International buyers benefit when Coldwell Banker Bermuda Realty guides them through the often complex rules determining who may buy property in Bermuda.
The main thing to remember is that there are two categories of residential real estate in Bermuda: Real estate that is available only to Bermudians and real estate that also is available to international buyers.
From this simple distinction it gets more complicated. The following summary of additional requirements, exemptions and exceptions gives you an idea of how helpful it can be to have a knowledgeable real estate professional help navigate the process.
- To be eligible for purchase by an international buyer, a property’s annual rental value (ARV) must exceed a designated amount ($25,800 for a condominium, providing the buyer has a Residential Certificate, $126,000 for a house).
- International buyers may also buy property in a development designated under the Bermuda Immigration and Protection Amendment (no.2) Act 2010 as tourist accommodation and hotel residences (resort hotel).
- Prospective international buyers must submit an application along with a consideration fee.
- The cost of a License to Acquire varies depending on the type of property you wish to purchase. Fees are set at the following rates:
- 6.5% of the purchase price of a condominium resort hotel;
- 8% of the purchase price of a house;
- In addition to the License fee there are the normal closing cost plus stamp duty and legal fees, your Coldwell Banker agent can estimate these costs based on the purchase price.
- The starting price for resort hotel condos for International buyers is around $375,000 and for houses the starting price is around $2,500,000.
- Agreement in principle between an international buyer and seller includes a deposit of 10% of the purchase price. The deposit is held in escrow, subject to contract, and deducted from the overall purchase price.
- International buyers may NOT buy investment property such as land, commercial real estate or property intended mainly to earn rental income unless they obtain an Economic Investment Certificate and the investment is approved by the Bermuda Government.
- International owners may be granted permission to rent their property by the Immigration Department. Permission rarely extends to periods of more than a year and includes a tax of 7.25%. Resort hotel condos are available for rental as per the Hotel Management Contract.
- A Non Bermudian working in Bermuda on a work permit currently is unable to purchase a condominium, except in hotel condo developments.
Effective 1st March 2021 “The Economic Investment Certificate and Residential Certificate Policy” replaced the 2003 and 2015 Residential Certificate policy.
What has changed
- Leasehold condominiums are now NOT available to overseas buyers unless the buyer already has a Residential Certificate or if the condominium is located in a Government approved resort residential development.
- If an overseas buyer wishes to purchase a leasehold condominium outside of a resort residential development effective 1st March 2021, they must invest $2.5M in order to trigger the process. An application will have to be made for an Economic Investment Certificate and a Residential Certificate will be granted in 5 years at which time they can purchase a leasehold condominium located outside of a Government legislated resort residential development, subject to ARV threshold policy .
- At five years, the holder of an EIC would be eligible to apply to The Minister responsible for immigration for the right to reside indefinitely in Bermuda. If successful, a Residential certificate will be granted by the Minister.
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