How to Buy a Home in Nassau, Bahamas

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Partner, Licensed Real Estate Agent at Better Homes and Gardens MCR Bahamas

Timothy Smith was born and raised in Nassau, Bahamas to a respected real estate family.At 25, Timothy had already achieved the goal of Top Rookie of the Year at MCR Bahamas. Just one year later, he achieved the highest honor in the firm as Overall Top Producer of the Year. He won this award again the year after in 2020. In 2021, Timothy Smith was appointed as Partner of the firm and has established himself as one of the most respected Real Estate agents in The Bahamas.

Why You Should Buy a Home in Nassau, Bahamas

Nassau is a true island metropolis; the perfect mix of a big city seated in a tropical paradise. As the capital city of the Bahamas, Nassau is the central hub of business, education, government, and arts. Over 70% of the total population of the Bahamas lives in Nassau, contributing to its vibrant culture.

As if the perfectly temperate weather, stable government, and tax-neutral status aren’t reasons enough to want to move to The Bahamas, there are many reasons people put down roots in Nassau. Some financial benefits include:

No income tax
A homebuyer can obtain permanent residence by purchasing a property.
If you choose your investment property wisely, you could get an exceptional rate of return should you decide to rent out the property.

And of course, the lifestyle is incredible. If you’re an ocean lover, then the Bahamas has got you covered. The archipelago’s breathtaking pink and white sand beaches are arguably some of the finest in the world.

The opportunities are endless for the water sports enthusiast, from kayaking to stand-up paddle boarding to water skiing. Off-shore glittering ocean waters are tailor-made for snorkeling, diving, fishing, sailing, parasailing, etc.

If that hasn’t sold you, some of the best golf courses in the world might. Or you might be more interested in the wide variety of dining, nightlife, shopping options, and must-see places to visit.

As previously mentioned, buying a house provides you with a route to obtaining a residency, allowing for a seamless transition to retiring in the Bahamas. With a minimum home purchase of $750,000 you are eligible to receive permanent residency.

If you were to double that offer and invest $1.5 million, then your application process would qualify for an Accelerated Consideration for a Permanent Residence certificate.

But if you’re more of an investor looking to generate passive income, the Bahamas is still a great option because it is one of the Caribbean’s top tourist destinations. So, whether you rent out seasonally or through Airbnb, you can see a profit: The Bahamas has experienced steady growth over the last few years.

In fact, in 2019, they recorded a record 1.78 million stopover visitors.

What is the real estate market like in Nassau in 2022?

In Nassau–and truthfully many of the islands–there’s already a lot of activity in the market, and experts predict continued growth. Plus, the strength of tourism continues to generate significant demand for accommodation, which allows homeowners to line their pockets further by taking advantage of the vacation rental market.

If you’re willing to spend upwards of $700,000 and work with a luxury real estate company you can trust, you’ll have your pick of the litter, considering it’s currently a buyer’s market

What to Know About Buying a Home in Nassau, Bahamas

Home Purchasing Costs

Nassau has the largest selection of properties–inland and beachfront–even if they are more expensive than the Out Islands.

Property price varies greatly depending on which area of Nassau you’re looking in. For example, in New Providence it can be hard finding beachfront homes because they are mainly limited to high-end gated communities like Lyford Card, Old Fort Bay, and Paradise Island. These properties can cost upward of $2 million and are more often in the $3 million range.

For a more affordable option, take a look at beautiful beachfront condos, which start at around $300,000.

How Long Does the Buying Process Take

It doesn’t take very long for the buying process to move along. Generally, it may take up to two months.

However, what extends closing processes are issues such as needing mortgage financing. If you can secure your financing ahead of time, that makes the process much smoother overall.

Foreign-Owned Property Requirements

To start, read up on the requirements and pinpoint what you are particularly looking for in an investment property or home. From there, get in touch with a licensed realtor who has experience working with foreign buyers. The realtor will also be able to help you get in touch with a well-qualified lawyer.

Unlike most countries in the Caribbean, foreign buyers don’t require any licensing or permits to purchase a home in the Bahamas. The exceptions are the purchase of over 2 acres of land, anyone who purchases with the intent to rent out the property or buying for commercial development.

For a more in-depth look at what to know about buying an investment property in the Bahamas, head here!

