Cayman property prices and rents are rising – Buy now and stop throwing money away!
Have you been renting for a while and watching property prices rise, while your rent increases too? Are you a First Time Caymanian buyer, or do you want to put roots down in Cayman and apply for your Permanent Residency? All of the Cayman real estate market reports show a significant up turn in both sales and rental prices – so where does that leave you?
Step 1: How Much House You Can Afford?
Depending on the Cayman bank, local lenders generally recommend that people look for homes that cost no more than three to five times their annual household income if the home buyers plan to make a 20% down payment and have a moderate amount of other debt. But you should make this determination based on your own financial situation.
Step 2: Speak to a Mortgage Specialist.
Before you start looking for a home in Cayman, you will need to know how much you can actually spend. The best way to do that is to speak with a mortgage specialist at one of the financial institutes. You will need to provide some financial information to your mortgage specialist, such as your income, the amount of savings and investments you have. Your lender will review this information and tell you how much home you can afford and the price range of homes you should be looking at. The local lender will also take into account the anticpated strata payments, and/or insurance costs as both bank financed and strata properties have to be adequately insured.
Once you have found the perfect property and your offer to purchase has been accepted you can start the process to get approved for your loan. This will involve providing your financial documents (paycheque stubs, bank account statements, etc.) so your lender can verify your financial status and credit. There are different steps and paperwork to take if you are a resident of Cayman or non-resident of Cayman.
It is also good to shop around to get the best interest rates. Each bank lenders terms can differ. Make an appointment at a local Bank such as Butterfield, CNB, Scotia Bank, RBC, Credit Union, CIBCFCIB, to see which banks suits your needs – We would be happy to make an introduction to any of these please contact Jennie Cairns for more details
Step 3: Find the Right Real Estate Agent
Real estate agents are important partners when you’re buying or selling a home, and we at Milestone Properties Cayman have been trusted partners and advisors to countless buyers – we go the extra mile in helping you find and secure the right home for you in Cayman. CIREBA real estate agents can provide you with helpful information on homes and neighbourhoods that isn’t easily accessible to the public with our full access to the MLS. Myself and the team at Milestone Properties Cayman have extensive knowledge of the home buying process, negotiating skills, and familiarity with the area you want to live and this extremely valuable. There is no need to spend hours on Ecay, newspaper or Facebook groups. We can do the leg work for you by searching the MLS listings and providing you a comprehensive customized list of available properties of all three islands.
And best of all, it doesn’t cost you anything to use an agent when buying a home – CIREBA agents are compensated from the commission paid by the seller of the property.
Step 4: Shop for Your Home and Make an Offer
With Milestone, we focus on quality rather than quantity and your quality of life means the most to us! Finding the prefect property in Cayman is way more than just a budget and bedroom count. Tell me what your needs and wants are and we will do our best to find them.
If you are not sure where to start think about the area you want to be in, think about the commute, what kind of amenities you would like such as a swimming pool, access to a gym, would you rather own stand alone home on your own piece of property that allows for some freedom but also the commitment of all the up keep, or does a home with a strata fit your lifestyle better knowing when you come home from a long busy day you can relax instead of cutting the grass. Knowing how much you can afford is important and be realistic on what your budget can allow for. Please let us know if you have a proerty for sale.
It is a great idea to see what is out on the market, not just a drive by but to set up a viewing with your realtor togo inside and take a real look. Try and take pictures or videos to help you remember each home, even though there is not much availability at the moment, it can be hard to remember everything about them as you might see a lot of houses!
It is always good to keep an eye out for some of the details of the homes, for example:
- Test the plumbing by running the shower to see how strong the water pressure is and how long it takes to get hot water
- Try the electrical and AC systems by turning them on and off
- Open and close the windows and doors to see if they work properly, are they hurricane rated?
It’s also good to take a look of the neighbourhood and make a note of things such as:
- How much traffic does the street get?
- Is it conveniently located near places of interest to you: schools, Grand Harbour/Camana Bay/George Town or Countryside, restaurants, beaches, and public transportation?
Take as much time as you need to find the right home, as this is one of the biggest investments you will make in your lifetime. Then work with your CIREBA real estate agent to negotiate a fair offer based on the value of comparable homes in the same area. Once you and the seller have reached agreement on a price, the property will go pending/conditional and once the conditions of sale have been met, such as home inspection, valuation and/or financing then the sale can go pending until both parties are ready to close.
Step 6: Get a Home Inspection
A full home inspection of the property is not always necessary but it is always suggested to do. The inspector can check for signs of structural damage or things that may need fixing in your mechanical, electrical and plumbing systems. Your CIREBA real estate agent can usually help you arrange to have this inspection conducted within a few days of your offer being accepted by the seller. Alternatively, we can put you in contact with specialist trades if you have a specific area of concern such as Air Conditioning or Termite Infestation.
This contingency protects you by giving you a chance to renegotiate your offer or withdraw it without penalty if the inspection reveals significant material damage. Please ask us for details of the relevant home inspectors or trade specialists.
Once you receive the report on the home inspector’s findings. You can then decide if you want to ask the seller to fix anything on the property before closing the sale. Before the sale closes, you will have a walk-through of the house, which gives you the chance to confirm that any agreed-upon repairs have been made.
Step 7: Work with a Mortgage Banker to Select Your Loan
Every homebuyer has his or her own preference when choosing a mortgage. Some want their monthly payments to be as low as possible. Some want their monthly payments to never increase and some choose a loan based on the fact they will be moving again in just a few years. Lenders have a wide range of competitively loan programs and a reputation for customer service. You will have questions when you are purchasing a home, and having an experienced, responsive mortgage bankers assist you can make the process much easier. Butterflied, CNB, Scotia Bank, RBC, Credit Union, CIBCFCIB they all provide this service. Contact us for more details and introductions to local banking professionals.
Step 8: Have the Home Valued
Lenders will arrange for a valuation of the house you are buying. In Cayman, valuers are usually appointed by your chosen lender and are RICS qualified. The bank will tend not to lend more then what the valuation comes back at, and most will not lend on the value of the chattels..
Step 9: Understand the Paperwork
Although buying real estate in the Cayman Islands is relatively straightforward, let us walk and talk you through the paperwork – we do recommend that you contact us for more details on the process. There is the offer to purchase that your CIREBA agent will fill in for you to sign, date and initial, the loan documents that your lender will help with, and the lawyers with the closing documents. You will need to apply for stamp duty concession if you are a First Time Caymanian buyer.
Step 10: Close the Sale
At closing, you will sign all of the paperwork required to complete the purchase. Cheques will be written to the different parties involved and then you get the keys! At Milestone Properties Cayman, your agent will be with you every step of the way – from the initial brief that you contact us with your wants and needs, all the way through the process to handing over the keys to you at closing.
Please contact me anytime if you have any questions regarding the process of purchasing a home in Cayman or if you are ready to get started.