Buying, Building and Renting in Belize

Buying, Building and Renting in Belize
Buying, Building and Renting in Belize
By LAN SLUDER

Copyright 2001 by Lan Sluder


Of the many appealing things about Belize, probably none is more important to prospective retirees and relocatees than the relatively low cost of housing here. To be sure, in a few prime areas you can spend hundreds of thousands of dollars on North American-style luxury home, but you can also buy raw land at prices not seen in the U.S. since the 1960s and in some areas find a simple but pleasant rental house near the sea for under US$100 or $200 a month.


Add to that the ease of purchase or rental -- there are few restrictions on the purchase or use of real estate by foreigners, and legal documents are in English and follow English common law traditions -- and it’s even more apparent why Belize can be a terrific alternative to other retirement or relocation areas.

What’s Different, What’s Not?
Most of the same rules of thumb that apply when looking for a home, land or apartment in the United States or Canada also apply in Belize:


• Location, location and location are the three most important factors in determining price. Demand drives price. For example, many people dream of living on the beach, so beachfront property in Belize is in great demand, and prices are high compared with similar property inland or even one lot back from the beach.


• Prices vary greatly depending on your negotiation skills. If you’re a good horse trader, you’ll likely get a better deal in Belize than the guy who isn’t. Keep in mind that in most parts of Belize there is far more available real estate than buyers with cold cash, so don’t jump at the first deal that comes your way. Remember, too, that in real estate you almost always make your money when you buy, not when you sell.


• The more you know, the better price you’ll get. A common saying among expats in Belize is that the second house you buy or rent is twice as large as the first and costs one-half as much. Spend as much time in Belize as you can before you put any money in real estate.


• Caveat emptor. Buyer beware applies as much in Belize as anywhere else. Real estate agents in Belize aren’t licensed. That beachfront lot that looks wonderful in the dry season may be under two feet of water in the rainy season, and there are no laws in Belize that provide for you to get your money back if the real estate agent didn’t provide full disclosure. In addition, as soon as the word gets out that you’re in the market for a place to live, everybody and his brother will tell you about this little piece of property owned by a cousin of theirs. It may be a great deal, but look before you leap.


But a couple of things also are quite different about real estate in Belize:


• In Belize, there almost always is one price for Belizeans and another price for foreigners. The difference may only be a few dollars, but often the Belizean price may be one-half or less of the “rich foreigner” price. In some cases the differential may be five or ten times or more. From the expat’s point of view, this is unfair. From the Belizean point of view, this is perfectly kosher and reflects the reality that Americans (or Canadians or Europeans) make far more money for the same work as Belizeans and can well afford to pay more. One way around this problem is to get a trusted Belizean friend to find out the “local price” for you. Once the owner has quoted the Belize price, he or she won’t raise it, even if it’s discovered that you’re a foreigner. Another is spend enough time in the country to get a feel for the difference between the Belizean price and the non-Belizean price, so that at least you can bargain with your eyes open.


• The Belize market is very small and inefficient. The real estate market anywhere is inherently not very efficient, since sales involve one-of-a-kind properties sold at high prices to a relatively small pool of potential buyers. In Belize, the marketplace is even more inefficient. There is little real estate classified advertising, and most properties are sold or rented by word of mouth. Except for one or two informal associations of real estate companies, there are no multiple listing services, and many properties are for sale by owner. Thus, it’s not easy to find out exactly what is on the market or what the prices are. The pool of financially capable real estate buyers in Belize is small, leaving many sellers dependent on foreign buyers. There are few qualified real estate agents, appraisers and surveyors. Mortgage financing is not easily available for foreign buyers, further reducing the size of the buying pool and requiring cash sales or owner financing. All this means that prices for similar properties can be all over the board. Also, the time to sell a property may be measured in years rather months. Which is something to think about as you buy real estate which you may someday want to sell.

Shopping for Housing
If you are interested in buying or renting property in Belize, how do you go about finding properties for sale or rent?


Except for occasional ads in the San Pedro Sun on Ambergris Caye and in Belize City newspapers, few properties are advertised for sale. Real estate agencies do maintain listing brochures, and you can contact them to request a copy. Increasingly, brokers use the Internet as their primary way of presenting listings and of getting prospective buyers. This is as true in Belize as it is in California. See the real estate agent listings below for addresses of real estate Web sites in Belize. Even with the Internet, however, you’ll miss three-fourths of available properties. To find out what’s really for sale, you’ll have to spend time on the ground in Belize. Most properties are for sale by owner, rather than being listed with a broker. In many cases, you will see no sign or other indication that a property is for sale. Just start asking around, and before long you’ll have more deals being offered you than you can even begin to consider.


