Ben­jamin Nor­ris

and Paul Hamel-Smith

Trinidad & To­ba­go’s na­tion­al an­them was orig­i­nal­ly com­posed for the West In­dies Fed­er­a­tion. While the Fed­er­a­tion did not last long, the Caribbean Com­mu­ni­ty (or Cari­com) and the Caribbean Sin­gle Mar­ket & Econ­o­my (or CSME) has fa­cil­i­tat­ed the move­ment of peo­ple and busi­ness­es through­out the is­lands. In re­cent years, as a re­sult of the CSME, many Trin­bag­o­ni­ans have pur­chased or in­vest­ed in busi­ness­es and prop­er­ties in oth­er Cari­com mem­ber states, in­clud­ing Bar­ba­dos. In this ar­ti­cle we will an­swer some fre­quent­ly asked ques­tions that Trin­bag­o­ni­ans may have about pur­chas­ing prop­er­ty in Bar­ba­dos.

Q: Can non-res­i­dents pur­chase prop­er­ty in Bar­ba­dos?

A: Yes—non-res­i­dents can pur­chase prop­er­ty in Bar­ba­dos. Gen­er­al­ly, non-res­i­dents will first need per­mis­sion from the Cen­tral Bank of Bar­ba­dos. How­ev­er, there are cer­tain ex­cep­tions for qual­i­fy­ing Cari­com na­tion­als so each pur­chas­er should con­sult with a Bar­ba­dos-qual­i­fied at­tor­ney up-front. In any event, ob­tain­ing such per­mis­sion is typ­i­cal­ly a straight­for­ward and rou­tine part of the over­all pur­chas­ing process which your at­tor­ney can han­dle for you.

As a non-res­i­dent, can I get my mon­ey back out of Bar­ba­dos if/when I sell?

For­eign ex­change com­ing in­to Bar­ba­dos as a re­quire­ment to pur­chase prop­er­ty should be reg­is­tered with the Cen­tral Bank of Bar­ba­dos when the funds are brought in.

This reg­is­tra­tion will fa­cil­i­tate hav­ing the sale pro­ceeds re­mit­ted out of Bar­ba­dos on any sub­se­quent re-sale of the prop­er­ty. The reg­is­tra­tion of funds can al­so be han­dled by your at­tor­ney.

What does the typ­i­cal con­veyanc­ing process en­tail?

Af­ter a prospec­tive pur­chas­er has found a prop­er­ty they like and had an of­fer ac­cept­ed on it, their next step is to en­gage a Bar­ba­dos-qual­i­fied at­tor­ney if they have not al­ready done so.

The at­tor­ney’s pri­ma­ry role is to help the pur­chas­er un­der­stand and ne­go­ti­ate the pro­posed pur­chase agree­ment.

The pur­chase agree­ment will be pre­pared by the sell­er’s at­tor­ney and agreed to by the par­ties.

A de­posit of typ­i­cal­ly 10 per cent must then be paid in or­der to se­cure the prop­er­ty.

This de­posit is held by the sell­er’s at­tor­ney in es­crow on the sign­ing of the agree­ment un­til com­ple­tion of the sale.

The sell­er’s at­tor­ney will pro­vide the pur­chas­er’s at­tor­ney with copies of the ti­tle deeds to the prop­er­ty to al­low for the car­ry­ing out of in­ves­ti­ga­tions of the prop­er­ty in­clud­ing search­ing the Land Reg­istry in or­der to con­firm good ti­tle to the prop­er­ty.

In Bar­ba­dos, “good ti­tle” is an iden­ti­fi­able chain of own­er­ship with no breaks go­ing back at least 20 years and no charges or liens af­fect­ing the Prop­er­ty.

The pur­chas­er’s at­tor­ney will al­so “req­ui­si­tion” the sell­er’s at­tor­ney about any pos­si­ble is­sues, for ex­am­ple, whether there are all nec­es­sary plan­ning per­mis­sions, mak­ing sure all tax­es & util­i­ties are cur­rent and mak­ing sure there are no en­croach­ments.

The pur­chas­er’s at­tor­ney will al­so ex­am­ine any covenants af­fect­ing the prop­er­ty which might re­strict the way you want to use it.

The con­veyance, which ac­tu­al­ly trans­fers own­er­ship, will be draft­ed by the sell­er’s at­tor­ney. Af­ter a care­ful re­view, the pur­chas­er may sign the con­veyance.

If the pur­chas­er is sign­ing the con­veyance out­side of Bar­ba­dos, then they will have to sign it be­fore ei­ther a No­tary Pub­lic or Com­mis­sion­er of Oaths.

Pri­or to clos­ing, the line marks to the prop­er­ty are point­ed out to the pur­chas­er, or the pur­chas­er’s agent, by a Land Sur­vey­or ap­point­ed by the sell­er.

The land is al­so typ­i­cal­ly cleared of any over­grown bush and de­bris (if nec­es­sary). If the prop­er­ty is be­ing sold fur­nished, the pur­chas­er or the pur­chas­er’s agent is per­mit­ted a walk-through of the prop­er­ty to check and ver­i­fy that all items (as pro­vid­ed on an in­ven­to­ry list­ing) are present and in good re­pair (fair wear and tear ex­cept­ed).

At clos­ing, the signed con­veyance, pri­or ti­tle deeds and plan, along with any oth­er nec­es­sary doc­u­ments, are pro­vid­ed to the pur­chas­er in ex­change for the bal­ance of the pur­chase price.

At this stage ti­tle to the prop­er­ty pass­es to the pur­chas­er, and the pur­chas­er’s at­tor­ney will have the con­veyance record­ed at the Land Reg­istry.

