Grenada Property Buyers Guide
Whether you are buying a starter home, an investment property or a vacation home away from home, purchasing a property is likely to be the largest financial investment you will ever make in your life. As such, it is imperative that you arm yourself with as much information as possible to make a well-informed decision.
Below is a guide in understanding the Grenada Real Estate buying process; this list is not intended to be by any means exhaustive.
The Residential Buying Process1. Know What You Want and Wheather You Can Afford To Buy
Make a detailed “wish list” of what you want in a home. This will include location and type of home. Finally, examine your current financial situation and project how much you can afford.
2. Get Pre-approved
It is highly recommended that you get pre-qualified for a loan before you start your search for a home. This process involves meeting with your lender and providing them with information on your current financial situation and credit history. The lender will examine this information and provide you with details on how much you can borrow. Getting pre-approved will give you an accurate idea of how much you can afford and it will allow you to be taken more seriously upon making an offer.
3. Contact a Realtor
Altman Real Estate (Grenada) Ltd. highly experienced Real Estate Agents will guide you through the property search, financing, negotiation and transaction processes.
4. Search for and Find a Home
Searching for a home is all about knowing what’s important to you. We recommend you begin your search online where you can view a large number of properties and make a short list for viewing in person with your real estate agent. In viewing a home, your Altman Real Estate (Grenada) agent will help you notice details that you might overlook, provide expert analysis, and can also act as an unbiased advisor.
5. Make an Offer and Purchase the Home
Once you’ve found the home you’d like to buy, it’s time to make an offer. If the offer is accepted, you will require a registered Grenadian attorney to search the register and establish the title of the property. The contract will be prepared by the vendor’s attorney, which provides for a deposit to be made securing the property.
6. Secure your Financing and Close the Deal
It is now time to return to the lender in step 2 to finalize your mortgage details and close the deal. This means finalizing all financial conditions associated with the closing, such as interest rate and down payment. A 10% deposit will be held by the vendor’s attorney in escrow until completion, when the balance of the purchase price is paid and the title passes to the purchaser by way of the conveyance, which usually takes about two to three months. The remaining 90% of the balance due will be paid at time of conveyance. The final step is for the vendor to pay for the transfer taxes and the government stamp duty.
Alien Land Holding License – In order to own property or land for sale in Grenada, you must apply for an Aliens Land Holding License. This license fee is 10% of the agreed purchase price minus the value given for contents and furniture. This fee must be paid to the Government of Grenada once the license is granted. It generally takes about three (3) months to obtain the License.
The attorney representing you will require the following documents in order to apply for the License on your behalf:
- Police Certificate/Two Character References from a Friend/Bankers Reference.
- Stamp Duty – this is generally 1% of the agreed purchase price.
- Legal fees – these are generally 2% of the agreed purchase price.
- Other minimal charges may include FedEx charges, postage, recording fees etc. – ½%
Once a price has been agreed, a Sales Agreement outlining the terms and conditions of the sale is prepared by the vendor’s attorney and sent to the purchaser’s attorney. The purchaser will then be required to pay a 10% non- refundable deposit which is held in escrow by the vendor’s attorney until completion of sale. The only condition in which the 10% deposit is refunded is if the Aliens Land Holding License is not granted or if proper Title Deed is not proven. It is imperative that when monies are being transferred from overseas, the “source of funds” be included in the information for the bank in Grenada as this can delay the process.
Property Tax – Paid annually, this is 0.30% of the value of the property as deemed by the Government of Grenada for a residential property and 0.2% for land. Valuation takes into account the following:- location, land prices in the area, development potential, type of land, size of land, condition of building.
Obtain any covenants that may exist of the area, thus enabling you to make an informed decision on the restrictions governing the area. Some of these areas include Westerhall Point, Ft. Jeudy, Lance Aux Epines, Egmont, Point Marquis and Calivigny Gardens. There is usually an annual maintenance fee that is required by residents of these areas.
If purchasing a property that has a pool, it is advisable to have the pool checked out thoroughly before purchase.
Land Transfer Tax – The seller (if a non citizen) is required to pay 15% of the agreed selling price at the time of sale to the Government of Grenada. If a property is being sold fully furnished, a portion of the sale price can be attributed to the furnishings as Land Transfer Tax is only calculated on the cost of the property and land. The Government of Grenada gives everyone a break of EC$20,000.00 off and Land Transfer Tax is calculated on the balance.
If purchasing land, ensure that all boundary markings are clearly identified.
Building costs generally run in the range of US$250.00 per sq. ft. increasing depending on the level of finishes and complexity of design. The addition of a swimming pool can cost in the range of US$46,000-US$74,000 for pools ranging from 20’ to 30’ long by approximately 12’ wide. This costing would include a pool deck but you may even have to pay more if you add Gazebos etc.
Architectural fees can range depending on the firm chosen, however a rough guide would be approximately 12% broken down as follows:-
- Architects fees – 6% -10% of total construction depending on services provided.
- Quantity surveyors – 2 ½% of total construction
- Structural engineering – 2 ½% of total construction.
- Electrical engineering – 1% of total construction
Approximate Interest Rates:
- 10 – 11 % payment over 30 years (25% down payment required)
- Good Credit
- Existing Liabilities/Loans etc.