This goes double for rentals. It is rare to see a house advertised for rent in a newspaper, and brokers handle only the most expensive rentals. About the only way to find a house or apartment to rent is to spend some time in the area where you wish to rent. Drive around and look for vacant homes, or ask foreign residents or Belizeans for tips on what’s available.

Real Estate Brokers
In Belize, anyone can be a real estate broker. No license needed. No schooling, no bonding, no continuing education. All you need is enough money to print business cards, and, presto, you’re a broker. Selling real estate is a popular first job for expats in Belize, and some do it on the side without a work permit. Quite a few hoteliers, dive shop operators and taxi drivers peddle real estate to tourists on the side. One of the best-known real estate guys in Placencia, until he left to sail his boat around the Caribbean, was also the proprietor and barkeep of one of the most popular bar on the peninsula.


Not surprisingly, the quality of agents varies. Some are professional and honest. A few are out for a fast buck. The ones we’ve listed here and in the Prime Location chapters are among the best we’ve heard about, but even so your mileage may vary.


Real estate commissions in Belize are similar to those in the U.S. Agents typically charge the seller 6 or 7 percent commission on residential property, and around 10 percent on raw land. Because many properties are in remote areas, brokers often charge prospective buyers expenses for travel and transportation incurred in connection with showing properties.

Selected Agents
Here some real estate agents who have been given good marks by expats in Belize (but check them out for yourself).

Bill Wildman, Belize Land Consultants, P.O. Box 35, Corozal, tel. 501-4-38005, fax 4-38006, e-mail blzland@btl.net, www.consejoshores.com. Bill, a Canadian land surveyor and wife Jenny, originally from England, developed Consejo Shores near Corozal Town and also have more than 30 years of real estate experience in Placencia and elsewhere in Belize.


Belize Real Estate (W. Ford Young Real Estate, Belize City, and Langdon Supply, Ambergris Caye), 160 N. Front Street (P.O. Box 354), Belize City, tel. 501-2-72065, fax 2-31023, e-mail bzreal@btl.net, www.belizerealestate.com. Properties throughout Belize.


John C. Burks, Regent Realty, 81 N. Front St., Belize City, tel. 501-2-73744, fax 2-72022, e-mail regent@btl.net, www.regentrealtybelize.com. John, an American who first came to Belize in 1972 to raise cattle, has listings all over Belize and represents The Plantation in Placencia.


Madeleine and John Estephan, Emerald Futures Real Estate, 13 Cork Street, #3 (P.O. Box 1442), Belize City, tel. 501-2-36559, fax 2-36559, e-mail realgem@btl.net, www.emeraldfutures.com. Emerald Futures has properties in most areas of the mainland. The Estephans were born and raised in Belize.


Amanda Symes, Sunrise Realty, P.O. Box 80, San Pedro, Ambergris Caye, tel. 501-2-63737, fax 2-63379, e-mail sunrise@btl.net, www.sunrisebelize.com. Focuses on properties on Ambergris Caye.


Diane Campbell, San Pedro, Ambergris Caye, tel. 501-2-65203, e-mail camp@btl.net. Diane is a former Californian who with her husband has build a number of homes on Ambergris Caye, including the Los Encantos development.

Restrictions on Ownership
Belize imposes few restrictions on ownership of land by nonnationals. Unlike Mexico, which prohibits the direct ownership of land by foreigners on or near the coast, in Belize foreigners can buy and hold beachfront real estate in exactly the same way as Belizeans.


The only limitations on ownership by foreign nationals are these:


• Formerly, an alien license from the government was required for the purchase of properties of 10 acres or more anywhere and for properties of 1/2 acre or more within city limits, on the cayes or in a few other restricted areas. In most cases, these alien licenses were routinely granted by the Ministry of Natural Resources and the Environment in Belmopan (tel. 501-6-22249). However, in spring of 2001, the alien license law was repealed.


• Government approval is required, from the Ministry of Natural Resources, before the purchase of any island, regardless of size.

Real Estate Prices
Property prices vary greatly in Belize from one area to another. They generally are highest in Belize City, on Ambergris Caye and in Placencia, and lowest in remote rural areas. In large tracts, raw land is available in Belize for under US$100 an acre, but for this price access may be poor and surveying costs may exceed the cost of the land itself. Good agricultural land might range from US$250 to $2,000 an acre, depending on quality and access. Home prices range from under US$15,000 for a simple Belizean-style home in a small village to US$500,000 for a luxury home on the beach in San Pedro. Finished, newer homes typically sell for from US$30 to $80 per square foot, though of course the location of the lot or land also is a major factor.


