Bermuda apartments, homes, condominiums, flats and fractional units for sale or rent

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Bermuda apartments, homes, condominiums, flats and fractional units for sale or rent

Types, costs, taxes, affecting citizens and non-Bermudians

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Introduction

Population density shows in closeness of housing

If buying a Bermuda home, it is suggested you first find the only daily newspaper in Bermuda, the Royal Gazette daily newspaper. It publishes on online Homefinder at http://www.royalgazette.com/section/realtors. You'll need to deal directly with one of the number of established local realtors/real estate agents. If selling a Bermuda home note that if the purchaser was introduced to your property by the agent when the agent held the listing then The Bermuda Chamber of Commerce Real Estate Handbook advises that the time from introduction to renewed interest will be within 180 days. In other words, up to that period that agent will be able to claim commission.

February 9, 2013. Bermudians married to non-Bermudians will no longer have to buy a licence in order to own a second home on the Island, Government announced yesterday. Other methods will be implemented to preserve land for purchase by Bermudians, said Governor George Fergusson as he read the Throne Speech. “The land licence requirement for the purchase of additional dwellings for married couples that include a Bermudian and a non-Bermudian spouse will be set aside. In removing the licensing requirement, the Government will put in place measures to prevent any potential loss of land that would otherwise be eligible for Bermudian purchase. ”The Bermuda Immigration and Protection Amendment Act demanded that mixed-status couples buy a land licence to purchase a home in an effort to reduce fronting. Amendments were passed last year that allowed such persons to purchase their first home without a licence. Yesterday’s move opens the door for ownership of further properties. Chamber of Commerce president Ronnie Viera campaigned against the land licensing requirement when it was law. Government also take a look at legislation surrounding Permanent Residents’ Certificate holders ability to buy. Some relaxation of the PRC rules are what the Real Estate Division of the Chamber of Commerce has been asking for. Government also promised to amend the Bermuda Immigration and Protection Appeals Rules 2013. “The Government is keen to deal with long-standing appeals that have been submitted to the Immigration Appeals Tribunal for consideration,” it was stated in the Throne Speech. “Therefore, the Bermuda Immigration and Protection Appeals Rules 2013 will be amended to ensure that individuals are not penalised by decisions affecting their rights or legitimate expectations unless they have been given prior notice of the case and fair opportunity to answer and present their own case.” The Appeals Tribunal was established in July of 2011, replacing a Cabinet committee that heard appeals of Ministerial decisions. More than a year later, the Tribunal had yet to deal with a single appellant after discovering that there were no rules in place

January 29, 2013. Compared to 2011, in 2012 Bermuda’s overseas luxury real estate market was hugely disappointing — virtually drying up in the second half of the year. Bermuda's overseas luxury market (homes available to overseas purchasers) has not rebounded like comparative jurisdictions. In fact, all the sales of property involved global purchasers occurred in the first two quarters of 2012 with practically no transactional activity for the remainder of the year. There has been a significant decline in property sales volume overall, including in the luxury market. Conversely, Bermuda’s high-end competition, including exclusive North American coastal communities — particularly in Boston and New York — have cited significant increases in sales of luxury property, the report states. Both locations are where many of Bermuda’s overseas buyers hail from. In order compete globally, the Island “must critically assess whether or not we compete favourably from a global perspective.” Bermuda's new government - from December 17, 2012 - has been asked to make the “necessary policy changes” to help stimulate this sector of the economy. Issues relating to the barriers to entry for overseas investors, from the complicated rules and regulations surrounding an overseas purchase to the high cost of a foreign buyer licensing fee, are just some of the issues realtors would like resolved. Currently the licensing fee is 25 percent for houses and 18 percent for condos and 6.5 percent in resort properties. Comparatively, the Turks & Caicos doesn’t have such a fee, a place that has seen home sales vault a reported 70 percent over the past year. While some progress has been made — relaxing some restrictions around homes that non-Bermudians can buy and the laws around non-Bermudian spouses needing a licence to purchase, however, realtors say that is not enough in order to compete with rival jurisdictions.

In 2012 in general, prices in Bermuda have plunged 10 to 30 percent in the last four years. Investment values have depreciated, rental incomes have fallen, and many owners are servicing debt that is no longer sustainable.

October 10, 2012. Realtors called for review of foreign property ownership requirements for long term owners. The call came in reaction to concerns expressed by Canadian homeowner Larry Marsland who said that a policy change on foreigners owning Bermuda property had reduced his options for the disposal of his property, and made it “more likely” that he will leave the Island taking his economic contribution with him. Mr Marsland, who has owned a Tucker’s Town home since 1974 said that when the revised rules on foreign property ownership became effective in June this year, his house became inaccessible to foreign buyers as its ARV fell just below the threshold. He argued that as a good faith investor, the property should have been grandfathered. Government’s policy review was aimed at having only the top 250 homes in Bermuda available to foreigners, so as to protect Bermuda homeowners and potential owners from undue competition for Island properties. “There is a fine line between protecting properties for Bermudians and encouraging/permitting foreign ownership,” said Dale Young, President of the Chamber of Commerce Real Estate division. “Mr. Marsland is correct that foreigners do add a great deal to the Bermudian economy in the way of jobs and financially supporting charities and organizations on the island. We believe that the policy should be reviewed particular for long standing foreign owners of 20+ years. In most cases, Bermudian are not purchasing properties in the upper ten to 20 percent of the market as it would be assumed that this property would be in that range. Failure to allow foreign owners in this range of the market to sell to another foreigner is a huge disadvantage and will substantially reduce the selling price. The Chamber is always willing to work with government by providing data that could help arrive at a ‘fair’ policy to all.” The United Bermuda Party suggested that the policy could be relaxed on a case-by-case basis.

July 27, 2012. A law requiring Bermudians married to non-Bermudians to purchase a licence before buying property has been rolled back by Senators. While such couples will not require a licence to purchase their first home, as was necessary under the controversial law, they will still need licenses to purchase additional properties. OBA Senator Michael Fahy said yesterday the amendments were an improvement, but the law remained unfair as it discriminates in a way against Bermudians who fall in love with non-Bermudians. “I still see discrimination against Bermudians,” Sen Fahy said. “I still think we need to go a little bit further. I’m just not sure why there’s this restriction. The mistake continues because if a married couple want to buy a second home, they require a licence based on a code of conduct we haven’t seen.” Passing the legislation in the Senate, Senator Jonathan Smith said that the original law was introduced to combat the issue of fronting, which allowed non-Bermudians to circumvent property regulations. As a result of fronting, land left Bermudian hands and property values rose beyond what many Bermudians could pay. He said the legislation would also increase the limit of local property that can be held by non-Bermudians to 2,500 acres. The limit had been set at 2,000 acres, but in reality 2,344 acres is already owned by non-Bermudians. The new figure, Sen Smith said, would account for that and provide room for new hotel developments such as Park Hyatt and Morgan’s Point. A Code of Practice, intended to guide Ministers on the practical application of the law, will also be created. Independent Senator Joan Dillas-Wright stressed the need to protect Bermudian land for the sake of Bermudians, saying: “Even if people are in a position where they can purchase more than one property, it behoves the government to exercise some control.” Independent Senator James Jardine agreed that it was important to protect land for Bermudians, noting that the amount of open space around the Island had fallen. Government Senator Vince Ingham said that Government was right to tackle the issue of fronting, saying that land is a precious commodity for Bermudians. “It was important to act, and act we did,” Sen Ingham said. “What I like about this amendment is it not only addresses an issue that has been raised, but it also has a forward looking view in the terms of allowing future development.” Senator David Burt agreed, stressing that the original intent of the legislation was to help Bermudians, describing the amendments as a “recalibration”. “At the time the average property value was $1.6 million. This is something that just seems out of reach for most Bermudians. Many young Bermudians have been able to enter the housing market, some on a single income.” OBA Senator Michael Dunkley noted that while Sen Fahy had to purchase a licence to buy a home with his wife, Sen Burt will not have to when he is married next month, joking: “Timing is everything in life.” Sen Dunkley said he supported the amendment, but criticized the time it took the Government to make the move. Sen Dunkley said: “There are people who will be pleased by the policy that’s coming today, but there are others who will say: ‘This didn’t help me in any way.’” Responding to the comments, Sen Smith said the matter is a difficult one to legislate, noting that in the case of a divorce properties could easily slide into foreign hands.

June 23, 2012. The Island’s real estate industry hailed an announcement by Government today that it’s finally made changes to its policies on property purchase by non-Bermudians. A bill tabled in Parliament allows Bermudians to now sell property to Non Bermudians providing their house has an ARV of over $177,000. In addition, special spousal alien licenses (for non-Bermudians) are no longer required for the purchase of a primary residence. The bill changes the ARV on houses for purchase by non-Bermudians from $153,000 to $177,000. It’s not clear yet if or how the land holding policy changes affect the condominium market. Announcing the changes, National Security Minister Wayne Perinchief told the House: “I can confirm to Honourable Members that the provisions of what has become known as ‘the 2007 Act’ have expired such that Bermudians can now sell properties, meeting the requisite criteria to non-Bermudians. As we indicated throughout this process, these provisions were transitional and would eventually expire.” Mr Perinchief continued: “Mr. Speaker, a return to the market conditions which prevailed at the time these provisions were enacted is not in the best interests of property owners or those of our citizens seeking to become homeowners. A real estate market which is overly weighted and is sustained in favour of any one group is not healthy and defeats a primary aim of this Government; to promote conditions for young families to acquire their own homes. Mr. Speaker, as I indicated publicly on previous occasions, the ARV threshold for those properties available for purchase by non-Bermudians must be set at a level that promotes Bermuda as open to high net-worth individuals while preserving a market share for Bermudians that makes home ownership and asset improvement a realistic goal. Mr. Speaker, I will introduce into this Honourable House a set of Regulations that have been gazetted today which set the ARV threshold for those properties available to non-Bermudians at $177,000. Mr. Speaker, as I previously indicated, setting the ARV at this level is consistent with a long-standing policy to provide the top 250 valued properties in Bermuda as available for purchase by non-Bermudians. This figure is not arbitrarily set but is based upon current data supplied by the Land Valuation Department. Mr. Speaker, I am also pleased to be tabling amendments to the Bermuda Immigration and Protection Act to remove the requirement for couples, in which one spouse is a non-Bermudian, to obtain a license on the purchase of their own family home. This change is a responsive one and delivers on a promise this Government made earlier this year. Mr. Speaker, the Bill is forward-looking in its scope and provides the framework that will support the intended development of the tourism products planned for Morgan's Point, Tucker's Point and Park Hyatt.”

