Buying and selling properties in the Cayman Islands in the 1970s and 1980s was quite different from today, as real estate companies were not organised as effectively and efficiently. It is for this reason that in 1987 a group of realtors agreed to form the Cayman Islands Real Estate Brokers Association (CIREBA). CIREBA is a not-for-profit association based on the North American style of relationship between realtors and clients. One of the Association's founding objectives was to "improve and elevate the general knowledge of persons engaged in the real estate business." Today, CIREBA is proud to boast that it has more than 31 member companies, making up approximately 80% of all realtors in the Cayman Islands!

   To be a member of CIREBA, agents and brokers must complete a professional training programme which, amongst many subjects, encompasses business ethics, due diligence requirements and some contract law. A high degree of competence is expected from all CIREBA members and they must adhere to a strict Code of Ethics established by the Association.

   CIREBA members input listing data into the Multiple Listing System (MLS), providing a central data source of information for its members. The basic premise of the MLS is that all CIREBA member firms have agreed to share their property listings and work together on any real estate transaction. This means you can view and buy any property through any CIREBA agent, not just the listing broker or agent. CIREBA monitors the business standards and practices of all of its members, thus ensuring fair, honest and professional dealings in all real estate transactions

The CIREBA Multiple Listing System currently (as of July 2009) holds 1902 active listings totalling more than US$1.8 billion. This is up slightly from one year ago, when the total value of properties was US$1.74 billion. These listings include 106 three-bedroom condos at an average price of US$813,838, 389 two-bedroom condominiums at US$502,622 and 480 parcels of land at US$469,430. From January through July of 2009, 256 listings have been sold, valued at US$114,640,936. For the same period last year, 316 properties sold with a total value of US$170,662,929. A quick analysis indicates the average sale price achieved this year is 83% of the average price one year ago. The number of transactions this year is 81% of the total for the same period last year and the combined value of sales achieved has come in at 67% of last year's. 

   While Cayman real estate has clearly been in a buyers' market, there are signs which indicate that the market has reached its lowest point. This year, condominiums listed in the CIREBA MLS have sold for an average of 95% of the listed price. In comparison, a year ago condominiums were selling at 94% of the listed price. The average time on market for a condominium this year is 364 days; last year the time on market for condos was 401 days. Residential homes have sold at an average of 91% of list price this year, compared with 89% a year ago. The average home listed this year was on the market for 307 days before selling; a year ago the time on market was 367 days. Residential/agricultural parcels of land have yielded 91% of list price and have been on the market for an average of 432 days. One year ago, similar properties were on the market for 431 days and fetched 91% of their list price.    

   Though it is clear the properties that are selling are the less expensive ones, those properties that are selling are fetching a slightly higher price in relation to their list price and are selling a bit more quickly.  Thus, as usual, the value of real estate assets in Cayman has been fairly consistent and owners of Island real estate have retained full confidence in Cayman and their assets. This year's reduced time on market in all the real estate sectors, together with the firming of prices, is a strong indication the buyers' market is waning.    

Buying a property in the Cayman Islands has many advantages, not least that if you are staying for some time, mortgages tend to work out cheaper than rents over a three to five-year period. There are no restrictions on foreign ownership of real estate if the property is for personal use, and there are no annual property or capital gains taxes. Cayman's Land Registry office is well run and modern, enabling transfers to be relatively quick and simple. Every piece of property is registered under a unique block and parcel number, which means every owner is registered and the government guarantees the right of ownership. A potential purchaser may examine the records regarding any piece of property to check whether there are any liens, charges or restrictions on it.

Good realtors, architects, land surveyors and building contractors are easily accessible, as are attorneys who can assist with conveyancing.
  

Stamp Duty is payable on all real estate transactions. A one-time fee of either 6% or 7.5% is paid on the sale price or the fair market value of the property (as determined by the Lands and Survey Department), but NOT on furnishings purchased with the property. Stamp duty along West Bay Road, on the water, and in the downtown George Town area is charged at 7.5%. For exact locations, you should ask a real estate agent to confirm which block and parcel numbers fall within the 7.5% zone. All land outside of this area (for example West Bay and anywhere outside the downtown George Town area) is charged at 6%. Caymanians purchasing property falling within the 6% duty rate pay 4%.

Other charges associated with purchasing typically include:

> A 1% duty is charged on mortgages of less than CI$300,000 and 1.5% on mortgages of CI$300,000 or higher. You should budget up to 1% for legal and registration fees.

> When building a house, stamp duty is payable only on the land value and not on the building after it has been built.

> When transferring, a Transfer of Land form (which costs CI$50) is required to be registered at the Lands and Survey Department. Other forms may be required.

> When purchasing with bank financing, a valuation by an accredited firm is required and costs CI$350 and upwards, depending on location, type of property, etc.