The condominium type of ownership is new to Belize, and most condos are on Ambergris Caye. Prices start at under US$100,000 for a one-bedroom unit. Belize has a few timeshares, also mostly on Ambergris Caye. These are generally not a good investment.


Property in Belize has appreciated over the past two decades, but by exactly how much is more difficult to say. Real estate agents say that some beachfront property in Placencia and elsewhere that was selling for under US$100 a front foot in 1980 is now going for US$1,000 or more a foot. Real estate agents naturally talk up the appreciation potential, but keep in mind that the Belize economy is closely tied to the economy in the U.S. Should America’s economic machine go into a tailspin, expect to see little if any growth in real estate values in Belize.


Even with appreciation, real estate prices in Belize are still inexpensive by the standards of the U.S. or most of Western Europe. That’s especially true of beachfront prices. Waterfront lot prices on the Eastern seaboard of the U.S. or in Florida rarely are less than US$200,000 to $500,000, and in places like Hilton Head, S.C., or Ft. Lauderdale, Fla., can easily reach US$3 million or more, whereas beachfront building lots on Belize’s Caribbean are still available for US$50,000 to $100,000.


Here’s a sampler of what you can expect to get for your money in Belize in 2000:

Under US$10,000
10 acres of farmland in Cayo or other rural area
Seaview (not seafront) lot in Corozal
Seaview lot on Long Caye

Under US$25,000
Canal/lagoon lot in Placencia
Seaview lot on Ambergris Caye
Small Belizean-style two-bedroom home in village or rural area
20-acre farm with small basic dwelling in rural area
6-acre “farmette” with utilities near Consejo Shores and Corozal Bay

Under $50,000
Beachfront lot on Ambergris Caye
Beachfront lot in Placencia, Hopkins or Corozal
Pleasant small concrete home in Corozal or Cayo
Mennonite “prefab” small house on canal/lagoon lot in Placencia

Under US$100,000
50-acre farm with dwelling and outbuildings in northern Belize, Cayo or Toledo
Modern 1,000 square-foot home on waterfront in Corozal or Hopkins area
One-bedroom condo on Ambergris Caye

Under $200,000
Two-bedroom condo on water on Ambergris Caye
Deluxe 1,800 square-foot home on nice lot in San Ignacio, Placencia or Corozal
150-acre farm with nice home, outbuildings and equipment in rural area

Under $500,000
Luxury 5,000 square-foot home on small estate in Cayo
Luxury 3,000 square-foot home on the beach on Ambergris Caye
1,000-acre farm with nice home, outbuildings and equipment in rural area

Fees and Costs of Purchase
Besides the cost of the property, you are likely to incur charges associated with the purchase that total 12 to 15 percent of the purchase price. These include the following:


• Land title transfer fee, sometimes called stamp tax: Everyone in Belize pays 5 percent transfer tax; non-citizens pay an additional 5 percent tax, for a total of 10 percent. At press time, the Belize Tourist Board was working to have this additional 5 percent tax repealed for those in Belize as permanent residents under the Qualified Retired Persons Incentive Act.


• Attorney’s fee: For around 2 percent of the purchase price, the attorney will draw up transfer documents and search the title.


• Property taxes: These are levied in advance and will be about 1 percent of the market value of the unimproved land outside city limits. Taxes within city limits but vary from around 3 to 8 percent of the value of the land (not the buildings and other improvements).

Registration and Title
There are three different real property title systems in Belize:
1. Conveyance system, which involves the transfer of land by conveyance and registration. In order to assure that the seller actually owns the land, a title search must be made in the Lands Unit in Belmopan (formerly Registry Office in Belize City), to unearth the chain of title and to uncover any encumbrances such as uncanceled mortgages. This search is normally done by an attorney. The owner holds a deed but the proof is in the registry search. Unfortunately, it is sometimes difficult or impossible to trace old conveyances with any degree of certainty of results, due to the terrible condition of the index books.


2. Torrens system, which involves a First Certificate of Title (FCT) followed by Transfer Certificates of Title (TCT). Unlike the “real” Torrens system in use in parts of the U.S. and elsewhere, the Belize systems is not backed up by a fund which guarantees title. Under this system, the undischarged (uncanceled) "charges" or encumbrances and the transfers from the title are shown on the relevant Certificate, so no further search is normally needed before the new Transfer Certificate of Title is issued, following the application for transfer.


