2026 Bahamas Real Estate Market Report
Record-breaking tourism, the largest crime reduction since 1963, tightening luxury inventory, and updated tax policy define the Bahamas property market entering 2026. The Bahamas welcomed 12.5 million visitors in 2025, the highest ever, generating $7 billion in tourism revenue. Murders fell 31%. Prime residential prices grew 5.1% in 2024 (Knight Frank PIRI), outperforming the global average.
What Is the Bahamas Real Estate Market Doing in 2026?
The Bahamas luxury real estate market enters 2026 in strong position. Nassau median home prices sit around $495,000, with an average sale price near $590,000. The luxury segment (properties above $3 million) has roughly doubled in value since 2020. Waterfront inventory is approximately 20% below recent levels. Prime residential price growth registered 5.1% in 2024, above the 3.6% global average (Knight Frank PIRI 2025).
The Bahamas ranked 31st globally in the Knight Frank Prime International Residential Index for 2025, exceeding both the global and "sun destinations" averages. Approximately half of wealthy expats in The Bahamas are now permanent residents, up from about 20% before the pandemic.
Inventory compression is the defining theme. With new construction limited and foreign buyer demand sustained, well-located luxury properties are selling faster and at stronger prices than any point in the past decade. The IMF's February 2026 Article IV consultation confirmed 2.8% real GDP growth for 2025, with 3.4% achieved in 2024. Inflation remains below 1%. Unemployment stood at 9.3% in Q2 2025.
Why the Crime Numbers Matter for Investors
2025 delivered the largest percentage drop in homicides since the Royal Bahamas Police Force began tracking in 1963. Murders fell 31% (83 vs 120 in 2024). Major crimes overall fell 15%. Armed robberies dropped 39%. This is the most significant safety improvement in modern Bahamian history, and it directly impacts property values, insurance costs, and international buyer confidence.
Commissioner Shanta Knowles attributed the reductions to intelligence-led policing, targeted operations, and stronger community partnerships. The 65% murder solvency rate signals improved investigative capability. The 83 murders in 2025 represent the lowest figure in a comparable policing environment since 2008 (when 73 were recorded).
For property investors, this trend matters. Safety perception influences international buyer demand, vacation rental bookings, and insurance premiums. Luxury communities like Lyford Cay, Albany, Old Fort Bay, and Ocean Club Estates maintain private security and gated access, offering an additional layer. If sustained, these improvements could become one of the strongest catalysts for premium valuations.
Why Record Tourism Matters for Property Values
The Bahamas shattered its tourism record in 2025 with 12.5 million total visitors, an 11.4% increase year-over-year and over 72% above pre-pandemic 2019 levels. Tourism revenue hit $7 billion for the first time. This is the third consecutive year of record-breaking performance (Ministry of Tourism, January 28, 2026).
Stopover visitors spend approximately 20 times more per person than cruise passengers, making them the primary economic driver for vacation rental properties. Nearly 30% of stopover visitors now travel to the Out Islands, spreading demand well beyond Nassau.
Cruise arrivals accounted for 86.5% of total visitors (10.6 million), nearly double 2019 levels. International air stopovers totalled approximately 1.7 million, slightly below 2024's 1.82 million due to weather disruptions and aviation constraints, but still above 2019's 1.81 million. Canada emerged as a bright spot: stopovers surpassed pre-pandemic levels, now accounting for 7% of stopover business.
The IMF noted that hotel capacity constraints are limiting stopover growth. The government's response: $10 billion+ in new touristic investment in the pipeline, plus the Home Sweet Home grant programme expanding short-term vacation rental supply.
Nassau Short-Term Rental Performance
Average daily rate: $510.80 (AirDNA / Central Bank of The Bahamas, August 2025). This benchmark is critical for investors building rental pro-formas for Cable Beach condos and Reef Residences at Atlantis.
Who Is Buying Bahamas Real Estate in 2026?
American buyers continue to dominate the foreign property market, followed by Europeans and Canadians. Approximately half of wealthy expats are now permanent residents, up from about 20% pre-pandemic. The most significant shift: the buyer profile has moved from "vacation home" to "primary base."
Remote work, tax optimization, and lifestyle quality are driving longer stays and eventual permanent relocation. The $1M EPR threshold (effective January 2025, up from $750K) continues attracting tax-motivated investors. More than $10 billion in new private-sector investment has been committed since 2021, much of it in resort and residential development.