As stated earlier, stamp duty is not charged on the furnishings or chattels of a house. Some confusion has surrounded what is and what is not included. For example, anything you can pick up and move from the house is often considered a chattel. However, air conditioning units, fitted carpets and bespoke hurricane shutters are not considered to be chattels, whereas fridge/freezers, dishwashers, cookers, curtains, area rugs and any furniture or accessories are considered to be chattels. When working out the value of these items, the cost must be based on the replacement value. So if it is a five-year-old fridge/freezer that you are working out the value on, you must estimate the replacement value of another five-year-old fridge/freezer, not a brand new one. If the appliance would normally cost CI$800 brand new, then a second-hand version would probably be valued at CI$350. This figure is what would be used for the value of the chattel. If you are not entirely sure how to calculate value, then call the Lands and Survey Department on (345) 244 3420 and they will be happy to discuss your specific circumstances.

Residential property in Cayman is often sold as part of a strata plan if it is in a condominium or apartment complex. Most countries have the concept of freehold property, where the owner has ownership of, and responsibility for, looking after the land they own and all buildings on it. Strata ownership is less familiar to many people, but very common in Cayman. The following is an explanation of how it works:

> If you buy a property which is part of a strata plan, you will have the freehold title of the house or apartment that is situated within the property in the plan. You will also own a share and have voting rights in a corporation (the strata corporation) which owns all the land in the strata plan, including estate roads, communal gardens, shared pools and gyms, etc.

> The strata corporation has an obligation to insure the strata property and maintain it for the benefit of the shareholders, along with the right to recover the costs of doing so from them. There will be rules and regulations governing how the strata company is run (known as strata by-laws) and an annually elected committee that is authorised to run the corporation. The by-laws will contain any restrictions on activities of strata owners, such as owning pets or keeping a boat at the property, so it is important to understand them before buying. It is also important to know how much you can expect to pay the strata corporation for providing the insurance and maintaining the property.

> Examples of monthly strata fees you might expect to pay are: CI$500 for an inland two-bedroom townhouse (CI$300 per month for insurance and CI$200 for maintenance - water and electricity fees for the grounds, garbage collection and garden maintenance); a three-bedroom inland apartment may well be CI$650 per month, and for properties on the water, especially along Seven Mile Beach, you could easily pay between CI$800-$1,200 (CI$400 maintenance, CI$336 insurance and CI$64 sewage charge). If you are interested in a particular property, your realtor should be able to find the exact strata fees for you. A well run strata plan will help a property to hold or increase its value.

When applying for a mortgage it is current bank policy to request that a property valuation be undertaken by a qualified valuation professional or chartered surveyor. It is usually the purchaser, not the seller, who has to undertake this step. A property valuation will give a general description of the property, describe any improvements to the house or the garden, pool, fencing, etc (and work out their value to the property). It will take into account the location, give formal title details, include maps and photographs and provide invaluable background checks on the recent property sales in the area. If nothing else, it will help you feel reassured you are paying fair market value for the property (and not being overcharged). For a straightforward valuation on a home, condo or land parcel, the process usually takes only a week.

There are various pitfalls you will want to avoid when buying a property in Cayman. Many, such as unpaid strata fees by the previous owner, will be caught by a conveyancing lawyer just doing his or her job. However, other pitfalls, less well known but equally easy to avoid, are as follows:

> Water Bills: Make sure the final water bill on the property has been paid by the previous owner. Though technically both water companies cannot hold you responsible for any outstanding balance, unpaid bills can, and have in the past, caused problems. Do your own due diligence and check with the water provider before finalising the purchase of the property. All it takes is one phone call to the water company. This issue does not arise with CUC (the electricity provider).

> Air Conditioner Servicing: Another thing worth checking is whether the property owner has been regularly servicing the a/c units. It costs around CI$125 every quarter to service two a/c units and unfortunately many property owners don't bother, especially if they are soon going to sell the property. You will want to ask the seller how often the air conditioning units have been serviced, as a lack of regular maintenance will greatly reduce the life expectancy of air conditioning condensers and new a/c equipment can cost thousands of dollars. Also, in the event of an air condenser (which is usually housed in the attic) failure, the first thing you will probably notice is your ceiling caving in! As a condition of the sale, request that the seller have the property's units serviced and provide a report on their condition.

> Pest Control: Lastly, you have to remember that Cayman is a tropical country, so you will need to check if the previous owners have had the property sprayed regularly for ants, roaches and other pests. In this climate, it is recommended that your property be sprayed every quarter, not only to protect your investment, but to keep down the number of ever present pests which are a reality of life in Cayman. If you do not have your house sprayed regularly, you will quickly find you have an ant problem or, even worse, a roach problem. If you are buying a wooden house, you absolutely must get the house checked for termites by a professional before you buy the property. A severe termite infestation in a wooden house might make the property unsalvageable.