In 2022 the PLP Government budget announcements brought some exciting change to the cost associated with buying real estate in the Bahamas. These welcomed changes made the purchase of real estate a bit easier for buyers with value added tax fees on conveyance amount be rated on a sliding scale.
While this is exciting news and shrinks the cost of acquisition slightly there are still a number of other costs to consider when purchasing.
Downpayment | 5-10 Percent This takes the property off the market and represents the portion your financial institution won't finance. A number of institutions minimum downpayment is 10% and it appears at the moment the only institutions using a 5% downpayment requirement is
Legal Fees | 5 Percent
Your attorney who needs to be on the list of your chosen bank will provide you with two services both of which costs about 2.5% plus vat totalling 5.5% when paired together. That five percent does not include some minor charges like copies and disbursements costs.
Appraisal & Commitment Fee | 1.5% You will need to obtain an appraisal report from a firm that is on your banks list, this could usually cost about $500 not including vat depending on the size of the house. After your mortgage is approved the bank will call you in to make a payment for your commitment fee which is about 1% of the purchase price.
In an example of a home purchase of $300,000.00
Downpayment | 5% - $15,000
Value Added Tax | 3% - $9,000
Legal Fees | 5.5% - 16,500
Miscellaneous | 1.5% $4,500
You will need about $45,000.00 in savings to be able to make this purchase happen. Now keep in mind that these numbers can change slightly depending on a number of factors but these give you a general feeling of where you will need to be in savings for a local purchase in 2023.
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