“This year has been extremely good in terms of sales,” said Chertertons' director Kieran Kelly. “It’s a big turnaround from 2010 and 2011, which were tough. Sales began to pickup in 2012 and have been increasing. We’re currently seeing around 10 new clients per week.”
Prices of beachfront condominiums in both West and South Coasts rose during the fourth quarter of 2015, according to Terra Luxury. Based on Terra Caribbean's Beachfront Condo Price Index (BCPI), which the company launched in January 2015, beachfront condo prices in the West Coast rose by 10.7%, "a clear indicator that the market is in a healthy growth pattern and on track to return to pre-2012 levels".
The median price of beachfront condos on the West Coast was US$ 805 per square foot (sq. ft.) in end- 2015, up from US$ 728 per sq. ft. in 2014 and US$ 546 per sq. ft. in 2013.
The median price of South Coast's BCPI beachfront condos rose by 3.5% during 2015 to US$ 441 per sq. ft.
In terms of supply, Terra Caribbean noted that the West Coast is currently oversupplied, although demand is improving and prices are rising as new buyers enter the market. In the South Coast, main beachfront properties are sold out and there is no new pipeline supply, so an increase in resale prices is expected.
British tourists made up around 14.6% of arrivaals in 2015. Property demand from British buyers also increased greatly in 2015. Royal Westmoreland reportedly had their best sales period in more than 10 years, with US$ 60 million worth of villa sales as of June 2015.
"The drop in the strength of the pound has not slowed sales as the overall economic outlook is so buoyant in the UK," said Royal Westmoreland's Sales Director, Kim Goddard. She noted that 99% of her sales inquiries came from the UK.
Goddard forecasted that residential property prices will increase by 3% to 5% in 2016, as demand continuous to grow for properties worth US$ 1.5 million to US$ 2.5 million, and properties worth US$ 10 million onwards.
“We are anticipating a good season as demand for property has increased this year (2015) and we predict this will continue next year (2016), especially amongst the British who account for the majority of our international sales,” said Jeanie Mahon, from Knight Frank’s Barbados office.
Generally there are no restrictions on foreign ownership in Barbados except for one formality: nonresidents must obtain permission from Barbados´ Central Bank if they want to buy property. This is pro forma, but failing to do so will void your purchase.
Analysis of Barbados Residential Property Market »
Rental income earned by nonresidents is subject to 25% withholding tax, which is credited against the taxpayer’s final income tax liability.
Capital Gains: There are no capital gains taxes in Barbados.
Inheritance: Inheritance is not taxed in Barbados but transfers of property in Barbados are subject to property transfer tax.
Residents: Residents are taxed on their worldwide income at progressive rates, from 20% to 33.50%.
Buyer and seller pay for their own lawyer (legal fees are at 1% - 2%, plus 15% VAT).
Tenant Eviction: The landlord cannot evict a tenant without a court order under any circumstances, even when the tenant has not paid the rent for six months. It takes an average of 92 days to evict a tenant.
The central bank expects a 5% fiscal deficit for 2016-17, lower than 7.4% of GDP in 2015-16.
During the first quarter of 2016, inflation was at -0.6%, down from 1.6% in Q1 2015, according to the central bank - significantly lower than the 5.6% average from 2005 to 2013, according to the IMF.
Unemployment was 9.3% in the first quarter of 2016, down from 11.8% in Q1 2015, according to the Barbados Statistical Service.
Tourism is one of the main economic drivers of Barbados, accounting for about 12% of the country's GDP in 2015, according to the World Travel and Tourism Council, and 12.3% of the country's total employment.
In the first quarter of 2016, total visitor expenditure in Barbados expanded by around 20% during the year to Q1 2016, according to the Caribbean Tourism Organization's (CTO) quarterly survey, due to a 7.4% growth in tourist arrivals and 14.9% rise in tourists' average length of stay.
In 2015, tourist arrivals rose 13.9% to a historic high of 591,872 visitors, according to the Barbados Statistical Service.
"This year we have seen growth in all of the major areas of importance, including airlift, accommodations, and programmes to enhance the quality of our tourism product," said William Griffith, CEO of Barbados Tourism Management Inc (BTMI).
"We are also enjoying favourable global economic conditions in several key source markets, the price of oil is down and travelers are gaining greater confidence and now booking further in advance."
In 2015, stop-over arrivals from the USA were up by 24.9%, the highest y-o-y growth among the country's visitor markets. Tourism from the Caribbean Community and Common Market (CARICOM) (excluding Trinidad & Tobago) rose by 14.8%, followed by growth in the UK market (14.6%), Canada (13.2%), Trinidad & Tobago (6.2%), and Germany (2.9%).
"In 2016 Barbados will be a hub for visitors as we will raise the standard of every event in line with our golden celebrations to mark our 50th year of independence. During these year-long celebrations there will be chances to win free vacations and free destination weddings, as well as incentives for our top-performing travel agents," according to Mr. Griffith.