Road to Ownership: Your Guide to Buying Property in Barbados

Where do I start? What’s my next step? What are my options? If these sound familiar, you are not alone. Many buyers, whether purchasing their first home or a second property, share similar uncertainties. We understand the hurdles and are here to guide you through each stage of the buying process in Barbados.

Step 1 – Understanding Your Purchasing Power 

The first step in buying property in Barbados is understanding your purchasing power. If you require financing, it’s wise to shop around for the best interest rates. In 2023, interest rates for mortgages in Barbados ranged between 3.5% and 7%. Securing a mortgage certificate prior to viewing properties will help clarify your budget. It is also important to note that while some financial institutions offer mortgages to foreign buyers, the options are limited compared to those for residents. Be prepared to discuss employment/ownership, income (employment or otherwise) and liabilities (loans, car payment(s), credit cards – yes! credit cards can impact how much you qualify to borrow). Your financial institution will require a credit check so transparency is key.

Step 2 – The Role of a Real Estate Agent

A knowledgeable local real estate agent can be an invaluable resource. They provide insights into Barbados’ property market, help you find suitable listings, including discreet listings, and guide you through negotiations and offers. Additionally, they coordinate property viewings, answer questions about the area, and make sure you’re aware of any property-specific considerations. It’s also essential to understand the associated costs, including attorney fees, inspection fees, property valuations (for financing purposes), and closing costs. Their network of attorneys, contractors, bankers, and valuers ensures you have the necessary support at every step.

Step 3 – Inspection and Due Diligence 

Before making an offer, discuss with your real estate agent what type of due diligence is best depending on the property you are purchasing. For example, if purchasing a plot of land, test holes would be the suitable next step. If purchasing an already existing home, the recommendation would likely be to conduct a property inspection to identify any issues that may require repairs.

Step 4 – Making an Offer and Negotiation

Once you’ve found the right property, your agent can provide comparable listings to inform your offer decision. Our Q1 & Q2 2024 Market Report indicate discounts  averaging 3.3% off the listing price , depending on market conditions and the property’s location. When you’re ready, you’ll sign an offer and acceptance form, a non-binding document that indicates your intent to move forward with the purchase. Once the offer has been accepted, the sale will be instructed between your attorney and the seller’s attorney.

Step 5 – Market Valuation

When seeking a mortgage, a market valuation is important. The valuation process includes a property inspection, measurements, and research on comparable properties, helping to determine an objective market value. Quite often there is a perspective that the valuation should be a particular figure, higher, lower or equal to the purchase price. The valuer will provide you with a report based on evidence with an assessment of the market value for the property, keep in mind that this is an advisory tool, informing both you and financial institutions of the property’s value based on current market conditions. Learn more about valuations here: Property Valuation 101.

Step 6 – Legal Requirements 

Engage an attorney who deals with conveyance to handle the legal aspects of the purchase.  Legal fees in Barbados for conveyancing typically range from 1-2.5% +VAT of the property value. The exchange of contracts and 10% deposit typically happens within two to four weeks. Also, bear in mind that you are responsible for the legal fees of the financial institution if using one.

Step 7 – Closing the Deal

The closing process in Barbados typically takes 3-6 months, from the initial offer to the transfer of ownership. After completing all legal checks and payments, the transaction moves to the closing phase. At this stage, the final balance is paid, ownership is transferred, and the property title is registered in your name.

Step 8 – Enjoying Your New Home

Once the purchase process is complete, you can settle into your new home. Whether for vacations, rental income, or permanent residence, owning property in Barbados offers both personal enjoyment and investment potential.

Owning property in Barbados is a rewarding journey, and with the right preparation, it can be a seamless experience. Whether you’re drawn to a beachside retreat or a neighbourhood setting nestled among modern conveniences, understanding each step empowers you to make confident, informed decisions.

Ready to get started? Reach out to a Terra agent for personalized guidance, access to exclusive listings, and expert assistance at every step. Our team is here to help you turn your vision of Barbados property ownership into a reality.