Minister: Land Licence Policy Revised
[Updated with video] A policy requiring couples of whom one is non-Bermudian to buy a land licence will be revised Minister of National Security Wayne Perinchief said this morning [Feb.17] in the House of Assembly.
“All of us have been approached or lobbied to change this aspect of the law,” said the Minister. “The practical consequences for these couples has often been to unduly and adversely affect their ability to purchase a home.
“In some cases vendors are reluctant to wait for the license process to run its course to complete the transaction, while in others, complex applications have caused sales to simply not proceed.
“Mr. Speaker, again a balance must be struck. I can therefore advise this Honourable House that Cabinet has approved amendments to the relevant legislation to include married couples, where one spouse is a Bermudian, in the list of those persons not requiring a license for the purchase of property in Bermuda.
“This is provided the purchase is a first-time family home to be occupied by the purchasers. Subsequent, investment homes will be subject to the license requirement.”
The law came into effect in 2010, and required property owning couples of whom one is non-Bermudian to obtain licences costing $1,375.00.
The Minister’s full statement follows below:
Mr. Speaker, Honourable Members will recall that the Ministry of National Security set up a Land Policy Review Group to consider and advise on specific areas of land holding policy.
Submissions were sought from the general public and interested groups in the community. Forty-four (44) submissions were recorded, and several meetings conducted by the Review Group.
Mr. Speaker, the technical officers involved were drawn from various Ministries and in some cases had advised on the 2007 changes to the law in this area. As might be expected there was not universal agreement on the way forward and the discussions mirrored the debate in the public domain.
At the heart of the 2007 changes to the law and concurrent policy has always been the protection of the rights of Bermudians. This Government’s responsibility is to take note of trends in any area and to implement policies that will serve our people first.
Lest Honourable Members forget, Mr. Speaker, the 2007 changes to the law on land policy were implemented against a background of prevalent and illegal “fronting” which used available means to frustrate the laws on foreign-ownership of land in Bermuda.
Mr. Speaker, the rental and housing markets were simply white hot in terms of price and when taken with the earning power of Bermudians and the housing subsidies provided to their expatriate counterparts, a perfect storm of market conditions made the struggle for home ownership too great for our people.
Mr. Speaker, long after we are gone, the debate will rage on whether what was done was necessary or effective. Mr. Speaker, we cannot be consumed by that debate when there is a clear need for action.
Mr. Speaker, changes must be made. This economy demands that changes must be made. Our challenge is to effect change that stimulates the economy and continues to be beneficial to Bermudians.
Mr. Speaker, the Ministry has consulted widely. We have taken full account of the advice that urges no change. We have considered the pleas for total lack of restrictions. We have ended up with a formula for change that will stimulate this important sector of the economy and allow Bermudians to leverage their main asset to their benefit.
Mr. Speaker, Honourable Members will recall that the results of section 17 of the 2007 Act restricts Bermudians from selling residential property to non-Bermudians. Mr. Speaker, I can advise this Honourable House that amendments to that section and others will be made, to permit the sale of land generally to non-Bermudians valued at or above a prescribed ARV threshold.
Mr. Speaker, Honourable Members should take note that the ARV threshold is set by the Minister responsible for Immigration and traditionally reviewed every five (5) years. Historically, the policy has been to permit the top 250 homes for sale to non-Bermudians.
During the five years between revaluations, property owners would modify their homes to get their ARV above this threshold. Mr. Speaker 2009 revaluation did not include a review of ARV thresholds. Therefore the existing 2005 thresholds would make 396 homes available for purchase by non-Bermudians; or 58% more than the traditional number of homes usually available.
Mr. Speaker, this is where striking the appropriate balance is vitally important. I have advised my Cabinet Colleagues and can now advise this Honourable House that the policy of having the top 250 homes available for sale to non-Bermudians will be maintained.
To achieve this, the ARV threshold will be set at $177,000 which in fact makes 249 properties available. The new threshold will be set as at 1st April, 2012.
Mr. Speaker, the mechanics of sections 76, 77 and 78 of the Bermuda Immigration and Protection Act 1956 result in married couples, in which one spouse is a non-Bermudian, having to obtain a license to purchase land in Bermuda and pay the prescribed application fee. Section 82 sets out exceptions to these provisions; they do not currently include such couples.
Mr. Speaker, the depth of feeling expressed on this state of affairs is real. All of us have been approached or lobbied to change this aspect of the law. The practical consequences for these couples has often been to unduly and adversely affect their ability to purchase a home.
In some cases vendors are reluctant to wait for the license process to run its course to complete the transaction, while in others, complex applications have caused sales to simply not proceed.
