Can Americans buy property in Honduras?

Authored by the expert who managed and guided the team behind the Honduras Property Pack

Everything you need to know before buying real estate is included in our Honduras Property Pack

Who is the author of this content?

THELATINVESTOR

A team specialized in real estate investing in Latin American countries (Honduras, Mexico, Costa Rica, etc.).

We are a team of financial experts, legal professionals, developers, and local real estate specialists dedicated to helping people like you avoid mistakes when investing in real estate in a foreign place, particularly in Honduras. If you'd like to learn more about us, you can check our presentation page.

How this content was created 🔎📝

At TheLatinvestor, we explore the Honduran real estate market every day. Our team doesn't just analyze data from a distance—we're actively engaging with local realtors, investors, and property managers in cities like Roatán, Tegucigalpa, and San Pedro Sula. This hands-on approach allows us to gain a deep understanding of the market from the inside out.

These observations are originally based on what we've learned through these conversations and our observations. But it was not enough. To back them up, we also needed to rely on trusted resources

We prioritize accuracy and authority. Trends lacking solid data or expert validation were excluded.

Trustworthiness is central to our work. Every source and citation is clearly listed, ensuring transparency. A writing AI-powered tool was used solely to refine readability and engagement.

To make the information accessible, our team designed custom infographics that clarify key points. We hope you will like them! All illustrations and media were created in-house and added manually.

Can Americans legally buy property in Honduras, and are there any restrictions compared to Honduran citizens?

Americans can legally purchase property in Honduras without any residency requirements.

Since 1991, Honduras has permitted foreign property ownership, and the 1998 Constitution further clarified this right to encourage foreign investment. As of June 2025, Americans enjoy broad property ownership rights, though with specific limitations that don't apply to Honduran citizens by birth.

The main restriction affects individual ownership limits and coastal property access. While Honduran citizens can purchase unlimited amounts of land anywhere in the country, Americans face a 3,000 square meter (approximately 0.74 acres) limit per property for residential use without special approval. Additionally, Article 107 of the Honduran Constitution restricts foreign ownership within 40 kilometers of borders and coastlines.

However, Americans can bypass these restrictions by forming a Honduran corporation, which can own virtually any size or type of property, including beachfront or agricultural land. Decree Law 90/90 also allows foreigners to buy in restricted coastal zones for residential or tourism projects, provided they register with the Ministry of Tourism.

It's something we develop in our Honduras property pack.

Are there any limits on the amount or type of property Americans can own, especially beachfront or agricultural land?

Americans face specific ownership limits that can be overcome through proper structuring.

Individual Americans are restricted to purchasing up to 3,000 square meters of land for residential use per property without special approval. This limitation applies to direct personal ownership and affects both inland and coastal properties. For larger plots or commercial purposes, Americans must establish a Honduran corporation to exceed these limits.

Beachfront and agricultural land ownership requires additional considerations. The constitutional restriction on coastal property ownership within 40 kilometers of coastlines can be navigated through corporate ownership or by registering with the Ministry of Tourism for residential or tourism-related projects. Agricultural land follows similar rules, with corporate ownership providing the most flexibility for large-scale agricultural investments.

The corporate route offers virtually unlimited ownership potential. A Honduran corporation can own any size or type of property, including large agricultural tracts, beachfront developments, or commercial properties. This makes corporate ownership the preferred method for serious investors or those planning significant real estate investments in Honduras.

Do Americans need to be residents or hold any specific visa to purchase property in Honduras?

No residency status or specific visa is required for Americans to purchase property in Honduras.

Honduras maintains an open property ownership policy for foreigners, allowing Americans to buy real estate as non-residents. This policy applies whether you're purchasing a vacation home, investment property, or planning future relocation. The absence of residency requirements makes Honduras particularly attractive for American investors compared to other Central American countries that impose such restrictions.

While residency isn't required for property purchase, obtaining it can provide benefits for ongoing property management and potential access to local financing options. Some Americans choose to pursue residency after purchasing property, but this is entirely optional and not a prerequisite for ownership.

