How to Buy in the BVI
- July 4th, 2007
- in Yachting
Buying to Rent – Any person or corporation may own land in the BVI, but because the BVI has a limited amount of land available, the initial advertisement requirement aims to give Belongers priority on the choice of purchasing real property. Hence, property will only be sold to a non-Belonger if no Belonger exercises their statutory right of first refusal to buy it at the same price and under the same terms as are evidenced by the sales contract in question.
However, non-belongers are subject to certain requirements in order to perfect the purchase transaction, specifically a Non-Belonger Land Holding Licence (“NBLHL”). The NBLHL gives the holder an entitlement to own the property specified therein and agreements to purchase property are therefore made contingent upon such a licence being obtained by the non-belonger purchaser.
If the purpose of buying a property in the BVI is to rent it out, then the applicant must seek rental permission from the Ministry along with the NBLHL application. If the previous owner was renting out the property, the request will generally be granted. In the request, the applicant must provide proof of rental history (if applicable). Once the request has been granted, it is then possible to rent the property and become a landlord.
Rights and Obligations of the Landlord and the Tenant
This section aims to sketch out in general terms the relevant dispositions of the BVI Registered Land Ordinance regarding leases. Because there are different types of leases, we will concentrate on housing leases.
Types of Housing Leases
Typically, leases have a one-year term. Hence, the parties may decide to renew the lease yearly. However, the parties are free to elect a different term. For instance, a property may be used as a vacation rental property and the term of the lease may be different for every rental. The law also provides for tacit renewal of the lease. The lease then becomes a periodic lease. This situation happens when (a) the tenant continues to occupy the premises with the consent of the landlord after the termination of the lease (oral or written); or (b) when the landlord accepts payment for the rent after the termination of the lease. In those circumstances, the tenant continues to occupy the premises under the same conditions as those of the lease.
When the term of the lease is not specified and no provision is made for the giving of notice to terminate the tenancy, it is considered to be a periodic lease. A periodic lease may be oral or written. Under this type of rental agreement, the period of the lease becomes the period by reference to which the rent is payable. The parties may determine the currency of the tenancy by way of notice to the other party. Otherwise, the lease is tacitly renewed every time the tenant pays the rent.
When the currency of the lease exceeds two years, the lease shall be registered. This means that the lease is filed at the Court Registry under the name of the tenant.
Implied Obligations in Leases Imposed Upon Landlords
Save as otherwise expressly provided in the lease, so long as the tenant is paying the rent and observes and performs the agreement conditions, the landlord is bound to perform or adhere to the following obligations:
- To allow peaceful and quiet enjoyment of the leased premises during the period of the lease without any lawful interruption.
- Where part only of a building is leased, to keep the roof, main walls and main drains, and the common passages and common installations, in good repair.
- Where the premises are leased furnished, to ensure that such premises are fit for habitation at the commencement of the tenancy.
- When the premises or any part thereof are destroyed or damaged by fire, civil commotion or accident not attributable to the negligence of the tenant, and that the premises or part thereof are rendered unfit for occupation or use, the landlord’s right to receive rent (or the proportional part thereof) is suspended until the premises have again been rendered fit for occupation and use.
- To give the tenant reasonable notice before visiting the premises.
These obligations include that the landlord is not permitted to visit the premises without notice. This action would infringe the tenant’s right to peaceful and quiet enjoyment of the premises. …When the premises are rented with furniture, the landlord is obliged to provide the furniture described in the lease. Otherwise, the tenant may seek a reduction of the lease payment on the basis that some conditions of the agreed contract are not satisfied.
Implied Obligations in Leases Imposed Upon Tenants
Save as otherwise expressly provided in the lease, the tenant’s obligations include the following:
- To pay the rent specified in the lease at the times and manner therein specified.
- To pay all rates, taxes and other outgoings which are at any time payable in respect of the leased premises, unless the same are payable by the landlord by virtue of any written law.
- When the premises are leased furnished, to keep the leased premises in repair; and to look after the furniture, subject to fair wear and tear, and to replace such articles as are lost, destroyed or so damaged as to be beyond repair with articles of equal value to those so lost, destroyed or damaged.
- To permit the landlord to enter the premises on reasonable notice (usually specified in the lease).
- To repair or otherwise make good any defect or breach of agreement for which the tenant is responsible and of which notice has been given by the landlord to the tenant.
- Not to sublet the premises without the previous written consent of the landlord, but such consent shall not be unreasonably withheld.
Termination of the Lease
In addition to the terms stipulated in the lease regarding its termination, the landlord has the right to forfeit the lease when the tenant commits a breach thereof. However, this right of forfeiture is waived when the landlord accepts the rent which has become due since the breach has occurred, provided that the landlord knows or should have been aware of the fact of the tenant’s breach. The landlord is obliged to serve on the tenant a notice (a) specifying the particular breach complained of; (b) if the breach is capable of remedy, requiring the tenant to remedy the breach within such reasonable period as is specified in the notice; and (c) for any breach other than non-payment of rent, requiring the tenant to pay the landlord compensation for breach.