Mr. Speaker, again a balance must be struck. I can therefore advise this Honourable House that Cabinet has approved amendments to the relevant legislation to include married couples, where one spouse is a Bermudian, in the list of those persons not requiring a license for the purchase of property in Bermuda.
This is provided the purchase is a first-time family home to be occupied by the purchasers. Subsequent, investment homes will be subject to the license requirement.
Mr. Speaker, these changes in policy recognize the economic realities of this present age. In a society where the most valuable asset is often real estate, a responsible Government acts in ways to permit assets to work for those individuals who have invested in them. We believe these changes achieve that goal.
Mr. Speaker, encouraging economic growth in the current climate may require that all stakeholders feel a tightening of their belt straps before we see a market turn-around.
To that end, I renew my call for the private sector to play its part in supporting these policy changes. To maximize on their economic impact, real estate agents should consider a temporary reduction in the traditional 5% commission.
Local lending institutions should reduce the required down payment to further stimulate the market, particularly for first-time purchasers. The legal profession should reduce their conveyancing fees in such circumstances.
Mr. Speaker, Honourable Members will also recall that the Review Group was tasked to examine the policy related to the purchase of condominium units by PRC holders and the potential for a reduction in the applicable land-holding charge.
Mr. Speaker, this is a unique demographic and an equally unique market share. We continue to gather data and consult on these proposals in advance of effecting any change in policy.
Mr. Speaker, stimulative prospects of these policy changes for the economy span small construction and contractors engaged to upgrade homes, market activity as some Bermudians sell large homes and downsize, fees to the related private sector parties, repayments of loans and mortgages increasing viable capital for further lending, and additional revenue to the Government.
The Government is leading by example and stimulating the market, the action will only be fully successful if our private sector parties act with equal conscience.
Thank you, Mr. Speaker.
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Update 12.45pm: Minister Perinchief hosted a press conference this morning, video below.
Do. I. Get. My. Money. Back?
…the sound of crickets……
Me too!
This is not a policy revision…this is a policy reversal. And NO, you don’t get your money back. The govt is broke and they need it all!!!
Well then give me a CREDIT ON MY LAND TAX! If not then I’m voting to kick yah assses out in the next election.
How many Bermudian/non Bermudian couples have left the island because of this unfair law?
My guess is None.
Unfair, hardly. I think it was more of a bureaucratic headache as opposed to Unfair.
It was unconstitutional. Very unfair!!!! It was a desperate act by a desparate bankrupt govt.
It was openly discriminatory and arguably contrary to human rights laws. Specifically, it discriminated against Bermudians women who married non-Bermudians men who became the principle bread-winners when the couple decided to have children.
It was complete bollocks, and taken with the inability to sell to non-Bermudians, the red tape, and the flooding of the market with tax payer funded condos, killed the real estate market and consequently liquidity in the local economy, stone dead.
but apart from that it was a great idea?
love your impotent rage – you and Laverne need to get together.
Wow, you’re using big words again? Bet you looked up ‘bureaucratic’ to make sure it was in fact the right word.
It was completely unfair, it discriminated against Bermudians because they were married to a non-Bermudian. It discrimination costed more like $3000 after layers fees, surveyors fees and more. It was completely unfair.
While the change is long overdue it is still discriminatory. As to jump starting the housing market, it is unlikely to happen. The loss of thousands of jobs/people in the last 4 or so years means the demand is no longer there, so who will be buying? The market is saturated with available units so any recovery will not be seen for many years.
This is nothing more than a farce of a Government. Just about any idiot could see from the start that the policy would not work in practice. I did say just about any idiot. Obviously the ones in the PLP didn’t and this is truly scary.
We’ve all heard the phrase “too little, too late”. With the government, it’s more like “too much, too late”.
We had to wait until the absolute peak of the housing bubble in ’07 for the government to–FINALLY–step in, and then they exacerbate the housing bust with such an asinine policy.
This reversal/revision seems more reasonable, but–four years after the housing bust, and in true government fashioin–it’s inexcusably late.
I was just going to ask if all of those who have paid for their licences and are still applying – get their funds back – they should and immediately…..
And just WHERE do you expectt his money to come from?? Its obvious they don’t have any to give back from the public purse and they sure won’t give it up out of their own private funds!
That brilliant well-thought-out policy sure worked well, didn’t it Burchie? I can hardly wait until you are Premier!!! The Loo-tennant hisself!! Or maybe Mr “son of a slave” Burgess will be our new Prem! Cuz, if y’all re-elect the PLP/BIU Party back into power again, Paula will be gone so fast you’ll wonder if they haven’t deceived you – AGAIN!!
That frightens me.