Developers are increasingly building turn-key condominiums with resort amenities, catering to "lock-and-leave" buyers who want island ownership without standalone estate maintenance. Branded residence demand from Four Seasons, Montage, and Goldwynn continues to drive the premium segment.
Which Bahamas Island Is the Best Investment in 2026?
Nassau and Paradise Island remain the safest long-term investment with the deepest buyer pool. Exuma and Harbour Island deliver the highest yields. Abaco hit a record approximately 520,000 visitors. Grand Bahama crossed 1 million visitors for the first time in 22 years.
Nassau and New Providence
Lyford Cay, Old Fort Bay, Albany, Cable Beach / Baha Mar, Palm Cay. Median ~$495K; luxury $2M to $30M+. Deepest buyer pool, strongest infrastructure.
Paradise Island
Ocean Club Estates, Four Seasons Private Residences (~2027), One Ocean. Two-bed condos from ~$700K; estates to $40M+.
Exuma
Private islands, luxury villas, strongest short-term rental returns. Limited inventory creates scarcity pricing. Growing cruise and air access.
Eleuthera and Harbour Island
Pink sand beaches, boutique luxury, nearly 30% tourism growth in 2025. Privacy-seeking buyers and strong high-end rental demand.
Abaco
Strongest recovery story. Record ~520K visitors in 2025, up 5.2% YoY. Montage Cay and Bakers Bay driving renewed interest.
Grand Bahama
1.1 million visitors in 2025 (first time in 22 years). Air arrivals +20% YoY. 55 miles from Florida. Most accessible luxury pricing.
How Do the Top Communities Compare?
Nassau's western corridor, Lyford Cay, Old Fort Bay, and Albany, remains the crown jewel. Paradise Island leads branded residences. Cable Beach / Baha Mar offers strongest rental returns with newer construction.
| Community | Price Range | Character | Best For |
|---|---|---|---|
| Ocean Club Estates | $3M - $40M+ | Ultra-luxury, Four Seasons | Trophy assets |
| Lyford Cay | $2M - $30M+ | Historic, most exclusive | Privacy, generational wealth |
| Albany | $2M - $25M+ | Resort, mega-yacht marina | UHNW lifestyle |
| Old Fort Bay | $2M - $20M+ | Colonial charm, waterfront | Long-term appreciation |
| Cable Beach / Baha Mar | $260K - $25M | Branded residences, condos | Rental income |
| Palm Cay | $600K - $3M+ | Modern marina village | Entry-level luxury |
Glenn has closed transactions in every community and knows the micro-markets, which streets appreciate fastest, which HOAs are best-managed. Contact Glenn for community-specific insight or a tailored property shortlist.
How Much Can You Save by Moving to The Bahamas?
Zero income tax, zero capital gains tax, zero inheritance tax, zero wealth tax. For UHNW individuals relocating from high-tax jurisdictions, savings can be hundreds of thousands to millions annually. This is the primary driver of EPR applications.
| Tax Type | Bahamas | United States | United Kingdom | Canada |
|---|---|---|---|---|
| Income Tax | 0% | Up to 37% | Up to 45% | Up to 53% |
| Capital Gains | 0% | Up to 20% | Up to 24% | Up to 26.8% |
| Inheritance / Estate | 0% | Up to 40% | Up to 40% | Deemed disposition |
| Property Tax (Owner-Occ.) | 0% - 1%* | Varies by state | Council tax | Varies by province |
Bahamas Property Tax Rates (2026)
| Category | Rate |
|---|---|
| Owner-Occupied: first $300,000 | Exempt (0%) |
| Owner-Occupied: $300,001 - $500,000 | 0.625% |
| Owner-Occupied: above $500,000 | 1% |
| Non-Owner-Occupied: first $500,000 | 1% |
| Non-Owner-Occupied: above $500,000 | 2% |
| Annual Cap (all categories) | $150,000 |
Owner-occupied rates require minimum 90 days/year residence. $150,000 cap requires 183+ days/year (RPT Amendment Act No. 43 of 2025). Owner-occupied duplexes and triplexes now qualify for the residential exemption (January 2026).
US citizens are taxed on worldwide income regardless of residency. Always consult your home-country tax advisor. Use the Caribbean Tax Comparison Tool to compare Bahamas vs Cayman vs Turks and Caicos vs BVI vs Florida.
What Does It Cost to Buy Property in The Bahamas?
