Heading out to the clubs and spending money willy-nilly is all well and good when you’re really young, but now, more than ever, millennials are beginning to realize that there is a better way to invest: in property.
Cayman’s property market has rarely, if ever, been hotter than it is right now. It’s What’s Hot! With new roads, renovations and other updates to the island’s infrastructure coming down the pike, why wouldn’t you buy? Renting is so very last season, and looking at the rates so far in 2018, a mortgage will set you back less per month and you’ll reap more benefits.
So what kind of place should you buy? Mark Gaus from RE/MAX says you have to be practical when you ask yourself the question. “Is it somewhere you plan to live for a long time or are you buying it purely as a rental property? Are you prepared for the maintenance that comes with a standalone home, or is a condo or townhouse more your speed?” he asks.
As far as the rental market goes, the latter is much easier to lease out than a home and it usually comes with a number of onsite amenities like a swimming pool, gym, and included maintenance.
In the end, the correct answer is determined by your needs, desires, lifestyle and future plans.
For Caymanians, a home of their own means security and investing in their island’s prosperity. For expats, it can be an investment or a building block towards getting permanent residency in the long term.
If you are starting to think about buying, you may find the idea of wading into the market a challenging one. The paperwork, applying for a mortgage, and being sure about what you’re getting can seem daunting.
Certainly, if this is your first home purchase, having a certified, experienced agent like Gaus working with you is the best way to avoid some common pitfalls. Agents are familiar with the market and which areas are appreciating faster than others. They can also advise you on what papers you’ll need to get together to secure a mortgage and may have the inside scoop on properties soon coming up for sale.
Looking at buying in a new development could be the way you’ll want to go. If you make a deposit pre-construction you can get a better price than when the property is finished, and you can choose any upgrades and options you want in advance to suit your taste.
What to expect
Regardless of what you decide to buy, you need to be prepared for the process from viewing the property to applying for a mortgage and finally taking ownership. It is about 4-6 weeks from start to finish so take a few deep breaths before you begin.
There is no point in drooling over a $500,000 house when you can’t afford it. Head to your local bank first to get a price point and pre-approved, otherwise there will be tears.
Beware the closing costs. Just because the bank tells you that you only have to put 5 percent down on the value of the property doesn’t mean that’s all you’ll be shelling out. Depending on the stamp duty you need to pay, you should be prepared to fork out another 5-10 percent before everything is said and done. Build thyself a buffer.
Stamp duty will be waived for Caymanians buying a property under $300,000 and will be 2 percent if the property does not exceed $400,000. That being said, there are certain locations that are an exception to the rule, such as parcels with water frontage. Check with your real estate agent so you don’t get a nasty surprise just when you think your purchase is in the bag.
Buying a house is not the easiest experience, but there is no greater feeling when those keys are in your hot little hands and you have your very own piece of the rock.
The best way to keep the stress to a minimum is to have an expert on your side who can guide you through the process so you don’t waste time and energy.
Just like anything else you buy in life, try not to get emotionally invested until it is a done deal. This will be one of the biggest single purchases you ever make, so keeping a clear head is imperative.
For more information on how you can get on the road to owning your own property, call Mark Gaus at 324-9961 or visit his website at www.remarkablerealestate.ky.