Find Your Ideal Property

Beauty is in the eye of the beholder, so consider the characteristics that embody your idea of the perfect property. Peruse our 3D and video tours, and contact us to help you through every part of the buying process.

Paradise Island and the beaches close to Nassau, like Cable Beach, are extremely popular if you want to be close to the fun and action. If you’re looking for a quieter destination to refocus your energy on yourself or just want to get away from the hustle and bustle of city life, look no further than peaceful Eleuthera and tranquil Exumas.

If you require a more luxurious experience, take a gander at Lyford Cay, Old Fort Bay, Albany, and Paradise Island. These areas are renowned for their exclusivity and refined luxury.

MCR Bahamas agents have full access to all of the properties listed for sale, as well as many properties that are not publicly listed. By working with MCR Bahamas, potential buyers will have a greater likelihood of finding their dream home where they can enjoy the incomparable beauty and charm of the Bahamas.

Consider a Mortgage or Loan

Whether you’ve been saving up for a Bahamas home for a while, or are a first-time home buyer, definitely consider a mortgage or home loan. Multiple reputable banks offer loans to residents as well as foreign buyers in the Bahamas.

It’s always wise to get pre-approved for your mortgage. Why? Because if you can afford to pay upfront on new construction, cash buyers may get discount benefits on the property’s asking price.

Mortgages work much the same as you would expect at home – except mortgage terms are 15-20 years. Once they receive your application, the lender will conduct the usual checks to ensure you are eligible for a mortgage.

Know that you might have higher interest rates than you would typically receive back home, and make sure to ask your mortgage lender any questions you have before signing.

Submit an Offer

At this point, you can start your search. Whether remotely or in person, MCR Bahamas is very happy to work with you to find your ideal home. We’ll walk you through the available offerings, and once the buyer selects their desired residence, MCR Bahamas works on the client’s behalf to obtain the most favorable terms and remains as client representative throughout the transactions.

Work with a Local Law Firm

If you’re unfamiliar with local laws and need some guidance, it’s never a bad idea to ask your realtor if they know any local lawyers or law firms. We often recommend that people seek advice from a local lawyer to ensure all of their title documents are correct.

Finalize all Taxes & Fees

The Bahamian Government is committed to the continued development of a modern economic environment where free enterprise can flourish. The Government serves as the regulator and facilitator of the economic development of The Bahamas, focusing on the ideals of transparency and fair play in business.

Of course, this is going to include fees and taxes you want to take in account when purchasing a Nassau home.

Stamp Duty

All real estate transactions in the Bahamas incur Stamp Duty and Value Added Tax (VAT), with a couple of exemptions. The rate payable depends on the value of your property, as follows:

Up to $100,000: 2.5%
Over $100,000: 10%

Exemptions include the transfer of a home mortgage, and first-time homeowners.

A 10% VAT (Value Added Tax) applies to real estate services, such as appraisals, legal services, commissions, and insurance.

Traditionally, the VAT costs are split 50/50 between buyer and seller.

Real Property Tax

There is a requirement to pay an Annual Real Property Tax according to the value of your property. The calculations are as follows:

Owner-occupied properties:

For the first $250,000 of market value: 0%
For the next $250,000 up to $500,000 of market value: 0.625%
For the next $500,000 up to $5,000,000 of market value: 1%
For the part above $5,000,000 of market value: 0.5% (capped at $50,000 p.a.)

Unimproved properties:

For the first $7,000 of market value: $100
For the part above $7,000 of market value: 2%

Other properties:

For the first $500,000 of market value: 1%
For the part above $500,000 of market value: 2%

Register with the Exchange Control at the Central Bank of The Bahamas

If you are a non-Bahamian purchasing, make sure to register your investment with the Exchange Control at the Central Bank of the Bahamas. This step helps ensure that if you resell the property they will be able to remit the net proceeds of the sale outside the Bahamas in the currency of the original investment.

Conclusion: Find Your Nassau, Bahamas Dream Home Today

So, now that you’ve found your dream destination and you’ve come to the realization that Nassau, Bahamas is the place to be, it’s time to make your first move.

Whether you want to find that luxurious resort condo or if you’re looking for oceanfront apartments or opulent waterfront estates, the Bahamas has it all. If you’re looking for a luxury home in Nassau, contact us at MCR Bahamas so we can help!