Few places offer real estate investors the kind of stable returns that Barbados has and continues to offer. The small Caribbean nation has an area of only about 70 square miles and a population of around 340,000 people. The country’s economy is heavily dependent on tourism, with over half of its GDP coming from this sector alone and was recently named one of the top 10 tourist destinations by Lonely Planet.
Barbados Real Estate Market Overview
The Barbados property market is currently experiencing some very positive growth. This is largely due to the fact that there are many new developments being built across the island. These include luxury homes, apartments, townhouses, villas, condos, and more. There are also several large projects under construction which will add even more properties to the market. Firms like Residence Barbados help buyers and speculators navigate all their options, from fractional ownership to high-end seaside villas; as well as the paperwork required to see the purchase through.
The Real Estate Market Today
Today, the current average house price for Barbados is $250,000, but this number varies depending on where you live. Homes in the capital city Bridgetown can cost as much as $500,000 while those in other areas of the island may be less than $100,000. That said, if you are interested in luxury properties in the finest of resort communities, costs can easily extend into the millions and even tens of millions of dollars.
Why Invest in Barbados?
Barbados is known for its beautiful beaches, warm weather, friendly locals, and great food. However, what makes Barbados such a popular place to invest in is its stable economic environment. While the rest of the world struggles through slow or negative economic growth, Barbados continues to experience strong economic expansion.
In fact, the International Monetary Fund predicts that Barbados’ economy will grow at a rate of 4.5% per year between now and 2023. That means that the value of your investment will increase significantly during this time period.
Barbados is one of the most attractive destinations for high-net-worth individuals looking to invest offshore. With a strong economy, low taxes, and an English-speaking population, it’s no wonder why many wealthy people choose to make their home here. In fact, according to Forbes Magazine, the average net worth of residents living in Barbados is $2 million.
The Government of Barbados recognizes the importance of attracting investors to the country and has taken several steps to encourage investment. This includes offering tax incentives to those investing in real estate and allowing foreigners to purchase land freehold or leasehold.
In addition, there are specific requirements for obtaining residence permits in Barbados, including having sufficient funds to support yourself during your stay. To qualify for a permit, you must prove that you have enough money to live comfortably while working in Barbados. You must also show that you intend to work in Barbados and return to your home country every three months.
4. Well Established Real Estate Market
Barbados has a well-established realty sector with an excellent international reputation, ranging from ultra-luxury through to the more affordable ends of the market. There are properties for sale throughout the island including contemporary houses, villas located on the beach and golf courses, resort condos and serviced apartment blocks as well as elegant period residences such as historic plantations brimming with character. It is currently a buyers’ market offering great value to property owners looking to invest.
SERP (Special Entry and Reside Permit)
The Barbados Immigration Service introduced SERP (Special Entry & Reside Permit) in 2012. This program allows individuals to apply for a residence permit based on the fact that they are wealthy enough to invest in Barbados. To qualify, applicants must be either (a): A high net worth individual – defined as having a personal wealth of $5 million USD or greater; or (b): Owner of real estate or investments valued at $2 million USD or more.
In addition, the applicant must demonstrate that the funds used to purchase the property or investment originated from outside of Barbados and that the funds are intended to make further investments in Barbados. If approved, the application process takes approximately six months to complete.
No Tax on Capital Gains & Low Transfer Taxes
Capital gains are not taxed in the British overseas territory of Barbados. There is no capital gains tax in Barbados.
This means that there is no taxation on gains arising from the sales of properties in Barbados.
If you invest in a property here and sell it for a gain later, you won’t pay tax on the profits. In Barbados, transfer taxes are levied on the sellers and stamp duty is payable by the buyers.
Foreign currency being used for buying real estate can be registered to the Central Bank of Barbados. This makes it possible to repatriate the invested funds on resale.
Mortgages in Barbados
Barbados is one of the most expensive places to buy a house in the world. A recent report by the Economist Intelligence Unit ranked Barbados as the most expensive place in the Caribbean to buy a residential property. However, there are ways around the high cost of living here. One way is to look into getting a mortgage.
A recent article in the Barbados Advocate highlighted the fact that foreigners looking to invest in Barbadian real estate could qualify for a mortgage. This is because Barbados does allow some people to obtain a mortgage without having to live in the country.
The article pointed out that a number of banks offer mortgages for non-resident buyers. These include First Citizens Bank, Barclays Bank, BMO Financial Group, HSBC, Royal Bank of Canada, TD Bank, and Westpac.
If you plan to finance a purchase in Barbados, make sure you do your homework. You want to find a bank that offers competitive rates, good customer service, and a loan officer who understands how to help you navigate the process. If you want assistance, reach out to the team at Residence Barbados.