Many people come to Belize and fall in love with both the natural beauty and the friendly people who they meet in their travels here. Then, when they get home from their vacation, they often think about what it would be like to have a place here, a second home, so they begin looking into owning a vacation rental in Belize.
While some retired folks dream of being snowbirds and spending winters in Belize, those who are still busy working think about just having a second home here, a place to come and escape from their busy lives once in while. What both of these groups of people have in common is that they often dream about owning a vacation rental in Belize.
Like for many other popular vacation destinations, folks dream of having their own place in Belize and to offset some of the expenses involved with owning a second home by renting it out when they are not using it.
Can I own a vacation rental in Belize?
As we discussed in our Basics of Real Estate in Belize article, unlike for many other countries in South and Central America, in Belize, foreign nationals can legally own property here in the same way as a Belizean national.
Thus, owning a vacation rental in Belize is perfectly legal for foreign nationals; however, setting up and actually operating a vacation rental property here in Belize is a bit more complicated than in many other vacation destinations. Let’s take a look at the market here, and what is legally required to operate a vacation rental property in Belize.
What is the Belize Tourism Board?
To examine the vacation rental market here in Belize, we need to first take a look at the Belize Tourism Board (BTB). The BTB plays a major role in everything tourism-related in Belize, including the vacation rental market.
There seems to be some confusion about the BTB in Belize, as some folks contend that the Belize Tourism Board is a private entity, so it is limited in the rules it can produce and in the enforcement of regulations.
This view of the BTB is only true in part. Yes, they are a quasi-private organization; however, the BTB was created by an act of legislation of the government of Belize, and it was granted certain powers:
The Belize Tourism Board (BTB) is the legislated body designed to govern, enhance and promote the Belize tourism product. The BTB undertakes numerous strategic initiatives as well as the implementation of tourism policies to address the changing needs of the tourism industry. The organization’s goal is to ensure the socioeconomic growth of Belize through prudent, transparent and effective governance.
Belize Tourism Board website
For foreign nationals owning a vacation rental in Belize, the BTB is very important because they require that in order to legally offer a vacation rental to any foreign tourist in Belize, one must have a Hotel License, approved by the BTB.
What is required for my BTB Hotel License?
All of the requirements to acquire a BTB Hotel License are listed on the BTB website; however, at least when I first read through this, I did not realize how many entities outside of the BTB I would need to deal with before I would be inspected by the BTB itself.
Prior to moving to Belize, for over 20 years, I had owned and operated vacation rentals in Hawaii, one of the most regulated states in the US, yet I could never have imagined how complicated owning a vacation rental in Belize would be.
While there may be some slight changes to these requirements depending on whether or not one registers a company in Belize and where in the country the property is located, the basic steps are similar in most cases:
Along with your completed BTB Hotel License Application, you will need to submit documents such as:
- Title or Conveyance for the property
- Business name registration
- Certificate of Incorporation
- Certified copy of Certificate of Good Standing for the company
- Owner’s Passport information
- Manager’s Work Permit if a foreign national
- Trade License Certificate if located in a larger town
- Contract with Management Company
- Proof of Liability Insurance
In addition to this documentation, there are also a number of required inspections which need to be completed by outside entities, prior to the final Hotel License inspection by the BTB. These inspections include:
- Central Building Authority-Occupancy Certification
- Department of the Environment-Environmental Clearance
- Fire Department-No Objection Report
- Public Health Department Inspection
Each of these inspections requires an application and payment of a fee, as well as making arrangements for all of the inspectors to visit the property.
As you can imagine, when a realtor tells you that owning a vacation rental in Belize is possible for a foreign national, and that many folks do it successfully, she most likely will not thoroughly explain the cumbersome process one has to negotiate in order to legally operate a rental here.
For some condo projects with a management company in place, there is the possibility that you will not need to apply for a new BTB Hotel License after you buy your unit. Make sure to speak directly with the condo’s property management company to verify whether or not this is the case.
How long does it take to get my BTB Hotel License?
First, like dealing with any other authority in Belize, results may vary considerably depending on where you are located in the country and the particular representatives you are dealing with, both those who work for the BTB, and those who work for the other agencies from whom you need inspections.
While it has been several years since I went through the BTB licensure process, I have spoken with a number of others who have done this more recently, and I have also read many reports online written by those who are currently in the process or have recently completed it. It took me about a year from start to finish to get all of my outside agency inspections and my final BTB approval, and it appears that others are still facing a similar timeline for this process.
Can I manage my Belize vacation rental myself?
If you are not a Permanent Resident or Belizean national, you will either need to hire a local manager or management company to manage your rental, or if you are going to be living in Belize, you can choose to register a business entity in Belize, and then apply, and pay for, a Work Permit to manage your own rental.
The process of applying for and being granted a Work Permit in order to legally work in Belize could add considerable time to your timeline for getting your rental property legally up and running.
In some towns, such as San Pedro, there is a bit of a catch 22, as one needs to submit a Trade License in order to apply for the BTB License and Work Permit, but it can be difficult to get the Trade License if you are not already a Permanent Resident.
Many people choose to hire a property management company to walk them through both the process of acquiring a Trade License, if required, and the BTB Hotel License, and while this can prove to be a bit more expensive, the right management company can help the process go much more smoothly.
Finally, if you plan on owning a vacation rental in Belize and only being in the country a few weeks or months a year, you will certainly, both for legal and practical reasons, need either a property manager or a property management company in place.
Do I need a BTB Hotel License if I want to rent my place long term rather than short term?