February 18, 2012. National Security Minister Wayne Perinchief yesterday defended Government’s handling of a controversial land policy in Parliament. Mr Perinchief faced robust questioning from Opposition figures shortly after announcing the key changes. But in a novel twist, a question from his own Cabinet colleague, Deputy Premier Derrick Burgess, forced Mr Perinchief to admit that the amount of land owned by non-Bermudians has already exceeded the statutory limit. And Government came under fire from the One Bermuda Alliance for “doing more to harm the Bermuda economy than any other single entity” through policies like the land licence policy. Mr Perinchief had announced that Government would allow land above a certain annual rental value to be sold to non-Bermudians, reversing the policy which prevented Bermudians from selling to non-Bermudians. He also revealed that Bermudians married to non-Bermudians would no longer be required to obtain a licence to buy land, provided it is for their first home. Mr Perinchief was asked by Kim Swan, who was elected as a United Bermuda Party MP, how much money Government had made from the land licenses since that policy was implemented in 2007. The Minister responded by saying the information was in the Budget book. Mr Swan then asked whether the Minister had concluded that the original policy was “draconian”. “It was brought into place to stop fronting. That has now been stopped. And to preserve land for Bermudians.” Ruling party backbencher Dale Butler then asked: “Can the Minister, Mr Speaker, in light of an alleged leak of his statement indicate if he is going to resign, cross the floor or open an investigation as to how this happened and tell us what will be done to prevent this in the future?” Mr Butler was referring to this newspaper’s story about the Minister’s statement. Mr Perinchief told the House that no leak had occurred but that he had authorized release of a “small, abbreviated teaser to the press”. He said: “There was no expectation of pre-empting the House and if there’s an apology to be given, I now give it.” One Bermuda Alliance Shawn Crockwell put it to the Minister that he had in fact reversed policy because the policy was wrong. “There’s no culpability here. Any prudent Government, using principles of good governance, changes policies according to the financial situation, and that’s what we have done,” the Minister replied. “It’s an adjustment to a policy which became dated and we now find that it had to be amended.” Mr Crockwell then asked whether the Minister agreed that the policy restricting land sales to non-Bermudians by Bermudians, had “suppressed the real estate market and hurt the economy.” Mr Perinchief said the new policy allowed Bermudians to sell to foreigners if their property was in the $177,000 ARV band and that “stimulates the real estate market.” Mr Crockwell asked whether the policy requiring licenses for mixed couples had suppressed the market. The Minister agreed that changing the policy had stimulated the market. “Lenders were confused as to who was allowed to buy property and who was not. And that did cause a problem,“ Minister Perinchief said. “So it has removed the barrier and it has satisfied a need to restimulate the market. So you can interpret that any way you wish.” Pat Gordon-Pamplin of the OBA referring to the Minister’s statement that illegal fronting had been “prevalent” asked the Minister how many prosecutions had been brought against fronting. He said he was not aware of any prosecutions but one property was forfeited to the Government. A question from Deputy Premier Derrick Burgess, revealed that the limit on land holdings to foreigners had already been exceeded. “Minister Perinchief, is it a fact that 37 percent of our 6,000 residential acres are owned by non-Bermudians and the main objective of this Government was to preserve land for Bermudians?” asked Mr Burgess. “That is correct. I believe the figure is 2,300 and some acres,” he said. “We’ve actually exceeded the allocation to be sold to foreigners. We are really moving close to the mark now in even expanding it further but we’re loath to do that.” Shadow Education Minister Grant Gibbons, referred to the Minister’s comment that local lending institutions should reduce down payments, and asked whether the Minister had discussed the matter with the Bermuda Monetary Authority. The Minister said that a discussion had been had with one lending institution which had indicated that 100 percent mortgages had resulted in some mortgages being considered sub-prime. “We have not put any pressure on the lending institutions at all,” he said. Dr Gibbons then suggested that the Minister was not aware that the BMA had tightened up capital requirements and required banks to take a “more conservative lending position.” Mr Perinchief said he was aware of the BMA policy. The OBA later issued a statement which criticized the Government’s handling of land policy. The party said that it welcomed the reversal of policy, but said: “The damage from its flawed policies has caused untold stress on Bermudian families, in the form of lost jobs for thousands, reduced pay cheques and shrinking business earnings. “The Government has been in damage control for most of the past year, scrambling to reverse policies that have not worked. Today’s rollbacks on land policy are the latest step in this process.” The land policy “was bad policy from the start,” according to the OBA statement. “It discriminated against Bermudians who happened to fall in love with and marry non- Bermudians, instantly making them second class citizens in their own country. “It undermined the value of real estate owned by hundreds of families. And it gave international business people one more reason to consider moving their businesses elsewhere. The outflow of international businesses to other jurisdictions cannot be separated from the 2007 legislation, and every Bermudian who saw their rental income go down or disappear since should consider the cause. The Minister, by stating that today’s policy reversal is intended to ‘stimulate’ the economy, is admitting the 2007 policy helped depress it. The Minister, by stating the 2007 policy ‘unduly and adversely’ affected Bermudians married to non-Bermudians, is admitting the discrimination at the heart of the policy. We sympathise with the people who had to pay for a licence during this period. For many, it severely strained family budgets and was fundamentally unfair. Perhaps the Government can address their concerns directly. The reversal of the 2007 land policy a policy that went too far - is welcome.”

January 12, 2012. Bermuda luxury home and condo sales were so strong in 2011 that there was increased demand from wealthy overseas buyers for multi-million-dollar properties in desirable areas, including Tucker’s Town. Not only did the number of sales of high-end homes rise, but there was also a significant increase in the average selling price of both luxury houses and condos compared to 2010. The 2011 luxury market saw robust activity with an increase in the number of homes sold by 30 percent over 2010 for homes with an ARV of $153,000 and higher. Average sale prices in the luxury residential market also increased by 15 percent over last year, from $6.4 million to $7.5 million. Sales to international buyers increased by 40 percent from the previous year representing 56 percent of the total luxury home buyers this year. The numbers were in contrast to the non-luxury local market, which continued to suffer in 2011 with the two-bed condo market remaining saturated and rents dropping further. It seems this is a sign of confidence in the Bermuda market by international buyers, who are drawn for tax purposes, as well as the Island’s quality of life, sophisticated business community, location and proximity to the US and UK. While the number of luxury properties sold was small - nine houses in 2011 vs seven in 2010 the increase in sales in that market showed a clear, positive trend. There’s demand for homes by international buyers who want to become Bermuda residents as well as base their businesses here. International buyers are looking for homes with at least four to six bedrooms, primarily in Tucker’s Town, followed by Fairylands, Point Shares and Paget. Tucker’s Town particularly appeals to international residents interested in convenient amenities from golf, to direct beach access and a hotel resort lifestyle. The demand showed a need for proposed changes to land policy to open up the buying pool for luxury homes in what is a tightly controlled real estate market. The majority of the luxury home sales were to Americans followed by British and Canadians. The luxury condo market also saw an increase in the number of sales and average sale price. There were 69 luxury condominiums sold to overseas and Bermuda buyers in 2011 versus 64 in 2010. International buyers represented 15 percent of the 2011 condominium purchases with ARV values over $32,400 again with the majority of purchases by US citizens, followed by British. Average sale price of this luxury condominium tier increased 12 percent from $969,000 to $1.1 million. 60 percent of international buyers bought their Bermuda properties as vacation homes in 2011. The remaining 40 percent regard Bermuda as their primary residence and place of employment marking a seven percent increase over 2010 in the number of international buyers making Bermuda their primary residence. Changes to current land policy could boost the luxury market even more. It is hopeful that the policy would be changed in 2012 to allow Bermudians to sell their homes to non-Bermudians, allow permanent resident certificate holders to purchase properties as Bermudians and drop the requirement for non-Bermudian spouses to have special licences to acquire properties. At least $35 million worth of luxury homes has sold in Bermuda in just the first six months of the year. More multi-million-dollar properties had sold in Bermuda in the first half of 2011 than all of 2010, and 2009. The sales represent millions of dollars worth of annual revenue to the Government, given the now 25 percent cost of a licence for a foreigner to acquire a home in Bermuda, plus the one to three percent stamp duty, legal fees and land taxes due.

Generally, international buyers may only buy property currently owned by a non-Bermudian except in a development designated under the Bermuda Immigration and Protection Amendment (no. 2) Act 2010 as tourist accommodation and hotel residences. The cost of a Licence to Acquire varies depending on the type of property. For example, international buyers pay 18 percent of the purchase price of a condominium; 25 percent of the purchase price of a house; and 6.5 percent of the purchase price of a tourist property. To be eligible for purchase by an international buyer, a private property’s annual rental value (ARV) must exceed a designated amount ($32,400 for a condominium, $177,000 for a house).

Buying a single-family home or condominium or fractional unit in Bermuda, with its only 13,000 acres in total and an average of 3,400 people per square mile in the most affluent country in the world, is far more costly for Europeans than buying one in, say, the USA (where, in 2010, according to the National Association of Realtors, the median price fell to $166,100) or Canada, Spain or the Canary Islands or Italy, France or Greece or anywhere in the Caribbean. Only in Bermuda are there so many restrictions and exclusions. In contrast, in all the other tax havens - such as the Bahamas, Cayman Islands, etc - and international business centers, there are no such restrictions. Also, the cost of living is far higher than in any of these places. Nothing is cheap in Bermuda; not fuel (petrol, gas); not electricity; not automobiles or other transport; not property taxes; not alcohol, not anything. But for those who can afford it, the rewards can be many. Bermuda is in a mid Atlantic setting of green foliage, pink coral beaches and golf courses, less than two hours away by air from North America and seven from Europe.

There are no regulations limiting non-Bermudians who retire or work here and what type of property they may lease or rent, but there are very strict regulations and complex rules in the purchase by them and/or sale to them of real estate. What this means is that there are two categories of both commercial and residential real estate in Bermuda. One is real estate that is available only to Bermudians. Only Bermudians (see "Citizenship") may own any type of property. The other is real estate that is available to international or Bermuda-based but non-Bermudian buyers as well as Bermudians.

Non-Bermudians, also referred to as restricted persons - some Bermuda realtors refer to them as international buyers - include newcomers or those yet to arrive to seek employment and/or a property to buy and long-term resident Permanent Residents limited by a number of provisos to the most expensive properties in both price and taxes. They must first apply to the Minister of Labour, Home Affairs and Public Safety for a "License to Acquire" a property; and must, upon approval of the License, pay the same fees as other non-Bermudian applicants - viz. 25% of the purchase price (equivalent to $2.5 million on a $10 million property) of a freehold property and 18% of the purchase price of a town house or condominium. They cannot subdivide the property. They cannot purchase property with multiple Annual Rentable Values (ARVs). They cannot rent the property without official Bermuda Government Ministerial consent.

