Ready to Buy? Now What?
Buying property in Barbados is quite easy as, with regards to expenses, it’s the same for both nationals and non-nationals.
It is recommended that prospective buyers meet with their financial institution first to determine what they qualify for before starting their property search. This helps to expedite the process once a binding agreement is entered into. The services of a real estate agent approved by the Barbados Estate Agents & Valuers Association (BEAVA) are recommended. This helps to facilitate the property hunt, and provide access to free advice, as the realtor is paid by the vendor.
Local purchasers may find banks offering down-payments of 5-10% with payment periods of 25-30yrs. There are several banks which cater to non-nationals and may offer international mortgages. The down-payment might be 20-30% with the payment period sometimes being 15 years or less.
Purchasers must utilize the services of a local registered attorney to transact the sale, which on average may take 3-5mths once there are no encumbrances. Property passes by conveyance of title, evidenced by the recording of the deeds and certified survey plans at the registry of title. Legal fees for the purchaser are legislated in the range of 1-3% on a sliding scale plus 17.5% VAT. Both the purchaser and vendor are responsible for their own legal fees.
Non-nationals especially should note that funds brought into the island should be registered with the Central Bank as a formality. Your attorney or banker would coordinate this with the Exchange Control Division. This ensures that as a foreign investor your funds are protected, therefore if you want to sell in the future, repatriation of these funds should be seamless.
On signing the sale agreement, a 10% deposit is required which the vendor’s attorney holds in escrow. The balance is then due on the transfer of deeds, and is payable to the vendor’s attorney.
It should be noted that a purchaser does not have to pay Property Transfer Tax, only the vendor. In addition to legal fees they should budget to pay their proportion of the land tax, property insurance and stamp duty.
Now, armed with this information, getting started should feel a whole lot easier. Let the hunt begin!