SELLING GUIDE

14/06/2016

Selling a property is a significant decision and warrants professional advice. Choose a real estate agent you are comfortable with. Shamar Estates and Properties International is a member of BEAVA (Barbados Estate Agents & Valuers Association). BEAVA lists recognized agents who have met certain qualifications are bound by the duties imposed by its Code of Ethics.

Agency Fees

Typically the fee associated with the sale of a property is 5% of the agreed selling price of the property. This fee may vary slightly from agent to agent but this is the generally accepted fee charged by members of BEAVA Inc. The fee charged for having a property tenanted is generally one month’s rent on a long term rental. It should be noted that the above fees are subject to 17.5% VAT. The fee charged on a short term rental (holiday rental) is generally 17.5% and is subject to 17.5% VAT.

 

You have the option of entering different arrangements with your agent.

Sole Listing Agreement

This agreement is used in cases where only one agent is authorized to offer the property for sale, but the owner may sell directly to a purchaser with no obligation to pay commission to the sole agent.

Exclusive Listing Agreement

This agreement is used in cases where the real estate agent is authorized to sell the property and the vendor must pay the agreed commission to the said agent regardless of whether he sells the property or indeed even gives it away.

In the cases of the Sole or Exclusive arrangement, the agent can sub-list the property with the other agents on the island in order to give the property the widest possible coverage.

Non-exclusive Listing Agreement

This agreement is used in cases where the owner appoints more than one listing agent himself. All of the listing agents must have the same information and listed price.

 

Legal Fees

Vendors must obtain the services of a registered local attorney to complete the sale transaction on your behalf. The real estate agent may not take funds from the purchaser to facilitate a purchase nor may the seller of the property, either one would be illegal. The attorney will search the register and establish the title to the property prior to the completion of sale and complete the documentation to finalise the transaction.

The purchaser’s legal fees for property transfer are legislated by government and range between 1% and 2.5% plus 17.5% VAT. Both buyer and seller are responsible for their own attorney fees.

Legal Fees are legislated as follows:

  1. Up to $25,000 – $750
  2. On the next $75,000 – 2.5%
  3. On the next $100,000 – 1.5%
  4. On the next $300,000 – 1.25%
  5. Thereafter – 1%

VAT of 17.5% is payable on legal fees

Note: The time to complete the purchase of a property varies from property to property but averages between three to six months.

Vendor Expenses

These expenses will be incurred by the vendor as a result of the sale and hence should be taken into consideration.

 

Property Transfer Tax

Improved Property (House & Land)

  • 0% on the first Bds$125,000
  • 0.1% on Bds$125,001 to Bds$350,000
  • 0.65% on Bds$350,001 to Bds$850,000
  • 0.75% on Bds$850,001 and over

Unimproved Land

  • 0.60% on unimproved value of the land

Improved Property (Commercial)

  • 0.65% on every parcel of land which is not a residence

Stamp Duty – 1% of the Purchase Price

Land Tax – This amount will vary depending on the value of the property at the time of the transaction

Land Surveyor’s fee – Approximately BDS$1,500.00

Real Estate Commission – Normally 5% of the Purchase Price (plus 17.5% VAT)

Utility Bills – Clearance of any outstanding utility bills on the property

 

Miscellaneous Out-of-Pocket Expenses – Approximately $300 e.g. landscaping; painting etc

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