Construction and building costs in The Bahamas.
A few 'Ball park' figures of build costs for home buyers
Cost of construction on the islands.
Here, as in any country, construction costs in the Bahamas vary depending on the location, terrain and topography of the construction site, design of the building, the materials used and the quality of finish.
Costs can be as low as $65 to $80 per square foot for low cost, wooden housing. However, a modest home of concrete block construction with timber roof framing should cost between $100 to $150.
An average home will cost around $150 to $200.
A better than average home with good quality finishes can cost $200 to $400
For luxury, high end, homes the cost can be well over $400 per square foot though, naturally, this would include the finest finishes and details associated with such upscale housing.
The building standards here are higher than practically all US areas including the very tough standards of South Florida. As the majority of homes in the Bahamas are of concrete block, or poured concrete, construction they are built to meet very strict building codes indeed.
Who is buying real estate in the Bahamas?
Actor Johnny Depp recently bought himself a private sand ringed island off Exuma.
Depp discovered these idyllic islands while filming "Pirates of the Caribbean" on the island chain.
In 2004 he bought Little Hall's Pond Cay, a deserted 36 acre island with six beaches, where he plans to build a small home.
Musician Lenny Kravitz also bought a little cay in the Eleuthera chain.
Kravitz, who has Bahamian roots from his mother, was a frequent visitor before he bought his own tiny island.
Sean Connery lives in Lyford Cay, an exclusive area of New Providence.
Connery, a longtime resident, lives in a single story home overlooking a golf course.
The Bahamas is drawing celebrities seeking sun and a culture that discourages celebrity worship, which allows them to avoid autograph seekers while remaining within easy reach of the United States.
Actor Nicolas Cage who owns a home in the capital, Nassau, says.
"People are happy to meet you, but they don't want to exploit you or want anything from you. It's nice to be able to take a walk on the beach and not have to worry about having your picture taken."
At the third annual Bahamas International Film Festival last month Cage said he hopes to recruit more Hollywood figures to get involved with the event. If some decide to buy property in the islands the government would gladly accommodate them.
Offering favorable tax and residency laws the government of the Bahamas is encouraging the wealthy to come to take a look.
Any foreigner, movie star or not, who purchases a home worth at least $500,000 can become eligible for permanent residency. This is an incentive for jet-setters seeking to come and go with the minimum of fuss. Another major advantage is that the Bahamas has no tax on income, capital gains or inheritances.
Lots of other stars own Bahamas getaways too, including Shakira,
Faith Hill and Tim McGraw,
Sean "Diddy" Combs.
Most celebrities, and lots of ordinary people too, lead very quiet, and relaxed lives on these islands.
FAQs of real estate purchase in the Bahamas.
Is it possible for a non Bahamian to purchase property in The Bahamas?
Yes. The International Persons Landholding Act of 1993 provides for the sale of real property in The Bahamas to non Bahamians.
Are there any special permits required when purchasing property in The Bahamas?Permits are required by non Bahamians, provided under the International Persons Landholding Act, if,
1. The property being purchased is greater than 5 acres.
2. The intention is to rent out all or a portion of the property.
3. The property being purchased is for commercial development.
Non Bahamians who buy land for which a permit is not required must register their purchase with the Foreign Investment Board under such Act.
How do I go about getting a permit or registering my purchase with the Foreign Investments Board?
Non Bahamians should also register their investment with the Exchange Control at the Central Bank of The Bahamas, this will insure that on resale they will be able to remit the net proceeds of sale outside the Bahamas in the currency of the original investment.
In what form is title to property given?
The vast majority of property is sold Freehold.
There are a few exceptions of leasehold properties. These properties are generally Crown Lands (Government owned) properties that are leased for agricultural or development purposes. The Government of The Bahamas does not generally sell its property.
Do I need to engage the services of a local attorney when purchasing property?
No, but the appointment of a local attorney is highly recommended.
Apart from insuring that the documents of title are properly prepared and are in good order the local attorney, when representing the buyer, gives an Opinion on the title to the property. This Opinion is considered to be the same as title insurance as the lawyer is liable should the purchaser find that there is a defect in the title. Local lawyers carry indemnity insurance.
Is title insurance available in The Bahamas?
Yes. There are companies in the Bahamas offering title insurance.
The risk premium generally runs between .20%-.27% of value.
What are the costs involved in buying or selling property?
A typical sale, which is called a 'Gross Sale', assumes that the vendor will be responsible for the payment of
1. The real estate agents commission (if an agent is involved).
The commission on the sale of residential developed property is 6% of the gross sales price.
The commission on the sale of undeveloped property is 10%.
2. The Government Stamp Duty (Tax on the conveyance of real property). This is a graduated Tax.
The total amount of the Government Stamp Duty Tax is calculated as follows
When the value of the consideration is less than $20,000, the rate is 2%
When the value of the consideration is equal to or greater than $20,000 and is less than $50,000, the rate is 4%
When the value of the consideration is equal to or greater than $50,000 and is less than $100,000, the rate is 6%
When the value of the consideration is equal to or greater than $100,000 and is less than $250,000, the rate is 8%
When the value of the consideration is equal to or greater than $250,000, the rate is 10%
This tax is split between the vendor and the purchaser
3. The vendor's legal fees.
The legal fees on a sale or purchase are usually 2 1/2 % of the first $500,000, 2% of the next $500,000, 1% of the next $4,000,000 and 1/2% thereafter.