The answer to this question is that it depends on the Immigration status of your your potential tenant. If you own a home in Belize, you are free to rent it to a Belizean National, or to anyone who has a valid Work Permit, a foreign national who is a member of the Belize Qualified Retirement Program (QRP), or to someone who has been granted Permanent Residency in Belize.
However, according to BTB regulations, in order to rent accommodation, regardless of the length of stay, to anyone who is on a Tourist Visa, one must have a BTB Hotel License.
Whether a tenant has been in Belize for many years, or is intending to stay long term and apply for residency, BTB states that if they are required to go to Immigration and renew their Visitor’s Permit, they are legally required to stay in a licensed property.
There has been much chatter in all of the Belize forums about this over the past couple of years because while there has always been a requirement for those on Tourist visas to stay in a licensed property, even for long-term rentals, until the post-Covid period, this rule was rarely enforced; however, BTB has started enforcing this rule since the country reopened from Covid.
The recent enforcement of the requirement that foreign nationals who are on Tourist Visas must stay in licensed properties has proven to be unpopular with both landlords and potential tenants.
For landlords, as we discussed above, the BTB licensure process can be costly and take a significant amount of time to complete, and for tenants, because the landlord is now required to collect the 9% Accommodation Tax on even long-term rentals, the price of long-term rentals has increased.
Can I make money owning a vacation rental in Belize?
First, like for any other vacation destination, whether or not a vacation rental property is profitable is often determined by its location, amenities, maintenance costs, and the marketing ability of the owner or property management company.
There are foreign nationals with vacation rentals in Belize who are making money, and I imagine that those who are seeing any significant profit from their rentals likely have unique properties and are at the high end of the market.
I believe that if in order to make it work financially, one really needs to turn a profit while owning a vacation rental in Belize, it is probably not a great idea to make the investment.
However, if you view the second home as a lifestyle choice, perhaps planning to use it for several visits a year until ready to retire and move to Belize full-time, then it might make sense for you.
What are the challenges of owning a vacation rental in Belize?
For over 20 years, I owned and self-managed rentals in Hawaii, which is one of the most regulated and competitive tourism markets in the world, and I will have to say that I was still not prepared for some of the challenges of operating my rentals in San Pedro.
First, while most tourist destinations have a high season and low season, even with the current surge in demand in Belize, there is a very strong peak season during winter, from about Christmas until Easter, and then a low season which could be described as dead rather than simply slow.
Of course, there are some properties, because of their unique location or amenities, which maintain solid occupancy for most of the year, however, we need to look at average occupancy rates to determine what our likely occupancy will be.
Aside from regulating the tourist industry in Belize, the BTB also collects and publishes statistics on the industry. We will take a brief look at Ambergris Caye since it is the largest tourism market in the country, as in most cases, aside from Placencia, or perhaps Belize City with folks over-nighting there for early flights or business, occupancy rates in the rest of the country will be significantly lower.
For the high season of 2023, Ambergris Caye saw monthly occupancy rates of between 44% and 61%, and in the low season, the monthly rates ranged from 23% to 35%. This produced an annual monthly average of 39.3% occupancy for Ambergris Caye in 2023.
From these numbers, it is very easy to see that if you purchase a rental and then use it for part of the high season, you will likely greatly impact your overall annual occupancy rate. For this reason, I often advise folks who just want to come down and spend 4-6 weeks every winter that they might be far better off simply renting every year rather than exposing themselves to the risk of owning a vacation rental in Belize.
Is it expensive to maintain a rental property in Belize?
For my example, again, I will describe my experience with my triplex in San Pedro, Ambergris Caye. Prior to moving to San Pedro, I had self-managed a number of rentals on Kauai, Hawaii, and I also owned and operated a very busy café and retail coffee roasting business on the island, just a quarter mile from one of the most popular beaches in the state.
My café in Hawaii was in a 100-year-old building, and it was small, only about 700 square feet. In this small building, we saw 600 or more people come through the doors every day, yet even with this intense volume, the maintenance on my café building on Kauai was less work than what I experienced with my vacation rental in San Pedro.
Because Ambergris Caye is really narrow at some points, just a 10 minute walk from sea to lagoon, from a maintenance standpoint, it felt like we were living between two huge vats of salt. Everything rusted quickly, electric components needed to be replaced on a regular basis, and I was always repainting something.
My local neighbors told me, “In San Pedro, even plastic rusts.” Thus, while I had lots of previous experience managing vacation rentals, I could never have imagined the amount of maintenance which was required to keep the place up in San Pedro. This is something to really think about if you consider buying a single-family home and offering it as a rental. You really need a trustworthy maintenance person to keep the place nice.
Final thoughts on owning a vacation rental in Belize
Owning a vacation rental in Belize is possible for foreign nationals, but if one really looks at purchasing a property, dealing with the licensing process, and then likely needing to hire a management company to operate, market, and maintain the rental, as an investment, I simply don’t think it makes a lot of financial sense for many folks.
Of course, there are some unique properties here in Belize, especially at the top of the market, which have excellent occupancy rates, and the owners may be realizing a profit.
However, if one looks at owning a vacation rental in Belize in strictly business terms, for many rental properties, I see limited opportunity for a return on investment, especially if you account for the cost of tying up at least $300k USD in a rental property here.
For those of you really interested in having a vacation rental in Belize, I would encourage you to visit multiple times, in both the high and low season, and perhaps try staying in different parts of Belize prior to making your decision.
Many expats who have been in Belize for a long time often say that patience is the number one requirement for those who come to live here, and I think that the same can be said for those who are thinking about purchasing a rental property in Belize.
Great article. Thank you for your insight!