The real estate market in Cayman is simple and straightforward. Apart from a one-time stamp duty, there are no annual property taxes or restrictions on foreign ownership by individuals and title is granted and guaranteed by the Cayman Islands Government.
Title to land is recorded in a modern, reliable and centralised land registry, where every plot of land is mapped and given a descriptive title number based on location. Any encumbrances such as mortgages, rights-of-ways and cautions pending contracts are recorded on the title register of the parcel of land. As a result of this there is no need for lengthy title searches, title companies or title insurance. In fact, title companies and title insurance do not even exist in Cayman. Vacant land can be owned and held for future investment potential.
To date, Cayman real estate has proven to be an attractive and profitable investment. Owning land in the name of a corporation is possible, but strict rules apply and a lawyer’s advice is essential. Buildings are subject to a series of planning permissions and building permit approvals. These are monitored by the Cayman Islands Central Planning Authority and Building Control Unit, which carries out plan reviews and onsite inspections that relate to site, building, plumbing, mechanical and electrical works. There are also requirements for structural engineers to take into consideration such as seismic design principles depending on the building heights and purpose of building.
Construction materials have to be imported and are subject to duties that range from 15%-22% on the landed value (which includes duty on the shipping costs). Consequently, the cost of building is considerably higher than in places where materials are more readily available. Refer to the Building in Cayman chapter for a detailed guide on building a residential property, as well as a list of building professionals in the Cayman Islands.
Attorneys are usually used by a purchaser to aid in understanding the difference between our system and what they are familiar with back home. An attorney can also help with more complicated transactions, and ensure that the somewhat archaic procedures required by the Cayman Islands Land Registry are more easily negotiated. The biggest difference between a purchase here as opposed to most other jurisdictions is the Stamp Duty which is a 7.5% fee based on the sales price of the property. It is paid to Government after closing on each transaction in order to register your title and it is normally paid by the purchaser.