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Buying property
WHAT-TO-DO - FREEPORT/LUCAYA & GRAND BAHAMA ISLAND - JULY 2003
Buying property
Keeping it simple
Buying real estate in The Bahamas is mostly a matter of balancing your needs and wants with your resources. A beach at your doorstep, a tennis court in your yard, a home on a golf course, a jacuzzi and a dozen spare bedrooms, perpetually beautiful gardens, hired help or just a roof over your head, the choice is yours.
But keep in mind that purchasing a home worth $500,000 or more entitles you to accelerated consideration for permanent residence.
Lanelle Phillips-Cole, district manager for H G Christie's busy real estate office in Freeport says the steps to acquiring property on Grand
Bahamas are pretty straightforward
"Acquiring a home in The Bahamas can be as complex or as simple as you want to make it. Following some basic steps can keep it simple," she says.
"To begin your property search contact a licensed Bahamas Real Estate Association (BREA) agent and tell the agent the type of property you are seeking and your budget range," she advises. "The more specific you can be the easier the transaction and the better service you will receive."
Valuable tool
An experienced agent, your most valuable tool in the hunting process, knows what's for sale and will match your needs with available properties. Everyone has different tastes and therefore it's a good idea to look at a range of properties before choosing.
Once you decide on a property, you can make an offer through your agent. The agent will present your offer and handle negotiations until an agreement is reached.
The buyer should know if the house is being offered furnished or unfurnished, and whether the transaction is in US or Bahamian dollars.
Understand the deal
The agent explains all closing costs to both the seller and buyer so that each party clearly understands what the offer means and what costs will be incurred by whom.
When an agreement is reached a purchase-sale agreement that outlines all terms and conditions is signed by both parties. To bind the agreement the buyer is usually required to pay a deposit of about 10 per cent of the purchase price. This is held in the seller's attorney's or real estate agency escrow account until closing. It is important to understand all aspects of the deal.
Stamp tax is payable on conveyance of all real property, based on the selling price. For properties up to $20,000 the tax is two per cent; from $20,000-$50,000, four per cent; from $50,000-$100,000, six per cent; $100,000-$250,000, eight per cent; and more than $250,000 the tax is 10 per cent. The stamp tax is usually split between the buyer and seller.
Real estate fees, generally paid by the seller, are usually six to eight per cent of the sale price on developed land and 10 per cent on undeveloped land.
Legal fees are usually 21Ú2 per cent of the sale price up to $500,000; two per cent on the next $500,000; one per cent on the next $4 million; and 1Ú2 per cent on the remainder.
No property tax
Within the 233-sq-mile Grand Bahama Port Authority area of Freeport/Lucaya, there is no property tax until 2015, based on the Hawksbill Creek Agreement. However, there is an annual service charge affixed to every property. The charge, ranging from about $125 to $1,000 is payable to Lucayan Services Company for building and maintenance of roads, street and directional signage, landscaping of common and general areas, tree trimming, trash removal from general, common and canal areas, maintenance of canal bulkheading, removal of hurricane debris and installation of utility poles.
Foreign Investment Board approval is required for foreign buyers if the property is more than five acres, but it is generally a formality.
Buying a condo
When purchasing a condominium, the purchaser must complete an application and be approved by a condominium board whose members are other homeowners.
It is important to clearly understand all the condo rules with regards to renting and the monthly maintenance fees. In Grand Bahama monthly maintenance fees for condos range from $200 to $1000 depending on the building and amenities.
Developments such as Waters Edge, Lucayan Marina Village and Bell Channel Club and Marina carry a condominium agreement which allow them to apply a monthly or quarterly maintenance fee which includes all maintenance of the complex and service charges.
Purchasing a second home in The Bahamas is not only a sound investment but with the help of your professional agent the whole process can be relatively simple.
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Information in editorial and listings is subject to change at any time.