How to Build a Home in The Bahamas [2024 Guide]

house in the Bahamas
Mario Carey

The allure of The Bahamas is undeniable. With its vibrant culture, tropical climate, and breathtaking beauty, it’s a prime location for a serene escape. Now, imagine not just visiting, but building a home of your own in The Bahamas. Whether it’s a luxury mansion or a chic tropical hideaway nestled amongst lush greenery, we will guide you through the essentials of making that wish a reality.

We’ll cover everything you need to know from securing your desired piece of land, navigating legal procedures, working with reliable architects and contractors, to finally sitting back and enjoying your new Bahamian abode. Get ready to embark on this rewarding journey toward creating a home that reflects your taste and lifestyle in one of the most desirable locations in the world.

Why Build A Home in The Bahamas?

Whether you’re considering purchasing Bahamian land in The Exumas, Eleuthera, or any other Bahamas island, you’ll find many of the “must-haves” you’d want when building a home. Beyond the amazing weather, rich culture, and relaxed lifestyle, it’s also considered a tax neutral country, is close to the U.S., and offers excellent healthcare. 

Let’s get into some of the top benefits of building a home in The Bahamas. 

Investment Opportunities

The areas of real estate, tourism, infrastructure, financial services, sustainability, and agricultural and marine resources all provide ample opportunities to invest in The Bahamas.

The Bahamian government rolls out the red carpet for foreign property owners, offering minimum restrictions and a welcoming attitude towards investment. As part of its concerted effort to position the country as an alluring investment hub, the Bahamian government offers myriad benefits to foreign landowners: 

  • For properties up to two acres, foreign investors can purchase without needing prior approval from the government. 
  • When purchasing homes valued at $1.5 million or more, investors enjoy accelerated consideration for Permanent Residency status, processed within a mere 21 days.
  • Access to government-owned land for business development.

Reduced Taxes

The Bahamas is considered a tax haven because they are free from income, inheritance, gift, and capital gains tax. Instead of these, the Bahamian government earns through VAT (value-added tax), stamp and property taxes, import duties, and license fees. 

There are also concessions on border taxes for specific construction materials, equipment, and supplies, and even exemptions on real property taxes for defined periods. 

Beautiful Climate

The climate of The Bahamas is a big draw for tourists and investors alike. Average temperatures gently fluctuate between the refreshing low 70s Fahrenheit in the winter and the comfortably warm low 80s in the summer.

This agreeable temperature range contributes to the overall quality of life in The Bahamas and makes the location particularly appealing for investors looking for a high-end lifestyle or retirement destination. In the dry season, from November through April, you’ll experience less rain and generally warm, dry weather. 


How to Build a Home In The Bahamas

home construction

1. Review Restrictions and Regulations

Before embarking on your home-building journey in The Bahamas, it’s essential to familiarize yourself with the local restrictions and regulations. 

In accordance with the International Persons Landholding Act of 1993, all foreigners, including non-residents, are allowed to buy property in The Bahamas. It’s fairly straightforward, but there are instances when you may require a permit. These include situations where you’re buying land spanning more than two acres, if you intend to develop the land commercially, or plan to earn income through rent.

It’s worth noting though, permit or not, every overseas land purchase must be registered with the Foreign Investment Board as a mandatory step. If any of this seems daunting or if you need assistance understanding the specifics of permit requirements and the registration process, don’t hesitate to reach out. Our MCR team is well-versed in all these details and is happily available to guide you through your buying journey in The Bahamas.

2. Engage an Architect and Contractor to Understand Building Costs

Understanding the potential building costs is a critical step in constructing a home. Engage with a local architect and contractor who understands the Bahamian construction market. They would be able to provide you with detailed estimates relating to the design, materials, and labor costs involved. Their expertise will also ensure that your home design aligns with the local environment and building codes.

