Honduras Property Ownership

A new property law passed in July 2004 should improve land registration procedures and allow for more security in land titling, and thus a reduction in land disputes. By providing clearer land title, it should also allow more people to apply for mortgages and increase land-related investments. However, the purchase of land in Honduras by foreigners should still be undertaken only with great caution (US Export Guide 2006, Honduras). Foreign citizens contemplating investment in real estate in Honduras should proceed with extreme caution, especially in the Bay Islands or coastal areas, because of frequently conflicting legislation, problems with land titles, and a weak judicial system. Investors or their attorneys should check property titles not only with the property registry office having jurisdiction in the area in which the property is located (being especially observant of marginal annotations on the deed and that the property is located within the area covered by the original title), but also with the National Agrarian Institute (INA) and the National Forestry Administration (COHDEFOR). Investors in land should be aware that even clear title is not a guarantee that a future dispute over land would be resolved equitably (US State Department, Real Estate Note on Honduras).

Honduras Trade Associations

ROXANA SALAZAR
Presidente ANABIR-Region Nor Occidental
Bo. Suyapa
14 y 15 Ave. 5ta. calle S.O. No. 106
San Pedro Sula, Honduras, Centro America
Telfax. (504) 552-7453 Tel. (504) 553-0397
Celular: (504) 986-6141
Email: roxana@hondutel.hn
(online: http://www.bolsain.com)

Honduras Real Estate Info Summary

A new property law passed in July 2004 should improve land registration procedures and allow for more security in land titling, and thus a reduction in land disputes. By providing clearer land title, it should also allow more people to apply for mortgages and increase land-related investments. However, the purchase of land in Honduras by foreigners should still be undertaken only with great caution (US Export Guide 2006, Honduras).

Honduran laws and practices regarding real estate differ substantially from those in the United States, and there are many cases of disputed or fraudulent deeds and titles. Even areas which have been subjected to a cadastral survey have not been free of land disputes, as the lack of a single unified land registry makes adjudication of land tenure difficult (US Export Guide 2006, Honduras).

The purchase contract might be in English, but ultimately may be in Spanish to ensure ease of enforceability.

Property Taxes:

Honduras recently changed the law to reduce the registration/transfer tax to 1.5 percent of the sales price or the municipal (catastral) assessed value. There are some miscellaneous stamp and other charges (Honduras Real Estate Atterneys).

Honduras Mortgages & Financing

The International Monetary Fund reports that both residents and non-residents may hold foreign exchange accounts. Payments and transfers are not restricted, and few capital transactions require approval. Although Honduras restricts some investment, most barriers are informal (Freedom Index 2006).