If non-Bermudians/restricted persons are given permission to buy it will be for one property only, a specified unit eligible to be held or bought by non-Bermudians. It is either a substantially higher-priced single family dwelling or a condominium priced for non-Bermudians as well as Bermudians. They may select only Bermuda's 200 or so most expensive single family properties - luxury homes with an Annual Rentable Value (ARV, see below) of US$177,000 a year or more - from among the more than 20,000 residences, or from an expensive condominium - with an ARV of US$32,500 or more (Bermuda Immigration and Protection (Designation of Eligible Condominium Units) Regulations 2007).

The average purchase price for a single family 2-3 bedroom detached dwelling house for non-Bermudians is over US$2.8 million.

Generally, non-Bermudians/restricted persons may only buy property currently owned by a non-Bermudian except in a development designated under the Bermuda Immigration and Protection Amendment (No.2) Act 2010 as tourist accommodation and hotel residences. Prospective international buyers must submit an application along with a consideration fee (refunded if the license to own property is granted). The cost of a License to Acquire varies depending on the type of property you wish to purchase. For instance, international buyers pay 18 percent of the purchase price of a condominium; 25 percent of the purchase price of a house; and 6.5% of the purchase price of a tourist property as designated above. To be eligible for purchase by an international buyer, a private property's annual rental value (ARV) must exceed a designated amount ($32,400 for a condominium, $153,000 for a house). Agreement in principle between an international buyer and seller includes a deposit of 10 percent of the purchase price. The deposit is held in escrow, subject to contract, and deducted from the overall purchase price. International/non-Bermudian buyers may not buy investment property such as land, commercial real estate or property intended mainly to earn rental income. International/non-Bermudian owners may be granted permission to rent their property by the Immigration Department. Permission rarely extends to periods of more than a year and includes a tax of 7.25 percent.

Plus, there are heavy Bermuda Government stamp duty charged on sale or re-sale of all homes owned by Bermudians and non-Bermudians; legal fees involved; and recurring real estate or property taxes, referred to as Land Taxes. By American and Canadian standards, Land Taxes, paid on homes and condominiums twice a year, are very high. They compare in cost to Council Taxes in the UK.

These restrictions can make Leasing Property a preferable option for non-Bermudians who wish to live in Bermuda.

However, for non-Bermudians, instead of freehold buying a Bermuda property such as a house on land or a condominium, a practical solution for some may be to purchase a fractional unit, of which there is now a wide variety. The fee for the first-time sale of such a unit is 10 per cent. The fee for sale of a fractional unit is 18 per cent on the second disposition of such units. For hotel residences condos or hotel units with individual land valuation assessment numbers if they are placed on the hotel inventory it will cost 18 percent, or 25 percent if the property is kept for private use.

Non-Bermudians are advised not to seek to evade these laws by "fronting" via local or overseas law firm or attorney or Bermudian living in Bermuda or abroad or any other kind of fronting. If they ignore this advice the property will be forfeited to the Bermuda Government.

Thus it can be hugely important to have a knowledgeable Bermudian real estate professional help navigate the process.

For non-Bermudians/restricted persons, once a property has been selected, an application for a license to purchase is made to the Bermuda Government's Ministry of Home Affairs and Public Safety. Your realtor will assist in this. An "Acquisition of Land" advertisement issued in the Official Gazette of Bermuda will say that "Notice is hereby given that (the full name of the applicant), a citizen of (whichever applies) is applying to the Minister of Labour, Home Affairs and Public Safety for sanction to acquire a leasehold interest in or the freehold of a particular property (by name, acreage if relevant, unit number and Parish) - and if relevant, in joint tenancy with a Bermudian parent or sibling or spouse.

While there are a number of realtors (estate agents in UK) in Bermuda, there is not yet any central on-line accessible register of who they are or what services they perform or what sales they have achieved. Nor is there any national website showing all properties for sale or rent at any one particular time. There is a need for all Bermuda realtors to establish a Bermuda Multiple Listing Service. This has long been common in the USA, Canada, UK, Europe and beyond.

Best places to retire overseas

Unfortunately, it isn't. Nevertheless, as the nearest foreign non-mainland place to the USA and Canada, it can offer distinct advantages to affluent Americans, Britons, Canadians, Europeans and others.

For a list of Bermuda Real Estate Agents/Realtors see under the latter section in Bermuda Employers

Land Evaluation and Land Taxes (real estate or property taxes)

Land Taxes are a property tax charged on all developed land throughout Bermuda with some minor exceptions. The expression "land" is used in its broadest sense to include land, buildings and structures attached to land. Undeveloped land is not liable to tax, though developed land that is merely unoccupied is still liable.

Each piece of property that is liable to tax is known as a "valuation unit" and details describing it and its assessed annual rental value (ARV) are entered in the Valuation List. This List is prepared and maintained by the Land Valuation Officer under the authority of the Land Valuation and Tax Act 1967 as amended.

A printed copy of the Valuation List is available for public inspection at the Land Valuation Department. Note that The Land Valuation Department just deals with the property and its assessment. The taxpayer, tax payable, billing, pensioner relief (exemption of Land Tax for qualified Bermudians who both own and occupy the property) etc. are the responsibility of the Tax Commissioner’s Office.

For example, a house owned by a Bermudian family, with an Assessment Number (see below) of 071022015, with an ARV of $46,800 has a 2012 annual tax of $1,258.80.

Bermudians and other residents pay these taxes because, as in most communities worldwide. it has proved beneficial for certain services to be provided by a central body rather than by private individuals either for themselves or for others. The obvious examples of these services are defence, health, education, the emergency services (ambulance, fire and police), public highways, public parks and garbage disposal. To maintain these services finances must be made available and for such community-wide services the best method is usually one that involves some community-wide charge or tax.

Land taxes, or property taxes elsewhere, are some of the most simple, effective, open and cheapest taxes to administer and collect. In addition, revenues from land taxes are both stable and predictable unlike say import duties or an income tax which can fluctuate widely from year to year. Land taxes are also difficult to evade because the liability attaches to the property itself in the final resort. Property taxes also reflect, in general, some "ability to pay" in so far as people with more resources tend to live in higher value properties and this aspect is further enhanced by Bermuda's progressive land tax structure. Finally, it is fair to say that community-wide benefits tend to impact to a significant degree on property values so that each taxpayer does receive some benefit from the payment of taxes that go to improve the quality of life and the environment in the community.

The "owner" of a valuation unit is liable for all land tax charges. This "owner" is usually the freeholder but can also include a life-tenant, a leaseholder for three years or more and even a periodic (yearly or monthly) tenant in the case of properties owned by the Government, WEDCO or BLDC. The Land Tax Officer can advise you more fully if you are in doubt about your liability.

Some residential properties and many commercial properties are let on leases for three years or more making the tenant the "owner" for land tax purposes regardless of any provision in the lease concerning taxes. However, most of these latter provisions usually require the tenant to either pay these taxes or to reimburse the landlord if he has to pay them in addition to the basic rent for the property.

As the liability for land tax attaches to the property itself in the event that any "owner" defaults on payment, it is important for landlords and/or prospective purchasers to always ensure that all land taxes have been paid.

Bermuda's Land Valuation and Tax Act 1967 requires all properties on the Island be revalued every five years. The 2009 draft valuation list was published in late 2009. The last revaluation before that was carried out in December 2004. The government states all properties are revalued at the same time to maintain fairness in the Valuation List. Property values change over time with some property types and areas going up in value while others in some cases may go down. The revaluation re-levels the playing field by reflecting these relative changes in value. See the Land Valuation website www.landvaluation.bm. This Land Tax in Bermuda is payable to the Bermuda Government by all Bermudian and non-Bermudian property owners. It is based upon the Assessed Rental Value (ARV) for each private dwelling (apartments, condominiums and single-family detached homes) and commercial buildings with the ARV determined by the Bermuda Government's Land Valuation Officer. Amended - higher - Land Taxes apply from 2009. Your real estate agent will tell you how much land tax applies to a particular property of interest to you. Note that Bermudian home owners over 65 qualify for exemption or a rebate (a) when the property is registered in their own names, not in the name(s) of their child(ren) and, since early 2012 (b) if the ARV is less than $50,000 (Until 2012 all Bermudian homes owned by senior citizens were eligible, irrespective of ARV). Contact the Land Tax Officer for an application form if you consider that you are eligible for this relief.

Note also that land taxes - property taxes in North America, Council Taxes in the UK - paid by homeowners in Bermuda do not include access to a municipal or local water supply or sewage disposal.

In Bermuda, land taxes do not change when a property changes hands, unlike in the UK where Council Taxes - the equivalent of Bermuda land taxes - may do, unfairly to newcomers. Also, in Bermuda and in most other jurisdictions too other than the UK - land/property taxes change by law uniformly in a stipulated number of years (in Bermuda, every 5 years, with the previous one done in 2004) in a much fairer system for all than in the UK. Whereas in the UK, while newcomers pay higher property taxes, residents who have been there far longer pay their Council taxes based on valuations last made in the early 1990s.

The Bermuda Government's Land Valuation Officer is now referred to as the Director of Land Valuation, under the Land Valuation (Reorganization) Bill 2002.

Land Evaluation Appeals Tribunal. Those who complain about their taxes can try complaining to this Bermuda Government body, appointed under the Land Valuation & Tax Act 1967 and shown in alphabetical order in Bermuda Government Boards.

Who pays Land Tax? Usually, the Land Tax on Private Dwellings on rented properties is paid by landlords, not tenants. But it is not uncommon for many local landlords to include the Land Tax in the sum they ask for rentals.

Apartment and single-family home hunting in Bermuda

Assessment Numbers of houses and apartments and their impact on parking of motor vehicles

Each single family home and/or apartment has a 9-digit number, after the owner has received a Certificate of Use and Occupancy Permit (Completion Certificate). The owner of each valuation unit - a self-contained (with its own entrance, electricity meters, permit to own a car, etc) apartment or unit in the same building and/or any other building - will also have a (separate) number. Each 9-digit number is unique, no two are the same. The digits are, in this order, Parish number (2 digits); sequential number (4 digits); Split Digit (1 digit); Re-use Digit (1 digit); Check Digit (1 digit).

