NHC-National Housing Corporation
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House Price($) :
% Down Pmt :
Loan Term : years
Int Rate% : %
Explain Calculations: Show me the calculations and amortization
 
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Buying Land to Build-Advanced

Property is passed by conveyance of title, evidenced by the recording of title deeds
and certified survey plans at the registry of title. A purchaser will require a registered Barbadian attorney to search the register and establish title to the property prior to the completion of a sale.

Town and Country Planning Approval (http://www.townplanning.gov.bb/index.aspx)

If the purchaser is buying vacant land, the vendor will require a Certificate of Compliance from the Town and Country Planning Office (TCPO), which certifies that the roads and services have been provided in accordance with planning guidelines. It is therefore illegal for a vendor to sell a property without a Certificate of Compliance.

If the purchaser is buying a built property which is to be improved, or intends to build a property on the land, he will require planning permission from TCPO. The planning permission is granted in accordance with a set of guidelines established by acts of Parliament and statutory instruments, which govern such things as set backs from adjoining properties, roads, cliff tops, and the high water mark, if the property is on the beach. The guidelines also cover density and building height. In addition, TCPO would be guided by the zoning of the land and environmental issues, such as the method of effluent disposal, and the capturing of rainwater for irrigation purposes.

In all cases application is made to the TCPO and permission is usually granted within a period of two to six months.

Buying land to build is a fairly long process. It may take about a year to complete.The process is as follows:
- With a real estate agent you have to search and find a piece of land
- You then have to become the rightful owner of the land
- Hire a surveyor to clearly mark out the boundaries of your new purchase
- Hire an architect to draw up house plans
- a Real Estate agent has to provide you with the value of the house and land
- Submit your house plans to the appropriate Ministries (http://www.townplanning.gov.bb/index.aspx)
- Find a contractor to build your new house
- Have sufficient funds to build the house.

Transaction Costs

In 1998 the Government abolished property transfer tax for non-national purchasers, which waspreviously set at 10%. Sales commissions and survey costs are borne by the vendor. Each partybears their own legal fees, which are based on a scale of fees ranging between 1.5% - 2%. On average, the cost would be approximately 1.5% for the purchaser. This is the only purchase transaction cost other than incidental costs of forming and registering a company if a corporate vehicle is to be used. When selling a property the vendor would normally incur sales commissions of 5%, transfer taxof 7.5%, stamp duty of 1% and legal fees of approximately 1.5%.

Operating Costs

The owner of improved property (house and land) in Barbados will have to pay an annual land tax at the following rates:
0% on the first US$62,500
0.10% on US$62,501 - US$175,000
0.65% on US$175,001 - US$425,000
0.75% on Excess over US$425,000
Unimproved Land (land only)
0.60% on unimproved value of land

The main other operating costs would include insurance, which ranges from 0.4% for residences;
0.6% for commercial buildings; 0.9% for hotels, and in all cases would depend on characteristics of the building and the site. Other major costs would include metered utilities, and any common assessments applicable to master planned communities.

Mortgages and Financing



Most properties in Barbados are bought with a combination of owners' investment and borrowing.Twenty to twenty-five year mortgages are available for residents of Barbados, andin the case of nonresidents US dollar loans are available for up to 60% of the value of the investment, over a term of up to fifteen years.

If you are a non-resident of Barbados and would like to purchase property on the island, here are some mortgage options:

1.) Raise finance at home:
Re-mortgaging an existing home to release equity is a popular option. Many overseas property buyers live in countries in which the housing markets have left them with equity in their own homes. The UK property market is a good example of this. Many people have benefited from steady house price increases leaving them with small mortgages and large amounts of equity.

2.) Use a local overseas mortgage lender:
Many emerging markets are coming to grips with overseas buyers and can now provide a real alternative for the overseas property buyer.

3.) Secure an overseas mortgage with an international mortgage provider:
International mortgage providers can provide mortgages in a whole host of countries. The choice of countries is increasing as the demand for overseas mortgages develops. International mortgage advisors tend to be knowledgeable in this specialist field and provide overseas buyers with a real alternative to other financing options