Other benefits of hiring an architect and local general contractor include:

  • Expertise and vision: An architect has the training and skill to produce a design based on your lifestyle needs, preferences, and budget. They can see the big picture, creating a cohesive design that ties all your ideas and needs together into a functional and aesthetically satisfying whole.
  • Quality assurance: A contractor brings a high level of craftsmanship and attention to detail. They ensure that the building will be durable and well-constructed, providing you with peace of mind regarding the structural integrity of your new home.
  • Regulatory knowledge: Architects and contractors are knowledgeable about local building codes, regulations, and the permit process. They can ensure your home design is compliant, thereby avoiding legal complications down the line.
  • Project management: Building a new home involves coordinating numerous tradespeople, materials, and timelines. A contractor takes care of this complex project management, ensuring work is completed on schedule and within budget.
  • Cost and time efficiency: Through their experience, architects and contractors can save you money and time. They can help prevent costly design mistakes, and their relationships with suppliers can potentially lead to cost savings on materials.

In essence, engaging an architect and a construction company reduces the stress of building a new home, ensuring the process is smoother, more efficient, and leads to a final result that mirrors your initial vision.

3. Find and Purchase Land

Island in Bahamas

As experts in the Bahamian real estate market, MCR Bahamas agents listen to your needs and steer you toward the best places to live. Some popular investment destinations include:

  • Nassau/New Providence: This bustling hub offers ample land for sale, including affordable single-family lots around the $100,000 range. Selecting the perfect neighborhood, however, can be a challenge. Don’t worry – our experienced Nassau real estate agents can guide you through the Nassau landscape with ease.
  • Exuma & Exuma Cays: Recognized for its stunning coastline visible from space and the world-famous swimming pigs, Exuma is an ideal place for investment, especially for eco-touristic development. The Exumas also offers several opportunities for buyers looking to invest in a private island. 
  • Eleuthera: Famous for its enchanting white beaches and laid-back vibe, Eleuthera draws travelers and expats alike, making it the perfect location for your luxury home or seaside villa.
  • Grand Bahama: Just a 3-hour ferry from Fort Lauderdale, Grand Bahama holds lucrative opportunities for commercial developments, especially near Freeport.
  • Bimini: Being incredibly close to Miami, Bimini offers itself as the ideal location for building a weekend island retreat to keep for yourself or as a seasonal rental.

Real estate agencies are incredibly helpful in a foreign market. They can give you the low-down on the latest neighborhood trends, up-and-coming developments, great investment opportunities, and more. At MCR Bahamas, we have an impressive roster of real estate agents that have lived and worked in various Bahamas neighborhoods.

Our agents are skilled in building long-lasting relationships with clients, have intimate knowledge of the Bahamian real estate market, and can provide you with resources that will guarantee you the best experience possible.

Contact MCR Bahamas to get started on the journey to your dream build.

4. Get Financing (If Needed)

Depending on your financial resources, you may need to secure financing for your home-building venture in The Bahamas. Numerous local and international banks offer mortgages and construction loans to foreign investors. Be sure to research loan terms and interest rates and consider speaking with a financial advisor to understand the best options for your situation.

Obtaining financing for your new build in The Bahamas isn’t difficult, but likely a little different from that of your home country. The biggest difference is that interest rate percentages and down payment amounts are generally higher, but they vary by institution.

For a new build, investors should expect to put down at least 50% of the land purchase price as a down payment, compared to the traditional 20% you’d put down when purchasing an existing dwelling back home. 

You can also expect to have the usual costs that come with purchasing a property including legal fees, appraisal costs, title search, registration, and home insurance.

5. Construction & Inspections

Once you’ve finalized your designs and secured financing, the construction phase begins. Before any ground is broken, however, you’ll need to apply for a building permit. There are fees associated with the application, which vary depending on the structure and its operations. The turnaround for a building permit is approximately 6-8 weeks. 

All builds must meet the minimum requirements set out in The Bahamas Building Code and must comply with the Buildings Regulation Act. This is why it is key to choose an architect and contractor that understands local legislation.

