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Real estate market still hot
WELCOME BAHAMAS NASSAU - 2008
Real estate market still hot
Growing stronger despite setbacks, say agents
It's hard to tell whether most wealthy expats in The Bahamas came to invest their money and then decided to stay, or whether they came to enjoy the climate and then decided to invest.
It doesn't really matter as more and more high-net-worth folks are investing here and more are living here too, either part- or full-time.
This steady influx has produced a real estate market that remained hot early in 2008, despite the sub-prime mortgage crisis in The United States. While contractors reported an emerging slowdown in new building contracts, realtors said demand continued to be strong at the high end of the market.
Foreigners were investing in new resorts and housing developments running the gamut from luxury timeshares to superb condo hotels and dream dwellings that look more like castles than homes.
"Real estate is still your best return on investment anywhere," says realtor John Christie of H G Christie real estate."There is a limited supply of land and ever-increasing demand, so prices will naturally continue to rise. And as global population continues to grow, The Bahamas will remain among the most sought-after real estate in the world." Over the years, that growth averages out to 10 per cent per annum.
Your own island
The Bahamas offers buyers many dwelling options. At the top of the list are idyllic private islands. Though not for those with shallow pockets, there are several islands on the market, according to realtors.
"Island sales remain stable," says Christie. "As the baby-boomer generation retires, more people with large disposable incomes are looking to invest in island property."
Buying one is usually a multi-million-dollar investment, but that's only the beginning. Buyers should know that buying an island may involve steep infrastructure and development costs.
"You have to gauge the fantasy against the reality," advises Larry Roberts, of Bahamas Realty. "As most are undeveloped property, you have to be prepared to invest in transportation, infrastructure and construction."
As with any real estate investment in The Bahamas, buyers should seek out an agent or broker licensed by the Bahamas Real Estate Association (BREA). Among other things, an agent will help you obtain approval from the Bahamas Investment Authority-required for all island purchases.
Out Island living
Another option is to buy property on one of the populated islands, known locally as the Out Islands or the Family Islands. Settlements there are small, picturesque towns, usually with a beautiful beach or two nearby, caressed by crystal-clear water.
Some properties offer private lagoons or miles of unspoiled beaches, great for serenity and solitude, if that is what you seek. Fourteen of the islands have full electricity and communications services and all have land in breathtaking locations.
For those who want to live closer to the action, there are endless options in New Providence, Grand Bahama and Abaco, with a wide range of private estates and condominium homes for sale.
Linked by bridge to Paradise Island-site of the world-famous Atlantis resort, casino and upscale condo developments-New Providence boasts up-to-the-minute communications and other infrastructure, along with fine hotels, restaurants and night spots.
New Providence is the location of exclusive Lyford Cay. This gated residential community was designed for those looking for the ultimate in comfort and prestige.
Professionals, commercial and industrial magnates and famous public figures, such as actor Sean Connery, are neighbours in this prestigious community.
Importance of title
Buying real estate is made simple when you're dealing with a licensed BREA agent. And all of them will tell you that it's important to acquire clear title.
In The Bahamas, title is registered under the owner's name, which is different than in other countries, so the process is best left in the hands of an experienced lawyer.
In fact-and this goes back to British colonial days-the services of an attorney are mandatory, regardless of the value
of the sale.
"It is imperative to have proper, responsible legal counsel to secure your title," says Roberts. Lawyers generally charge about 2.5 per cent of the purchase price for their services-including title searches and applications in your name for all required permits.
"It may take some time to obtain a clear title, so it is wise to be patient and employ due diligence to successfully complete the process," Roberts also advises.
The basics apply here, just as they do back home. Check that electricity, water and telephone are readily available because bringing them to your property will be costly.
Agents charge 6 per cent commission on the sale of developed property and 10 per cent for raw land and for Out Island real estate, whether it is land, a home or commercial property. This is usually paid by the seller.
The government charges a one-time stamp duty on realty transfers ranging from 2 per cent for property valued up to $20,000 to 10 per cent for property valued at more than $250,000. Annual property taxes are also payable, based on the value of your property.
You can arrange financing back home or you can choose a Bahamian bank that provides mortgages for foreign nationals-again, just ask your agent.
When the seller agrees to an offer, the buyer deposits 10 per cent of the purchase price in the escrow account of the seller's lawyer.
Property is held in freehold in The Bahamas, not leasehold as in some other countries. This means the property is yours to use, sell or assign in your will, without restriction.
As a foreign buyer, you can apply for an annual homeowner's residence card, which facilitates entry into the country. Owners of homes worth more than $500,000 may apply for permanent residency status.
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