What should also frighten you is that Col. Burch would rather rule in hell than live quietly in heaven. He is out to kick a$$.
I think Burch,needs some serious help.
He walks around town with Bodyguards. this is a serious dictator in the making. He will walk over anyone to get in the House.
How much money did this scam bring in? Transparency please.
Pigs will fly before you get Transparency from PLP.
It cost millions in labour costs to consult, review, bring legislation, support the legislation, provide documenttion, clarification and processing of the licenses. It made negative money.
Forget the long drawn out court cases against the Government to get my money back for the land licence that I paid for when the only one who benefits are the lawyers. If I don’t get a credit on my land tax then I will not vote for them. Plain and simple. My one vote may just be the one that is needed. End of story.
This is your only reason for not voting PLP?
Reversal of another Burch policy…Soooo glad he is back in politics!
educated fools, to think the cog was pleased to have Burch back on board..after all the damage he has done to this Island, and to think we have the likes of Burch ,Commisiong and Bean to have a say in Bermuda’s future !!!!
Bermuda we need to wake up !!!! time for a change…
This reversal will never fix the damage that has already been done. This policy prevent Oprah from buying into the Island. Had she been allowed to buy Golden Eye, Bermuda would have went from, not known by most Americans, to a popular destination. For all those who think that this is just speculation and noting more, take a look back in history, you will find that everything she puts her hands on, turns to gold. If you don’t believe that, just ask all those no name book anthers who have turned Millionaires over night after she reads their books.
In addition to all the other policies that have been reversed, next will be this ridiculous duty hike. This is going to have some very negative unintended consequences but by the time it’s reversed, the damage would have already been done.
Free thinker, Oprah winfrey is admired all over the world.. and to think she was not allowed to buy property in bda was a huge mistake…. think about the publicity this fantastic women and how she could have promoted bda.
VOTE FLIPPLoP VOTE FLIPPLoP VOTE FLIPPLoP VOTE FLIPPLoP VOTE FLIPPLoP VOTE FLIPPLoP
VOTE FLIPPLoP VOTE FLIPPLoP VOTE FLIPPLoP VOTE FLIPPLoP VOTE FLIPPLoP VOTE FLIPPLoP
YOU MUST BE CRAZY! This is a flip flop party !
Yo crack me up Cancer!!!!!!!!!!!1
How nice of them to revise the law… They are still discreminating against Bermudians with foreign spouses! If they’re so afraid of scam marriages, please set policies in place to check on these couples, I am sure they’ll find many who have nothing in common but a marriage certificate and maybe a Bank account where the monthly ‘fee’ goes into… so wrong!
Here comes that PLP bicycle furiously being pedaled backwards again by some PLP buffoon. Get out of the way.
It is all just so pityfull. Hundreds of thousands have been incurred unecessarily by property owners.
Triangle, these idiots in charge make a law and whoops !!! they change it because they do not think things through …how many times have they reversed their decisions on serious issues ? we have become a joke to the rest of the world and we still have these jokers in charge !!!!
As someone who was affected by this ridiculous piece of legislation, I wonder will my spouse and I get a refund ? I see where the developement across from Swizzle II have not sold one unit, not to mention overpriced units made by private developers. This is an act of desperation from government, under the guise they are helping the economy, will some one standup and admit we made a big boo,boo in the first place. For the want of 1,300 Dollars per, the cofers have missed out on a lot of stamp duty,and other related fees had this stupid policy not been introduced. So here comes 2012 the country is broke and we are even thinking of messing with pensions and you want us to take a pay cut while you did not even mention that you would follow suit from the get go?? SMH can’t believe we have come to this point,funny how the apologist have refrained from commenting even on the other forums. 1998 now seems like soooooo long ago, L.F. Wade man of reason and common sense where are you, sir ?
L.F. Wade man of reason and common sense where are you, sir ?
Probably spinning in his grave. He and Dame Lois had honour and integrity. Today’s PLoP has very little in common with the PLP they worked so hard to shape.
Class action lawsuit anyone. I’m in.
Come on PLP dimwits…do I get MY MONEY BACK?
Plus legal fees?
Plus damages?
Sandgrownan – no, consider it a gift for future generations of the poor and the disposessed.
next question?
Latrine Fruitbat gets my vote!!
great psendonym and an even greater much needed laugh in the face of yet another example (as if we needed it) of the grim reality of this government; lead by
Ms Cog and followed with Sleezy(1, 2, & 3), Sleepy (1 & 2), Dopey(1 & 2) and Sneezy (1, 2 & 3), and, and…………… all the other Dwarfs blindly following down the hill, assured that all is right with the tiny world known as Bermuda, as they each walk over the cliff thinking the world is still flat……………