About The Bahamas
When considering purchasing real estate in the Bahamas or any country it is important to be informed. We have included brief details below to help in your research.
Starting 60 miles off the coast of South Florida and stretching as far south as Cuba, Haiti and the Dominican Republic you will find the Bahamas. A coral archipelago of 700 islands, 29 of which are inhabited, and over 2,000 rocks and cays.
With a population of over 300,000 people, and with an adult literacy rate of 95%, The Bahamas, an English Speaking country, has a capable and adaptable work force.
The term, “Isles of June” has often aptly been used to describe the Bahamas due to its mild climate. Having a tropical maritime wet and dry climate, with slight incursions of mildly polar air, generally the Bahamas does not experience extremes of temperatures. The humidity is fairly high, especially in the summer months, but there is usually a pleasant breeze which lessens the humid effect. Rain showers can occur at any time of the year, but the rainy months are May to October. Rainfall is mainly in the form of heavy thundershowers, which clear quickly.
THE Bahamas has comprehensive and modern infrastructure, particularly on the two major islands, New Providence and Grand Bahama. Electricity and water are in abundant supply. Telecommunications services and facilities in The Bahamas are state-of-the-art, with direct international links provided through a 100% digital switching system.
The currency of the Bahamas is the Bahamian Dollar. Although all other currencies are foreign, the U.S. Dollar is readily accepted throughout The Bahama islands and is on par with the Bahamian Dollar. The Exchange Control is administered by The Central Bank of The Bahamas.
The Bahamas is a stable developing nation, according to a United States of Commerce report by the U.S. Embassy in Nassau. The economy is based mostly on tourism and offshore banking and other financial services. Retail and wholesale distributive trade, manufacture, agriculture and fisheries are the other major sectors of the economy. The Gross Domestic Product (GDP) of The Bahamas exceeds $3 billion, 60% of which comes from tourism related activities.
International Home Owners
Overseas investors may acquire up to 1.99 acres of residential property in The Bahamas without prior government approval. However, such acquisitions are required to be registered in accordance with the International Persons Landholding Act. Foreign homeowners are eligible for a ‘Home Owners Residence Card’, renewable annually for a small fee. This card will facilitate entry into The Bahamas and entitle the owner, his/her spouse and minor children to enter and remain in The Bahamas for the duration of the validity of the card. Application may be made to the Director of Immigration.
Annual or Permanent Residence
Accelerated consideration of applications for annual or permanent residence will be given to major international investors; and owners or residences valued at $500,000 or more.
If setting up a business in The Bahamas, necessary work permits for key personnel will be granted. Businesses requiring permits for persons other than key personnel are encouraged to discuss these requests with The Bahamas Investment Authority in advance.
Local Partners in Joint Ventures
International investors are encouraged to establish joint ventures with Bahamian partners. The choice of such Bahamian partners is at the absolute discretion of the investor.
Government Stamp Tax & VAT on Property Conveyances
Stamp Tax was reduced to 2.5% on all purchases in July 2015.
Purchases over $100,000.00 are subject to VAT of 7.5%
These taxes are shared equally (50/50) by the buyer and the seller, unless otherwise agreed.
Note that these taxes are subject to change.
All Bahamas real estate transactions must be performed by a licensed Bahamian Attorney. Both the buyer and the seller are responsible for 2.5% legal fees on the sale of property unless otherwise agreed. Please note that there is a minimum fee which should be discussed with your Attorney
Rates of Taxes
Property tax must be paid by Bahamians and non-Bahamians owning real property in The Bahamas. Returns are due on or before December 31 each year. These are filed with the Chief Valuation Officer. Taxes can now be paid online at http://www.bahamas.gov.bs or at the property tax office.
The rates on real property tax are as follows:
In respect to owner-occupied property:
- The first $250,000 of market value is tax exempt
- $250,000 and not exceeding $500,000 of market value is .75%
- Market value over $500,000 is 1%
In respect of unimproved property other than unimproved property exempt by virtue of Section 39 of the Real Property Tax Act:
- First $7,000 of market value is $100
- $7,000 and above of market value 1.5%.
In respect of any other property:
- First $500,000 of market value is 1%
- More than $500,000 of market value is 2%