Before you start the process of home or property ownership in Barbados, outside of the obvious prerequisite of investment capital, be prepared to embark on an educational, numerical and perhaps even emotional journey. I recommend that you start off by reading this book and then, after establishing some clarity of intent, which includes the purpose for the property, size, area and type of property, start doing your own research and don’t be afraid to ask a lot of questions.
The following is a basic “cheat sheet” on the sales process and some considerations and tools to get the investment process off on the right foot.
1. Arrange your finances. Decide on what you can comfortably afford. If you will require financing, make sure that you consider the fees and interest for a mortgage. If you need a mortgage, visit your bank or financial institution and determine the best price range for your needs and budget. Make sure to be pre-approved for the maximum number in this range
2. Find a reputable agent. You do not need more than one real estate agent. Your agent should be your partner from the beginning to the end of your real estate journey. In the Barbadian context, the agent that you select should be a recognized, approved agent of the Barbados Estate Agents and Valuers Association. To find the list of approved agents, you can visit www.beavainc.com. All BEAVA agents co-broke each other’s properties and therefore, they can offer you whatever is listed by other BEAVA agents. It is less stressful for you to deal with one agent who you feel comfortable with and trust, rather than working with several agents who may be showing you properties that you have already seen with another agent.
The right real estate agent will help you do the following in a timely and efficient way:
- Find the right place to fit your budget
- Provide helpful information about Barbados including information on neighbourhoods, security, infrastructure and schools as well as more technical information.
- Answer all questions pertaining to real estate
- Negotiate with sellers, so that you can get a fair price that fits your budget. Offers should be made to sellers on your behalf
- Represent your needs
- Either independently or with the support of your agent, take time to carefully consider what type of property you like, need and can afford. The location, number of bedrooms and amenities are critical considerations. Also consider whether you might want to purchase a stand-alone villa, a town house or a condominium. Consider the type of neighbourhood that you would like and whether you would like a resort or gated community.
- Determine how you would like to use the property— will it be an investment property? Your holiday home or will you be staying in it long term? If it is for investment, will you be trying to flip it, or will you be using it for short or long-term rentals? Will it remain empty when you are not staying in it?
- When you have found a property of interest, you will need to ask your agent the following questions:
- Does this property meet my needs; i.e., can I rent it short term/ long term?
- Can I have animals?
- Is this house suitable for children?
- Can I operate a business from the property?
- Are there any concerns about this property?
- Does the property require a structural survey?
- What is a fair price for this property?
- What is the initial offer that I should make?
- You will need to hire an attorney who is a member of the Bar Association. Your agent will be able to recommend 2 or 3 attorneys who they have previously done business with and can vouch for their reputation and their track record for closing sales in a timely manner.
- Once the negotiations are complete and a price has been agreed to between the purchaser and vendor, an offer document will be provided by the agent to the purchaser who will complete the document with the required information, which will include but not be limited to the following: name(s) of the purchaser(s) or company purchasing, address and director(s) if it is in a company name, the price of the property with any provisions and a signature. The Offer document will be forwarded to the vendor, who will sign as having accepted the offer. Two pieces of ID and proof of address are required for the Agents records, as is the law in Barbados
- The signed offer document is included with the agent’s instruction letter to the vendor’s attorney.
- The vendor’s attorney will draw up a contract and provide it to the purchaser’s attorney who will vet the contract, discuss it with the purchaser, decide on a closing date and make any necessarychanges.
- The contract is returned to the vendor’s attorney who will vet the changes and discuss with the vendor. When both parties agree with the contract, it is signed by both the vendor and the purchaser and a 10% deposit is paid to the purchaser’s attorney.
- Both attorneys are required to conduct due diligence on the property and financial records should the property be owned by a company. Once everything is in order, the balance of all monies owed will be paid to close the sale. All foreign transactions are recorded by Central Bank in the name of the purchaser. The landmarks are pointed out by a land surveyor to the purchaser or the agent acting on behalf of the purchaser. The keys are then handed to the purchaser or their representative.
Other tips
- Don’t decide based on a photo alone. Make sure to schedule a trip to Barbados and see the property that looks appealing online or on paper.
- If you are considering building, note that building is not always cheaper than buying or renovating.
- When factoring in costs, consider the services of a good property manager, especially if you do not plan on living in Barbados full time.
- Do not exceed your budget. In a worst-case scenario, you can start small and renovate over time.
