Whether you live in Barbados, are relocating to Barbados, or wish to invest in the Barbados property market, Barbados is a great place to buy property. With its population of just over 280,000 and a land area of 166 square miles, Barbados is well-known for its warm climate, welcoming people, rich culture and beautiful scenery.

If you’re considering buying a property in Barbados, this comprehensive guide will provide you with valuable insights and considerations to navigate the process successfully.

In this guide, we will take a look at the requirements and the step-by-step process for facilitating your purchase.

Property Search & Appointing a Real Estate Agent

Whether you’re looking to purchase a property as a residential home or a commercial investment, it’s important that you first take some time to explore the property market in Barbados.

Some of the things you may wish to consider are your budget, the size of the property, the location, amenities, and any other special features that are important to you.

While this search may be conducted independently, enlisting the services of a real estate agent who has a strong background and insider knowledge about properties on the market may be a critical next step. A real estate agent will be in a position to advise you accordingly on what’s available based on your unique preferences, helping you to narrow your search and provide important details on the property market in Barbados.

Choosing a Property and Making an Offer

Once you have decided on a property that meets your criteria, the next step would be to make an offer with the seller of the property in question. This should be sent as soon as possible once you have expressed an interest. This may be in the form of a verbal offer, or some cases, a written offer form or letter of intent may be submitted as proof of your formal interest in the property. A typical offer form or letter of intent sets out the following details.

The address and description of the property being sold
The prospective buyer’s offer ($)
The name and address of the Prospective Seller(s)
The name and address of the Prospective Buyer(s)
The names of the Purchaser’s and Vendor’s attorneys
The time frame in which the offer should be accepted

Financing Your Purchase

You may wish to finance your purchase as an ‘all cash buyer’ or through mortgage financing.

Cash Buyer

A cash buyer will typically be attractive to a seller in cases where other potential buyers may be awaiting loan approvals and the finalization of a mortgage.

Under anti-money laundering (AML) compliance requirements, if you are a cash buyer you would be required to provide your attorney with details on your source of funds/wealth for your proposed real estate purchase.

Along with other important customer identification requirements, providing information on how you intend to finance the purchase will typically be done at the beginning of your engagement with your attorney.

Non-residents who are seeking to bring foreign funds into Barbados to invest in real estate should consult with an attorney to have the funds registered with the Exchange Control Authority of the Central Bank of Barbados. Your attorney will prepare the relevant documentation to facilitate this. You should retain these records in the event that you seek to repatriate funds in the future.

Obtaining financing

Prospective buyers may also finance the purchase by obtaining a loan. If you are selecting this route, it will be important to meet with a financial institution or your financial advisor to discuss financing options for your proposed purchase.

In Barbados, non-residents may also be eligible for mortgage financing. If you are a non-resident, you should speak with a local financial institution to discuss what options may be available to you to obtain financing for your intended purchase.

Appointing an Attorney-at-Law

Once you have submitted your offer, you should then notify your attorney-at-law to proceed on your behalf. In Barbados, an attorney is responsible for preparing the necessary legal documents required to facilitate the closing of the sale.

Your attorney will immediately notify the Seller’s attorney about having the agreement for sale prepared and reviewed. Your attorney will also typically request a copy of the most recent land tax bill for the property.

Agreement for Sale

The Agreement for Sale sets out the terms and conditions of the sale along with the consequences in the event that either party is unable to complete the purchase/sale of the property.

Deposit

Typically, the prospective buyer will be required to make a 10% deposit of the purchase price upon exchange of the sale agreement. The remaining 90% will typically be due upon the closing of the sale.

Role of Attorney During the Buying Process

Your attorney will also be responsible for liaising with the seller’s attorney throughout the transaction. The duties of your attorney during this process involve reviewing and making amendments to the agreement for sale and the conveyance, making queries regarding the title to the property to ensure that title is good and marketable, requesting important documents about the property, submitting the purchase funds on your behalf to the seller’s attorney as well as any other tasks which are necessary to conclude the sale.

If you are a non-resident, your attorney will apply for exchange control approval from the Central Bank of Barbados, which is a legal requirement for property transactions being conducted by non-residents.

At the closing ceremony, your attorney will submit the remaining balance of the purchase price to the vendor’s attorney as well as receive all important documentation pertaining to the transfer of ownership on your behalf.

Professional Fees, Taxes and Expenses

Fees prior to ownership

Stamp Duty & Property Transfer Tax

In Barbados, stamp duty on the conveyance and property transfer tax on the transfer of ownership are borne by the seller of the property and not the buyer. For a more detailed outline on how these expenses are calculated, click here.

Attorney’s Fees

You should consult with your attorney to confirm the fees and costs associated with your property transaction. Guidelines on attorney’s fees for property transactions are governed by the Legal Profession (Remuneration for Non-Contentious Business Rules)1997, which outlines the minimum fees charged for acting as the attorney for the buyer.

Other Fees

Some other fees which a buyer may be expected to cover are loan processing fees (if finance is being sought), which should be thoroughly discussed with the lending institution.

Additionally, if you are purchasing a home or building, another expense that you should be mindful of is property insurance, which is typically required if the property is financed with a mortgage.

Fees after ownership

Land Taxes

Once you obtain ownership of the property, the payment of land taxes will be an annual requirement. Land taxes are due annually on the 31st day of March of each year.

After the transfer of ownership to you, you will receive a land tax bill that outlines the exact amount due for the tax year. To learn more about how land tax rates in Barbados are calculated, click here.

Final Walkthrough

Prior to closing, the real agent or your attorney will typically advise you on carrying out a final walkthrough to ensure that everything with the property is in good order, as outlined in the agreement for sale. This is carried out a few days before the closing date. If there are any issues, you should contact your attorney or the agent to identify any issues that arise so that they can be rectified prior to completing the sale.

Closing the Sale

Once it has been confirmed that everything with the property is in order following the final walkthrough and that title to the property is good and marketable, it’s now time to proceed with the closing ceremony.

This involves the exchange of all title documents to the purchaser’s attorney and the balance of the purchase price to the vendor’s attorney. The keys to the property may also be exchanged during the closing ceremony or would be delivered directly to the purchaser after closing.

Final Note

Purchasing a property is Barbados can be one of the best decisions you can make for your future, whether you are seeking to purchase land, a home or an investment property.

At Law Office of Lyngeolle Morris, we represent purchasers in property transactions, including advice and guidance from the moment you to decide to proceed with making an offer until the actual closing of the sale.

If you would like to learn more about how our office can assist you through the buying process, you can book a call by clicking here or contact us with any questions you may have by clicking here.

We look forward to learning more about your needs at this time.

Ultimate Guide to Buying Property in Barbados: Step-by-Step Process