Roatan Island: property buying guide (Sept 2025)

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

Yes, the analysis of Roatan Island's property market is included in our pack

Who is the author of this content?

THE LATINVESTOR

A team specialized in real estate investing in LATAM countries

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 Roatan Island. If you'd like to learn more about us, you can check our presentation page.

Can foreigners legally buy property in Roatan, and are there any restrictions on the type or size of land they can own?

Foreigners can legally purchase property in Roatan Island with specific limitations that are important to understand before making any investment.

The maximum land size that foreigners can directly own in their personal name is 3,000 square meters (approximately 0.74 acres) for residential use. This restriction applies to individual ownership and covers most typical residential property purchases including homes, condos, and small lots.

For properties exceeding 0.74 acres or if you want to own multiple properties, you must establish a Honduran corporation. The corporation formation process costs approximately $1,500-$2,000 in legal fees and effectively removes most ownership restrictions. Many foreign investors choose this route even for smaller properties to simplify future transactions and provide additional legal protection.

Roatan benefits from a special government decree for the Bay Islands that permits foreign ownership for residential purposes, despite the general rule restricting foreign ownership within 40km of Honduras's borders or coast. This decree specifically addresses the unique situation of the Bay Islands and provides legal clarity for foreign buyers.

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

Is there a path to residency or even citizenship if I invest in real estate on Roatan?

Honduras does not offer direct citizenship through real estate investment, but property investment can contribute to residency pathways.

The investor residency visa requires a minimum investment of $50,000 in Honduran real estate or business, plus a $5,000 security deposit. This visa pathway allows foreign investors to establish legal residency based on their property investment in Roatan Island.

After maintaining residency for three years with required physical presence in Honduras, you become eligible to apply for citizenship through naturalization. The physical presence requirement typically involves spending at least 6 months per year in Honduras during the residency period.

Alternative residency options include the pensionado visa for retirees with stable pension income and the rentista visa for individuals with consistent passive income. These programs don't require real estate investment but do require proof of stable financial resources.

The residency process typically takes 6-12 months to complete and requires working with a qualified Honduran immigration attorney familiar with foreign investor applications.

Where do foreigners usually buy on the island, and which areas are considered the safest or most popular?

Foreign buyers concentrate their purchases in three primary areas that offer the best combination of safety, infrastructure, and community amenities.

West Bay represents the most popular destination for foreign property buyers, featuring pristine beaches, established tourism infrastructure, and the highest concentration of vacation rental properties. This area commands premium prices but offers the strongest rental income potential and property value appreciation.

West End serves as the cultural and social hub for the expat community, with numerous restaurants, bars, and dive shops creating a vibrant atmosphere. Properties here tend to be more affordable than West Bay while still maintaining strong safety standards and English-speaking communities.

Sandy Bay provides a middle-ground option with good access to amenities, reasonable property prices, and strong expat presence. This area attracts buyers seeking permanent residence rather than vacation rental investments.

Areas to generally avoid include Coxen Hole, French Harbor, and Flower's Bay, which have higher crime rates, limited infrastructure for expats, and fewer English-speaking services. These areas may offer lower property prices but come with significantly increased risks and challenges for foreign owners.

What's the typical step-by-step process for buying a property in Roatan as a foreigner?

Which documents are mandatory for the purchase, and which ones are just optional or recommended?

The mandatory documentation requirements for property purchase in Roatan are clearly defined by Honduran law and must be completed for any legal transaction.

Essential mandatory documents include your valid passport, certificate of title/deed from the seller, certificate of no encumbrance showing the property is free of liens, certificate of tax payment proving current taxes are paid, and certificate of good standing from the seller. A recent property survey is also required to confirm exact boundaries and measurements.

For remote purchases, a notarized power of attorney becomes mandatory, allowing your representative to sign documents and complete the transaction on your behalf. This document must be properly authenticated and translated into Spanish.

Optional but highly recommended documents include certified bank statements showing proof of funds, letters of recommendation from previous real estate transactions, professional property inspection reports, and comprehensive insurance documentation. These documents can expedite the process and provide additional protection.

All documents must be current (typically within 90 days of closing) and some may require official Spanish translations and apostille authentication depending on their origin country.

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Can I complete the purchase remotely without physically being in Honduras?

Remote property purchases in Roatan are legally possible and commonly executed through proper power of attorney arrangements.

You can complete the entire transaction without traveling to Honduras by granting a power of attorney to a trusted individual or your legal representative. This person gains the legal authority to attend closings, sign documents, and complete all necessary steps on your behalf.

The power of attorney document must be notarized in your home country, apostilled for international recognition, and translated into Spanish by a certified translator. Your attorney in Roatan will guide you through the specific requirements for your country of origin.

Remote buyers should establish strong communication channels with their local team, including regular video calls during property viewings, detailed photo and video documentation of the property condition, and real-time updates throughout the due diligence process.

While remote purchases are possible, many buyers prefer to visit Roatan at least once during the process to personally inspect the property and meet their local team face-to-face. This approach can help prevent misunderstandings and build stronger working relationships.

What are the most common mistakes and pitfalls that foreigners fall into when buying property there?

Foreign buyers frequently encounter preventable problems that can be avoided with proper preparation and professional guidance.

The most serious mistake involves skipping comprehensive due diligence, including title searches, property inspections, and boundary surveys. This oversight can result in purchasing properties with hidden debts, unclear ownership, boundary disputes, or significant structural problems that become expensive to resolve.

Many buyers attempt to navigate the process without qualified local professionals, either to save money or because they underestimate the complexity of Honduran real estate law. This approach frequently leads to legal complications, overpaying for properties, or missing critical warning signs during the transaction.

