Mars House St. Michael
Barbados is a developing country and it is a common practice to buy land and build the house of your dreams.
There is plenty of land for sale in Barbados and you can often find the ideal location with ocean views and rolling countryside to build upon.
The appealing nature of buying land in Barbados is you can design and create your ideal living space and you don't have to make do with an existing property.
The down side to buying vacant land and building your own home is you have to go through the sometimes stressful process of construction. However, there are many reputable builders on the island who you can work to alleviate a lot of the problems that tend to make new construction stressful.
If you are looking to fund your land purchase from overseas, you will need to register your funds with the Central Bank of Barbados, so in the future if you want to take the money back out of the country you can.
If you are looking to fund your purchase with a mortgage, the banks in Barbados have specific loans in place for land purchases. If you are not a resident or citizen of Barbados, you can still apply for a land loan as long as you have a proof of income in your home country and a good credit rating.
The bank will release the funds for the purchase of the land you have chosen separately to the funds for building the house; however a land loan is usually at a higher rate than a mortgage for an existing home. This is good option if you want to secure the land now and are in no rush to build the property, which is why the banks offer this loan option.
It is worth shopping around for quotes from a number of construction companies and go with the firm that you feel most comfortable with, which may not be the least expensive. You may initially plan on building a 3,000 square foot house, but after you sit down with a construction company, they may advise you with your current budget you can actually only afford a 1500 square foot house.
At the time of writing (September 2008) building costs are on average $200 BDS a square foot. If you bought a plot of land totaling 8,000 square foot on the south coast of Barbados, this may cost approximately $300,000 BDS. A 1500 square foot house would cost approximately an additional $300,000 to build.
Therefore your total of land and home cost will be approximately $600,000 BDS and the monthly mortgage repayments would be upwards of $4375 BDS based on the current rate of 8.75%.
When you are ready to build on your land, you will need to get plans drawn up by the builder and submit them for approval by the Town & Country Planning in Barbados. This usually takes anywhere from 3 to 6 months for approval.
Once the plans are approved you can proceed with the chosen construction company to start the building construction. If your purchase is funded through a mortgage, the bank will release a predetermined amount of money to the construction company for each phase and set a deadline for completion of this work.
The bank will send out a building inspector to ensure the project is on track and will release the next set amount of funds when they are satisfied with the work carried out and as the project moves along through the building phases.
As the purchaser, this system ensures you are getting your work completed and inspected, and ensures the construction company gets paid each time the bank is satisfied with the work completed in each phase of construction.
The price of land varies depending on the location. On average you can expect to pay around $50 BDS per square foot, however if you purchase a larger piece of land this square foot rate can be reduced quite dramatically. If you decide on purchasing a beachfront or sea view plot you can expect to pay as much as $300 BDS per square foot.