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PURCHASING A PROPERTY IN BARBADOS – WHAT TO EXPECT

Oct 27, 2021 | Blog, General

So you’ve visited Barbados a few times and you’re in love with the island, its people, and of course the array of property options available to you. Once the thought crosses your mind to purchase a home in Barbados, then what do you do? You may have stayed in several areas and as such have an idea where you’d ideally like to live, but what is available? Will it fit your needs? What about the price of the homes? How do you know if something is a ‘good deal’ or above market? With all of these thoughts swirling in your mind, your team at Inspired Real Estate | Barnard Realty Inc. is here to offer more than just a helping hand. From our Sales Team, Maisha and Ward and Alicia Barnard will go through every step offering expert personalised guidance for you to make an informed decision.

Here are the standard steps to purchasing a home in Barbados

 

  1. Appoint a professional Real Estate Agent

Maisha Ward and Alicia Barnard

Maisha Ward and Alicia Barnard

Now we’re not being biased here, but having a professional Real Estate Agent can make life much simpler and the steps to purchasing much smoother. The Agent acts as your trusted liaison between you and the owner or the owner’s Agent/representative. Our team has had over 10 years and can provide detailed assistance along the way.

A point to note, we can show you any home in Barbados even if it is via another agency! We know in some countries a home may be exclusive to a specific agency or Agent which means you’d have to contact said agency to view and place an offer on a home, but that’s not the case in Barbados. You get to work with one agent across the board; how simple is that?!

 

  1. What are you looking for?

Once you’ve selected your Agent, it’s now time to get to the nitty-gritty of it all. We will ask a few questions to help pinpoint some options for you to view; her questions would be along the lines of:

– Are you familiar with Barbados?

– Which area are hoping to live? West Coast or South Coast? Any specific areas on these coasts such as on the beach, ridge, golf course or inland?

– How many bedrooms would you need?

– A one-storey or two-storey home? What about a pool?

– What’s your ideal budget?

– Will you be needing financing? Be sure to contact your bank to see how much you’re qualified for!

– Can you show proof of funds?

Once you can answer most of these questions, we will send you a few homes with images, prices, and details for you to peruse. As mentioned in point 1, we can offer you any home in Barbados; If you happen to see something online you like, just send her the link or image and we can gather more details.

Some homes may be on the property market for both sale and holiday rental; it’s good to note this, as this can be a benefit to you. It all depends on the reason you’re purchasing the home. If it is with the intent to rent for certain periods, then voila! As a new owner of a property that rents for holiday let, this means you would take over any rentals that are currently unpaid and you can continue to accept new rentals. A property that has a good rental history puts you ahead of the game than if were start fresh. For those of you who prefer to have the home to yourself, we would advise the current owner to halt accepting any new rentals. In some instances, depending on the timeline of the bookings, they would occur within the Sale and Purchase, so by the time you are ready to move, the rentals would be complete. If this is not the case, and you really wish to not have any rentals after the completion of the Sale, then we would advise the current owner to find alternate accommodation for their booked guests.

 

  1. Viewings & Video Showings

Now that you’ve selected some homes that interest you, it’s time to see them. Generally, when persons make an enquiry, they are overseas so we will send you the link to each property option and fine-tune from there. In some instances, you may first meet us at the beach, event or restaurant on the island and we can show you homes during your visit.

In the event you’re overseas we encourage you to take a vacation to Barbados and we can schedule one or two days to show you the homes you fancy. Remember we can also book your holiday home on your behalf and even more so, maybe one of the homes you like is on the rental market and you can actually vacation in the villa or condo when you visit! Talk about a hands-on experience!

If you end up staying at another property we’ve booked for you or at a hotel, we will collect you on an agreed day and time and take you around to the different homes.

If it happens a home you’re interested in viewing, is booked for holiday rental during your stay in Barbados, then we will schedule to hop on a What’s App call, FaceTime, or Skype to showcase the home to you when you’re back home.

