Buying A Property

Buying a property in the Cayman Islands is easy and has many advantages.

There are no restrictions on foreign ownership of real estate.
There is no annual property tax, capital gains tax, inheritance tax or income tax. There is no tax on rent derived from real estate investments.
By owning property long term (minimum 3 years) mortgages tend to work out cheaper than paying rent.
Property title is guaranteed by the Government.
Cayman's Land Registry office is well run and modern, which means registrations are quick and simple. Every piece of property is registered under a unique block and parcel number, and a potential purchaser may examine the records regarding any piece of property to check whether there are any liens, charges or restrictions on it.
World class architects, land surveyors building contractors and attorneys are available who can arrange purchases and assist you every step of the way to realizing your dream home.
There are no time deadlines for foreign investors to build on raw land. Indeed the land can be held, undeveloped, indefinitely.
Planning approvals are valid for one year following the grant of planning permission. Building time in Cayman is relatively quick, and most homes up to 3,500 sq. ft. can be built within a six to eight month period from the commencement of construction. Allowing three to five months for your architect to design and obtain planning approvals and prices, you can expect to be able to design and build a home in just over a year.
There is a professional realtors association known as CIREBA. Members of CIREBA all use the multi-listing system so have access to all properties listed for sale. It is unnecessary to engage several different realtors to view different properties.

Stamp Duty & Other Charges

Stamp Duty (same as land transfer tax) is payable on all real estate transactions. For foreign owners a one-time fee of either 6% or 7.5% (depending upon the location) is paid on the higher of the price or fair market value of the property, but NOT on furnishings purchased with the property. Stamp duty along West Bay Road, on the water in the Seven Mile Beach corridor, and in the downtown George Town area is charged at 7.5%. In all other areas the charge is 6%. Caymanians purchasing property falling within the 6% duty rate area pay 4%.

Other charges associated with purchasing typically include:

A 1% duty is charged on mortgages of less than CI$300,000, and 1.5% on mortgages of CI$300,000 or higher. You should budget up to 1% for legal and registration fees.
When buying vacant land to build a house, stamp duty is payable only on the land value and not on the building after it has been built.
When transferring, a Transfer of Land form is required to be registered at the Lands & Survey Department, which costs CI$50.
When purchasing with bank financing, a valuation by an accredited firm is required and costs CI$350 upwards, depending on location, type of property, etc.

Mortgages & Borrowing

A number of banks and financial institutions offer mortgage packages. Interest rates follow New York Prime as quoted by Citibank. Banks usually ask for deposits between 10–35%. The system (as in the UK) whereby you have an interest-only mortgage does not exist in Cayman. Mortgage lengths are usually 15 to 25 years and can be taken out in CI or US dollars. It is worth comparing what kind of deal the different banks will give you as a variance of 1% or even 0.5% on your interest rate will make an enormous difference. Unfortunately, there is no convenient way of finding the best rate other than arranging a meeting with each banks' mortgage advisors and talking to them. However, I have excellent contacts in the banking industry and can direct you to a loans manager to find out more. Most banks do not charge pre-payment penalties.

Average House & Apartment Prices

The average cost of an existing 2 bedroom apartment away from the water and near the schools is about CI$240,000 (US$300,000). The average cost of a 3 bedroom house in the same type of area is about CI$320,000 (US$400,000). The approximate cost to build a home, excluding land, is in the region of CI$200–250 per square foot depending on the quality of finishes and fixtures and also on the ground conditions existing at the property. Apartments and houses on the water start at about CI$300,000 (US$365,000).

Popular places to buy a property are South Sound, Seven Mile Beach, Rum Point and Cayman Kai. Up and coming areas are Savannah / Newlands and North Side. I can advise on where to live if you have children or any other special requirements.

Call or e-mail Scott Elliott at 345-323-9377 (scott.elliott@remax.ky).
I'd be happy to answer your questions.