The Purchaser will be responsible for
1. 1/2 of the Government Stamp Tax as set out above,
2. The purchaser's legal fees as detailed above. This fee includes the lawyers Opinion on the title to the property.
3. Recording fees ($3.50 per page) on the conveyance and other closing documents which need to be recorded.
4. Payment of the permit under the International Persons Landholding Act if applicable.
In the event that the sale is a 'Net Sale' the purchaser would be responsible for payment of all of the above mentioned fees.
After I purchase a property will I be able to repatriate the proceeds of sale whenever I sell it?
Yes. You will be able to repatriate the entire proceeds including any profits provided you register the purchase with the Exchange Control Department of the Central Bank at the time of purchase.
Do I need any special approvals in order to build on a property or to make any changes to an existing structure?
Yes. You will need to obtain approval from the Town Planning Board and a building permit issued by the Ministry of Works. A local architect or engineer would be able to assist you with this.
Are there good qualified architects, contractors and engineers available in the islands?Yes. Most if not all architects in the Bahamas were schooled either in the United States, Canada or the United Kingdom and have international accreditations. There is a local licensing Board for architects. The leading contractors are all civil engineers with international accreditations or have certified engineers on staff. Many of the smaller contractors are products of a good apprentice system and are very adept and skilled at efficiently carrying out residential construction. Civil, mechanical and electrical engineers in the Bahamas, like the architects were schooled in other countries and hold international accreditations from those respective countries and must also have a license issued by their respective local Boards
May I use the services of a non resident architect?
Yes, but that architect cannot work in the Bahamas without a permit to do so. All building plans submitted to the Town Planning Board and the Ministry of Works must be signed off by a local licensed architect and local engineers. As in any jurisdiction there are local customs and procedures required in getting the job done and it is recommended that you utilize the services of the local professionals.
Are Brokers and sales agents in The Bahamas licensed?
Yes. Brokers and sales agents are licensed by The Bahamas Real Estate Association.Is there local financing available to non Bahamians and permanent residents?
Yes, but the loan facility may only be given in USDollars at international rates and the down payment required is generally on the order of 40% of value.
What taxes do you have in The Bahamas?
First and foremost we have no income tax, capital gains taxes or inheritance taxes. There is no sales tax with the exception of the Stamp Duty paid on the conveyance of real property.
The Bahamas Governments main source of revenue is from customs duties on all goods imported into The Bahamas. This tax may be as low as 7 % as in the case of raw lumber, computer software and as high as 75% in the case of luxury automobiles, 160% on raw tobacco and 210% on cigarettes. There is an additional 7% stamp duty payable on these goods. The typical rate of duty is around 35%.
There is also property tax.
The rates are as follows:
On owner occupied properties:
First $100000, nil
Next $400000, 1%
Excess over $500000, 1.5%
The rates of tax on other properties is,
First $100000, 1%
Next $400000, 1%
Excess over $500000, 2%
Is it possible to establish residency in the Bahamas and if so how does one go about it?
Yes. The Government of the Bahamas has set specific guidelines that allow non Bahamians to establish permanent residency in The Bahamas. There are two categories of permanent residency,
Permanent residency with the right to work and permanent residency with out the right to work. One of the criteria for permanent residency is the investment of a minimum of $500000 in The Bahamas. This investment may take the form of the purchase of real property with a minimum value of $500000. Non Bahamians who own property in The Bahamas may apply to the Director of Immigration for an annual homeowner's residence card. This card is renewable annually and entitles the owner, spouse and any minor child/children endorsed on the card to enter and remain in The Bahamas for the validity of the card. It is intended to facilitate entry into The Bahamas with minimal formalities.
What are the advantages to establishing permanent residency in The Bahamas?
Apart from the opportunity to live and work in a warm and pleasant environment there are also significant tax advantages for citizens of countries with high personal and corporate income taxes as well as inheritance taxes. The advantages vary depending on the citizenship of the applicant and the tax laws of the applicant's home country.
Is it possible to obtain Bahamian citizenship?
Yes it is possible, but it is a long and involved process. Typically favour is given to long term permanent residents and spouses of Bahamians.
Is it possible to live and work in The Bahamas?
Yes. But The Bahamas has a small young population. The total population of the Bahamas is less than 300000 with a total land area of 10000 square miles spread over 700 islands. The policy of the Bahamas Government is to protect the well being and provide maximum employment opportunities for Bahamians. In order to obtain a work permit to work in The Bahamas an employer must demonstrate that there is not a Bahamian able to fill the position.
The preceding FAQs are based upon information that we consider to be reliable, but we cannot represent that it is accurate and complete, and it should not be relied upon as such. When buying, selling or listing property for sale in The Bahamas one should first consult with the relevant local authorities or request an attorney to do so on your behalf.
Helpful links to other Bahamas and Out Island sites.General Caribbean and Bahamas site.Lots and lots of useful information about the area, info on Nassau, the Out Islands, real estate, marinas, golfing and lifestyle, with links to lots of other Caribbean and Bahamian sites.Bahamas land values.Land values in the Bahamas.
Bahamas property lots for sale.
Lots, land and property available in the Bahamas.Long Island Bahamas.The new marina and golf development of Port St George.Bahamas property prices.Island wide guide to current property prices.Golfing Bahamas.www.Golfingbahamas.com
Bahamian golf courses, lots of info here for both the golf pro and non golfers, marina developments, new resorts, boating, fishing links, sailing pages etc.General construction links
Export and import trade to the Bahamas.
Building materials can be exempted from customs duties under the Industies encouragement act and Tarriff act.
Family Islands Development Encouragement.
Details of exemptions and time limits re building materials re customs and stamp duty.