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Frequently Asked Questions

Absolutely, yes! Any foreigner has been able to own property in Honduras since 1991.

An individual, non-Honduran citizen can purchase up to 3,000 square meters (or 0.74 acres) for residential use. An easy option is to set up a Honduran Corporation with the foreigner as the ‘Administrator’. The Corporation can own virtually any sized property for residential purposes or development.

This can be done by using a local attorney and will cost approximately $1.500 to $1.800 US and it is pretty easy to do. All the documentation must be written in Spanish and there are plenty of qualified, experienced bilingual lawyers available to do this. By forming a corporation, it entitles the ‘Administrator’ to all the rights of a Honduran citizen regarding ownership of property. Your broker/agent can provide you with a list of attorneys that specialize in real estate transactions. There are some attorneys who are now offering a “combo package” that would provide the necessary legal services for forming corporation and attaining residency.

The Honduran government is the second oldest democracy in Central and South America, as well as one of the strongest. It was modelled on the US system of three branches and the constitution was written in the late 1970’s with help from the US President Carter administration. Sometimes, Honduras’, or for that matter many of the Central/South American governments, can, at times, be ‘super charged’. This leads to a lot of updates and hype appearing on the internet on government pages and can lead to some embassies issuing warnings for the whole country rather than just the location of the event. Let’s put this into perspective, something newsworthy can happen in Houston but it doesn’t mean the whole of Texas is a threat or dangerous.

Overall, the Bay Islands are generally safe but, like every country, city or town, there are areas that have higher crime rates than others. Again, like everywhere, bad things can happen to good people and sometimes small countries are painted with a large brush. Islanders, by nature, are generally peaceful and friendly. Of course, Honduras being a poor country, petty theft can certainly happen especially if common sense is not used. Always bring your common sense on vacation, to anywhere, with you! The mainland of Honduras has its share of crime in its major cities, as does Chicago and many US locations. That said, the Bay Islands traditionally has been safe and has a murder rate lower than many other Caribbean locations.  Roatan-Buyers can also sleep a little sounder knowing that on the mainland of Honduras, the US maintains the largest US Military Base in Central America and South America.

This ultimately depends on how you wish to lead your life and what lifestyle you would like to be accustomed to. When you move to a foreign country, things that you buy everyday “there” are now imported items “here”, therefore, more expensive. If you go to a local store here and select items that you are familiar with from “back home”, your first impression will not be a good one. However, if you adapt eating habits to what is readily available on island and look to the fruits and vegetables, you can find great, locally grown, reasonably priced options. Do you eat out every evening? If so, there are a wide variety of restaurants for every budget and palate. Good restaurants serving local dishes are very reasonably priced and then there is every price between.

Electricity is higher than most people are used to paying in the US. It is based on diesel fuel prices and fluctuates based on the cost of oil and getting it here. It is the main source of power in most homes as natural gas is not available, however, bottled Butane gas is used by many for cooking. RECO (Roatan Electric Company) has proved to be one of the top companies in Honduras. In 2016, it invested in a project to produce natural gas and introduce windmill power to modernize the supply and generation of power on Roatan, making it more efficient and environmentally friendly.

The upside is that are no ‘heating’ bills. A/C may not be needed some of the year (or at all for some of us). The south side of the island and homes built on hilltops are normally much cooler due to prevailing trade winds than residences the north and west side of the island. Water temperatures from 75º to 85º and the fact that the island is only a couple miles wide, cooling breezes have a huge impact on your electricity bill.

Property taxes are extremely low in comparison to most other countries. A typical three-bedroom home is +/- US$800.00 and a vacant lot can be as low as around US$100.00 annually.

The same old adage, if it needs to be imported, then it will be more expensive than what you are used to. Diesel is about $1.00 per gallon cheaper than the selling price of gasoline so it is advantageous to buy a car than runs on diesel although the car itself will cost more to purchase.

From a Roatan-Buyers’ perspective, it differs little from any purchase you may have made at home. You select the property that you like the best and is best suited for your needs. Then you enter into a straightforward ‘Purchase Agreement’ with the seller that outlines the details of the property purchase: price; timeline; inclusions/exclusions; etc. After the offer is accepted by the seller, an earnest money deposit is made by the buyer (usually 10% of the purchase price), and then the buyer closes on the transaction by paying the balance of the purchase price and fees within the designated time frame. In the Bay Islands, the process differs from North America. This is where your real estate professional and brokerage office really kicks in. They, with an attorney of your choice (your agent/brokers can make recommendations if you wish), work hard behind the scenes, to obtain copies of all the required legal documentation such as title, corporation documents, and do title searches, obtain recent surveys, and work towards the conclusion or ‘closing’. Their responsibility to the client and knowledge base differs greatly in comparison to agents in most other locations. The buyer would either be present for the ‘closing’ or hand over that responsibility by giving Power of Attorney to their agent. At the closing, the seller and buyer (or their designated representative) sign the protocol (closing documentation), and the transaction is completed.

Although many purchases are cash deals, some sellers will consider financing the purchase themselves by entering into a either a legal, registered mortgage contract or possibly using the stock certificates as ‘bearer bonds’, which are held in escrow until the mortgage is paid in full. Another option is for the buyer to obtain financing in their home country via a second mortgage on their residence or obtaining a personal loan so that they can pay for their property purchase with cash here. Several alternatives may be available and may differ from property to property. Overall, financing can be an option but, bank loans are only offered to Honduran citizens or legal residents normally at higher interest rates, higher down payments and shorter term.