Persons who do not own but rent apartments in someone's house should always be given and make a point of knowing the separate assessment number of the apartment. This is for their own protection. If it does not have its own assessment number, the person or persons renting will not be able to own a car or have a separate electricity account and may also encounter further difficulties. For example, when the owner or owners of apartments who have not bothered to arrange to have their apartments given their own assessment number, but allow their tenant or tenants to have a car anyway, both they and their tenants are breaking the law and can be prosecuted, also with the likelihood that the car will be impounded or have to be sold. All responsible home owners, owners of apartments and real estate agents know this. There are also other potential problems. For example, when an adjacent or neighboring house - which may or may not be owned by a relative or friend - is used, with permission of the homeowner, for parking of any car used illegally or moped or scooter or all of them, that person too becomes contingently liable, plus also liable themselves or via their insurance companies for any damage caused by any means whatsoever to the car or moped or scooter while parked on the property. It is not right anyway for any tenant to have to park any vehicle in an adjacent or neighboring property because the owner of the property where the tenant is living does not have space in his or her own garage or driveway for the tenant's car and/or moped or scooter. Whenever a tenant parks regularly in any adjacent or neighboring property, he or she or they should always offer in writing to indemnify the property owner fully against all damage to the vehicle or vehicle or property caused by the vehicle or vehicles. Failure to so by a quality tenant could render withdrawal of parking permission or worse.

Uniquely in Bermuda, Land Taxes do not include Water or Waste Water/Sewage. Neither are piped in or out via a central system. Costs of water and disposal of waste water and sewage from cesspits is the separate responsibility of the home or condominium owner or tenant or both.

More than a third of families’ spending in Bermuda is now going on housing — nearly double that of the US. Statistics show 34 percent of household consumption went on housing — dwarfing the amount spent on education (4 percent), clothing (3 percent), healthcare (5 percent) and food and drink (14 percent). The corresponding figure for housing in America is just 18 percent.

That translates into a 30-year mortgage of more than $11,400 a month at current interest rates — assuming the buyer has paid out a five percent deposit of $80,000. While the escalating price of free-standing homes is moving them further out of the reach of middle-income Bermudians, realtors say locals are showing increasing interest in condominiums as a more affordable option for a home.

In many countries around the world - but not yet in Bermuda (although this will change later - good title to piece of real estate is determined by reference to a central land registry which records the owners of all land in a particular jurisdiction. Once an owner is registered, the land registry provides you with a certificate of title - or title deed - that describes the land owned in accordance with an accurate plan.

Each such document will attract a significant amount of Bermuda Government stamp duty.

Until April 1, 2000 - but no longer - a Bermudian spouse would have to buy a property first and then voluntarily convey it into the joint names of the Bermudian and non-Bermudian spouse. (It resulted in the payment of additional legal fees and stamp duty on the value of the 50 percent share of the property). But currently, any non-Bermudian acquiring a property with a Bermudian spouse will pay a license fee exceeding US$1,200. The format of the application for a non-Bermudian alone or one married to and living with a Bermudian is set out in law, so a lawyer is advised. It requires all involved as new purchasers to provide a current marriage certificate, two references and a separate bank reference.

Bermudian Buyers with a non-Bermudian spouse no longer need a license

From July 2012. Until then they did. Only in Bermuda did this apply, nowhere in any part of the world. Before the change in the law, Bermudians married or living with foreigners, and/or whose parents is/are non-Bermudian, had to get a licence for homes they own and which their partners financially contribute to or benefit from. Locals must had to obtain a licence for such residential properties before June 22, 2010 or face prosecution under the Bermuda Immigration and Protection Amendment Act 2007. Those who failed to comply with the legislation designed to limit the number of non-Bermudians who own land here could have ended up with a five-year jail term and/or a fine of up to $1 million. In 2011 the licence cost more than $1,375 and was needed for first homes, as well as additional properties obtained before June 22, 2007. Since that date, the legislation prevented mixed-status couples from having more than one property. Even where a home was solely in the Bermudian partner's name, a licence was required if their partner gave financial assistance or benefits from the property. A foreign spouse who paid for household bills, such as electricity, cable or water, was deemed to be giving financial assistance. A letter about the licenses was sent with land tax bills to homeowners in 2008. Bermuda banks sent a standard letter to all mortgage holders reminding them of their obligations under the Act. When a non-Bermudian contributed towards mortgage payments or benefits from rent received for a property, a constructive trust was created with their Bermudian partner. If a non-Bermudian spouse or partner provided financial assistance to their Bermudian spouse/ partner to purchase a property, then the non-Bermudian may be entitled to an equitable interest in the property. The Bermudian then had to apply for a licence as a constructive trustee for the non-Bermudan's equitable interest. When the license was in effect the Bermuda Government raked in more than $1.3 million issuing land licenses to mixed-status (Bermudians married to foreigners including UK nationals) couples. The National Security Ministry said 955 licenses were obtained for Bermudians married to non-Bermudians between June 2007 and the end of 2011 as part of the Bermuda Immigration and Protection Amendment Act.

A government spokesman said the high number of licenses reflected the large amount of land owned by foreigners; that it was indicative of just how much Bermudian land has elements of foreign ownership. It illustrated the importance of the 2007 Act. "We need to properly safeguard the interests of Bermudians seeking to own their own homes against the background of significant foreign involvement in the local real estate market. 37 percent of Bermuda’s land is owned by non-Bermudians, which is greater than the statutory limit. " Bermudians married to non-Bermudians complained they’re discriminated against by the 2007 ruling, which required them to get a licence to buy property as part of a crackdown on fronting, the practice of foreigners gaining an unlawful interest in land by using a local as a front. While the law is now reversed it was made clear there would be no refund for those who already bought licenses. They cost $1,375 each, giving Government a total $1.31 million, which went into the Consolidated Fund. Couples had to pay legal fees in addition to buying the license.

The need for a license depended on personal circumstances and the Department of Immigration drew up the following list of questions to help you determine if you need to apply:

If you had answered 'yes' to any question from 2 to 7, it was likely you needed a licence. If you had answered 'no' to questions 2 to 7, you may not have needed a licence.

Buying and Operating a Bermudian home compared to in the USA

This applies only to Bermudians and means a home, irrespective of area, that is not in the top 5% of purchase price and land valuation and so may not be sold to any non-Bermudian, only to Bermudians. Some mid-priced Bermudian homes, like this desirable one off the South Road in Paget shown below, are in lovely areas and have nice sea views, close to the hospital and near the city of Hamilton.

Bermudian home. July 2009 Photo by author exclusively for Bermuda Online. Has "location, location, location."

Same Bermudian home showing Bermuda cedar work and sea views. July 2009 Photo by author exclusively for Bermuda Online

2011 Year-end Report. Prices in Bermuda tumbled in 2011 with many properties on the Island now taking as long as a year or more to sell. Condos in the under $32,400 ARV sector were the hardest to sell, with double digit drops in both price and volume sold in 2011. However, the luxury home market saw increases in the number of sales and average price. The under $177,000 ARV housing market suffered significantly in the economic downturn, representing less than half of the total property sales in 2010. The average price of a house under $177,000 ARV declined six percent from 2010 to just under $1.2 million in 2011. There was a 38 percent drop in sales volume in that sector, with 66 homes sold last year (the number could change as it is not final for the year yet). For condos, the news was worse. The average price fell to $473,000, a 16 percent decline in average price for 2011 versus 2010. Sales volume decreased 14 percent, to just 18 condos sold. The main factor for the decline in price and volume is without a doubt the economic climate. Also, there are clearly more conservative lending practices by the lending institutions - their criteria are more stringent than before. The bottom line was that in 2008, sales volume in the then booming housing market was almost $680 million, compared to $250 million in 2011. Realtors are not optimistic the Island would see any significant increase in price or volume this year and it could even go lower. The amount of time homes are sitting on the market has also grown significantly.

60 percent of the homes under $177,000 ARV in 2011 averaged 353 days on market, while 72 percent of the condos under $32,400 ARV in 2011 averaged 369 days on market. Figures for last year also showed rents for apartments and houses on the Island have come down by as much as 25 percent in the last five years. However, there is still actually demand for executive homes in the $12,000 to $15,000-and-higher range because of limited inventory.

Based upon April 2011 market rates the cost of building a home with traditional residential Bermuda construction is $290 per square foot. This excludes the cost of the land.

For Bermudians, the average price of a single family detached home is now over $1.2 million, of average size 0.25 acre. In comparison, in the USA in April 2011 the median price of an existing home is $195,300.

In August 2011 it was reported that the average price in Bermuda in 2008 for a modest 2 bedroom single family house without water views was $1.45 million. Compare this to the situation in the USA in August 2011 where in many places a lovely 3-4 bedroom 2 bathroom home can be had for $280,000. See http://realestate.yahoo.com/promo/best-cities-for-housing-values-2011.html.

In Bermuda, condominiums now have about 62% of the total 2011 housing market. The average price of a condo in August 2011 is now about $800,000. The standard Bermuda price now for real estate is now a standard $1.6 million an acre, for undeveloped or re-developed land, without a house or utilities.

Housing is on average at least four hundred percent more than in the USA, and Canada, 300% more than in the UK.

Compared to, in USA

In August 2011 in USA - alas, not in Bermuda - housing is the most affordable it has been in decades, according to analysts at Moody's Analytics. They don't just look at house prices. They also look at incomes. Nationally, there the cost of a house is the equivalent of about 19 months of total pay for an average family, the lowest level in 35 years. Prices usually average close to two years' pay, although that varies nationally. At the peak, midway through the last decade, a home in Los Angeles cost the equivalent of 4.5 years' pay. The average price has since fallen to just over two years' income now. That's well below its pre-bubble average of 2.6 years. This means average Los Angeles homes are cheaper in "real terms" than they were typically during the period 1989 through 2003. The opposite is true around the Washington beltway, where it will take 26 months of pay to buy a home, versus the historical norm of 22 months.

Local breakdown

Overall, only 51% of all Bermudians own their own homes - the lowest rate by far in all the developed countries.

	Under 30	30-39	40-49	50-64	65+	Total
Own house or condominium with mortgage	7.1%	19.5%	29.42%	27.41%	11.4%	21.1%
Own without mortgage	2.1%	5.6%	12.1%	31.1%	60%	22.8%
Rent	85.9%	71.0%	55.1%	37.9%	23.0%	51.9%
Rent free	4.8%	3.9%	3.4%	3.7%	5.5%	4.1%
Not stated	0.0%	0.1%	0.2%	0.2%	0.2%	0.1%

30-year mortgages are now available to qualified persons from the local banks at interest rates totaling about 9 percent per annum (7 percent plus finder's fee). Bermuda banks require a household to make in excess of $12,000 a month to meet average 30 year mortgage payments. Plus, they need a $250,000 down payment, as a bank will not lend more than 85% of the appraised value of the property. Thus a far greater number of Bermudians than non-Bermudians in other countries are not able to afford home ownership. The number of households that can afford to buy the average Bermuda property is 5,064 of the 19,505 households in Bermuda making over $108,000 a year.

