NASSAU, BAHAMAS — Outgoing Bahamas Real Estate Association President Carla Sweeting says the government’s proposed real estate measures in the 2026/2027 Budget Communication are a positive step for the industry, particularly for first-time homebuyers, though questions remain about how some exemptions will work in practice over the long term.
The measures were outlined by Finance Minister Michael Halkitis during his Budget Communication in the House of Assembly, where the government announced reforms to the Real Property Tax system aimed at strengthening support for Bahamian homeowners while increasing contributions from foreign-owned properties.
Under the proposed changes, the government will introduce a two-tier Real Property Tax system distinguishing between Bahamian-owned and foreign-owned properties. A new category for foreign-owned residential property will carry a tax rate of 0.625 percent with a maximum cap of $200,000.
The government also announced that property classification will no longer depend on how many days a person spends in The Bahamas. Instead, it will be determined by whether the property is used as a residence, replacing the existing 180-day test.
At the same time, the government said it is increasing the First-Time Homeowner exemption under the Real Property Tax Act from $500,000 to $600,000 while broadening exemptions available to eligible first-time buyers.
Speaking with Eyewitness News, Sweeting said the measures represent “a step in the right direction,” particularly at a time when affordability remains a major issue for Bahamian families.
“So moving the threshold of first-time homeowners from $500,000 to $600,000, I’m very pleased with that and I’m extremely pleased with knowing that a first-time homebuyer who is looking at buying a property that they will get the full exemption as opposed to what they have been doing and only giving a portion,” Sweeting said.
She said the changes would provide meaningful upfront savings for buyers entering the market.
“If you buy a home and you fall under that exemption, that’s wonderful that you don’t have to pay the VAT on the transfer if you’re under $600,000,” she said.
However, Sweeting cautioned that uncertainty remains around how the Department of Inland Revenue will treat duplexes and other income-producing properties purchased by first-time homeowners.
“If I go and buy a duplex now and I get the full exemption on that, how is the DIR going to look at this property? Are they still going to look at it as commercial because it is income producing, or will they give me my portion as homeowner exempt? And how will they do that?” she questioned.
Sweeting said that while the proposal appears attractive on paper, buyers could still face higher real property tax obligations over time if those properties are classified as commercial.
Despite those concerns, Sweeting said the association’s initial review of the measures has been positive.
Sweeting, who is preparing to demit office following the association’s AGM on June 18, also reflected on the significant regulatory changes impacting the industry over the past decade, including the introduction of VAT, national risk assessments, the Financial Transactions Reporting Act, the Compliance Commission, and additional Department of Inland Revenue requirements.
“There’s been so many changes to our industry,” Sweeting said. “Look at how many changes the DIR has thrown at us and what we have to do now. It is insane.”
She said those developments have reinforced the urgency of modernizing the association’s governing legislation, noting that the Act has not been significantly amended in more than 20 years.
“We have been trying for years, or boards have been trying for years, to get amendments to our Act,” Sweeting said. “Our amendments are before the law reform, and we’ve never gotten it this far.”
Sweeting said the association remains hopeful the proposed reforms will ultimately reach Parliament.
“We are forever grateful to the past AG, Ryan Pinder, and we’re hoping that the current one, Mr. Monroe, who has a relationship with our board and understands the necessity, will keep that momentum going,” she said.
“It is imperative that we get these amendments done,” Sweeting added.
