"Quick Guide to Buying Real Estate in the Cayman Islands"
By Jan Tomkins, Azure Realty
Buying real estate in the Cayman Islands is not just a dream or lifestyle purchase but a smart and sound real estate investment. There are no restrictions on foreign ownership of property, which coupled with the absence of taxes (no annual property, school, or capital gains taxes) makes investing in real estate very attractive for overseas investors.
A Quick Guide:
1. Choose a reputable, trustworthy, and well-educated real estate broker/agent that is a member of the Cayman Islands Real Estate Broker’s Association (CIREBA) to assist you in finding the perfect property. Many can help you with your real estate transaction from start to finish.
2. Determine your budget and if you’ll need a pre-approval for a local mortgage. In the Cayman Islands mortgage rates and terms vary from bank to bank, and it’s recommended to meet with a loan officer to obtain some level of pre-approval for a local mortgage. If you’re purchasing a property as a resident of another country, it is possible to obtain a local mortgage, but a larger deposit is usually required, between 25-40%. Interest rates offered by local banks are between 1-3% plus prime.
3. Total costs for your purchase can vary, but a realistic estimate is 9-12% of the purchase price for closing costs depending on the property and area. Additional fees may include a property valuation by a Cayman Islands professional valuer, which start at US$480. Life insurance may be required for your loan and start at US$180. Legal fees for the mortgage and closing costs are generally 1% of your loan origination amount.
4. Stamp Duty is a one-time fee to the Cayman Islands Government on the real estate value of the purchase price (not including chattels/furniture), it’s currently 7.5% and the largest expense at closing. If you require a mortgage for your real estate purchase, there will be an additional duty of 1-1.5% of the monies advanced.
5. Once your realtor has assisted you in finding your dream property, their expertise becomes invaluable to you as you move into writing up your offer and the contract negotiations.
6. Once the contract is non-conditional, you’re ready for closing. While some purchasers prefer to be on the island for closing, others choose a law firm for legal representation. In a straight forward transaction, your real estate broker can assist you.
7. Congratulations on the purchase of your new Cayman property, now you can relax and enjoy the tranquility of the island.
For all your real estate needs please contact Azure Realty 345-946-2987 or the Broker (Jan Tomkins) directly at 345-926-2626 for immediate assistance.