The Bermuda Housing Corporation has built several thousand properties which it has sold to Bermudian families. The original idea was to provide subsidized housing to Bermuda's lower income families. But by international standards of subsidized housing costs, these are extremely expensive.

Administration of Estates Act 1974

The legislation when a Bermuda property owner dies, and the procedure, formalities, executor, executrix, objections, etc. See Executors or Bermuda Laws.

Appraisal fees

Local banks use independent appraisers to establish the value of a property for mortgage, valuation and other purposes. If done at the request of a bank for a mortgage on an average Bermuda home valued at $500,000 the fee will generally be from $300-$500.

Architecture, cess pits, sewage and water supply

See under Architecture. Architects in Bermuda must be registered under the Architects Registration Act 1969. In March 2004, more than 70 architects were registered.

Bermuda Immigration and Protection Amendment Act 2007

Provisions include clamping down on the practice of "fronting", where a Bermudian illegally fronts a trust to buy and hold land on behalf of non-Bermudians.

Bermuda Residential Building Code

Both a guide and specification document for contractors and home owners alike on all matters concerning traditional residential construction. Rigidly enforced, partially to ensure homes can withstand major storms. Individuals and entities wishing to bring new building products into Bermuda must first contact the Senior Building Inspector of the Department of Planning of the Bermuda Government to determine if the product meets local standards. Recently, innovative construction alternatives have included faux roof slate - imported - to replace or repair Bermuda slate and known as Dura Slate - steel frame dwellings and faux lumber (PVC) to replace or improve or with a better price than the local product.

Boundaries and surveys

Boundary Survey. If you are buying or selling a single family home, make sure the boundaries are staked and the stakes can be identified. If they are not staked, a surveyor should be consulted to do so. The vendor should either be asked or should volunteer to re-stake the property to confirm there are no encroachments on the property.

Structural Survey. While not yet common in Bermuda, the requirement for a structural survey is a prudent step in older properties that have not been rewired or re-plumbed for many years, and/or where termite damage is evident and/or or where the site may be steeply sloped.

Burglaries

The Bermuda Police Service issues reminders to the public to be sure to lock their homes before they leave for any length of time. There are numerous reports of break-ins at homes after they are left unlocked. Police tell the public to secure all windows and doors before leaving to prevent being victims of burglary. Thieves needing to fuel their drug habits are some of the nastiest and often the most violent or destructive burglars.

Citizenship

See Bermuda Immigration and Protection Acts. Some non-Bermudian residents with unblemished continuous residence have been in Bermuda for periods exceeding 20 and 30 years yet have not been given citizenship. It means they are not not allowed to vote, or to register to vote, in any election after they become 18 years old, even when they have been model residents for years. Those in this category are mostly from the USA, Britain, Canada, Caribbean and Europe, but some are from Africa, Asia, Australia, New Zealand, Philippines and elsewhere. Without citizenship, persons also cannot buy any real estate as Bermudians can if they can afford it; are limited to the top 5 percent of property in assessed value and a particular kind and type of property only and must pay a substantial purchase tax on top of other taxes; cannot obtain any local scholarships from any organization; if of employable age are not allowed to take any employment but are limited to the kind of employment on a Work Permit approved by the Immigration authority of the Bermuda Government; and may not under any circumstances be an executor or executrix of any Bermudian-owned property not in the top 5% of Annual Rental Value. Their attorneys are required to tell them this and would-be executors are expected to know this. They should also check with the Bermuda Government to see if it is permitted or not for them to benefit in any way financially from any Bermudian-held estate. They may only be executors of Bermuda property which is presently in non-Bermudian hands and as such is in the top 5% in Annual Rental Value. Nor are they - or any other non-Bermudian - allowed to be sole owners of a business in the local marketplace. They are limited to a maximum 40% holding in shares and management and are prohibited from employing any ruse that will enable them to overcome this restriction.

Closing Costs

They include a Stamp Duty charged on a sliding scale. It is 2 ½ % of the first $100,000; 3% of the next $400,000; 4% of the next $500,000; 5% thereafter. It is is usually payable by the Vendor and the Purchaser in equal shares.

Property value	Stamp duty applicable
$700,000	$22,500
$800,000	$26,500
$900,000	$30,500
$1 million	$34,500
$1.5 million	$59,500
$2 million	$89,500
$3 million	$149,500

For non-Bermudians, the length of time will be determined by how long it takes the Department of Immigration to process an application for a License to Acquire Property. This can range from 6 weeks to nine months. Sales contracts usually specify that the closing take place within a set time from the date of the grant of the License. A License to Acquire Property is required for non-Bermudians wishing to buy a home in Bermuda. The government charges a fee of 22% of the price of a house (or 15% if you are buying a condo) for this license, if it is granted. The review process is designed to determine that you are financially independent and not an 'undesirable.' Personal and financial references are required and will involve some research. Your local lawyer will guide you.

Commercial real estate

Generally - with some major exceptions - this cannot be acquired by non Bermudians. They have to lease. However, they are welcomed as investors in leasehold new hotels of more than 50 beds, or as minority owners of real-estate holding companies.

Condominiums

Available to overseas nationals

In 2012 in what is solidly a buyer’s market, condos sales have accelerated, unlike single family homes. Condominium ownership in Bermuda has become increasingly popular over the last 15 years partly because it requires a lower initial cash outlay and presents fewer responsibilities than for a traditional householder. Generally, a condominium owner is only responsible for the interior. External repairs, redecoration, grounds maintenance and insurance are shifted away from each owner, to condominium management. However, some homework is required before purchasing a condominium. Prospective buyers should determine to their satisfaction, by visiting each unit in which they may be interested, how much privacy and freedom there is, compared to and generally less than a traditional house. Rules and regulations written into condominium terms and conditions can seem restrictive. However, they can encourage good standards, for the benefit of all condominium owners. For example, noise can be reduced by requiring condominium owners to fit carpets and comply with auditory restrictions during defined night hours. Often, businesses and trades are prohibited from operating from a condominium. On-going contributions towards maintenance expenses can seem burdensome, especially as development buildings age and require more upkeep. However, the owner of a traditional house is solely responsible for the costs of upkeep, whereas condominium owners share responsibility for costs and can together accumulate a specific reserve over time. Such an accumulated reserve is known as a “sinking fund”, which spreads out payment for expenses over time and between all owners in a development. If a development is extravagantly maintained, ongoing fees may be too high; but if poorly maintained, the development may be a less desirable place to live.

An acceptable balance is required. Watch for expensive upcoming costs, for example with the elevator, roof and other structural repairs as owners must contribute toward those costs unless an adequate sinking fund has accumulated. In this regard, a professional buildings survey may assist you to determine what any upcoming costs may be. Investigate the condominium company’s accounts for the last three years for a sinking fund, for any non-contributions and for financial health generally. Missing contributions may indicate vacant units, or discord among existing owners and such could affect the desirability of the development. Non-contributions may have to be made good by those that do contribute; this is unfair, but may be the only practical solution for essential works. If owners have a shareholding (and so a say) in the management company, expenses may be kept to an acceptable level. Make sure that you understand how and when maintenance charges can be increased, and determine the percentage contribution to ensure that the charges for the chosen condominium are fair. Check that the buildings insurance is at a reasonable premium, for an adequate sum, and covers the unit — and be aware of any unreasonable exclusions. In case of a catastrophe, management should be obliged to reinstate the development (and so each condominium), within a reasonable period of time, using insurance proceeds. Talk to current owners and occupiers to discover the positives and negatives of the development, and ask how effective management is. Units in a neglected development may not appreciate and could even lose value. Check how active owners are in management. You may, or may not, want to become involved in management. In most cases, control will have been transferred to owners. For leasehold condominiums, make sure that each property owner becomes a shareholder in the landlord company. For small developments, it is likely that all owners are obliged to become involved in management.

Many condominiums are leasehold. A leasehold property is a depreciating asset, however many leaseholds are for around 999 years. Beware of leases with fewer than 70 years left, as they are unlikely to prove a good investment. Finance is unlikely to be available for a short-term lease, and the property itself represents less value to pass on to children. The more knowledge a purchaser has about a development, the more confident he or she may be about the potential success of ownership. As with all complex matters of law, do not sign any legally binding purchase agreement without first obtaining legal advice from a good Bermuda lawyer.

In 2011 the Bermuda Government announced that more than 500 condominiums across the Island, including The Waterfront in town and Mizzentop in Warwick, can now be sold to non-Bermudians (restricted persons). Earlier, non-Bermudians could only buy condominiums with an ARV of $32,400 or higher. Government amended a section of the Bermuda Immigration and Protection Regulations Act and added 521 condominiums to the list of units that can be bought by expatriates. These amendments were made through a notice in the Official Gazette. Forty-three of the units are on former tourist properties. The Government notice stated the following condominium units are eligible to be held or acquired by restricted persons, namely non-Bermudians.

Note that married and cohabiting couples, where one partner is an expatriate, need to get a $1,375 licence. The rule also applied to home-owning Bermudians with a foreign parent who has put money into the property. Often people find the licence will cost appreciably more than the $1,375 as it involves getting assistance from lawyers. Government has stated the rule was designed to prevent fronting, the practice of non-Bermudians gaining an unlawful interest in land by using a local as a front.

Condo monthly fees must also be a consideration. In April 2011 they averaged $400 a month, on top of Land Tax.

Conveyance, re-conveyance

A conveyance deed is a document, with considerable stamp duties involved, that in Bermuda conveys legal title to the owner, if mortgage-free, or if with a mortgage, to the lender with whom the deed is lodged and with the mortgage recorded in the Book of Mortgages at the Registrar General's Office. When a mortgage is repaid, a re-conveyance deed certifies that the property is no longer encumbered, with the bank asking the owner for the name of his or her attorney. The re-conveyance makes it clear that the debt is repaid. The legal cost of a re-conveyance is less than the cost of a conveyance, with stamp duty payable by the owner based on the original mortgage loan amount. The attorney will also arrange for the mortgage to be marked as satisfied in the Registrar Genera's Office. Those who do not get a re-conveyance risk having major problems when they decide to sell.

Development potential

There are strict development guidelines and rules. Development & Planning changes must be publicized before approval or otherwise. Bermuda's Department of Planning ultimately determines what can and cannot be done by way of development. Guidelines and specifications are set out in written form. Permission is routinely denied for anything which falls within these specifications and with the right guidance may well be permitted to do certain projects which fall beyond that scope, if in the public interest to make such exceptions. Those considering any development should consult an architect experienced and successful in dealing with the Planning Department.

