The Property Banks Buyers Guide to Bermuda
Bermuda is an Island of only 21 square miles, which is noted for its convenient tax system, proximity to the continental United States and the highly evolved business and communications infrastructure. Due to the limited land and number of houses, residential dwellings in Bermuda have been classified into two main categories - those available for local purchase only and those available for purchase by 'Non-Bermudians'. If you would like to look at properties available to international purchasers click on 'Worldwide Property '
Non-Bermudian property owners are also prohibited from buying land, commercial, and 'investment' property or property intended primarily to earn rental income. While they may be given permission by the Immigration Department to rent under certain circumstances, this permission cannot be taken for granted and is generally not given for periods in excess of one year. (A tax of 7.25% is paid to the government on rental income earned by non-Bermudians.)
Qualification for international purchasers is determined via an evaluation and assessment of property designed for Land Tax purposes, which results in the designation of an Annual Rental Value (ARV) status for each Island dwelling.
Effective 20th June 2005, for purchase by a Non-Bermudian, the ARV on a condominium must be in excess of BD$32,400 and for a house the ARV must be BD$153,000 or more. In addition, current policy states that property being sold to an international purchaser must be currently owned by a Non-Bermudian (in most cases).
In order for an international purchaser to qualify for property ownership in Bermuda, they must apply to the Bermuda Government for a license. The consideration fee is $1097, which is refunded if the application is successful. When a license is issued, the Government requires a percentage of the purchase price be paid for a License to Acquire, in the case of a condominium 15%, and for a house 22%. Finally, when an agreement in principle between the purchaser and the vendor has been made, the purchaser typically pays a 10% deposit (in non-Bermuda funds) to the agent to be held in escrow, subject to contract, which is deducted from the overall purchase price.