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10 Reasons to Buy Property in the Cayman Islands.

If you are thinking about buying property in the Cayman Islands as an investment, a second home for holidays or if you are looking to relocate, here are ten reasons why you are making the right choice.

Grand Cayman The Cayman Islands

10 reasons to move to the Cayman Islands

1. It’s always warm

Cayman’s tropical climate is a huge draw for people from North America and Europe, in particular. It’s nearly always sunny, rarely dips below 80 degrees Fahrenheit and very often there are days when there are simply no clouds at all. Paradise.

2. Cayman has outstanding beaches

Seven Mile Beach was recently named as one of the Best Beaches in the World by TripAdvisor’s Travellers’ Choice Awards. Even if you have a highly stressed job by day, there’s no reason why you can’t enjoy Cayman’s stunning beaches at the weekend or even for an early morning/late evening stroll or swim. They are always just a stone’s throw away.

3. It’s a diverse and interesting population

Cayman’s population is made up of over 100 nationalities, so you get to meet and know people from all around the world, appreciating their cultures and customs.

4. It’s a brilliant place to bring up kids

Private schools are excellent and follow either the British or American curriculum.

5. There’s so much to do

If you are into sports there’s a club or society for pretty much every sport, from rugby to squash, tennis to cycling. Yoga, fitness and weight training are hugely popular, as are running and jogging, dance, horse riding, kite surfing, boating and jet skiing.

6. It’s a safe environment.

The crime rate is far lower than comparable Caribbean locations and you won’t get hagglers on the beach or on the street.

7. The dining is sublime

For a small island, Grand Cayman has an awful lot of brilliant restaurants and cafés on offer. There’s every cuisine to suit every budget and occasion.

8. The proximity to the States

While the Cayman Islands are a wonderful place to live, the urge to travel gets all of us at some point. Grand Cayman has excellent air links to many major American cities – Miami is just over an hour away!

9. Shopping is a pleasure

Name brands are easy to come by here because of the diverse and varied shops all bringing customers excellent prices and a wide choice. Visit Kirk Freeport and Camana Bay for designer jewellery, watches, cosmetics and high fashion boutiques.

10. The calendar of events is always full

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Why Buy in the Cayman Islands?

So, what is it that makes the Cayman Islands such a popular choice for investors? Let’s take a look…

Gifted with an amazing climate, pristine white sand beaches, beauty and the bluest water you have ever seen plus warm and friendly people it is the definition of paradise. We love the natural beauty of Cayman but when you look closer you begin to understand that Cayman is far more than a picture post card and is an excellent option for potential investors.

It is a unique environment and offers benefits and incentives that are not available in other locations and so investors looking for property for sale in the Caribbean consider Cayman a serious candidate. For example,

  • There are no restrictions against foreign ownership and ownership is guaranteed.
  • There is no annual Cayman Islands property tax due.
  • There is no requirement to pay taxes on income from leasing a Cayman Islands Investment property.
  • The Cayman Islands are often referred to as ‘Tax free Islands’ but a better description is Tax Neutral which means there is no direct taxation – Including no Income, Inheritance, Capital Gains or Property Tax.
  • Property sales are subject to a one-time stamp duty currently set at 7.5%

The Government has developed environments that make Cayman Islands investments in real estate an attractive option for foreign investors. The actual process for purchasing property is simple coupled with a very sophisticated land registry system. In addition, here are a some of the other benefits.

  • The Cayman Islands continues to see steady growth in the real estate market.
  • It is possible for investors to make return on investment in Cayman Islands by purchasing land as there is normally no requirement to develop it.
  • There are many professional Real Estate Companies offering unparalleled service and an excellent portfolio of properties to match any budget, whether it be luxury, residential or commercial.
  • Real Estate law is consistent across the Cayman Islands districts.
  • The Island also enjoys proximity to the US and is one of the safest countries in the region.
  • Buyers can access hundreds of properties through CIREBA.COM and CIREBA’s public website
  • It is possible for ownership to remain private and it can be held in the name of one or more individuals or in a corporation.

The Cayman Islands also enjoys political stability and a strong economy. It offers a renowned business environment, thriving financial industry and a busy tourism market. The country has first world modern infrastructure and state of art telecommunications not to mention outstanding health facilities and an overall high standard of living.

