How to Buy Property in Barbados as a Foreigner: A Step-by-Step Guide
Barbados offers a unique blend of natural beauty, vibrant culture, and stable investment climate, making it a sought-after destination for foreign property buyers. Whether your goal is to own a vacation home, diversify your portfolio with a promising real estate investment, or reconnect with the island as a returning national, Barbados’ real estate market offers abundant opportunities.
As a non-resident, you’ll be pleased to know that foreigners can legally purchase property in Barbados. However, the process requires understanding key legal requirements and procedural steps. This guide is designed to provide you with the knowledge and tools necessary to navigate the process with clarity and confidence.
1. Why Choose Barbados?
Barbados offers compelling reasons for international buyers to invest in the real estate market:
Climate and Lifestyle: With its year-round warm weather, white sand beaches, and vibrant local culture, Barbados is an ideal retreat for expats and foreign investors.
Investment Appeal: Barbados’ strong tourism sector supports a high demand for vacation rentals and long-term real estate value appreciation.
Cultural and Emotional Connection: For returning nationals, property ownership offers a meaningful way to reconnect with home.
2. The Legal Framework for Non-Residents
Central Bank Approval
Non-residents can buy real estate in Barbados, but they must follow certain legal steps, including obtaining exchange control approval from the Central Bank of Barbados. This approval ensures that foreign currency transactions, like transferring funds for the purchase or repatriating proceeds from a future sale, comply with local regulations.
Your attorney will manage this process, making sure everything is handled smoothly and in line with Barbados’ exchange control regulations.
3. Step-by-Step Guide to the Purchasing Process
The process of purchasing property in Barbados is guided by specific legal requirements. Here’s what to expect:
Step 1: Retain a Local Attorney
A Barbados-based attorney is essential for navigating the legal process. They will:
Provide legal guidance on the buying process.
Communicate with the seller’s attorney on your behalf.
Submit the purchase funds on your behalf.
Handle Central Bank approvals for non-residents.
Prepare all legal documents required for a successful transfer of ownership to you.
Protect your interests at every stage.
Step 2: Conduct Preliminary Inquiries
Your attorney will conduct some initial inquiries about the property and will typically request from the seller’s attorney the following:
The title deeds to the property.
The most recent land tax bill and receipt if available.
Land surveyor’s plot plan for the property.
Step 3: Agreement for Sale
Once these preliminary queries are complete, the Agreement for Sale is drafted. This document outlines the terms of the transaction, including:
The purchase price and payment schedule.
Conditions for default by either party.
A deposit, typically 10% of the purchase price, is required upon signing.
Step 4: Due Diligence
Your attorney will perform due diligence to ensure the property has a “good and marketable title.” This includes:
Verifying that the property is free from encumbrances, such as liens, mortgages, unpaid taxes, or claims.
Requesting a boundary certificate to ensure there are no boundary issues or encroachments.
Confirming that all relevant planning permissions are in place.
Reviewing key documents and several other critical matters affecting the property.
Step 5: Closing Ceremony
The final stage involves the signing of the title documents, payment of the remaining balance, and transfer of ownership. Your attorney ensures that all legal obligations are satisfied before the property is officially transferred to you.
Ready to begin your property journey? Get in touch to learn how we can guide you through every step of the process.
4. Associated Costs and Taxes
Legal Fees
Attorney fees are calculated based on the property’s value, along with any associated costs impacting the transaction, and include services such as:
Conducting due diligence.
Preparing and reviewing the Agreement for Sale and Conveyance.
Any other services required to conclude the sale.
Annual Land Taxes
As a property owner, you’ll receive an annual land tax bill from the Barbados Revenue Authority based on the property’s assessed value. Payments are due by March 31 each year.
Rental Income Tax
If you plan to rent your property, rental income is subject to taxation. Non-residents must register with the Barbados Revenue Authority to comply with tax obligations.
N.B: Fees such as Stamp Duty and Transfer Tax are usually the seller’s responsibility and not the buyer’s.
Here's what one of our clients had to say:
Client Testimonial
“In a matter of 2 months I was able to purchase my home and relocate to Barbados. Ms. Morris presented herself as honest, trustworthy, transparent, and committed. I would definitely recommend the Morris firm for anyone who is looking to purchase a home and any legal matters."
– Client (New York, U.S.A.)
5. Financing Options for Non-Residents
Cash Purchases
Compliance with regulations: Ensure you can provide proof of the source of your funds to meet anti-money laundering requirements.
Registration of funds: Foreign funds must be registered with the Central Bank of Barbados, a process that your local attorney typically facilitates.
Mortgage Financing
Non-residents can also explore mortgage financing through local financial institutions. Key factors to keep in mind include:
Interest rate comparison: Rates and terms can vary across institutions, so thorough research is essential to secure favorable conditions.
Required documentation: Common requirements include proof of income, a formal offer letter for the property, and a professional valuation of the property.
Final Note
Purchasing property in Barbados is an exciting opportunity, but it involves important legal and procedural steps that require careful attention. Whether you’re considering the luxury of the West Coast, the lively South Coast, the peaceful East Coast, or other areas, understanding the process is key to making a confident investment.
At the Law Office of Lyngeolle Morris, we help non-resident buyers navigate the legal steps of property purchases, ensuring your interests are protected.
If you’re ready to move forward with your property purchase in Barbados, contact office by clicking here to learn how we can support you throughout the process.
Questions?
If you have further questions about the buying process in Barbados, get in touch by clicking here.
We look forward to assisting you.