Furthermore, inspections at various stages of the construction process are mandatory and essential to ensure adherence to the building codes and standards in The Bahamas. Once the structure is ready for occupancy, the owner must apply for a Building Inspection and Occupancy Certificate. This application also has associated fees, but the turnaround is generally a week.

6. Understand Property Taxes

We’ve already mentioned that living in The Bahamas offers numerous tax advantages. The most significant benefit is the country’s lack of income tax on foreign earnings. This means income derived from luxury rental properties, investment properties, or other international sources remains untaxed. 

Plus, while The Bahamas does impose a property tax, it’s relatively insubstantial when compared to some cities in the United States, making it a competitively advantageous choice.

But that doesn’t mean there aren’t any taxes to pay. Investors can expect to pay Stamp Duty, VAT, and Real Property Taxes when buying property. 

  • Stamp Duty: This tax applies to property conveyances. For a property worth less than $100,000, the duty rate is 2.5%, and for a property worth $100,000 or more, the duty rate is 10%. In The Bahamas, it’s common practice for both the buyer and seller to split the duty equally unless otherwise arranged. Furthermore, first-time buyers may qualify for Stamp Duty exemption for residential properties or empty land intended for residential use, provided the value does not exceed $500,000. This is similar to the mortgage tax included in the closing costs of some US states.
  • Value-Added Tax (VAT): As of January 1, 2022, the Bahamian Government introduced a 10% VAT on all goods and services, including all property conveyances, commissions, and legal fees. It is a consumption tax, and while it has similarities to the US sales tax, it is administered at the Federal level.
  • Real Property Tax: This legally mandated tax must be paid as designated by the Real Property Tax Act to prevent interest accumulation. The Department of Inland Revenue conducts assessments to ascertain a property’s value and corresponding property taxes. This can be likened to the United State’s real estate tax. 


More About Building a Home in The Bahamas

Home in the Bahamas

How much does it cost to build a house in The Bahamas?

The cost of building a house in The Bahamas varies depending on the location, house size, and material used. As such, it would be important to consult with local construction professionals for precise cost estimates and the experts at MCR Bahamas to understand land pricing.

Can you build a prefab home in The Bahamas?

Yes, there is the option to construct a prefab or modular home in The Bahamas. These types of homes can offer time and cost benefits and are welcomed in the Bahamian construction landscape after meeting the necessary construction codes and permit requirements.

What kind of climate should you expect when building a home in The Bahamas? 

The Bahamas has a tropical maritime climate. When building, anticipate warm temperatures year-round, with higher humidity and rainfall in the summer months. It’s crucial to design a home fit for a hurricane-prone area, as the hurricane season runs from June through November, bringing high winds and rainfall.

Can U.S. citizens own property in The Bahamas? 

Yes, U.S. citizens are allowed to own property in The Bahamas. There are no restrictions on foreign property ownership except for undeveloped land acreage of five or more. It’s always wise, though, to consult with a Bahamian real estate lawyer for comprehensive insights and legal advice.

How long can you stay in The Bahamas if you own a home? 

Owning a home in The Bahamas doesn’t automatically grant residency. Homeowners are eligible to apply for a Home Owners Resident Card which allows annual residence in the country. 

If you’re looking to relocate to The Bahamas and permanently reside in the country, one of the most popular routes is by investing. If you’ve invested over $750,000 in real property, you are eligible to apply for Economic Permanent Residency.


Land for Sale in The Bahamas

Land for sale in The Bahamas is plentiful. Let us help you find the perfect patch on which to build your dream home. 

Browse Land for Sale in The Bahamas


Find the Perfect Place to Build a Home in The Bahamas

The Bahamas offers some of the most idyllic locations if you’re wanting to build in a tropical paradise.  

Whether you’re after a tranquil retreat or a lucrative real estate investment, MCR Bahamas is your trusted ally on your journey. We are committed to guiding you through every step of your property acquisition, ensuring a seamless transition into your Bahamian adventure. 

Let us help you build your dream home in The Bahamas!

Contact us at MCR

How to Build a Home in The Bahamas [2024 Guide]

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