You can complete the entire purchase process from the United States, though physical presence or local representation through power of attorney is typically required for the final signing and registration procedures.

Is it necessary for Americans to be physically present in Honduras to complete a real estate transaction?

Physical presence in Honduras is not strictly required for property purchases.

Americans can appoint a local attorney or representative through a power of attorney to handle the entire transaction on their behalf. This arrangement allows for remote property purchases, though many buyers prefer to visit the property and meet their legal representatives in person before finalizing such significant investments.

The power of attorney must be properly notarized and authenticated through the appropriate legal channels. Your appointed representative can sign documents, transfer funds, and complete all necessary registration procedures at the Instituto de la Propiedad (Property Institute) on your behalf.

However, many successful property buyers recommend at least one visit to Honduras during the process. This allows for personal property inspection, meeting with your legal team, understanding the local market, and ensuring all documentation is properly handled. While not legally required, this approach often leads to more confident and successful transactions.

What is the full step-by-step process for Americans to buy property in Honduras, and which documents are required?

The property purchase process in Honduras follows a structured eight-step procedure requiring specific documentation.

The process begins with defining your purchase parameters, including property type, size, location, and whether you'll buy personally or through a Honduran corporation. Next, select a reputable real estate agent experienced in your target area and hire a qualified real estate attorney for title searches and legal compliance. Make a written offer and sign a "Promesa de Venta" (Purchase Agreement) with a deposit, typically 10% of the purchase price.

Due diligence follows, where your attorney verifies clean title, checks for liens, unpaid taxes, and zoning compliance. The sale is finalized before a licensed notary public who prepares the public deed (escritura pública) and registers the property with the Instituto de la Propiedad. Pay all required taxes and fees, including transfer tax (1.5%), notary/legal fees (1–3%), and registration fees (0.15–0.2%). Finally, register utilities and services if you plan to rent or occupy the property.

Document Type	Purpose	Required/Optional
Valid Passport	Primary identification	Required
Certificate of Title	Proves seller's ownership	Required
Purchase Agreement	Legal contract between parties	Required
Certificate of No Encumbrance	Confirms no liens or debts	Required
Tax Payment Certificate	Shows current on property taxes	Required
RTN Tax ID	Required for registration	Required
Power of Attorney	If buyer not present	Optional
Corporate Documents	For corporate purchases	Optional

Is it mandatory for Americans to hire a local lawyer or notary, and what role do they play in the transaction?

Hiring a local real estate attorney is strongly recommended and considered essential for American buyers.

While not legally mandatory, the complexity of Honduran property law and the differences from U.S. real estate practices make professional legal representation crucial for protecting your interests. A qualified attorney conducts comprehensive title searches, drafts and reviews contracts, ensures legal compliance, and guides you through the entire transaction process.

The attorney's role includes verifying property ownership, checking for liens or encumbrances, confirming tax payment status, reviewing zoning compliance, and ensuring all documentation meets legal requirements. They also coordinate with the notary public and handle registration procedures with government offices.

All property purchases must go through a licensed notary public, who prepares and registers the public deed and ensures the transfer is legally binding. The notary serves as an impartial party who verifies the transaction's legality and registers the new ownership with the Instituto de la Propiedad. This dual system of attorney representation and notarial registration provides strong legal protection for property buyers.

Legal fees typically range from 1% to 3% of the property value, a worthwhile investment considering the protection and peace of mind provided.

What are the typical property prices in key regions like Roatán, Utila, La Ceiba, Tegucigalpa, and San Pedro Sula?

Property prices in Honduras vary significantly by location, with coastal areas commanding premium prices.

Roatán represents the most expensive market, with beachfront and ocean-view properties ranging from $150,000 to over $600,000 for luxury options. Land parcels on Roatán typically cost between $45,000 and $200,000, depending on location, size, and proximity to the water. The island's established tourism infrastructure and international airport access drive these higher valuations.