Total buyer-side closing costs are approximately 8-11% of purchase price. The VAT on conveyance (5% buyer share) is the largest cost. Legal fees for foreign purchases typically run 2.5-3.5% plus 10% VAT on professional services. Process takes 60-90 days. Glenn provides a complete cost breakdown before you commit.
| Cost Item | Buyer Pays | Notes |
|---|---|---|
| VAT on Conveyance | 5% | 10% total (flat rate for foreign buyers); typically split 50/50 |
| Legal Fees | 2.5 - 3.5% | Title search, conveyance, closing |
| VAT on Professional Services | 10% of fees | Applied to legal and real estate fees |
| Title Insurance (optional) | 0.5 - 1% | Recommended for foreign buyers |
| BIA Permit Fee (if applicable) | ~$250 | Required for non-owner-occupied, 5+ acres, or commercial |
| Total Buyer Costs | ~8 - 11% | Of purchase price |
Closing Cost Estimates at Three Price Points
Can foreigners get a mortgage? Yes. RBC Royal Bank, CIBC FirstCaribbean, and Scotiabank lend to non-residents. Expect 30-50% down, 6-8% rates, 15-25 year terms. About 75% of foreign luxury purchases are cash.
Annual Holding Costs
| Cost | Typical Range |
|---|---|
| Property Tax | 0.625-2% (graduated, above $300K owner-occ / all non-owner) |
| Insurance | 1.5-3% of insured value (higher in Abaco/Exuma: 2-4%) |
| HOA / Condo Fees | $400-$2,500+/month |
| Property Management | 20-30% of gross rental income |
Timeline: Central Bank approval 2-3 weeks. Total 60-90 days. Cash purchases can close 45-60 days. For EPR purchases ($1M+), residency application can be filed simultaneously. As of July 2025, conveyances must be registered with DIR within 180 days.
What Are the Risks of Buying in The Bahamas?
No market report is complete without an honest discussion of risk. Glenn has watched buyers lose money by ignoring these factors.
Risks Every Buyer Should Understand
US economic dependency. Roughly 80% of tourists and the majority of foreign buyers come from the US. A US recession would reduce tourism revenue, rental demand, and property values simultaneously.
Hurricane exposure. The Bahamas sits in the Atlantic hurricane corridor. Hurricane Dorian (2019) devastated Abaco and parts of Grand Bahama. Insurance runs 1.5-3% of insured value in Nassau, 2-4% in exposed Family Islands. Post-Dorian building codes are improving but not universal.
Public debt. Central government debt remains elevated at 74% of GDP. The IMF recommends introducing income tax and raising VAT to 15%. The government has rejected both, but fiscal policy bears watching over the next decade.
Liquidity constraints. Outside Nassau and Paradise Island, resale markets are thin. Family Island properties can take 12-24 months to sell, sometimes longer. Factor this into your investment timeline.
Infrastructure gaps. Power reliability (Bahamas Power and Light), water supply, and internet speeds vary significantly by island. Nassau has fibre-optic (1GB+ speeds); some Out Islands do not.
Regulatory changes. EPR thresholds have risen twice in recent years ($500K to $750K to $1M). Property tax caps have changed. Future policy shifts are possible and could affect investment returns.
What Changed in Bahamas Tax and Real Estate Law?
Several significant legislative changes took effect in 2025 and early 2026 that affect real estate transactions, property tax, and cost of living. International buyers should plan accordingly.
July 2025: Property Tax Cap Raised to $150,000
The Real Property Tax (Amendment) Act, 2025 (No. 43 of 2025) raised the annual cap from $120,000 to $150,000. To qualify for the cap, owners must reside in the property for at least 183 days per year. "Owner-occupied" now requires a minimum of 90 days/year. EPR holders meeting only the 90-day minimum qualify for graduated rates but should confirm cap eligibility with their attorney.
July 2025: VAT Compliance for Real Estate Transactions
Parties must now obtain a VAT invoice from the Department of Inland Revenue (DIR) before executing the conveyance. Conveyances must be registered within 180 days. A declaration must be filed within 30 days when conveying a beneficial interest. Transferors and agents face a 3% penalty for non-compliance. Plan this step into your closing timeline.
January 2026: VAT on Unprepared Food Removed
PM Davis announced elimination of VAT on unprepared food, effective April 1, 2026 (reduced from 5% to 0%). This lowers cost of living for residents. Standard VAT rate remains 10% for other goods and services. The IMF estimates a revenue impact of ~0.2% of GDP.