3. Registered Land Act system, in which application for transfer is made, and a new Land Certificate is issued to the grantee. Under this system, an application is made for title transfer and a new Certificate of Title is issued to the grantee. Any existing "charges" will be shown on the Land Register for that parcel of land. The owner holds a Certificate of Title, and this, together with the relevant Land Register entries is the proof of ownership.


Which system you use depends on where your property is located. With only a few exceptions you won’t have a choice. If for example your property is located in an area of Belize where the Registered Land Act system is in place, such as around Belmopan or in a planned subdivision, your property will be registered under that system. Land in Belize is being put into this system area by area until eventually the entire country will be included in it. The Government of Belize in 2001 received a grant to help it pay for consolidation of land registration systems under the Registered Land Act.


Title insurance may be available. Regent Insurance (tel. 501-2-73744 in Belize City) offers title insurance through Stewart Title, a U.S. company. Typically, title insurance costs 1 percent of the purchase price.

Need for a Lawyer
You don’t hear many lawyer jokes in Belize. In Belize, attorneys remain trusted advisors. They’re usually well-connected, well-paid pillars of the community who wield real power. A roster of attorneys in Belize will reveal the surnames of families with histories in Belize going well back into colonial times along with those of today’s political leaders including Barrow, Young, Shoman, Musa, Courtenay and Godfrey. In any real estate transaction, you should have your own Belize attorney. Typically the fee will be around 2 percent of the purchase price. See the appendix for a list of lawyers, all located in Belize City. See Attorneys in Belize.

Financing
Land in Belize is usually purchased on terms under an Agreement for Sale or Contract for Deed whereby the seller keeps title to the property until it has been paid for in full. Terms vary but can range from 10 percent down with 10 years to pay at 10 percent simple interest per annum -- about the best deal you can hope for -- to 50 percent down and three years to pay at 12 to 14 percent.


Residential property may also have owner financing, although commonly the lowest price will be for an all-cash deal. It is difficult for a non-resident to get a mortgage loan from a bank in Belize for buying new homes or building, so you should be prepared to pay cash or to get financing through a loan from a non-Belize financial institution on your assets back home.


For citizens and official permanent residents of Belize only, the Development Finance Corporation, a financial institution owned by the government of Belize, makes loans of US$3,000 to $75,000 for building or buying housing for up to 25 years at interest rates of 8 1/2 to 13 percent. The DFC also has developed housing subdivisions near Belmopan, on the Northern Highway in Belize District and in Corozal Town. These subdivisions have new homes such as a 680 square footer for US$33,000 and a home of about 1,000 square feet for US$41,000. Financing is at 12 percent for up to 25 years.

Rentals
Rental levels in Belize also vary widely, being highest on Ambergris Caye and in Belize City. In upscale areas of Belize City such as West Landivar and Caribbean Shores, you can expect to pay around US$.80 to $1.50 per square foot per month, or about US$800 to $1,500 a month for a 1,000 square-foot two-bedroom apartment. On Ambergris Caye, a modern one-bedroom apartment goes for US$400 to $750 and a two-bedroom US$650 to $1,500. Elsewhere, rentals are much lower. In rural areas and low-cost towns such as Corozal, you can find a small house in a safe area for under US$250 a month. We know of several expats in Corozal who rent for under US$100 a month, and while their homes are not fancy they are comfortable, typically of concrete block construction with a couple of small bedrooms, bath, a living room and a kitchen with stove and refrigerator.


In all areas, North American-style housing with air conditioning, modern appliances, security will be many times more expensive than a traditional Belize rental, simple concrete or wood house, with only basic amenities and probably no appliances except for a butane stove and a small fridge.

Short-Term Rentals
If you’re coming to Belize on a scouting expedition, consider a short-term rental. Staying in a house or apartment rather than in a hotel can help you decide if Belize is really for you. Unfortunately, there are not a lot of short-term vacation rentals in Belize. Most of them are concentrated on Ambergris Caye, but there are a few in other areas including Placencia and Corozal.


Here are some sources of short-term rentals:


Ambergris Caye
Caye Management (Barrier Reef Drive, San Pedro, tel. 501-2-63077, fax 2-62831, e-mail cayeman@btl.net, www.cayemanagement.com) has the best selection of rental houses and condos on the island. Weekly rentals are mostly US$700 to $2,000. Six-month rentals start at around US$600 to $800 a month. Also consider short-term condo rentals. One good option is Banana Beach (P.O. Box 94, San Pedro, tel. 501-2-63890, fax 501-2-6389, e-mail bananas@btl.net, www.bananabeach.com) for around US$1,200 a month.