Bear in mind you may need to visit Barbados more than once to get a feel for what you’re looking for. We never expect a client to purchase a home from just one trip and one set of viewings, although it has happened and it was a lovely surprise, but we do understand this is a big decision and will take some time to find the right property for you. At least you will get to enjoy an amazing vacation each time!

 

  1. Choosing a home

You’ve seen a few homes, you know which ones definitely won’t work, which ones would be ideal but maybe it’s too pricey and maybe some that are a good base for you to expand on.

This is where you talk it out with your Real Estate Agent, your family, your partner etc… your entire support group to decide on what’s best for you.

You must look at your motivation for purchasing, be it as a second home to rent during specific periods or just as a family home, and of course, the criteria outlined to see which home fulfills these criteria the best.

With our wealth of knowledge, she may have shown you a home that didn’t fit your ideal location but everything is pretty much perfect; are you willing to be that ‘far’ from where you wanted to be? The reason we show you homes that may not be the exact fit to what you’ve outlined is that we can see the potential for what you’re asking for, even if it’s just a 15 min drive from the west coast for example. In Barbados, there’s no location that is really far so we tend to expand or search just outside of your location criteria.

 

  1. Financing

Once you’ve chosen your home and you require financing from the bank, you can let them know which home you’re interested in and the asking price. The bank will send someone to value the home to ensure the asking price is fair.

Our partners at Royal Bank of Canada or First Caribbean International Bank can assist with this. Just email us to find out more about this at info@inspiredbythecaribbean.com.

If financing is not needed, we do still need proof of funds and then we jump to the next step.

 

  1. Verbal offer and acceptance

With our guidance, you can place a verbal offer. In some cases, a Reservation Agreement may apply – A reservation agreement is an agreement between the vendor and the purchaser (subject to the sales and purchase agreement) this will be signed by both parties and a copy given to their attorney to show that there is an acceptance of an offer between the vendor and purchaser.

 

 

  1. Appoint an Attorney-at-Law

 

With all legal transactions, you must appoint an attorney. We have several attorneys to suggest who’d work swiftly to complete the sale. Legal fees hover around 2% of the purchase price of the property. For persons who will require a mortgage, this fee will increase due to the process and fees associated.

 

 

  1. Exchange of Sale contract & deposit

 

From here, things start to roll pretty quickly. An exchange of Purchase & Sale Agreement for the sale is made and the payment of a 10% deposit (non-refundable) is given to the Vendor’s attorney-at-law within 2 to 4 weeks of the sale contract.

Foreign currency brought into the island as well as funds borrowed by non-nationals should be registered with the Central Bank of Barbados.

 

  1. Final details

You’ve made the 10% deposit and then the legal work begins. A draft conveyance is sent to the buyer’s attorney-at-law and once this is signed the balance of the purchase price is paid by the buyer.

This takes roughly around 3 months to complete a sale.

During this time, we ensure that the vendor’s land tax and water bills etc… are all fully paid.

 

 

 

10. You now own a home in Barbados!

That’s it! You’re now a proud owner of a new home in Barbados.

 

HIGHLIGHTS:

Delays and issues that may occur

The current homeowner has a long-term rental or offers the home for vacation rental. What happens with these in relation to the new owner?

The new owner would honour the bookings and the current owner would not take on any more rentals. Sometimes the rentals in the current unit can be moved to another unit within the development.

Fees/costs to the client:

Legal fees hover around 2% of the purchase price of the property. For persons who will require a mortgage, this fee will increase due to the process and fees associated.

Outside of this, the client may wish to do an inspection of the home; this at the cost of the client.

Timeline:

It roughly takes 1-2.5 years to select a home after first searching. This is with the general idea you’re visiting 1-2 times a year to view homes

Conveyance and payment of 90% within 3 to 6 months (in the case of off-plan developments, stage payments based on construction progress may apply)

 

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