Another common error involves believing online marketing materials without independent verification. Properties may look significantly different in promotional photos compared to reality, with issues like poor construction quality, inadequate utilities, or problematic locations not apparent until inspection.

Underestimating total transaction costs represents another frequent mistake, as closing costs typically range from 4.5-7% of the purchase price, not including ongoing expenses like property taxes, maintenance, and management fees for rental properties.

Finally, many foreign buyers assume mortgage financing will be readily available, when in reality Roatan operates primarily as a cash market with very limited financing options for foreign purchasers.

What is everyday life like as an expat on Roatan in terms of safety, healthcare, and community?

Roatan Island provides a significantly safer environment for expats compared to mainland Honduras, particularly in the established foreign residential areas.

Safety levels in West Bay, West End, and Sandy Bay remain high due to visible police presence, security patrols, and the economic importance of tourism to the local economy. Property crime like burglary can occur, but violent crime against foreigners is rare in these areas. Most expats report feeling comfortable walking around during daylight hours and following basic security precautions.

Healthcare facilities on the island provide basic medical services, but serious medical needs often require travel to the mainland or back to your home country. The island has several clinics and a small hospital, but specialized care, major surgeries, or complex treatments typically require evacuation. Many expats maintain comprehensive health insurance that includes medical evacuation coverage.

The expat community on Roatan is large, vibrant, and welcoming to newcomers. English is widely spoken in expat areas, making daily life much easier for English-speaking residents. Regular social events, volunteer opportunities, and business networking provide multiple ways to connect with other foreign residents.

Daily amenities include decent internet connectivity for remote work, multiple grocery stores with imported goods, restaurants serving international cuisine, and various recreational activities from diving to fishing. The island's small size means everything is within a short drive or taxi ride.

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 property prices and rental yields across the main expat areas?

Property prices in Roatan vary significantly based on location, property type, and proximity to the beach, with 2025 showing continued upward pressure on values.

Inland starter homes suitable for permanent residence typically range from $150,000 to $250,000, offering good value for buyers seeking affordable entry into the market. Standard homes in desirable areas command $330,000 to $500,000, while beachfront villas and luxury properties can range from $750,000 to over $1,000,000.

Condominium units, particularly popular with vacation rental investors, typically price between $228,000 and $323,000 for one to two-bedroom units in well-managed developments. Prime development land costs approximately $3,800 per square meter in the most desirable locations.

Rental yields show strong performance for vacation rental properties, with beachfront villas generating $7,000 to $10,000 per month during high season (December through April). Average daily rates for vacation rentals reach $233 for well-positioned properties with professional management.

Annual rental income potential includes properties generating up to $20,292 annually with approximately 34% occupancy rates, though this varies significantly based on property type, location, and marketing effectiveness. The vacation rental market remains robust due to Roatan's popularity as a diving and cruise ship destination.

What's the long-term forecast for Roatan's real estate market—growth, risks, and outlook?

Roatan's real estate market demonstrates strong fundamentals supporting continued growth, though investors should understand both opportunities and risks.

Property values are currently appreciating at 3-7% annually, with beachfront properties showing the strongest gains up to 8% per year. Over the past five years, property prices have increased 30-40%, and over the past decade, many properties have doubled in value, indicating consistent long-term appreciation.

The growth drivers include limited developable land on the island, consistently high tourism demand, robust cruise ship traffic, and continued influx of expat residents and investors. The island's status as a major Caribbean diving destination and its English-speaking environment continue attracting international buyers.

Market risks include dependence on global tourism trends, which can be affected by economic downturns, travel restrictions, or major global events. The market's maturation may lead to more moderate growth rates as prices reach higher levels and affordability becomes a constraint for some buyers.

Infrastructure development, including airport improvements and utility upgrades, supports continued growth, but the pace of development must balance growth with environmental protection to maintain the island's appeal. Climate change and hurricane risk represent long-term considerations for any Caribbean real estate investment.

Overall, the forecast remains positive for continued appreciation and strong rental yields, particularly for well-located properties in established expat areas, though growth rates may moderate from recent highs as the market matures.

What taxes, fees, and extra costs should I expect when buying, owning, or selling a property on the island?

Can foreigners get mortgages in Honduras, what are the conditions and interest rates, and is paying cash the norm?

Mortgage financing for foreign buyers in Roatan is extremely limited, making cash transactions the standard approach for property purchases.

Very few Honduran banks offer mortgages to foreign buyers, and those that do typically require exceptionally high interest rates reaching up to 35% APR, making conventional bank financing impractical for most buyers. The banking system generally prefers to lend to Honduran nationals with established local credit history and employment.

Seller financing or builder financing occasionally becomes available, typically requiring 30-50% down payment with the balance paid over 2-5 years at interest rates of 12-14% APR. These arrangements depend on individual seller willingness and property circumstances, making them unreliable for purchase planning.

Many foreign buyers choose to refinance properties in their home countries or secure credit lines against existing assets to generate cash for their Roatan purchase. This approach often provides better interest rates and more familiar lending terms compared to local financing options.

The cash-dominant market means buyers should have liquid funds available before beginning their property search, as sellers expect rapid closing timelines and may not consider offers contingent on financing approval. This reality affects negotiating power and purchase strategy for foreign buyers.

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. TheLatinvestor - Roatan Island Property
2. Roatan Real Estate - Buyers Guide
3. Roatan Real Estate - Americans Moving to Roatan
4. About Roatan Real Estate - Buying Guide
5. YouTube - Roatan Property Investment
6. Century 21 Roatan - Owning Property
7. YouTube - Property Purchase Process
8. About Roatan Real Estate - Legal Requirements
9. Nomad Capitalist - Honduras Citizenship
10. Golden Visas - Honduras