Placencia
Kitty’s Place (P.O. Box 528, Belize City, tel. 501-6-23227, fax 6-23226, e-mail info@kittysplace.com, www. kittysplace.com) manages a number of rental houses in and near Placencia village, starting at around US$300 a week or US$1,000 a month. Barnacle Bill’s (23 Maya Beach, Placencia, Stann Creek, tel. 501-6-37010, e-mail taylors@btl.net, www.gotobelize.com/barnacle/) has two nice one-bedroom cottages on the beach at Maya Beach, for under US$500 a week. Serenade (tel. 501-6-23420, e-mail leenyhus@hotmail.com), a small, newly built two-bedroom house in Placencia village goes for under US$250 a week.


Corozal Town
Corozal Bay Inn (P.O. Box 184, Corozal Bay Road, Corozal Town, tel. 501-4-22691, e-mail relax@corozalbayinn.com, www.corozalbayinn.com) has attractive two-bedroom suites with kitchenettes for around US$300 a week. Bed and Bananas is a lovely two-bedroom house in Consejo Shores owned by a German couple that rents for US$650 a month plus utilities -- reservations are available through a Web site, www.consejoshores.com/bedandbananas/.

Building a New Home
As a general rule, you will get more for your housing dollar in Belize by building rather than buying a completed home. If you can put up with the hassle of construction, you can build a house with details such as built-in furniture, exotic tropical hardwood floors and custom-made mahogany cabinets that in the U.S. would be found only in the most upscale homes.


In Belize as elsewhere construction costs vary depending on such factors the cost of transportation of materials to the building site, the terrain and quality of work. As rules of thumb, in Belize construction costs are highest on the coast and cayes, because of the need to use hurricane-resistant construction. In the case of the cayes, it costs extra to transport building materials by boat. Building costs also are higher in southern than in northern Belize. Inexpensive building materials are more readily available in northern Belize since they can be imported from Chetumal, Mexico.


Labor in Belize is much less expensive than in the U.S., with carpenters getting around US$25 a day or less. While labor may be cheap, jobs usually take longer in Belize. Workers may be skilled at construction techniques common in Belize but may lack knowledge about building in the American style. Outside of urban areas, it is difficult to find qualified craftspeople such as electricians and plumbers. Building materials vary but are mostly no cheaper than in the U.S., except for locally produced items such as tropical hardwoods which run about US$1,000 for 1,000 board feet. Cement is more expensive than in the U.S., as are most bathroom and kitchen fixtures which have to imported. Flooring materials such as salt tiles from Guatemala and Mexico are moderately priced and of high quality.


Overall, building costs in Belize range from around US$25 to $100 a square foot, not including the cost of land. At the bottom end, that would be a simple Belizean-style block house or frame construction, and at the top it would be high-quality concrete construction with hardwood floors and trim and with many custom details such as hand-made doors and windows. Most commonly, you’d expect to pay about US$50 to $60 a square foot, so a 1,500 square foot home would cost US$75,000 to $90,000 to build. That’s about one-half of typical costs for construction in the U.S.


Of course, if you have a nose for thrift you can build for much less than that. We know one man, from Louisiana, who built a small house on a lagoon north of Corozal for about US$4,000. He collected building materials such as old planks and boards that were floating in the lagoon, scrounged others from old houses and did most of the actual construction work himself.


Mennonite builders sell prefabricated frame buildings which they will install on your site. This is an inexpensive and quick way to get a home up in Belize.


In areas at risk of hurricanes and tropical storms, you’ll have to put in deep pilings and raise the first floor above ground level to avoid water damage. Reinforced concrete is the preferred construction. Hurricane straps and rafter ties are inexpensive protection against having the roof blown away.


In the past, the only building codes in Belize have been those imposed by local municipalities. Many rural areas had no codes at all. In 1999, work began on developing a national building code calling for nation-wide standards of construction. This new code is expected to be implemented soon.

Free Land in Belize?
From time to time we get questions about the possibility of homesteading or otherwise getting free land in Belize. Yes, there is such a program in place, but here are the catches: First, you must be a Belizean citizen or have lived in the country as an official resident for at least three years. Second, land is only available in certain areas. Mainly it is small tracts or building lots. This is not the homesteading hundreds of acres of prime farm land that you read about in the your American history book. Third, you have to lease the land from the government, clear it and actually construct a home. At that point, for a nominal amount you can buy the property from the government, and you will get title. Given all the time and red tape involved, and the low cost of land in Belize, it’s hardly worth it to get a small piece of land worth a few hundred to a few thousand dollars. Frankly, if the only reason you moved to Belize is to take advantage of such a scheme, it’s unlikely you’ll have the financial resources to make it in Belize long enough to qualify for the program.

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Buying, Building and Renting in Belize