The wider picture shows substantial developments with both new and existing projects underway across the Island which are set to only enhance what Cayman can offer.

The government has plans for stimulating growth in the Capital, there are major infrastructure developments underway such as the Esterley Tibbetts Highway plus the expansion and modernization of Owen’s Roberts Airport. In South Sound, we see the construction of Cayman Enterprise City’s campus and there is continued rapid growth along Seven Mile Beach, the Eastern Districts, Camana Bay and Darts Groups Projects.

Clearly, there are many advantages to Investing in Cayman Islands and this continues to be the primary reason that it is popular with investors particularly for real estate investment.

If you are looking to invest in the Cayman Islands then we always recommend seeking the professional advice of a real estate agent and lawyer.

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Common Real Estate Questions

Frequently Asked Questions

 

Q. What is CIREBA?

Answer. The Cayman Islands Real Estate Brokers Association(CIREBA) is a non-for-profit association that provide a professional network for the different Real Estate Companies in the Cayman Islands.  CIREBA has grown to have 34 Broker Members with 168 Realtors. The basic premise is that all listings are shared between members and are easily accessible through the CIREBA Multiple Listing System.   This means that buyers can select one realtor and stay with them throughout the process instead of having to work with numerous real estate agents. For sellers, it means their property receives wide coverage quickly and efficiently.

In addition, CIREBA ensures that all members are up to date with changing laws that pertain to the Real Estate Industry.

Q. Who pays the Realtor fees?

Answer. It is the responsibility of the seller to pay the Realtor fees. The seller pays the listing Broker and the Broker splits this with the agent if they bring the purchaser.

Q. What is Stamp Duty?

Answer.  Stamp Duty is a one-time fee paid at 7.5% of the purchase price and this applies across the islands. The stamp duty is paid by the purchaser on the sale of the property minus the value of the used chattels/furniture.

Q. Are properties sold furnished or unfinished?

Answer. Approximately 95% of all condos and homes are sold furnished. The 7.5% stamp duty is calculated on the price you paid for the property minus the value of the used furniture. For example, if you buy a home for US$500,000 and the furniture is valued at US$22,489, you will be required to pay stamp duty on US$477,511.

Q. When do I get to see the Strata documents? Otherwise knowns as HOA or Condos documents?

Answer. Also known here as Strata-by-Laws and are like HOA or condo documents, Strata-by-Laws are registered on the title for each condominium complex. You can request to see them as a condition to the offer to purchase along with the latest AGM minutes and financial records for the Strata Corporation. Owning part of a well-run Strata or HOA will hold and increase your property value.

Q. What are Strata Fees and what do they cover?

Answer. Strata Fees are like HOA fees. It is a fee charged based on per sq. ft. of the condo. These fees are set by a budget and are to cover the cost of things like insurance, building maintenance, landscaping, pool maintenance, the Strata Management Company, bulk cable packages, common area water and power usage.

Q. What happens if a Seller/ does not pay his/her condo fees?

Answer. Any outstanding Strata Fees not paid prior to closing will be deducted from the Sellers funds and paid to the Strata Corporation. Your Attorney will request from the Strata Ex-Co or the Property Management Company what is called a “Section 6.4” and this will outline any fees not paid and also if there are any future assessments for the property.

Q. Are there title insurance companies or Escrow companies who facilitate the closing?

Answer. No, we do not need Title Insurance because Government guarantees title. However, we highly recommend that you hire an Attorney to research the title and advise you if there are any liens, or problems with the title. The cost is between .55% and 1% of the purchase price.

Q. Is there Freehold land or Leasehold land?

Answer. Most of the land is Freehold but there are some parcels of land that are leasehold from the Government. Leased land is uncommon but ask your CIREBA agent and your attorney.

Q. Can anyone own property?

Answer. Yes, there is NO restriction of foreign ownership. You can own up to 3 properties in your own name, after that you will need to have a license and your Attorney can help with that.

Q. Is there Property Tax in Cayman Islands?

Answer. There is no property tax in the Cayman Islands.

Q. Can I get a Mortgage at a Cayman Bank?

Answer. If you are a non-resident you can obtain a mortgage for the purchase, however a maximum of up to 70% financing is available. Interest rates fluctuate and can be between 1 -3% above the US prime rate.