All additions, alterations, conversions, conversions, extensions, improvements, etc, must be made to the Bermuda Government's Department of Planning, 3rd Floor, Government Administration Building, 30 Parliament Street, Hamilton. The applied-for changes will be advertised in the Official Gazette by Parish with the full name and address of the applicant in each Parish and the changes sought, with a Plan Reference number. Any person wishing to object must do so within 14 days of the date of publication of the relevant notice. Objections must be written, in letter format, stating any interest which the objector may have, with names and full addresses and with a concise statement of the grounds of the objection. For further details, see the Development and Planning (Applications Procedure) Rules 1997.

Electricity

Everything depends on the reliability of this. When outages occur from gale force winds because only relatively few homes and streets have underground electricity, electric water pumps do not work and consumers cannot access the water. Some homes have - and many more need - portable generators (see separate heading). A serious disadvantage is if the property needs major electrical work. It could involve months of stress and strain in high humidity. All this is at a very high local cost compared to North America and Britain.

Executors of Bermudian estates

Expatriate land registry coming

At least 37% of Bermuda's homes are believed to be beneficially owned by non-Bermudians (non-nationals, foreigners). In February 2010 it announced it will be compiling a register of non-Bermudian land ownership and has granted foreigners the same extension to ensure they comply with an anti-fronting law. Expatriates who own homes and other real estate here under a licence granted before August 2007 have until June 22, 2110, under the terms of the Bermuda Immigration and Protection Amendment Act 2007 and 2010 to get that licence validated by Government or face having to sell their property and probably be fined heavily as well. The latest legislation is a law designed to outlaw the practice of fronting, where non-Bermudians gain an unlawful interest in land here by using a Bermudian "front." The Act requires non-Bermudians who contribute towards mortgage payments or benefit from rent on a property to be licensed even if they are not named on the title deeds. One of the aims of the 2007 Act was to allow Government to gain an accurate picture of the acreage of land owned by non-Bermudians. It is supposed to be no more than 400 acres per parish, but is believed to be more.

The true scale of foreign land ownership had yet to be determined, with 2,300 acres "on record" but licences for only 356 acres of land validated since 2007. Bermuda has just 13,000 acres of land, with 6,000 of those for residential use. That may prove to be the highest percentage of land owned by non-citizens of any country in the world. In 2007, the Bermuda Government was investigating 200 properties considered to be fronts. Government believes it must preserve our land for our children and our grandchildren. There is nothing left. The 2010 amendment, which was passed by MPs, also clarifies that parents applying for Bermudian status must have children who all possess Bermudian status.

Fractional Ownership

Fairly new, within private membership property developments and hotels. Now a popular form of property ownership in Bermuda by non-Bermudians. Fractional ownership offers the purchaser a deeded real estate interest in a Bermuda residence but they do not confer any permanent residency or work permit rights (they have to be applied for separately and are based on merit or appropriate employment opportunities, in both cases needing approval from the Bermuda Government. But for regular visitors who do not seek permanent residence or to work in Bermuda, these developments offer many amenities such as swimming pools, tennis courts, golf course/club, beach clubs etc. The purchase licensing fee is 10% of the purchase price. Presently there is no central register or website. Some are being sold by hotels, others by realtors.

Garages at homes or condos or apartments

Whether buying or renting, an apartment of any size or house with a garage is essential for a car (only one per household is allowed) or moped or scooter. Those without one should be avoided because vehicles not stored in them just do not stand up to Bermuda's salt-laden air, constant winter gales and periodic hurricanes. Do not leave your vehicle outside at night without being securely garaged (in a garage with four solid walls, not a flimsy carport). Even rust-proofing is only partly effective for garaged vehicles. Be aware that Bermuda can often have hurricanes or storms or gales and plenty of rain.

Left out in the driveway or under a flimsy car port, many vehicles in Bermuda could suffer damage. In the aftermath of Hurricane Fabian in 2003, many people returned to their vehicles only to find them damaged or destroyed as a result of flooding and fallen debris. If you have no choice and can't garage your car, consider parking your vehicle in a public car park such as Bull’s Head, Hamilton. The cement structure is likely to keep your vehicle safe in a severe storm. If you can't do that either, park away from land which is liable to flooding and try to locate a lee, such as a wall or a rock face for your vehicle to keep it safe from high winds. Don't park near trees or electricity poles. Casuarinas are shallow-rooted trees, which can be easily uprooted during a storm. Norfolk Pines have branches that can break easily and can damage your vehicle. If your car is exposed to wind and rain, try to park the car with its rear-end to the wind. This prevents salt, sand and debris from getting under the hood and into your engine. Plus, at least try to keep it in good working order ahead of time for use after the storm, when you’re likely to need it. Check your lights and brakes and ensure your tires have sufficient air pressure and top up all vehicle fluids. Also, don’t forget to fill your car with gas. If you are leaving the Island on vacation or business during likely bad weather or a hurricane or windstorm, do not leave your car at the airport. During Hurricane Fabian, many vehicles that were parked at the airport were destroyed due to flooding and damage to the airport itself. The airport and Bermuda Government disclaim any responsibility for damage to cars parked in paid parking areas at the airport.

Gardening

For home owners who do not wish to do this themselves, they can employ a gardener from $30 an hour or a gardening contractor which will quote for year-round maintenance.

Generators

Especially after Hurricane Fabian on September 5, 2003, when virtually all Bermuda homes were without electricity for periods ranging from days to three weeks, portable generators are an absolute "must" for all who own homes and many who rent homes or apartments. There is a very high Bermuda Government Customs Duty rate on them, exceeding 30%. If bought locally, they can retail for over $2,000. If bought and imported privately, from places such as Home Depot (enter "generators" in the search prompt) in Florida or New York, they will still cost more than $950 after transportation delivery and Customs duty. As most homes in Bermuda are of limited acreage (one third or less) and are close together, the noise of a generator can be very stressful, so should be plugged in only during the day.

Granting permission to reside in Bermuda

But not be employed, for which a separate Work Permit is required by any non-Bermudian.

Home insurance

Homes and Ageing problems

More than 90% of all Bermuda private homes do not yet have all these features, yet about 15% of all Bermuda residents are seniors, some very frail and liable to fall.

Household Income

Statistics

Houseboat homes or rentals

Not for everyone and with some disadvantages, but for those who like to live on boats, the pros outweigh the cons. It is a viable alternative to the huge cost of buying or renting land-based housing in Bermuda. But space is at a premium at places such as the marina in Dockyard, where a waiting list has been created. Other places include Ely's Harbor, Mangrove Bay, Jew's Bay, St. David's and St. George's Harbor. The cost of a mooring and what comes with it can be crucial. Costs from from $85,000 for a 10' by 35' Vagabond but expect to pay at least $160,000 if you want guests to sleep over. Users require strict compliance with local marine and environmental laws.

Illegal apartments

Especially for non-Bermudians on a Work Permit, they should be avoided like the plague as a potential source of trouble and expense. An illegal apartment is one that has not passed the tests of the Bermuda Plan 1992 Planning statement and has one or more of the following faults:

Joint tenants or tenants-in-common

When property - houses and/or condominiums and/or land - is passed on by a parent or parents to their children or relatives, they become owners and/or co-owners. There are two kinds of co-ownership, one known as "joint tenancy" and the other as "tenants in common." There are significant differences between the two. In a joint tenancy, each co-owner has an unspecified share which cannot be sold separately. Generally, when a co-owner dies his/her share goes to other co-owners regardless of the stipulations of any will. In a tenancy in common, see http://homeguides.sfgate.com/tenants-common-legal-rights-6824.html, each owner has a specific share, for example 25% each in a family of four children, or 50% each with two children, or by arrangement each co-owner can hold an agreed proportion of the property. This form of co-ownership also enables all the parties concerned to transfer their shares during their lifetime if they wish, without any legal requirement to notify any other party beforehand and bequeath their shares entirely as they wish in their will, a process which will ensure their shares continue to be protected. This means that on the death of any of the co-owners in a tenancy-in-common, their shares do not pass to other co-owners (as it does in a joint tenancy) but to a spouse or another or others designated in a will.

When a will does not specify that co-ownership of a property goes to specific individuals in joint tenancy or as tenants in common, a lawyer may suggest a Declaration of Trust be signed, to record the respective shares. If the property is sold in the future the amount of equity distributed to each owner will reflect the terms of the Declaration of Trust. A lawyer should be consulted for more details, terms and conditions, changing from joint tenants to tenants in common, etc. and inform clients of any problems.

Land Title Registration

In May 2012, in reply to an enquiry from this writer, a representative from The Land Title Registry Office (LTRO) stated it will be accepting applications for registration shortly. The timescale is not certain yet but staff anticipate late summer/fall of 2012. A conveyance of the type between siblings would be required to be registered there under legislation enacted in December 2011 (the Land Title Registration Act 2011). However, First Registrations will only be accepted from Barristers and Attorneys. The reason for this is that the Attorney is required to certify that the deeds and documents lodged for registration comprise the complete record of title and the applicants identity has been checked and verified. This is in line with current conveyancing practice. Once the application is received in the LTRO they will examine the title and create a register and plan based upon the title shown. The resulting register entries are guaranteed by law and will be the legal record of title, superseding the deeds in this regard. There are a great deal of advantages in having a registered title due to the certainty and security of title. As you will see, the initial first registration process is an additional stage to the conveyancing process rather than a way of bypassing lawyers, but this is deliberate in order that there are two layers of scrutiny in the first registration process. Thereafter any dealings with a registered title will be much more straightforward, as the register will contain all the information required for any potential purchaser, mortgagee, etc. This is where the value and efficiency of a registered system will truly prove its worth. And this will indeed be less expensive. In the meantime, if you are the seller or co-seller of a home you should obtain legal advice independent of a sibling's lawyer who will be acting for the purchaser. A simple yellow pages search will give you a number of local conveyancing attorneys to choose from.

