Purchasing Real Estate in Belize

Belize is part of the British Commonwealth and has a legal system that is based on British Common Law. Property purchasers can take title to freehold property in Belize in one of three different ways:

(i) Deed of Conveyance:

The oldest form of title ownership is by a Deed of Conveyance. Ownership by way of conveyance is a registered right to ownership of property. Ownership by conveyance can be converted to a Certificate of Title via an application for first registration. Any subsequent buyer is issued a Transfer Certificate of Title. It should be noted, however, that a Deed of Conveyance is a valid legal title once an attorney has confirmed that the seller has good title to the property.

(ii) A Transfer of Certificate:

A Transfer Certificate of Title is a physical title to a particular parcel of land. This form of ownership is secure. It is more costly and time consuming to transfer title on a Transfer Certificate of Title than on a Deed of Conveyance.

(iii) A Land Certificate:

A Land Certificate is an absolute title and applies to property purchases in new or specially designated areas. The Government is in the process of re-registering all freehold lands under the Registered Land Act of 1987 to achieve an eventual uniform system of nationwide land ownership. However this will take time, as some areas have to be re surveyed.

When purchasing property in Belize, title insurance is not necessary and closing costs are very minimal as there is no capital gains tax. On all purchases over $10,000 US, the Government assesses a 5% stamp tax on the declared purchase price of the property at the time of transfer of title.

Currency Exchange

The Belizean dollar is pegged to the US dollar at the rate of two dollars BZ to one dollar US. Whereas US dollars are readily accepted as currency in Belize, this convenient fixed exchange rate does not apply to other foreign currencies. Therefore during closing periods you may be susceptible to risk due to fluctuating currency exchange rates.

For example, if you are a Canadian looking to buy property in Belize, you will inevitably need to transfer your US currency dollars to buy your property or arrange financing. If you had been looking to buy a property in Belize priced at $500,000 US at the beginning of January 2007 it would have cost you $592,000 CA. However, if you looked at that same property at the beginning of July 2007, it would have cost you only $528,000 CA. In other words, the same property would be $64,000 CA cheaper than it was at the beginning of the year. And if five years ago you had been looking to buy that same $500,000 US property, it would have cost you a staggering $809,000 CA. In other words, the same property is now $281,000 CA cheaper than it was five years ago.

So it is important to pay attention to the exchange rate for your payments, or it could cost you a lot of money.

A firm named HiFX offers services that can reduce the risk due to fluctuating currency exchange rates. They have a free currency converter that you can use, and they can assist you in locking in an exchange rate for up to two years in the future to protect against currency fluctuations.