* Please note: If a pur­chas­er plans on build­ing, or mak­ing ex­ten­sive ren­o­va­tions to the struc­ture of an ex­ist­ing prop­er­ty they must al­so ap­ply for Plan­ning and De­vel­op­ment De­part­ment per­mis­sion.

How long does it take?

The sale/pur­chase process typ­i­cal­ly takes be­tween three to four months once an of­fer has been ac­cept­ed. Tim­ing can be frus­trat­ing for all in­volved giv­en that ex­pec­ta­tions are am­pli­fied.

Typ­i­cal­ly, the pur­chas­er has fi­nal­ly found the place that they want to buy, and the sell­er is ready to get paid!

The sale/pur­chase process may be de­layed past the usu­al three to four-month pe­ri­od if there are en­croach­ments or is­sues re­lat­ing to the ti­tle which have to be re­solved by the sell­er’s at­tor­ney.

Poor com­mu­ni­ca­tion can al­so make the process feel longer than it should.

For these rea­sons, it is im­por­tant that all par­ties be con­tin­u­ous­ly kept in the loop of the le­gal process.

Can I get a mort­gage?

Yes. Non-res­i­dents can al­so ex­plore lo­cal lend­ing op­tions. If you are fi­nanc­ing your prop­er­ty pur­chase, it is rec­om­mend­ed to pre-qual­i­fy as this may give you a bet­ter idea of your ul­ti­mate bud­get.

It can al­so help avoid de­lays (and pos­si­ble heartache) in the sale/pur­chase process.

A pur­chas­er who is fi­nanc­ing will al­so need to cov­er the lender’s le­gal fees in hav­ing the mort­gage pre­pared and for the lender’s own in­de­pen­dent ver­i­fi­ca­tion of “good ti­tle”.

What are the rel­e­vant tax­es, fees and ex­pens­es that I can ex­pect?

At­tor­ney’s fees are usu­al­ly 1 per cent to 2 per cent of the pur­chase price of the prop­er­ty plus VAT.

In Bar­ba­dos, these fees are de­ter­mined by ref­er­ence to a min­i­mum scale of fees set by law.

It is worth not­ing that there are po­ten­tial sav­ings if you use the same at­tor­ney in mul­ti­ple roles (ex­am­ple: act­ing on your be­half for the mort­gage and al­so in the pur­chase).

Land tax is payable on an an­nu­al ba­sis and vary by prop­er­ty. Land tax for the year will be ap­por­tioned be­tween pur­chas­er and sell­er as at com­ple­tion. The sell­er’s at­tor­ney will pro­vide a copy of the most re­cent land tax bill.

Stamp Du­ty and Trans­fer Tax on the con­veyance/trans­fer of the prop­er­ty it­self is the sell­er’s re­spon­si­bil­i­ty (please note, this dif­fers from Trinidad & To­ba­go where the tax­es are typ­i­cal­ly borne by the pur­chas­er). Please al­so note that the pur­chas­er must pay Stamp Du­ty on any mort­gage at $6 per $1000 as well as le­gal fees on the mort­gage of ap­prox­i­mate­ly 1 per cent.

When should I in­sure the prop­er­ty?

Ear­li­er than you might think. Un­less oth­er­wise agreed, from the ini­tial pur­chase agree­ment (ie when you pay the 10 per cent de­posit) the “risk” of the prop­er­ty pass­es to the pur­chas­er so from this point you should have cov­er­age over the prop­er­ty.

Some­times it will be an eas­i­er op­tion to keep the sell­er’s in­sur­ance in place un­til com­ple­tion and pay a pro­por­tion­ate part of their pre­mi­um while seek­ing to put your own in­sur­ance in place.

Can I pur­chase through a Com­pa­ny?

Yes, prop­er­ty can be owned by in­di­vid­u­als, by lo­cal­ly reg­is­tered com­pa­nies, or by a com­pa­ny in­cor­po­rat­ed over­seas and reg­is­tered here ex­ter­nal­ly. Lo­cal com­pa­nies and ex­ter­nal com­pa­nies are con­sid­ered res­i­dent for the pur­pos­es of buy­ing prop­er­ty and do not re­quire ex­change con­trol.

How­ev­er, per­mis­sion is need­ed for a lo­cal com­pa­ny to is­sue shares to a non-res­i­dent.

This is al­so typ­i­cal­ly a rou­tine process that can be han­dled by your Bar­ba­dos-qual­i­fied at­tor­ney. It is al­so a good idea to ob­tain tax ad­vice if you are con­sid­er­ing us­ing a com­pa­ny for your prop­er­ty pur­chase.

Do I need to wait un­til

the pur­chase is com­plete

to move in?

Usu­al­ly, yes. How­ev­er, ear­ly pos­ses­sion is ne­go­tiable. This may be sought when the pur­chas­er doesn’t want to find al­ter­na­tive liv­ing ac­com­mo­da­tion pend­ing clos­ing.

In prac­tice, sell­ers may re­sist ear­ly pos­ses­sion be­cause if the sale falls through it makes it hard­er to aban­don the process.

Ben­jamin Nor­ris and Paul Hamel-Smith are at­tor­neys at Hamel-Smith Caribbean, sis­ter firm of M Hamel-Smith & Co. Ben can be reached at ben@caribbean­law.com and Paul at paul@caribbean­law.com.

Dis­claimer: This Col­umn con­tains gen­er­al in­for­ma­tion on le­gal top­ics and does not con­sti­tute le­gal ad­vice.