On February 6, 2012 it was reported that transactions in Bermuda could soon become faster and less complex as Government plans to introduce a Land Registration Office. Primary legislation has already been enacted to support the move from a deeds-based system to a registration system, but the legislation is not yet in force because secondary legislation designed to set out the operational details of the new system has not been enacted. A registration system will avoid the current paper chase for deeds, resulting in dealings with fewer Government departments than is now the case. Ultimately, the legislation anticipates that property transactions will eventually go online. At present, all real property is unregistered with the exception of Government-owned land, which is in a shadow system, to become live when the new legislation comes into force. Once the legislation is in force, all other real property shall compulsorily become registered, in due time, by “trigger events.” Such events include the transfer of property by purchase, gift, court order, after death, partition, appointment of a new trustee, long lease and mortgage. Registration is to be required prior to application for subdivision, for primary homestead designation, and the formation of a condominium under the Condominium Act 1986. Government has also reserved power, in the legislation, to phase in compulsory registration without the need for a trigger event. Today, an unregistered property owner proves title through at least 20 years worth of good paperwork, known as deeds. Deeds should be kept safe, as if they are lost or damaged, a property can become unmarketable, and therefore less valuable and unmortgageable. The result is that property falls into disrepair, causing a loss to the economy and of precious housing for the community. After registration under the new system, title is to be kept at the Land Registration Office and so deeds generally shall not be required. On request from time to time, the Land Registration Office shall provide evidence of ownership of a title, by way of a title document called an “Official Copy.” A Government scheme may provide compensation for inaccurate registration, resulting in loss. Compensation may not be payable in case of fraud, or lack of care. A compensation scheme is important, as there is no defective title insurance market in Bermuda, due to the inherent dangers in a deeds-based system. On registration, a class of title is to be given, with “absolute” the best, most marketable and mortgageable title. Absolute title is expected in most cases because most deeds are in good order, having been stored with attorneys or banks. A “provisional” class of title can be provided if deeds are lost, damaged, or in poor order. A provisional title is less marketable, but after 20 years of registration, a provisional title can be upgraded to absolute, thereby bringing potentially worthless property back into the economy and community. The possibility of title upgrade may prompt Bermuda insurance companies to develop insurance products to assist with the marketability of provisional titles. The Land Registration Office is to maintain a plan showing boundaries of titles, to be known as the “Index Map”, which is to be based on satellite maps. Boundaries shown on the Index Map are indicative and not conclusive. For this reason, owners should keep a copy of their deeds, as most have careful boundary descriptions. In addition to the owner, others may have rights over property. For example, banks through mortgages and further charges, and neighbours through easements to walk or drive. These rights shall be registerable, as affecting the land and indeed if not registered, such rights may be lost. For practical purposes, registration does not cover every interest in property. Such interests are called “overriding interests” and include short-term tenancies and rights of those in actual occupation, such as spouses. Overriding interests should be obvious on a physical inspection of a property. As a practical step, property owners and potential property owners should ensure that their details are up to date on the Register of Bermudians, maintained by Immigration. The reason being, the Land Registration Office must refuse to register owners who fail to demonstrate Bermudian status, or who cannot produce a License from Immigration.

In December 2011, it was announced that finally, after planning for this since 1999, Bermuda is to change from deeds-based property transactions to a parcel-based land registration system, under landmark Land Title Registration Act 2011. But a major concern was about that law is that it allows government to take over land if it was not registered within three years. But Attorney General Senator Kim Wilson said that the law was not intended to dispossess people of their land. If a bona fide owner could demonstrate after the deadline their claim then they would be the owner of the land. And if the land has been developed by then, the owner would be entitled to compensation. The Bermuda Government had been considering a land title registration legislation to simplify the process of buying, selling and mortgaging land The Department of Land, Buildings and Surveys will introduce a system of land title registration. It will provide a definitive record of ownership and other rights and interests in land such as mortgages and rights of way. There will be a functioning Land Title Registration Office. A new IT system will record the information as well as provide comprehensive details of all land Government holds. Work continues on the online mapping access giving access on address, location and other data layers. Surveyors would be working major mapping projects this year including a new area survey which will produce new larger scale aerial photos of the whole island. In time the new aerial map will be publicly available to the whole community to be used as the basis of decision-making, planning and project work across the island.

On August 8, 2011 it was reported that the Bermuda Government was expected to pass legislation soon creating a land registration system for Bermuda. Although precise details aren’t yet known, the system is likely to be similar to land registration in other Commonwealth countries. By way of an introduction to land registration, as yet not applicable in Bermuda, government-owned land is already registered in a shadow system, to become live when land registration legislation is passed. All other land should be registered over time by “trigger events”, until eventually almost all Bermuda land becomes registered. Common trigger events should be purchase, long lease, mortgage, further charge, planning application, primary homestead application and transfer after death. Presently a land owner in Bermuda proves title through at least 20 years’ worth of good paperwork, known as deeds. Deeds should be kept safe, as if they are lost or damaged, land could become unmarketable leading to a loss of value and difficulty in securing a mortgage. When that happens, land falls into disrepair, causing a loss to the economy and of precious housing for the community. The significant benefit of a system of land registration is that once land is registered, title should be proved without recourse to deeds (avoiding delays with a hunt and transfer to attorneys). Additionally, Government should guarantee each registered title, with compensation payable for inaccurate registration, resulting in loss. This is important as presently there is no defective title insurance market in Bermuda, due to the inherent dangers in a deeds-based system. On registration, a class of title should be given, with “absolute” the best and most marketable and mortgageable title. Absolute title is expected in most cases, because most deeds are in good order, having been stored with attorneys or banks. A “provisionary” class of title should be given if deeds are lost, damaged, or are in poor order. A provisionary title is less marketable. Over time, a provisionary class of title can be upgraded to absolute, so bringing worthless land back into the economy and community. The possibility of title upgrading may interest Bermuda insurance companies, which could develop insurance products to assist with provisionary titles. Each title should have an official plan of the land based on Ordnance Survey maps. All registered title plans should be consistent with each other, possibly avoiding the need for deed plans to be compared when boundary disputes arise. In addition to the owner, others may have rights over land. For example, banks through mortgages and further charges and neighbours through easements to walk or drive over land. These rights should be registered as affecting the land. For practical purposes, land registration is unlikely to cover every interest in land. Such interests are called “overriding interests” and include short-term tenancies and the rights of those in actual occupation, such as spouses. Overriding interests are usually obvious on a physical inspection. After registration, land transactions usually become faster (possibly going online) and less complex, avoiding a paper chase for deeds and allowing dealings with fewer government departments. The precise details of Bermuda’s land registration scheme are yet to be released.

Environment Minister Marc Bean has promised easier property sales arising from this. All of Government’s land holdings are now entered into the Land Register. The latter now has the authority to register privately held land. The Government foresees significant benefits accruing to the public as a result of the implementation of a Land Title Registry. Such a system should provide for the guarantee of legal ownership of land and the simplification of conveyance transactions. Currently, property transactions can take months to complete, and at significant expense. Once a parcel of land is registered, the register will become the definitive record of title and subsequent transactions can be carried out in a fraction of the time and at a fraction of the cost. Property would have to be registered by the owner following a “triggering event,” such as the conveyance on sale or otherwise, the granting of a lease for more than five years or the creation of a new mortgage. The Ministry estimates that all private lands would be added to the register after around ten years. Mr Bean said the register will reportedly rely heavily on the Government’s Geospatial Information System, marking parcels of land on high-resolution aerial photographs. In order to ensure that Government has the most current and most accurate mapping data, the Department of Land Surveys and Registration, of which the Land Title Registry is a part, will soon procure a new set of aerial photographs. These photographs will be analysed and digitised to enable us to carefully identify each parcel of land. Once in place, the land registry would help to protect the rights of property owners who historically may have been taken advantage of. The Minister noted: “Many of our elder generation have experienced the injustices of their family land being adversely possessed by what some might describe as unscrupulous professionals, and even at times by their own family members. Many of us can tell a tale of land being swindled from their family. Many of us still feel the pain of this theft. It is the intent of this bill to bring an end to this sorry practice.”

Lawns

Homes with lawns of their own are fortunate in one way, but keep their homeowners or renters busy in another. In drought conditions, which can be frequent in the summer months, it is not advisable to use chemicals to control weeds or even pest and diseases unless the plants are well irrigated and then only in the cool of the day. A "good" lawn should be virtually weed-free, of good colour with little or no thatch and of one grass type. Selecting the right grass type for the specific area will save future headaches with less maintenance problems to deal with. Mixed type lawns can be troublesome not only from a patchwork appearance but also with weed control as chemical control for one type of grass may adversely affect another type. Common Bermuda grass seed is sown at a rate of two to three pounds per thousand square feet, sow in two directions to obtain a more equal coverage. St. Augustine plugs are planted at four inches to six inches apart and are best installed in spring. As temperatures rise, they will, when maintained properly, in-fill quickly. Warm season grasses are St. Augustine and variety Floratem, a chinch bug resistant strain; Bermuda grasses and their hybrids and Zoysia. St. Augustine grass is not always advisable as it is subject to attack by chinch bug which will devastate a lawn in a short period of time given the right conditions. Many homeowners prefer to let landscaping companies handle their lawn mowing and maintenance.

Leases

If you lease instead of own an apartment or condominium or home, note carefully that you will not rent by the month but will lease for a specific, mutually-agreed time. Leases are legal and breakage of a lease should not be attempted without risk of a severe penalty. If an employer, not a professional newcomer employee, signs a lease, great care should be taken by the employee not to put the employer at risk. The employee will still be liable to the employer for payment of utilities, conduct and care and interior maintenance of the leased property.

Littering of residential premises

The Waste and Litter Control Act 1987and its penalties may apply, but only if the litter from yours or another person's rented or leased or owned apartment or condominium or house is visible from a public place, for example, from a main road or estate road, park, etc. This type of litter should always be reported first to the Bermuda Government's Department of Works and Engineering for investigation.

Mortgages and mortgage rates

The Book of Mortgages at the Registrar General's Office will have details of all conveyances where mortgages are involved and all re-conveyances satisfying the mortgage. Bermuda banks are now willing to lend approved buyers up to 80 percent of the appraised value of a house. With an average mortgage of 20 years, persons who are loaned $400,000 for an average-priced $500,000 house will pay a variable rate from 7.25 percent plus fees. A household would need to earn at least $7,000 a month to qualify.

Organizations that provide mortgages include banks; Bermuda Savings & Loan, possibly some local (Bermudian) insurance companies; some law firm's trust departments. Some will lend to non-Bermudians. Terms range from 5-20 years.