You do not need to be a legal resident of Honduras to own property here as it is permitted for foreigners to visit or be in the country for 90 days or less. It is possible to obtain a visa extension, once, for additional 30 day period. However, if you wish to reside here or stay for extended periods of time, it would be advisable to get your residency.

There are several different types of residency available to foreigners which depends on the circumstance of the person applying. There is a “retiree” residency which requires that the holder has a monthly income from outside of Honduras that exceeds $1,500.00. These funds would need to be verifiable in the form of a pension or an investment income. This type of residency comes with some benefits as such as being permitted to bring in a new or used car along with some personal items’ duty free.

If you aren’t quite ready to retire, want to work on your terms in a new venture, or are of the age that you still “need” to work, you can start a small business or have an ‘e-business’. To enable you to do this, a Honduran corporation would have to be created in which a special situation permit would allow you to be here for five years. After that time, full-time residency would be granted, if you wished. This status would mean that you would not have to leave Honduras to fulfill visa requirements or renew your residency.

Another type of residency is as an investor (‘rentista’), which would allow you to live off any type of income generated here or back home as long as the income exceeds US$2,500 a month. This type of residency provides the same benefits as that of the “retiree” i.e. one-time opportunity to bring in a new or used car and personal items duty free.

The documents required to complete this process include: a apostilled police report; valid passport; birth certificate; marriage license (if spouse and children are also applying); and a Honduran health certificate. I can take 6-12 months for the procedure if you select the right attorney specializing in residency, and costs start at US$2,500.00 per person depending type of residency. NOTE: The requirements, cost and timelines can vary/change so definitely ask your broker or agent for the name and contact of a dependable and experienced local attorney.

The policies on foreigners setting up bank accounts differs from bank to bank. Some banks will allow a “foreigner” to set up a personal account here with your passport and valid visa stamp, others may require you to be a legal resident or be in the process of applying for their residency. If you are the administrator of a Honduran corporation (i.e. your property is held in your corporation), you can set up an account in the name of the corporation. Again, ask your realtor professional or attorney to referral to the correct bank to be able to do this or for guidance in the process.

Many of the leading international (non-US) banks and insurance companies are far more conservative and less susceptible to failure than their US counterparts. These international banks do not have government-backed insurance to protect their clients. So, US Banks are far more leveraged than many foreign banking systems because of the insurance programs (paid for by US taxpayers when they fail). A quote from ‘Sovereign Society’:

Since 1999, we are aware of the failure of ONE bank -- and within a week their assets were divided among other banks and the depositors had access to accounts.

Honduras is also a member of the International Association of Deposit Insurers (IADI).

Most of the costs for closing are borne by the buyer and, usually add up to around 5.7% to 6% of the purchase price including the cost of their attorney. This differs if the property is held in a corporation and means that a ‘change of administrators’ of the corporation is required - the cost is normally between US$2,000.00 & US$5,000.00 depending upon the attorney and how straightforward it turns out to be. If there is no corporation transfer involved costs are about 5.7 to 6 % of the purchase price.

The seller pays the real estate commission/fees, which are taxable at a rate up to 15% along with 4% capital gains tax. The seller’s brokerage sends out a statement prior to closing detailing all related fees.

High speed internet is available here on island and many bars, restaurants and resorts all have high-speed free WiFi. Be aware thought that you are not back home so the service and speed will not be equivalent to what you are used to. There are several providers on island such as Maxx Communications, Claro, Tigo and Reytel. Often cable is bundled in with your internet service with costs ranging from $50 up to $140 depending on the speed of the service in your area and your requirements.

Speeds run from a low of about 100 KBPS to 5 GB+, VOIP phones with US numbers are widely used on the island with providers like Packet8* and Ooma*, (calls are not individually charged but are a monthly fee running from less than $60 to $70/year).

Location can be an issue in terms of getting a signal but there is a company that has and is running fiber option cables if they can get 5 or more homes to commit to the service.

USB Modem through either telephone company on the island (Tigo or Claro). You can pay for a set megabyte usage in a pay as you go system. This may be a cheaper solution if you only use the internet for emails, but if you video chat with family and friends back home or subscribe to services like Netflix, you will quickly exceed the allotted usage amount.

MagicJack is another way to make international phone calls, it uses your internet connection to make phone calls to the US and Canada via a phone. And of course, there are services like Skype, Facetime, or WhatsApp to communicate with friends and family at home.

There are providers of health insurance here and the quality of medical facilities and care here on island has improved exponentially over the last few years. We have Garm Clinic and Cemesa Hospital that provide excellent medical care, are well-equipped, have professional doctors and staff, and are accustomed to working with insurance companies. A personal favorite is ‘BMI’ who covers US ex-pats who live off-shore for anything over six months per year and the client is covered in both the US and the other country of residence. Those who may be on Medicare there are supplement plans that will cover 80% for time period while you are in a foreign country.

If you have never bought or owned property in a foreign country, it is both a different and exciting process. Fortunately, you will not be the first to go through this process so help is available. working with an experienced broker or agent will make the process go much smooother and help you avoid costly mistakes.

Laws are different, customs are different, and although most islanders speak English, it is a different culture than you may be used to. Listen and learn is a good overall policy and remember, “Patience is a virtue”. Remember, you are choosing a Caribbean lifestyle which means that it is a little slower and much more laid back than many other countries.

If you didn’t find the answer to your questions, or if you need more info. or have additional questions, please contact one of the brokers or agents of the Roatan Island MLS.