Utila offers more affordable alternatives, with homes and land available from $50,000 to $200,000. This price difference reflects Utila's more rustic character and smaller scale development compared to Roatán. La Ceiba provides mainland coastal access with properties ranging from $50,000 to $150,000, making it attractive for budget-conscious buyers seeking beach proximity.

The major urban centers of Tegucigalpa and San Pedro Sula offer different value propositions. Urban apartments and houses typically range from $80,000 to $300,000, with luxury properties commanding higher prices. These cities appeal to buyers interested in business opportunities, urban amenities, and commercial real estate investments rather than beach lifestyle properties.

As of mid-2025, property prices have shown steady appreciation in tourist areas, particularly Roatán, driven by increased American interest and limited beachfront inventory.

Which areas in Honduras are most popular among Americans for living, renting out, or investing in property, and why?

Roatán dominates American property investment and relocation preferences in Honduras.

Roatán's popularity stems from its stunning Caribbean beaches, world-class coral reefs, well-established expat community, and developed tourism infrastructure. The island offers direct flights from several U.S. cities, English-speaking services, and a lifestyle that closely resembles Caribbean resort living. These factors make it ideal for vacation homes, rental properties, and permanent relocation.

Utila attracts Americans seeking a more laid-back atmosphere and lower property prices. The island appeals particularly to diving enthusiasts and budget-conscious expats who prefer a less developed, more authentic Caribbean experience. Its growing reputation as a diving destination supports rental income potential.

La Ceiba gains popularity among Americans looking for mainland coastal access combined with affordability. The city provides access to national parks, beaches, and adventure tourism activities while maintaining significantly lower property costs than the Bay Islands. This combination appeals to investors seeking rental income from eco-tourism and adventure travelers.

Tegucigalpa and San Pedro Sula attract Americans interested in business opportunities, urban living, and commercial real estate investments. These cities offer modern amenities, business infrastructure, and potential for commercial property appreciation, though they lack the beach lifestyle appeal of coastal areas.

It's something we develop in our Honduras property pack.

We did some research and made this infographic to help you quickly compare rental yields of the major cities in Honduras versus those in neighboring countries. It provides a clear view of how this country positions itself as a real estate investment destination, which might interest you if you're planning to invest there.

What are the average gross rental yields, rental income potential, and tourism stats in top expat and tourist zones?

Honduran coastal properties offer attractive rental yields, particularly in established tourist destinations.

Gross rental yields typically range from 6% to 9% for residential properties, with tourist areas like Roatán achieving yields up to 10.4% due to high demand for vacation rentals. These yields reflect the strong tourism demand and limited quality accommodation supply in key destinations. Short-term rental platforms like Airbnb have significantly boosted rental income potential, particularly during peak tourism seasons.

Roatán leads in rental income potential, receiving thousands of tourists annually through cruise ship arrivals and international flights. The island's established tourism infrastructure supports consistent year-round occupancy for well-managed rental properties. Peak seasons during North American winter months can command premium daily rates, significantly boosting annual returns.

La Ceiba shows growing tourism potential, with projected tourism receipts of $395 million by 2026. This growth supports increasing rental demand from eco-tourism and adventure travelers seeking mainland coastal access. The city's position as a gateway to national parks and adventure activities creates diverse rental market opportunities.

Utila's diving tourism provides steady, if seasonal, rental income. The island's reputation as an affordable diving destination attracts budget-conscious travelers who often stay longer, providing stable occupancy for rental properties. However, yields may be lower than Roatán due to reduced luxury market demand.

Are there mortgage options available for Americans in Honduras, and what are the typical rates, conditions, and tips to qualify?

Mortgage financing for American buyers in Honduras is extremely limited and comes with challenging terms.

Local banks rarely offer mortgages to non-resident foreigners, and when available, interest rates typically range from 12% to 35% annually. These high rates reflect the banks' perception of risk when lending to foreign buyers without local income or credit history. Most property transactions in Honduras are therefore cash-based, requiring buyers to have full purchase funds available.

