Property Buyers Advisory Guide to Barbados
WHY BUY A RESIDENTIAL LUXURY PROPERTY IN BARBADOS
Barbados offers a unique all year-round sunny, luxury destination with beautiful beaches, top restaurants and championship golf courses.
‘Bajans’, as the indigenous population, are referred to, are considered some of the friendliest people in the world. There are no restrictions to non-nationals purchasing property in Barbados and additional attractions are that, once selling a property, there is nil capital gains tax and also nil inheritance tax to pay.
FINANCIAL PLANNING IN BARBADOS
The first thing we would recommend you do is sit down and review your numbers, ideally even before you start looking at properties in Barbados. It may be that you can afford to spend more than you had thought with some thorough financial planning.
LUXURY PROPERTY MORTGAGES IN BARBADOS
Even if you have sufficient capital to buy property in Barbados outright, you may wish to consider using a mortgage to fund the purchase for various reasons including:
- – Fiscal: You may be eligible for tax allowances
- – Financial: You may earn a higher rate of return on capital invested than you would pay to service a loan
- – Security: a bank will carry out its own due diligence and only lend against a property that meets its criteria
RESIDENTIAL PROPERTY PURCHASE PROCESS IN BARBADOS
Once you have found the right property, the buying procedure is generally as follows:
- – Verbal offer and acceptance
- – Appointment of an attorney-at-law
- – Exchange of contracts for sale and payment of a 10% deposit
- – Deposit paid to the vendor’s attorney-at-law, within 4 weeks of accepted offer
- – The remaining 90%, of the agreed purchase price, is paid at the time of conveyance
- – Conveyance time is approximately three months
- – The freehold title may be in an individual’s name or through a corporate vehicle set up to own the property
- – Non-residents of Barbados tend to purchase property through a company, which may be incorporated outside of Barbados
- – Overseas purchasers can secure a 50% to 65% mortgage through a bank in Barbados
- – All mortgage applications will require a property valuation prior to a loan being approved
-Valuations are carried out by an independent valuer, appointed by the bank
LUXURY PROPERTY ATTORNEY FEES IN BARBADOS
Attorney Fees are 1% – 2% plus 17.5% VAT
RESIDENTIAL PROPERTY SURVEYS IN BARBADOS
A property inspection is not legally required in Barbados however, depending on the age/condition of the property a purchaser can request this and their agent in Barbados can put them in touch with a contractor to have the survey done. Unique Living would always recommend a survey. The cost will vary depending on the size of the house so it is best to ask for a quotation before proceeding.
A survey of the lot is required prior to completion. This is done in order to ensure that all line marks are in place and there are no encroachments. The surveyor will point out the line marks to the purchaser or his representative prior to completion
MONEY TRANSFERS IN BARBADOS
Currency prices fluctuate all the time so it is a good idea to fix your rate via a specialist foreign exchange company. You can literally lose or save thousands of dollars depending on the currency provider you use, in-particular mainstream banks. In most situations, a specialist FSA regulated currency broker can offer you a much better exchange rate than your bank. Please contact us for our list of recommended currency brokers. We recommend you only use brokers regulated by the FSA.
COST OF OWNERSHIP OF RESIDENTIAL PROPERTY IN BARBADOS
Once you own a property in Barbados, it is important to understand the associated expenses. The annual expenses include:
- Property insurance: This can vary between US $2.00 to US $3.25 per US $500
- Contents insurance: This is recommended and this will range between US $2.50 to US $3.00 per US $500
- Land Tax: This is an annual tax that all property owners pay. It is based on the value of the land and any structures thereon. Land Tax is reassessed every three years and is capped at a maximum of US$50,000 on residences.
- Corporation Tax: If you purchased your property as a Company you are required to file annual returns
- Communal Fees: If you purchased a condo or a property located on a lifestyle resort, you will also be liable for communal fees or estate charges
- Property Management Fees: The minimum charge generally starts at US $400 per month. Consultancy and Add-on services are chargeable separately.
OTHER REGULAR RESIDENTIAL PROPERTY MONTHLY EXPENSES IN BARBADOS
- – Electricity, Barbados Light & Power
- – Water, Barbados Water Authority
- – Telephone Land Line
- – Internet
- – Cable TV
- – Domestic Staff
- – Pool Maintenance
- – Garden Maintenance
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