Steps to Buy Property in the BVI

Steps to buying BVI property

Here are the basic steps to buying BVI property for non-citizens to purchase real estate in the British Virgin Islands:

  1. Select the property you wish to purchase.
  2. Submit earnest money along with a Letter of Intent to purchase which spells out offer price, terms to purchase and any conditions that must be met by the Purchaser or Vendor.  This Letter of Intent is only a tool to negotiate price and terms and is subject to a Sale and Purchase agreement being signed by both the Purchaser and Vendor.
    Work with a local realtor or BVI attorney to purchase the Property. Ernest money is normally 10% of the final negotiated sale price of the property.
  3. It is advisable to designate an experienced local BVI attorney to handle the sale once the Letter of Intent has been agreed upon and signed.
    Off-island lawyers are usually completely unaware of BVI real estate rules.
  4. Advertise locally in the BVI for 4 weeks, by newspapers and internet.  Buyer does this to prove to the BVI government that no BVI citizen (Belonger) is interested in buying the property.
  5. Sign a binding Sale and Purchase Agreement for the Property.
  6. Perform due diligence as needed on the property.
  7. Prepare the Non-Belonger License Application which includes the Property Appraisal, Sales Offer, various Character and Financial References. Your local BVI Lawyer can assist here.
  8. Pay a $200 application fee for a legal license to buy the property. This fee is included in attorney fees.
  9. Wait for the BVI Government & BVI Governor to approve the license to buy the Property, which costs $600 if granted.
    The BVI government and Governor are currently taking 5-6 months to approve such licenses.
  10. Pay Vendor for property minus earnest money.
  11. Non-Belongers: Pay 12% stamp duty to BVI  Government (or 1.5% of Property value + 20 years’ rent if leasehold Property); Belongers: Pay 4% stamp duty to BVI Government (or 1% of Property Value + 20 years’ rent if leasehold Property. Note: the Property value for Stamp Duty is either the offer Price or the Appraised value of the Property, whichever is greater.

Neither the purchaser nor the seller is required to be present in the BVI at any stage of the transaction.

Whether or not a foreigner intends to reside permanently in the BVI, it’s important to realize that purchase of a property in the BVI does not in itself establish resident status. However, it does currently grant a right to reside 6 months of the year. (Year-round residency can be applied for separately to BVI Immigration.)

In fact, all foreign parties are required to obtain a Non-Belongers Land Holding License (NBLHL) to purchase a specific property in the BVI. This license does not allow a Non-Belonger to bid on another property. A new NBLHL would be required.

It’s a long road from viewing to owning a property in the BVI, Emerald Properties BVI will help you do due diligence to avoid any surprises that could pop up. You’ll be able to rest easy knowing we have expertise with the unusual property laws in the BVI.

Who is a Belonger?

A Belonger is legally defined as a person whose mother or father was either born in the BVI or was naturalized. Therefore, a person does not have to be born in the BVI to be a Belonger.

A corporation can be defined as a Non-Belonger Company if it was incorporated outside the BVI, or if any one of its directors (or a shareholder with 33% or more controlling interest) is a Non-Belonger.

Disclaimer: Please consult with a BVI attorney or the Natural Resources department of the BVI government to clarify the above information, which has been simplified for the purposes of this website.

Completion of the sale, transfer of title, and stamp duties

The applicant is required to register at the Land Registry Department and provide documentation within 3 months once the NBLHL is granted.

A recent appraisal of the property will be required. Non-Belongers are subject to a 12% stamp duty on the purchase price or appraisal price (whichever is higher) in order to transfer the property into their name.

Steps to buying BVI property - Building a new home on BVI land

Non-Belongers are also allowed to buy land and build their own, customized home, but we recommend working with a good local architect and builder who understand the requirements of Town and Country Planning. From blueprints to a move-in-ready home may take 9 to 18 months.

Costs of building a BVI house

Building costs range from $250 to $300 per square foot for quality construction and finishes. Luxury finishes can cost up to $500 or $600 for each square foot.

A swimming pool may be an additional $60,000-$80,000+.

A Non-Belonger may choose to purchase their land from a builder who provides several standard designs to select from, builds the home and customizes it for you. In all cases of buying land and building, stamp duty is charged only on the land value, not the whole project. In addition you get a reliable builder who can deliver a quality home to you on schedule.

BVI real estate laws

The legal system in the BVI is based on British common law and locally enacted legislation. It is highly recommended that the buyer appoint a local attorney in the BVI to ensure the transaction goes smoothly.

The attorney’s responsibilities will normally include submitting the application for an NBLHL license. A Non-Belonger should expect to pay a lawyer fees from 1.5% to 2% of the purchase price.

The majority of land in the BVI is owned in fee simple. A purchaser will normally acquire absolute title, which is in the land registry of the BVI government office called the Registrar of Lands. No transfer of land can take place unless the boundaries of the property have been determined to the Registrar’s satisfaction.

Property in the BVI may also be held on long lease from the government or private individuals. Most often the duration of such leases is 99 years. Instead of the flat 12% stamp duty for freehold properties, a leasehold property costs a Non-Belonger 1.5% of the total premium paid for the lease (i.e. the purchase price) plus the first 20 years’ rent.

BVI real estate financing

The currency used in the British Virgin Islands is, strange though it sounds, United States dollars (USD), because we do so much business with the nearby US Virgin Islands.

Banks in the BVI offer worldwide banking services for Belongers and Non-Belongers alike. They will finance mortgages for 75%-90% of the appraised value of a property or the purchase price, whichever is lower, for terms up to 30 years. Construction financing is also available. Mortgage interest rates are generally 1.5% above New York Prime rate.

Property taxes

BVI Land Tax is assessed annually at the rate of $50 USD for sites that are under half an acre. All other land is taxed at $150 USD for the first acre and $50 USD for each additional acre (rounded up).

Houses are taxed at 1.5% of the assessed annual rental value. In practice this means that for an average 2- to 3-bedroom house the annual taxes will be less than $1,000 USD.

Call or contact Emerald Properties BVI at 284-541-6861 for all the steps to buying BVI property; your trusted partner for finding that special dream property to buy in the BVI. You can rely on our expertise to help you understand BVI real estate rules!