Q. Can I get Cayman Island Residency if I buy property?

Answer. The Cayman Islands Government encourages investment in the island.  Residency is assessed on a points system considering factors such as occupation, financial stability and local investments. Thus, owning property is considered advantageous to the process.

Q. Are there inspection and valuators companies on island?

Answer. There is the Royal Institution of Chartered Surveyors (RICS Valuation Standards) and if you are obtaining a mortgage thru a local bank they will assign an independent evaluation to value the home based on recent and past sales.   There are also a home inspectors, Ask your CIREBA Realtor for a list of respected Inspectors.

Q. Can I buy land and build my own dream home?

Answer. Yes, it is possible to buy land and buy your own dream home.  We have many qualified architects and contractors. Ask your CIREBA agent for a few recommendations so you can interview them.

Q. Why does it look like the entire island is for sale?

Answer. On average, there are around 1,600 listings on CIREBA.  About 800 homes and condos, and another 800 parcels of land over the 3 islands.  There are tons of signs that look like Realtor signs, but they are actually Vacation Rental signs, or names of homes, like in Cayman Kai.

 

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Buying Procedures

 

THE PROCEDURES FOR PURCHASING PROPERTY

IN THE CAYMAN ISLANDS

(by Kass Coleman at RE/MAX Cayman Islands)

 

Once you make a written offer and complete it (as purchaser), we present it to the vendor. The vendor either accepts it as it is or can make a “counter offer”. Once the contract is agreed-upon and properly signed up, the property is then considered “pending”.  If there are conditions to the offer, it is shown as “pending with conditions” (shown as PEN/CON in the system).  We can explain more to you about this. You would then proceed to make the required deposit per Clause 3 “Manner of Payment”); work would begin on any of the conditions that were stated in the contract per Clause #5.

At this time, we would contact your attorney (for your benefit and peace of mind, we highly suggest that you use an attorney) to let them know the current situation regarding the contract.  If financing is involved, we will also contact them to see if they need assistance with valuations, sales history, etc on the subject property and keep in touch with all the involved parties to ensure a smooth closing.

After all the conditions have been satisfied and are in writing to the vendor, the deposit becomes non-refundable (but stays in the account in which it was placed, per Clause 4 of the contract) and a firm closing date is set.  A “Search and Stay” is placed on the property’s land title at a cost of CI$50 (US$60.98 and paid for by the purchaser.  The Search and Stay form ensures there are no outside interests in the property. Since Government guarantees all Land Titles (there is NO  Title insurance in Cayman), this is assurance that you are buying what is represented and that there are no encumbrances on the title.

At closing, the purchaser needs to have all funds available for the vendor and any other expenses – legal fees, utilities deposits, Strata (Association) fees, etc. The amount due to the vendor by the purchaser is detailed on Purchaser’s and Vendor’s Closing Statements, either prepared by your attorney or by our office. All parties involved (sales agents, attorneys, property managers) will work closely together to ensure that all aspects of the sale are handled promptly to ensure that there are no surprises on the day of closing. The sales commission is always paid for by the vendor and all items detailed on the closing statements are distributed at closing.  The fully signed Transfer of Land (title deed) documents and Stamp Duty check are delivered by hand to the Land Registry Department for processing.  About 2 weeks later, the purchaser’s name will appear as the new owner on the title and this information is a matter of public record.   Once this is done, we will provide you with a copy of the Land Register for your record.

Other than Stamp Duty, you will owe no other monies to the Government for the entire time you own your property.  Cayman has no capital gains tax, inheritance tax or any other form of direct taxation on property.  The purchasing party always pays the Stamp Duty. 

 

Approximate Closing Costs borne by the Purchaser in addition to the Purchase Price:

 

  • Search & Stay Registration CI$50 (US$60.98)

 

  • Purchase Agreement Registration CI$100 (US$121.95)

 

  • Stamp Duty is 7.5% of the Purchase Property less the value of chattels

 

  • Registration Fees (to get title in your name) CI$50 (US$60.98)

 

  • Legal Fees (if applicable)- usually 1-2% of the value of the transaction (or some firms offer a flat rate)

 

  • Banking Fees (if applicable) – usually 1% of the value of the loan (some banks charge less than that)

 

  • Utility Deposits – phone, lights, water and cable TV, say- CI$600 (US$730.00). (Fees vary depending on whether you will rent out or live in the property)