January 2026: Expanded Property Tax Relief
Owner-occupied duplexes and triplexes now qualify for the residential property tax exemption. First-time homeowner concessions expanded. These changes primarily benefit Bahamian buyers but contribute to overall market stability.
FY2025/26: Domestic Minimum Top-Up Tax
The government introduced a Domestic Minimum Top-Up Tax on large multinational corporations as part of the FY2025/26 budget. This aligns with OECD Pillar Two and does not affect individual property owners or small businesses. Zero personal income tax remains unchanged.
What Is Glenn's Outlook for the Next Five Years?
Continued growth with moderation. The IMF projects 2.8% GDP growth for 2025, tapering to 2.1-2.2% in 2026, and converging toward 1.5% long-run potential. Tourism is structural at 12M+ visitors. Inflation remains benign under 1.5%.
1. Family Island diversification. Buyers and developers looking to Exuma, Eleuthera, Abaco, Andros, and Long Island as Nassau fills out. Nearly 30% of stopovers now visit Out Islands, up significantly from pre-pandemic patterns.
2. Branded residences pipeline. Four Seasons Paradise Island (~2027), Montage Cay on Abaco, and Goldwynn Cable Beach will attract new international buyers. Over $10B in private-sector investment committed since 2021.
3. Remote work permanence. Eastern time zone, fibre-optic infrastructure (1GB+ speeds in Nassau), proximity to US airports, and dramatically improved safety metrics make The Bahamas increasingly viable as a primary base.
4. Resilient construction standards. Post-Dorian building codes becoming standard, reducing the risk profile and improving insurance rates for newer builds.
5. EPR demand sustained. The $1M threshold continues attracting tax-motivated investors. Zero income, capital gains, and inheritance tax. January 2026 food VAT elimination further improves cost of living.
6. Safety trajectory as catalyst. If 2025's crime reductions are sustained, expect accelerated international buyer interest. Historically, safety improvements are among the strongest catalysts for emerging luxury market valuations.
7. Energy sector reform. The government aims to generate 30% of electricity from renewables by 2030. If successful, this would significantly improve reliability and reduce the cost burden on property owners.
Key risks: Global slowdown (US recession would reduce tourism and buyer demand), natural disasters, potential new tax measures (IMF recommends income tax and 15% VAT; the government has rejected both), and elevated public debt (74% of GDP).
Free Bahamas Buyer Tools
Glenn built these calculators so you can run your own numbers before your first call.
Your Bahamas Market Expert: Glenn Ferguson
Glenn Ferguson
Glenn handles the entire buyer journey: property search, negotiation, attorney coordination, closing, and EPR filing, under one roof. One relationship replaces three separate firms.
Off-market access. Many luxury properties sell before hitting the MLS. Glenn surfaces opportunities across Lyford Cay, Ocean Club Estates, Albany, Old Fort Bay, and the Family Islands.
Comparable sales data. Portals show asking prices. Glenn provides actual closed prices, $/sqft trends, and days-on-market.
Rental income projections. Property-specific pro-formas with nightly rates, seasonal occupancy, management fees, and net yield.
For wedding clients considering property, Glenn is also a WPIC-certified wedding planner and licensed Marriage Officer at BahamasPackageWedding.com.
Bahamas Real Estate Market FAQ
Sources
- Bahamas Ministry of Tourism, Investments and Aviation. "12.5 Million Visitors." Press Release, January 28, 2026. via bahamas.com
- Royal Bahamas Police Force. "2025 Annual Crime Briefing." Commissioner Shanta Knowles, January 27, 2026. via royalbahamaspolice.org
- International Monetary Fund. "The Bahamas: 2025 Article IV Consultation." IMF Country Report No. 26/31, February 5, 2026.
- Knight Frank. "Prime International Residential Index (PIRI) 2025." knightfrank.com
- Central Bank of The Bahamas / AirDNA. Nassau STR Average Daily Rate, August 2025.
- Real Property Tax (Amendment) Act, 2025 (No. 43 of 2025). Government of The Bahamas.
- Office of the Prime Minister. "FY2025/26 Mid-Year Budget Statement." March 4, 2026. via opm.gov.bs
- IMF Staff Concluding Statement of the 2025 Article IV Mission. December 12, 2025. via imf.org
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Ready to Invest in Bahamas Real Estate?
Glenn Ferguson (BREA Licensed Bahamas Real Estate Agent): 24+ years, full MLS access, off-market inventory, and residency filing. One call starts everything.
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