The Barbados real estate market is very active at the moment, however there are only a few active listings for properties within the price range of BDS$1.2 Million and below. This means that most of the properties on the market right now are going under offer even quicker!
It is best to hire a reputable and professional real estate agent that you can trust to work in your best interest. Global Estate Agency Inc. is led by Junior Sparks, a top producing and well connected realtor on the Island, with over 18 years of experience representing both buyers and sellers. GEA deals in all types of properties, including standalone houses, apartments, townhouses, multi-unit blocks and commercial properties.
In this blog post, we take you through the step-by-step procedure to secure a property in Barbados, from arranging your financing to closing the deal.
Step 1 - Get your financing in place
Do you need the help arranging a mortgage or loan? Ensure you get pre-qualified with a lender before touring homes and submitting offers. Sellers don’t take offers seriously when the buyer is not already pre-qualified with a lender, and it reduce your chances of getting accepted. It is best to seek financing before submitting an offer to know whether you qualify for the price region of the offer. If you are looking for a reputable lender in Barbados, you’ll be happy to know that there are a number of them offering competitive mortgage rates to citizens and international buyers. Hiring a reputable mortgage broker can make the process of securing financing much easier.
Step 2 – Note all of your important preferences
Now that your financing is secured, the next step is to make a list of all of your preferences in the order of importance. Ensure that the list covers everything, from how many bedrooms you need, to whether the location need to be close to work or school, to the type of property you are looking for. Do you want a house or apartment? Do you want to live in an open neighbourhood or gated community? Does the covenants allow pets or for commercial vehicles to be parked on the street?
Step 3 – Understand the buying process in Barbados
A professional realtor should explain the details of the buying process to the client. You should understand the various steps like making an offer, negotiation, and getting your offer accepted. Your agent would also let you know when to get your attorney and the seller’s attorney involved. You are required to hire a locally-registered Barbados attorney to represent you throughout the legal process of the sale transaction.
Step 4 – Choosing a Real Estate Agent
Refrain from hiring a random real estate agent from the yellow pages or after doing a Google search. Do your research to ensure that you will be dealing with a professional that holds their practices to a high standard and code of ethics. One sure way to achieve this is to choose a realtor who is a member of the Barbados Estate Agents and Valuers Association (BEAVA).
Being a BEAVA member comes with multiple advantages. The realtor has access to hundreds of listings on the island, outside of their own. This is because the Association has over a hundred members, and each agent can access the properties listed by other agents. Hiring multiple agents does not necessarily increase your chances of securing an offer, but can make it a bit messy as your name/property search gets duplicated within the same pool of agents for the same listings.
Step 5 – Viewing Properties
Keep an open mind when looking at properties. Have a vision before going on each tour so that you can look past the seller’s design and furniture choices when making a decision. Simple things like furniture can easily be changed but your focus should be on the structure and layout of the property.
Step 6 – Making an Offer
After finding a property that meets all your preferences, the next step is to make an offer as soon as possible. Inform your realtor about your budget and refrain from making a low-ball offer because sellers tend to feel insulted by this kind of offer and are likely to deny your request. Your agent will keep you updated with feedbacks from the seller.
Step 7 – Signing the Offer and Acceptance Form
If the response to your offer is positive, a document called an Offer and Acceptance Form must be completed and signed by the buyer and seller. If you aren’t a cash buyer, your lender would give you the all clear on when to involve your attorney and start the legal process.
Step 8 – Time for the attorneys to start the legal process
The sale transaction can only be executed when the property is passed on by conveyance of title, evidence by the recording of the deeds and certified survey plans at the registry of title. Attorneys fees are approximately 1.5% to 2% of the sale price, and each party is responsible for their attorney fees. Note that all attorneys work by a schedule of fees that are subject to 17.5% VAT.
After executing the Offer and Acceptance Form, your agent prepares and sends out the Attorney's Instructions to the lawyers representing both parties. The Attorneys' Instructions is sent via a document called a Memorandum of Sale, containing the necessary details for the legal process.
Most property sales take approximately 3 months to close, from the date of signing the sale agreement and payment of the 10% deposit. In some cases, transactions may take longer to close due to unforeseen complications.
Be sure to ask all the necessary questions and be duly informed before signing the sale agreement or making a deposit. You should exercise due diligence in checking the property for any faults. You can take extra measures to guarantee the quality of the property, like an inspection by professionals or doing test holes if you are buying a plot of land.