To qualify for the limited financing options available, Americans typically need to demonstrate strong creditworthiness, provide substantial collateral, maintain a local bank account, and sometimes establish residency or business operations in Honduras. Some buyers explore seller financing arrangements, where property owners provide direct financing terms, though these arrangements require careful legal structuring.

Establishing residency or forming a Honduran business can improve access to financing options, as banks view local entities more favorably for lending purposes. However, even with improved qualifications, mortgage terms remain challenging compared to U.S. standards.

Alternative financing strategies include using U.S.-based equity loans, international banking relationships, or partnership arrangements with Honduran investors who can access better local financing terms.

What are the key taxes and fiscal implications for Americans buying, owning, renting out, or selling property in Honduras?

Property ownership in Honduras involves several taxes and fees that Americans must understand for proper financial planning.

Purchase-related costs include a 1.5% transfer tax on the property value, notary and legal fees ranging from 1% to 3% of the property value, and registration fees of 0.15% to 0.2% of the property value. These costs typically total 3% to 5% of the purchase price and are paid during the closing process.

Ongoing ownership costs include annual property tax (ISBI) of 0.25% to 0.35% of the cadastral value, which is often lower than market value. Property owners must also pay for utilities, maintenance, and any applicable homeowners association fees.

Tax Type	Rate/Amount	When Applied
Transfer Tax	1.5% of property value	At purchase
Notary/Legal Fees	1–3% of property value	At purchase
Registration Fee	0.15–0.2% of property value	At purchase
Annual Property Tax (ISBI)	0.25–0.35% of cadastral value	Annually
Capital Gains Tax	10% for non-residents	At sale
Income Tax on Rental	Only if managed locally	Annually
Sales Tax	15% on goods/services	Not on real estate

Rental income taxation depends on management location. Foreign-sourced income, including rental income managed from abroad, is generally not subject to Honduran income tax. However, rental income from locally managed properties may be subject to local taxation. Capital gains tax of 10% applies to non-residents when selling property, calculated on the profit from the sale.

What are the most common mistakes or pitfalls Americans make when buying property in Honduras, and how can they avoid them?

American buyers frequently encounter preventable problems that proper preparation and professional guidance can avoid.

1. **Insufficient Due Diligence**: Many Americans fail to thoroughly verify property titles, check for liens, or confirm tax payment status. Always hire a qualified local attorney to conduct comprehensive title searches and property verification before committing to any purchase.2. **Ignoring Legal Differences**: Honduran property law differs significantly from U.S. real estate practices. Avoid assumptions based on American real estate experience and rely entirely on local legal professionals for guidance throughout the process.3. **Emotional Decision-Making and Overpaying**: The appeal of Caribbean lifestyle properties can lead to emotional decisions and overpaying. Work with reputable local agents, research comparable sales, and maintain rational decision-making processes.4. **Neglecting Local Market Knowledge**: Lack of understanding about local market conditions, neighborhood dynamics, and growth potential can result in poor investment choices. Spend time researching the local market and work with experienced local professionals who understand regional variations.5. **Title and Registry Issues**: Not all land in Honduras has clear, registered title. Some properties may have disputed ownership, incomplete documentation, or registration problems. Ensure your attorney verifies that the property has clean, registered title before proceeding with any purchase.

It's something we develop in our Honduras property pack.

Conclusion

This article is for informational purposes only and should not be considered financial advice. Readers are advised to consult with a qualified professional before making any investment decisions. We do not assume any liability for actions taken based on the information provided.

Sources

1. ArabMLS - Buying Property in Roatan as a Foreigner
2. Roatan Real Estate - Roatan Buyers Guide
3. TheLatinvestor - How to Buy House in Honduras
4. 1West Realty - Requirements to Purchase Property in Honduras
5. International Living - Honduras Real Estate
6. Global Property Guide - Honduras Buying Guide
7. Honduras Real Estate Pro - How to Buy Real Estate Safely
8. Zeyla Solutions - Step-by-Step Guide to Buying Property
9. Realtor.com - Honduras International Properties
10. US Embassy Honduras - Buying Property Guide