The Journey of Villa Mango
In early 2020, a friend and I discussed buying a vacation rental property in Barbados. We were real estate investors for many years and wanted to branch out beyond Canadian borders. I had been running a six-suite guesthouse in Prince Edward County, two hours east of Toronto, for the last four years and started thinking that a rental in a hot, sunny climate was bound to be successful.
I booked a vacation in Barbados with a few girlfriends over New Year’s 2020 and became more acquainted with the island. I found an Airbnb rental in Holetown in the community of Sunset Crest on the West Coast of Barbados. What I love about this area is its walkability as the beach, restaurants, mall and grocery store are all within a four-minute walk from our place.
Before I arrived, I was in touch with a real estate agent on the island so I could see a few properties while I was there. I saw properties around the island; some were great but just too expensive, and some were not so great as they weren’t in the right location.
Then the pandemic hit and we could no longer travel. I started re-evaluating whether to purchase a vacation property.
In January 2021, my friend suggested it was time to re-consider investing in Barbados because the world was returning to normal. I started thinking it might be a good time to buy because sellers in Barbados must be eager to sell, given the lack of tourists over the last year. I spoke to a second friend who was interested in purchasing a property with us. Now we had our investment group.
We connected with an agent who mentioned a property called Villa Mango. It had three bedrooms, three bathrooms and a pool in the Sunset Crest area. We had to wait a few weeks before she could show us the house, as Barbados was in lockdown at the time. Unlike Canadian agents who continued working throughout the lockdowns, agents in Barbados could not.
Our agent was eventually able to book a showing of Villa Mango and took us through the house on a video call using her phone. We didn’t see the place in person until we took possession.
We put in an offer and then waited and waited for an answer. Things take much longer in Barbados. We hoped the vendors would sign back our offer of $555,000USD. It was listed for $600,000USD and had been on the market for at least two years. We were pleasantly surprised when our agent informed us that the vendors (in England) accepted our offer and the house was ours. This was in February 2021.
We opted for a long closing date of Oct. 7, 2021, mainly so we wouldn’t have to pay for a property we couldn’t use over the summer. We also heard that properties in Barbados need at least 90 days to close. We planned to fix it up in October/November and have it ready for rent by late November. Little did we know that things would not go as planned.
After much back and forth with the bank, we found getting a mortgage was impossible because of their strict requirements. We would have to self-finance the house through our respective properties and lines of credit.
We then spent the summer shopping for furniture and preparing to close on Oct. 7. We figured if we planned to arrive on Oct. 18, any kinks would have time to work themselves out.
We were wrong.
Oct. 7 came and went without an email from our lawyers. When I contacted them on Oct. 8 to ask what happened and why no one had asked us to wire the funds to close, we were met with silence. Eventually, the lawyers let us know the closing had been delayed as they were waiting for signatures from the vendors in England. Barbados only accepts live signatures, so they were waiting for a signed contract to arrive. I’m not sure why the documents were not sent to England in September in anticipation of the Oct. 7 closing date.
We told them we were arriving on Oct. 18, so we needed to close by that date so we wouldn’t be homeless. We finally closed on the property on Oct. 21, 2021.
My adventures have inspired me to create a course for vacation rentals called Vacation Income Property $ecrets. As more people started to ask me about my experience buying vacation properties, I realized there was a need as so many people were looking to make their own purchase.
5 reasons you would consider owning a vacation income property
- Diversification of income
- Experience higher profits than your typical long-term rental
- Build an additional income stream
- Create a place for retirement
- Expand your knowledge as a Realtor
The 6 most important things to consider when purchasing a vacation income property
- Hire the right professionals: Realtor, accountant, lawyer, property manager
- Get your finances in order
- Find the right investment partners
- Do your research on where you’d like to invest – check out AirDna.co
- Run the numbers to ensure you can make a profit
- Don’t be afraid to get out of your comfort zone
If you’d like to read the full story on how we were able to purchase Villa Mango, read my blog.
Davelle Morrison has a Bachelor of Commerce degree from McGill University in Management Policy & Finance. She’s one of the top 10 agents at Bosley Real Estate in Toronto, sits on the Board of Directors of the charity Beautiful World Canada and is the president of the Licensed Short-Term Accommodators of Prince Edward County. She owns investment properties in Toronto, Prince Edward County and Barbados. Morrison co-authored the best-selling book Success Today with best-selling author and speaker Brian Tracy. She is regularly interviewed in the media and has appeared on Holmes And Holmes on HGTV and DIY Networks. Most recently she organized the Vacation Income Property Symposium and created the Vacation Income Property Secrets course for those looking to buy vacation rentals.