Have you ever been interested in owning property outside of Canada? Perhaps a beachfront resort home in a tropical destination? It’s easier than you think. There are many investment friendly countries that welcome foreign investment and some may even provide preferential immigration status. However, there are also countries that place significant restrictions on foreign ownership. Navigating global markets can be challenging and involves understanding not only the real estate market, but also political, economic, and cultural practices. Rest assured there are professionals both locally and abroad that can help you find your dream vacation property with minimal stress.
One investor friendly country that is worth exploring is the Bahamas. With over 700 mostly uninhabited islands, close proximity to the United States and Canada, and a tropical climate, the Bahamas is an excellent choice for investors looking to find a vacation home. It is one of the most prosperous countries in the Caribbean. First, it has no income, sales, capital gains, or inheritance tax. Second, it does not require government approvals for property purchases, unless there is a commercial purpose. Third, it allows foreign owners to apply for permanent residency for property valued at greater than $500,000 USD. Fourth, English is the official language making it easy to communicate for transaction purposes and while visiting. And fifth, the U.S. dollar is on par with the Bahamian dollar so there are minimal foreign exchange rate issues.
The Bahamas is an excellent choice for investors that wish to secure their investment dollars in a safe country. Some things to note though include that in the Bahamas, people drive on the left side of the roads (similar to the United Kingdom), which may prove challenging for Canadians. In addition, there are some taxes that investors should be aware of. Although the Bahamas is considered a low-tax country, it is not entirely tax-free. Owner-occupied property is only tax-exempt up to $250,000 USD. There is also a land transfer tax, called a ‘stamp duty’ on property transactions, which varies by amount. Nonetheless, the Bahamas is worth considering as an option for a vacation home, or investment purposes. For those interested in renting out their properties, its legal system is also very landlord friendly.
If you are considering purchasing property in the Bahamas, you will be pleased to know that the real estate market works in much the same way as in Canada. The real estate industry is very regulated and there is a Multiple Listing Service (MLS) for listings. One difference in the Bahamas is that commissions are set by the Bahamas Real Estate Association so there is no need to haggle over fees.
To learn more about investing in real estate in the Bahamas, or any other foreign country, be sure to seek out a REALTOR® in Canada that understands the international transaction process. Realtors with knowledge of international transactions are typically members of the Canadian Real Estate Association’s (CREA) Global Affiliate Program and/or global members of the National Association of Realtors (NAR) in the United States. In addition, many also have earned the Certified International Property Specialist (CIPS) designation. By working with an experienced Realtor, you can receive a high level of service and expertise, including referrals to member Realtors in other jurisdictions, who will work together to ensure your property transaction flows smoothly.