A big thank you to Kristian P Guerrero for allowing us to reprint this informative article!
Belize Real Estate Buying Process & Expectation
In spite of rising interest rates, more and more of you have been reaching out for Information about Belize Real Estate and how the buying process works here on the island. I thought it would be a perfect time to adjust and adapt this previously sent blog so we can keep you up to date on how the buyer and closing process works.
As most of you know and have read, Belize is an all-cash market with very little available with regards to Seller Financing. What we’ve been seeing a lot lately is our clients moving a lot of their investments out of the traditional stock and crypto markets and placing them in more secure real estate investments oversees. Real Estate Markets like the Caribbean and especially Belize, being an emerging location within Central America and The Caribbean, have historically shown significant growth in value or at worst, maintained their high value throughout the years. Our clients are blessed to be able to use their investments year round and also take advantage of rental returns that their condo or home accrues quarterly.
Like in North America, there is a process. Over the years we at RE/MAX Island Real Estate have been leaders - and if we can use a fancy word - Trail Blazers, in stream lining the process for our clients and friends. We secured services from trained and licensed professionals so that our investors can feel the same ease as they would if they were buying back home - albeit usually with better views on the island. Here’s how it usually works with us.
Drafting an Offer for Purchase in Belize
We’re gonna skip past the sexy part. We connected and we’ve exchanged dozens and dozens of emails, WhatsApp messages and we put a shortlist together. You got to ride around on a golf cart with me and you’ve laughed at my dad jokes. You probably met Kirian and Liliana, danced to a few Tik Toks they created for our properties, seen what you need to see and you're ready. Now, we’ve found the one that fits. We were patient and now the wife is happy. We found it! What happens next?
The first step would be to draft an offer or purchase. We gather the legal description that’s on the title and put it on a RE/MAX sales agreement and add your legal names as the buyers. We submit that offer to the selling side and then I take a bat and hit them on the knee caps until they sign. Just kidding. I hit them on the shins.
Once terms and price point have been agreed upon the first thing we do is we high five obviously, but then we would request 2 IDs (Bio Data Passport Page & Drivers License from you or all parties that are to assume ownership. I’m not sure if a Sam’s Club card will work). The Government of Belize requires this for proof of person and residency.
How Can You Choose to Take Title?
How do you choose to take title? The recommendation is to take title in a Belize Chapter 250 Corporation (our version of what you guys call an LLC). This reduces the Stamp Tax (Transfer Fee) from 8 to 5% as well as provides limited liability protection and serves as your holding company. The lawyer we recommend has a list of ready to go corps we recommend assuming to save time. A US Trust can be the director and shareholder of the Belize Corporation but would need to be registered to do business in Belize. The title company does that on your behalf in simultaneously with closing. This cost is reflected on the 1.5% approximate legal fees.
Another advantage of the Belize Corp is that you can open a Belize Dollar bank account. This process has to wait until you legally own the property but we connect you with the bank so they share their list of documents needed to open a bank account. It will feel like they ask for everything including DNA samples but in the end a lot of my clients feel it’s worth it.
If title is already held in a holding company or Belize Chapter 250, then no stamp taxes or transfer fees apply (depending on how the seller structured the share capital). The only fee would be 1.5% legal fees plus the transfer of shares and directorship which would be approximately 1%. The title company performs a full title and corporate search and offers an opinion with the end findings to guarantee marketable title and that the corporation has no liability and has done no business but act as a holding company for the property. In certain situations and because the corp name cannot be changed, we do end up with some pretty cool and sometimes some pretty unique names. Imagine taking ownership of Cheeseburgers In Paradise Limited or the coolest one I’ve seen is Casa Sin Pantalones Limited.
Home Inspections cost $600.00 and are recommended on all purchases. If you meet a Real Estate Professional that tries to tell you it’s not common, tell him this is not 2016! We hire a civil engineer and he flies down to perform the inspection and within 72 hours has a full report and recommendation back. These are all rentable units so the aesthetic stuff isn’t really what we are looking for. The major issues we try and see out are appliances, HVAC, electrical and of course Structural Integrity. Resurveys for undeveloped land or private homes range between $550.00 to $1900.00 depending on size of lot. Again, we get a professional licensed surveyor to carry out the resurvey and we usually have it back between 48-72 hours. Mr Gillete is great :)
Closings typically take 30/45 days however I always add an additional 15/30 day extension on all my contracts to purchase. The Belize Government requires wet signatures on all transfer of land documents submitted to the lands department so FedEx or DHL is required to send originals to buyer and seller of signatures and notarizations.
This is meant to be a short read. We use a couple of trusted Real Estate Lawyers like Arguelles & Co. & Arthurs & Balderamos because they focus primarily on Real Estate Law and give our clients first class service but also because they have a US based escrow account so earnest monies are held in a bank in the United States.
