How to buy Real Estate in the Bahamas?
Perhaps you want to know how to buy Real Estate in the Bahamas because you are considering moving. Or maybe you would like to purchase a property to rent out; whatever the reason, you will have a wide selection of properties available.
With stunning ocean-view residences, modern apartments, and cottages located in huge palm forests, the Bahamas boast one of the best real estate markets in the Caribbean.
This article will explain how to take your first steps into the Bahamian real estate market with complete safety and peace of mind.
Why is buying real estate in the Bahamas a good choice?
The Bahamas offer many beautiful environments, from dynamic islands like Bimini or Grand Bahama to more secluded and idyllic ones like Harbour Island.
True earthly paradises are perfect for those who desire a more relaxed atmosphere and peaceful lifestyle away from the chaos of the cities.
Moreover, the Caribbean climate, the white sandy beaches, and the crystal-clear blue waters of the Bahamas attract an uncountable number of visitors every month.
In 2019 and 2022, the number of visitors to the Bahamas was around 7.2 million, as reported by the official website of the Bahamas Ministry of Tourism.
Thanks to the enormous popularity of the Bahamas worldwide, tourism represents one of the island’s main economic drivers. It is an essential source of income for all commercial enterprises, especially for all property owners who choose to rent out their homes.
The real estate market and the financial sector continue to grow, accounting for over 20% of the island’s GDP.
In recent years, the contribution of the real estate sector in the Bahamas to the country’s Gross Domestic Product was approximately 9.3%, as reported by the World Bank.
Numerous banks and financing companies offer low and highly competitive interest rates to incentivize the purchase of new properties.
Is it hard to get a mortgage in The Bahamas?
To receive a loan in the Bahamas, all you need to do is submit an application to one of the local branches, assess your ability to repay based on your income, and have the property you wish to purchase evaluated.
After completing these steps, you must wait for loan approval and sign the contract.
The current interest rates for real estate loans in the Bahamas can range from 6% to 10%, depending on the conditions of the loan requested and the financial situation of the applicant.
The tax benefits of the Bahamas
The tax benefits of the Bahamas are many.
Starting with their strategic location, the Bahamas are right in the center of the Caribbean, which means they have a tropical climate all year round and access to major commercial shipping routes between the USA and Central America.
In terms of taxation, are exempted:
- Personal income tax
- Corporate tax
- Property tax
- Real estate tax
- Inheritance tax
The Bahamas’ banking secrecy laws protect the privacy of local bank customers by not requiring them to share their personal financial information. Private information can only be disclosed if a formal request comes from a foreign jurisdiction.
In addition, the Bahamas offer a wide range of highly efficient financial services, including international banks, mutual funds, trust funds, insurance companies, and wealth management services.
The process of buying a property in the Bahamas
Buying a property in the Bahamas doesn’t require particularly complex procedures.
The first thing to do is to start the search for the desired property.
Choosing the property you want to buy from a long list of options is possible.
For example, you could choose a seaside villa or apartment, or if you prefer peace and privacy, you could build your house on your private island.
The options are numerous, so it’s recommended to analyze them carefully based on your needs and goals.
Stay updated and discover the latest 2023 Buying Trends in Bahamas Real Estate
Once the ideal property has been found, and an offer has been presented on the real estate market in the Bahamas, it’s recommended to consult a local lawyer specialized in real estate law to ensure that all title documents comply with the law.
At this point, a sales contract will be drawn up on the real estate market in the Bahamas, which must be signed and accompanied by a 10% deposit of the final purchase price.
The buyer must transfer the remaining balance and pay all required taxes.
How it works for foreign people
If you are a foreigner that wants to buy Real Estate in the Bahamas, you will be asked to register the investment with the Central Bank of the Bahamas at the Exchange Control department.
The permit application can be made through a local lawyer and usually takes 2-3 months to process.
This procedure is necessary to ensure the buyer can resell the property in the future and transfer their net profits outside of the Bahamas in the original currency of the investment.
The taxation on properties in the Bahamas is comparably modest, with a fluctuating percentage range of 0.25% to 2.5% based on the property’s type and location.
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