If you’re thinking about buying Belize real estate you need to be careful. Scams and fraud abound, but with some due diligence and a little knowledge of recent history, you can avoid any pitfalls. Here, Placencia resident Gary Peterson explains.
Over the past year, we’ve seen the outing of some massive real estate scams in Belize. These scams involved Americans, Canadians, Belizeans, and more.
Central America is famous for money laundering, drugs, human trafficking, and more.
But with so much attention focussed on drugs, it seems your professional scammer has slipped under the radar.
But recently they’ve come to light and found themselves under the US prosecutor’s microscope.
Ask anyone in Belize if they’ve ever heard of Sanctuary Bay, Sanctuary Belize, or The Reserve, and they will reply, “oh that scam!”
For years this large “development” with an ever-changing name promised an exciting way of life. It promised a secure environment of homes, condos, restaurants, marina, airport, hospital, and more.
Developers and sales staff were excellent at following a prepared script to bilk millions from investors and unsuspecting retirees looking for a dream life in the Caribbean.
What they got for their money was scammed by the best.
The Federal Trade Commission say The Reserve case is the biggest foreign real estate scam they ever investigated.
Elsewhere in the country, the story is the same.
Belize is a favorite target for “developers” who start projects and talk unsuspecting buyers into paying for condos. And these partially built structures remain uncompleted for years.
The term “buyer beware” holds true if you’re looking for a condo or a house in a development.
Buying a not-yet-built condo with no infrastructure and nothing but a “rendering” is not smart.
One of my favorite Belize scam stories is the development of a new international airport in Placencia.
How many times have we heard from developers that “building with us will be a great investment, because of the new international airport?”
I first heard that spiel eight years ago, in a tour at the Sanctuary Belize.
Other developers also talk about the “new international airport” coming soon. Fraud is common here and a recent case involving a US fund manager and a $30m fraud surprised, well, not me.
Belize is ripe for so-called developers to grab large land parcels for cheap.
They hire marketing firms to draw you in to hand over your investment money and retirement funds. Then they hook you in with a small down payment and cheap monthly payments on lots.
They offer you a few days “in paradise” at a Belizean hotel, and show you a tiny part of their “world class development”. They show enough to get you excited and ready to give them your money.
The renderings of the proposed “finished resort” look so fantastic, how is this a scam? How could it not be an “award winning eco-development?”
It took a lawsuit in Belize, brought by over 200 resort lot owners to start the downfall of Sanctuary Belize.
The lot owners lost that battle, but it led to the investigation by the FTC in the States. This action halted everything, froze all bank accounts, and put The Reserve into receivership.
People looking to live in Belize are not only hurt by these big development scams.
You also get the smaller scale scammers like the foreign builder who persuades you to choose them over local Belizean builders.
They’ll quote your cost per square inch by US standards and then get quotes from local builders for much less and use them to build your house.
Do you get a Belize price? No, you still get the higher US price, plus inevitable cost overruns.
Is this a scam? Depends how you view things.
The Belizean builders say so. Luckily, many of them, at least in Placencia, now bid direct with expats and build homes at a much lower rate and total cost.
The word is out, and as vacationers visit Placencia, they see “Belize Builders” signs up in front of construction sites.
I’m a firm believer in supporting the Belizean builders. One of the best of them built my home.
I always refer my builder and other local contractors to anyone who stops to admire my new home. Keeping these builders busy helps them, their families, and the community.
Belize is a wonderful country, with beautiful and friendly local communities. Us expats are their guests and we owe them our loyalty and support.
We need to keep corruption out so tourism can thrive – not diminish – because of these scams and the general crime situation.
Some simple rules on how to not fall for a real estate scam in Belize:
- Do due diligence. Research everything about the development or builder. Look for reviews online and on social media. Join Facebook groups and ask others on the ground.
- Sign no contract in Belize without hiring a Belizean attorney to check it out.
- Sign no contract if with wording like this on the contract: “If you make any derogatory statements against the builder or development, you will receive a lawsuit for $$$$$$$$$.” This is a clear sign something is wrong.
- Have your Belizean attorney do a complete title search on the specific property you are buying. If you cannot own clear title for the property at closing, do not proceed.
- If it looks and sounds too good to be true, run!