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Buying property in The Bahamas
What to know before signing on the dotted line
Buying property in The Bahamas
What to know before signing on the dotted line
Purchasing property in The Bahamas is easier than you may think. For one thing, you don’t have to be a resident to buy property here, whether it’s a home or land.
The International Persons Landholding Act, 1993 allows non-Bahamians and their companies to buy real estate for personal use or as an investment. And because real estate is held freehold, owners have permanent and absolute tenure. This means the property can be used, sold or assigned in a will without restrictions.
Before purchasing property in The Bahamas, it’s important to deal with a realtor accredited by the Bahamas Real Estate Association (BREA) who can help you purchase your property. Agents can recommend a lawyer and a local bank, several of which offer loans to foreigners, whether they are residents of The Bahamas or not.
The government collects a one-time stamp duty on mortgages at a rate of one per cent of the amount borrowed. Also, real estate agents charge a 10 per cent commission on the sale of undeveloped property and six per cent on developed residential or commercial property. Agents charge 10 per cent commission for Family Island property, whether land, home or commercial.
A non-Bahamian who buys or acquires an interest in a condominium or an owner-occupied property must apply to the Secretary to the Investments Board to register the purchase. An application for registration must be filed with the Bahamas Investment Authority, Office of the Prime Minister, along with proof of ownership, payment of stamp duty and real property tax and a banker’s draft or money order for $25 made payable to the Public Treasury.
A permit to acquire property is needed if the property is undeveloped land and comprises two or more contiguous acres, a commercial property or if the residence is intended for rental.
The schedule of fees for a certificate of registration and permit are:
Application for registration - $25
Application for permit - $25
Upon issue of certificate of registration or issue of permit where the property value is:
$50,000 and under - $50
More than $50,000 and less than $101,000 - $75
More than $101,000 - $100
The government stamp tax, a one-time payment due at closing, is usually split 50/50 by buyer and seller, unless otherwise agreed. Government stamp duty on property conveyances or realty transfers is:
$0-$20,000 - 4%
$20,000.01-$50,000 - 6%
$50,000.01-$100,000 - 8%
$100,000.01-$250,000 - 10%
Over $250,000 - 12%
Lawyers who prepare the conveyance typically charge a fee of 2.5 per cent of the sale price, plus out-of-pocket expenses.
Effective until July 2013, first-time homeowners may apply for an exemption to the government stamp duty.
Residency permits
Non-Bahamians who wish to reside in The Bahamas on an annual basis may qualify under one of four categories, subject to formal application and approval process.
These include an independent economic resident, or a resident homeowner including a seasonal resident homeowner.
In the case of an independent economic resident, the applicant must provide a financial reference from a reputable bank verifying economic worth and two written character references. For an annual residence permit, a head-of-household pays $1,000 and each dependent, $25.
A resident homeowner or seasonal resident homeowner who owns a second home in The Bahamas may apply to the director of immigration for an annual homeowner’s residence card. The card is renewable annually and entitles the owner, spouse and minor children to enter and remain in The Bahamas for the period specified on the card. The fee is $500 per year.
These permits and cards do not allow the owner, spouse or dependents to be employed in The Bahamas.
Accelerated consideration of applications for annual or permanent residence is given to major international investors and owners of residences valued at $500,000 or more.
Property tax
Property tax must be paid by Bahamians and non-Bahamians owning real property and is due on or before Dec 31 each year. Returns are filed with the chief valuation officer and paid to the public treasury.
Tax rates are based on “market value” (the amount the property would realize if sold in the open market without encumbrances or restrictions) and are as follows:
Owner-occupied property (residential and licensed rental homes)
• The first $250,000 of market value - Exempt
• Between $250,000 and $500,000 - 3⁄4%
• Between $500,000 and $5 million - 1%
• On portion of market value greater than $5 million - 1⁄4%
Vacant land owned by non-Bahamians:
• First $7,000 - $100
• Portion over $7,000 - 11⁄2%
All other properties/commercial:
• First $500,000 1%
• Portion over $500,000 2%
In Grand Bahama, no property taxes are collected from owners of properties located within the Grand Bahama Port Authority areas of Freeport and Lucaya, but an annual fee is levied for trash removal, street maintenance and landscaping services.
Helpful contacts:
Bahamas Chamber of Commerce and Employers’ Confederation (BCCEC):
Shirley St and Collins Ave, PO Box N-665, tel (242) 322-2145, e-mail admin@thebahamaschamber.com, www.thebahamaschamber.com
Bahamas Real Estate Association (BREA):
10 Dowdeswell St, PO Box N-8860, tel (242) 356-4578 or (242) 325-4942, e-mail info@bahamasrealestateassociation.com,www.bahamasrealestateassociation.com
Bahamas Bar Association:
Mackey Street & Claire Rd,P.O. Box N-4632,tel (242) 393-3220,www.bahamasbarassociation.com
Association of International Banks & Trust Companies (AIBT):
Goodman’s Bay Corporate Centre, West Bay St, PO Box N-7880, (242) 356-3898, e-mail info@aibt-bahamas.com, www.aibt-bahamas.com
Central Bank of The Bahamas:
Frederick St, PO Box N-4868, tel (242) 302-2600, e-mail cbob@centralbankbahamas.com, www.centralbankbahamas.com
Bahamas Investment Authority (BIA): Office of the Prime Minister, Sir Cecil Wallace-Whitfield Centre, West Bay St, Cable Beach, PO Box CB-10980, tel (242) 327-5826/8 or (242) 327-5940/44, www.bahamas.gov.bs
Immigration Dept:
Head office: Hawkins Hill, PO Box N-831,tel (242) 322-7530 or (242) 322-8504, www.bahamas.gov.bs
Registrar General’s Dept (Civil Registry):
50 Shirley St, PO Box N-532, Nassau, tel (242) 322-3316, www.bahamas.gov.bs
Treasury Dept:
Watertower Place, PO Box N-7524, tel (242) 322-4561/5, www.bahamas.gov.bs
Lands & Surveys Dept:
Bay and Armstrong Sts, PO Box N-592, (242) 502-1200, www.bahamas.gov.bs
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