Buying property on Roatan is a straightforward process. Foreigners can buy up to .75 of an acre, per individual investor. If you want to buy more than that, it is required to form a Honduran Corporation, which can easily be done through a recommended lawyer. It is critical to ensure that the property being bought has a clear title and that a lawyer, notary, and real estate broker all assist with evaluating the documents.
The Buying Process
Once you have found a Roatan home or property that you are interested in, an offer is prepared by your Realtor. This offer will contain a deposit request for 10% of the selling price. It must be wired within 72 hours of accepting the offer to either the Broker’s or Notary’s escrow account. (Exceptions may be made if the buyer needs to return home first, in which case the escrow payment would be due 72 hours after their return.) The remainder of the purchase price is due upon closing, which is typically within two months.
The seller may reject, accept or counter the submitted offer. If an agreement is reached, the deposit money is received, and the next step becomes the closing process. This can be managed in different ways, with the easiest being that the purchaser is present on Roatan and signs all documents in person.
The Closing Process
If the purchaser is not present, they may choose to have Power of Attorney by appointing someone or their behalf to close the purchase and accept the property title in their name. This role is typically assigned to individual at the purchaser’s discretion.
Once the closing documents have been signed and the remaining purchase price has been transferred to the seller, a lawyer will submit the documents to the local Land Titles Registry. A new property title will be issued to the buyer, which will be delivered in person by the lawyer or sent via international courier. It can take several months for a new title to be processed.
Roatan Closing Costs
You should budget approximately 5.5% of the selling price to cover your portion of the closing costs. This includes land transfer taxes from the Government, various legal and notary fees and the title transfer. There may be additional closing costs if a mortgage is obtained or a Corporation is formed.
The seller also has closing costs. They must pay a Capital Gains tax which is currently 4% of the increase in their property value.
Should you have any questions about the buying or selling process on Roatan, I’d be happy to assist.