That gives my clients just a little bit more comfort when sending earnest funds and it can be confirmed as received within 24 hours as opposed to 7 business days if sent out of country from US to Belize.
The closing agent is your legal representative so he works for you alongside me. Monies are only dispersed to seller once he confirms that all the required documents for a safe and guaranteed transfer can occur and he only disperses funds with your authorization and permission. Emil & Saidi have been god sends throughout these busy times. Once funds are disbursed, Emil and his team have already submitted the required documentation to the Lands Department and Companies Registry and we can now track the submission with the LRS number issued. Easy right?
The blabbing or blogging ends here. At this point we have everything moving on cruise control and the only thing we then wait for is the title to be returned to the closing agent. That is a whole other blog post. Although you have ownership and possession of the property, the physical title turn around time if expedited is between 9-12 weeks. It's Island Time.
Thank you again for making it all the way down here on this written blog and for allowing me to help share more information about Belize.
Have a great day!
You can contact Kristian P Guerrero and see her listings here.
Images are all licensed from Canva.
Is Portugal's NHR Regime Ending?
Portugal has long been a popular destination for expatriates and retirees looking to enjoy a high quality of life in a beautiful and welcoming country. One of the key attractions for many is the Non-Habitual Residents (NHR) tax regime, which offers significant tax benefits for individuals relocating to Portugal.
However, in a recently televised interview with CNN Portugal, the prime minister of Portugal, Antonio Costa, announced that he plans to end Portugal's popular NHR scheme. The recent Portuguese budget proposal in October 2023 further confirmed that it is Portugal's intention to end the regime at the end of 2023. This decision is expected to have a significant impact on those who have already taken advantage of the NHR program, as well as those considering a move to Portugal in the future.
The NHR tax regime (Non-Habitual Residents) in Portugal allows qualifying professionals, retirees and high net worth individuals to benefit from a 20% flat rate of tax on Portuguese-source income. Many foreigners who planned to move to Portugal at the beginning of 2024 are understandably upset by the short notice of this news. John, a user comment from a popular Facebook group, stated the following:
For individuals who are considering a move to Portugal, this announcement may influence their decision to relocate. The removal of this significant tax benefit may make other countries with more favorable tax regimes more appealing. Spain, for example, also has a similar tax regime, where NHRs are taxed at a flat rate of 24%. Spain may become an attractive alternate option to those who were considering a move to Portugal.
Understanding the NHR Regime
The Non-Habitual Resident (NHR) tax regime was introduced by the Portuguese government in 2009 with the aim of attracting wealthy individuals and retirees to Portugal. Under this regime, qualified individuals who become tax residents in Portugal enjoy several tax benefits, including:
The Prime Minister's Justification for Ending the NHR Regime
The government of Portugal and the Prime Minister has cited several reasons for the decision to end the NHR tax regime. Primarily, the move is seen as an effort to address growing concerns about tax avoidance and wealth inequality. Critics argue that the NHR regime disproportionately benefits the wealthy, allowing them to pay little or no tax on their income and assets.
Additionally, the Portuguese government aims to streamline the tax system by removing the complexities associated with the NHR regime. Ending the program would foster greater tax equity among residents and ensure a fairer distribution of the tax burden.
Planning for the Future
There is still time to apply, for some people, even if the NHR regime ends at the end of 2023. According to the budget proposal, NHR ends on December 31, 2023. People who meet certain conditions on or before that date should still be able to apply before March 31, 2024.
For those who want to benefit from the NHR regime, it is essential to seek professional advice as soon as possible. There are many Portuguese attorneys that offer this type of legal and immigration service. Given that the changes will come into effect in 2024, individuals still have some limited time to evaluate their options and make the necessary adjustments to their financial plans.
It is also important to note that while the NHR regime is set to end, Portugal still offers many other advantages as a place for residency or retirement. These include a favorable climate, affordable cost of living, excellent healthcare, and a high standard of living. Individuals should consider these factors alongside the changes to the tax regime when making their decisions.
Carefully Consider all Your Options!
The Portuguese government's decision to end the Non-Habitual Residents (NHR) tax regime in 2024 will undoubtedly have a significant impact on individuals who have already taken advantage of the program and those considering a move to Portugal.
The move is seen as an effort to address tax avoidance and promote greater tax equity among residents. While the changes may present challenges for NHRs, Portugal still offers many appealing qualities that make it an attractive destination for residency or retirement. Seeking professional advice and considering alternative tax planning strategies are advisable to navigate the new tax landscape.
No website or company has paid a fee to be mentioned in this blog. Any suggestions you see are based solely on our own experiences and personal preferences.
Just a middle-class family with three young kids, looking to escape the rat race. This is our journey!
If you have a question for us, please contact us directly using our email here.