Once you, the buyer, have agreed on a price, Belize Property And Caribbean Development Corp. or a real estate lawyer (Note: Real Estate lawyers are extra cost for your pocket!), will draft a Sales Agreement for both of you to sign. This agreement is a legally binding contract and will outline how the buyer's payments will be made, who is responsible for closing costs, default clauses, possession of property etc.

A land purchase agreement/(sales Agreement) is a contract used for selling land from one person or entity to another. It identifies the names of the buyer and seller, the amount of money the land is selling for, the date the closing will occur, and other terms and conditions the buyer and seller agree to follow. 

Our procedures and recommendations

1. Initial consultation to discuss and identify area and specific type of property.  If we don't have a suitable listing, we then research and  submit a few suggestions. No charge.

2. Engagement or commencement letter outlining the process, followed by a deposit for property search, title search to ascertain the ownership status and any liens, encumbrances or other issues that may impede the purchase.

3. Once the purchase is agreed on, a retainer is required which covers any legal representation, surveys, Government fees and other items such as land clearing, structure construction.  The latter of which can commence once the lease or purchase is approved or can wait till a bit later.  It is important to understand that activity and at least a concrete foundation and some landscaping is essential to denote ownership interest.  If land is left fallow, it can be targeted by “active” buyers who can negotiate to undercut prospective buyers. Hence, it is important to “stake a claim”  to ensure ownership

4. Once land is “put into property” or a title is issued or changed ownership, a stamp duty of 5-8% (1st $20.000BZD is exempt), which is the Government stamp duty or purchase tax. This is based on the agreed purchase price or “fair market value” determined by the Government Valuation Department, whichever is higher.  5% for Belizean and CARICOM nationals and 8% for foreigners. It may make sense to purchase a property for less than $20,000 (US$10,000) to save on stamp duty. Stamp duty is placed on land and buildings but not on contents. And if you want to avoid stamp duties you are recommended to form an (IBC) International Business company; two main reasons for this is to keep your asset in Belize safe from foreign lawsuits and if you choose to resell your property, it is a much faster process.

5. 10% is the standard earnest deposit in Belize which is fully refundable less fees for title search, any legal fees, surveys, transportation costs to view property or other fees agreed on such as land clearing etc. See our Refund Policy please. Noteworthy is that our escrow service has both US and Belize based accounts.

6. We recommend you keep original documents in our or your safety deposit box at a bank. It is a longwinded process to replace.

7. Annual property tax is low but needs to be paid.  Approx. $100USD/year for an acre.

8. Although the stamp duty is considerably high, there is no capital gains tax should you decide to sell.

9. Self Directed IRAs are acceptable in Belize

10. Forms of currency include major credit cards, bank transfer, crypto and cash (cash paid at a bank or escrow office).

5 Steps to Register an IBC in Belize

• Find a Licensed Agent to Help You Establish Your IBC. ...

• Complete the IBC Application Form. ...

• Submit a Declaration of Ownership. ...

• Pay Registration Fees for the First Year of Business. ...

• Establish a U.S. Currency Account for Your IBC

Our closing agents and attorneys can assit with this.

REQUIREMENTS FOR ESCROW AGREEMENT AND ESCROW SERVICES

GENERAL:

• An Escrow is an arrangement where a third party holds funds and legal documents on behalf of the Buyer and Seller and disburses these documents and funds in accordance with the Escrow Agreement.

• The Seller and the Buyer must both agree with the terms and conditions of the escrow agreement; therefore, the interests of both parties are safeguarded.

• The Escrow Agent must comply with the instructions of the Buyer and Seller as stated in the agreement.

• The Escrow Agent guides the transfer of ownership process and acts in an unbiased manner.

• We use only recognized escrow services licensed in Belize, CARICOM Nations, USA,  Canada, UK or other nations who have recognized, licensed escrow services for asset protection and real estate services. 

REQUIREMENTS:

• Full name and address of the Seller

• Full name and address of the Buyer

• Purchase Price

• Payment Plan (e.g. down payment, other deposits & final payment)

• List of Additional Payments to be made from escrow (e.g. Property Tax, Stamp Duty, Filing Fees, Attorney Fees).

• Lawful Description of Property

• Proof of land ownership (title, conveyance, land certificate, etc.)

• Copy of Purchase Agreement or any other agreement

• Special Clauses or Additional Information

• Wire Instructions or other payment method