Planning Applications

In late June 2012 it was announced that some small-scale developments could soon not require a planning application. If approved, the changes would lead to increased efficiency and a faster approval process should the legislation be passed. The General Development Order is essentially enabling secondary legislation that permits a range of small scale development to be carried out without the formal submission of a planning application. Already some forms of small development, such as the installation of solar panels or satellite dishes and the construction of small walls are covered by the General Development Order, which grants automatic approval should specified conditions be met when applied for under current Planning Application rules. Such proposals go through the Permitted Development Process, which are on average dealt with by the Planning Department in six working days. The legislation proposed would expand the list of projects covered by increasing the permitted site coverage for additions, increasing total permitted floor area for additions and including the construction of swimming pools. |Safety, standards and environmental quality will not be compromised by these changes. In particular, safeguards will be in place to ensure compliance with requirements such as the development restrictions set out in the Bermuda Plan 2008. The main objective of this change is to respond positively to the current needs of the Island by expanding the range and scope of works that are deemed ‘Permitted Development’ and therefore can benefit from an expedited approval process. The relevant Ministry plans to make amendments to the Development and Planning Act 1974 to extend the powers of the Development Applications Board to delegate authority to the Planning director in determining straightforward application. The changes came as a result of a recent review of planning legislation. The Department is continually reviewing and streamlining its processes and procedures in the effort to reduce application processing times further. Both of these upcoming legislative changes outlined are consistent with the Government’s mission to gain efficiencies in the delivery of public service.

Bermuda largely follows the UK system, which has its flaws. Technically, a neighbor can object to an owner or new owner's application to Planning for amendments, upgrades, improvements and renovations. Anyone contemplating buying a house that has been noted or described by a realtor or neighbors as needing fixing up or extended or improved or in any modified in a way that needs Planning approval and wanting to make any such alterations now or in the future should make a special point of first asking the selling agent for details and also neighbours of that property if they are likely to object. In theory, if not in practice too, a house clearly in need of an extension or other modification should have had planning permission in principle granted, after an appropriate plan has been submitted. It may reduce the prospective value of a house if this has not been done. A potential seller should also compare the asking price with an competent and reasonably timely market-price evaluation by a qualified surveyor. You are advised not to buy the house if a planning application is likely to be rejected. It's been claimed, but this is arguable, that no purchaser is likely to pay to have plans drawn up and neither would he be able to submit them, until after he/she is the owner and the old owner has received his payment. Any objections a new owner may or may not make to plans a new owner of a house may produce in the future would be the business of the neighbor or neighbors entirely, after considering whether there would be any point under the planning and zoning laws.

Real estate links

The website of any realtor in Bermuda will be shown here gladly as a free courtesy active link if it will reciprocate with a link back to Bermuda Online at www.bermuda-online.org.

Real Estate by Parish map

Rents and Rent Control

Some non-Bermudian newcomers receive a housing allowance from their employers. It can pay all or some of the rental costs. Utilities are always extra. Newcomers are advised not to pay any more than 28% of their salary on accommodation if they do not receive a partially compensatory housing allowance.

In February 2011 the average price of a one-bedroom property $2,389, a two-bedroom $3,551 and a three-bedroom $5,403. Location and scenery are among the most significant factors.

Non-Bermudian property owners are prohibited from buying '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 10% is paid to the government on rental income earned by non-Bermudians).

Under the Rent Increases (Domestic Premises) Control Amendment Act 2009 approved by MPs in December 2009 the annual rental value (ARV) ceiling band for rent control purposes increased from $24,600 to $27,000. The Act sought to stabilize the percentage of premises that are rent-controlled. Tenants without the benefit of protection may be exposed to landlord undesirable practices and abuse, such as speculative rent gouging, inordinate rent increases, rent profiteering and unjust eviction.. Rent control has been in place in Bermuda since the late 1970s and is enforced by the Rent Commission. About 16,800 premises on the Island fall under the $27,000 ceiling, making them potentially subject to rent control. In theory, anyone in a rent-controlled property who felt they were paying too much could go to the Rent Commission. If someone has been paying too much rent for an amount of time, they can get reimbursed.

Landlords and tenants should be aware that a court action may result if the landlord of a rent-controlled property (house or apartment) shows a cynical disregard for the rights of a tenant. A common example of this is physical removal of the tenant or his possessions to re-let at a higher rent. Landlords should know that an order of a court is always required before a tenant may be lawfully dispossessed.

Security Precautions

With drug addition rife and burglary and other ant0social crimes common, Bermuda is not a low-risk area.

Selling Taxes

The vendor is typically responsible for paying 50% of the stamp duties (see below) on a conveyance.

Sellers of properties in Bermuda need to produce title deeds going back at least 20 years. Title deeds must be kept in a safe place known to the owner at all times. Those who have a mortgage should expect the mortgage holder to retain possession until it is satisfied. Possession of a deed is required to mortgage or sell a property.

Stamp Duties

See http://www.gov.bm/portal/server.pt?open=512&objID=275&&PageID=231422&mode=2&in_hi_userid=2&cached=true. Parents in Bermuda often used to transfer real estate to their children during their lifetime in order to avoid the payment of stamp duty by children, often referred to as a death tax. Today, however, parents no longer must transfer real estate during their lifetime, thereby losing control over the property, in order to avoid stamp duty. The far preferable method of eliminating stamp duty is to apply for a Primary Family Homestead Certificate (“Certificate”). Such a Certificate eliminates stamp duty payable after death on the designated dwelling. A Certificate can be applied for either during the life of the owner, or after death by estate representatives. If more than one dwelling is owned, it is advantageous to obtain the Certificate on the most valuable property. If a deceased owned more than one dwelling, estate representatives can only designate the actual residence immediately prior to death, as the primary family homestead. If the deceased did not reside in any of the dwellings immediately prior to their death because they were in residential care, for example then the estate representatives can only apply for designation of the least valuable dwelling. A designation during the owner’s lifetime provides a surer opportunity to obtain the highest stamp duty relief. If the owner is later in residential care pre-death, the dwelling representing the highest relief should already have been designated. Designating a dwelling as the primary family homestead often extinguishes the need for a transfer of property during the owner’s lifetime. However, owners of multiple properties may still find lifetime transfers useful in particular circumstances. For example, after-death stamp duty on a home with a market value of $1 million amounts to $85,000 while in comparison, the stamp duty on a lifetime transfer of a $1 million property is just $34,000. A lifetime transfer at less than market value is by Voluntary Conveyance. The advantages of such a conveyance are that the owner’s intentions can be effected during their lifetime, and stamp duty can be determined and paid during their lifetime. The disadvantages of such a conveyance are that stamp duty is payable within 30 days of the conveyance, and exclusive legal control of the property is lost. Some control can be maintained by way of joint ownership or by reservation by the person conveying of a “Life Interest” in the property — but both have pitfalls. For example, owning children may refuse to sign a mortgage to finance medical treatment, or for essential window upgrades. An owning child may also get divorced, resulting in the property being sold under a divorce settlement or court order. If owners are comfortable with co-owning property, ownership is either as joint tenants or as tenants in common. In the case of a joint tenancy, the last survivor ultimately becomes the outright owner. This is usually fine with spouses, but possibly not with multiple children, especially when grandchildren are involved. Potentially only the children of the longest survivor would benefit, to the exclusion of other grandchildren. Tenants in common do not suffer the survivorship rule; however, any owner is free to transfer their share to a third party. A reserved Life Interest is not ownership, but creates the right to occupy or collect rent to the exclusion of all others, including the owners. If a Life Interest is reserved, stamp duty is reduced using actuarial tables based on the life expectancy of the person with the Life Interest. The longer the life expectancy, the greater the reduction in stamp duty assessed. Choosing not to make a lifetime transfer maintains full control to sell, let, mortgage etc. In such cases, property may instead be gifted by Will. A Will can be changed at any time, but a lifetime transfer is more expensive, harder to reverse or change (if at all possible) and has further stamp duty implications. When disposing of a dwelling, a Will combined with a primary family homestead designation, not only ensures exemption from stamp duty but also that the dwelling passes to the intended beneficiary. The procedure to transfer the deceased’s assets to heirs is known as Probate. Once probate is obtained and the liabilities, debts and expenses of the estate have been settled, the assets are distributed according to the Will. If there is no Will, then the distribution is according to the Succession Act 1974 and property is shared by relatives in the highest categories set out in the legislation to the exclusion of others in the lower categories. Naturally, spouses and children are specified first, but anomalies mean that a Will is more certain of transferring assets to those intended to benefit from an estate. Owners have individual concerns and preferences for estate planning purposes and each family has its own unique dynamics. Owners should make long-term plans and obtain appropriate legal advice to be sure that their desired wishes are attained and in the least expensive manner possible.

The Stamp Duties Amendment Act 2008, a revenue-raising act, changes the various rates of stamp duty payable on the conveyance or transfer of property and land on the Island. It will need to be clarified whether the seller or buyer pays these or if they agree to split the cost. The new tiered rate structure from April 1 2008 is:

Most first-time home purchasers seek properties - condos only usually - valued at less than $1 million. Home buyers in this segment of the housing market will have the full benefit of the reduction in the rate from 2.5 per cent to two percent in the lowest tier. For properties that sell for more than $1 million the rate of stamp tax will be higher.

Subdividing

For Bermudians, the potential for subdivision will be governed by the zoning of the area. Non-Bermudians may not subdivide unless the portion subdivided is sold to a Bermudian and the portion retained has a qualifying ARV.

Surveyors

Only licensed surveyors are licensed under the Professional Surveyors Registration Act 1997. In March 2002, 21 were registered.

Time share units and their Services and Occupancy taxes

Utilities

These are not included when renting apartments, condos or single family dwellings and are triple or more the rates in most US cities. Get an account with the Bermuda Telephone Company (BTC) and local electric and gas suppliers. With air conditioning, electricity alone for a three bedroom house can easily cost US$ 450 a month. (One way to save on this if facilities permit is to get a system known as Geo-Exchange from Bermuda Energy Conservation Ltd). Home buyers should get it in writing as part of their purchase contract that the electricity wiring is modern, up to code standards and with a reliable electrical map of the wiring available to the homeowner. Bermuda homes may be very attractive to look at, but it will be expensive and prolonged if they need extensive rewiring to meet current code standards. A contract for such services is recommended. Bermuda limestone or concrete block walls have to be ripped open with jack hammers and plaster ceilings also cut into and exposed, with holes all over the place and dust and debris, at many times the cost of new electrical wiring in homes in the USA or Canada or United Kingdom.

Note the lack of central heating in most Bermuda homes and apartments. Some Bermuda winter days and nights can be quite damp and chilly for non Bermudians accustomed to having seasonal central heating. Some homes have a fireplace, while others may have a ductless split heat pump system with reverse cycle heat during the winter and air conditioning during the summer. If not, electric heaters and separate air conditioning units for winter and summer comfort levels are available commercially.

Vacant possession

Always best, when selling a home. Tenants who will continue in an apartment cannot be counted as vacant possession and could cause complications.

Water

Zoning Areas

Residential properties are typically zoned either Residential 1 or Residential 2. Residential 1 is higher density than Residential 2. Local realtors can be more specific. The current Bermuda Plan shows the present zoning for every part of the island.