The standard rate: 7.5%
Stamp duty is payable on all real estate transfers and purchases in the Cayman Islands (other than those between close family members, known as transfers by love and affection). The buyer pays stamp duty — it is not split with the seller. The rate is calculated on the purchase price or government-assessed market value, whichever is higher.
- Payable by the buyer at the time of closing/completion.
- Calculated on purchase price OR government-assessed value — whichever is higher.
- Applies to all property types: condos, houses, townhouses, land, commercial.
- First-time Caymanian buyers may qualify for concessions. Expat buyers pay the full rate.
- Stamp duty is a one-time cost — there is no annual property tax after purchase.
The new 10% threshold (January 2026)
Since January 1, 2026, a new higher stamp duty rate applies to properties valued above CI$2 million (approximately US$2.4 million). Properties at or above this threshold are subject to 10% stamp duty instead of 7.5%.
- Properties valued below CI$2M: 7.5% stamp duty (unchanged).
- Properties valued at CI$2M and above: 10% stamp duty on the FULL value (not just the portion above CI$2M).
- This affects high-end purchases in Seven Mile Beach, Camana Bay waterfront, and premium canal-front properties.
- Example: a CI$2.5M property now costs CI$250,000 in stamp duty (10%) versus CI$187,500 under the old rate (7.5%).
- The threshold is based on the higher of purchase price or government-assessed value.
Total transaction costs
Stamp duty is the largest cost but not the only one. Budget for the full package when planning a purchase.
- Total upfront cost on a $750K property: approximately $65,000–$80,000 (stamp duty + legal + fees).
- Total upfront cost on a $1.5M property: approximately $130,000–$155,000.
- These are one-time costs. No annual property tax after purchase.
| Cost | Typical amount | Notes |
|---|---|---|
| Stamp duty | 7.5% (or 10%) | Buyer pays. Largest single cost. |
| Legal fees | 1–2% | Conveyancing attorney. Budget $8,000–$20,000. |
| Land registry | ~$200 | Registration fee. |
| Property inspection | $400–$800 | Optional but strongly recommended. |
| Property valuation | $500–$1,500 | May be required by lender. |
| Mortgage arrangement | 0.5–1% | If financing. Lender charges. |
How stamp duty affects the rent-vs-buy decision
The 7.5% stamp duty is effectively a sunk cost — you do not recover it when you sell. This means you need to hold the property long enough for the ownership savings (no property tax, no capital gains) and potential appreciation to offset the upfront cost.
- Under 3 years: stamp duty makes buying more expensive than renting in almost every scenario.
- 3–5 years: break-even zone depending on appreciation and rental savings.
- 5+ years: buying typically wins given zero annual property tax and potential appreciation.
- The new 10% rate for high-end properties pushes the break-even point further out.
- Always model the full cost including stamp duty before making an offer.
Planning around stamp duty
Smart buyers plan for stamp duty from the beginning, not as an afterthought. It affects everything from budget allocation to timing.
- Include stamp duty in your total budget from day one — a $750K purchase is really an $810K commitment.
- If buying with a mortgage, stamp duty is usually paid from your own funds (not financed).
- Ask your attorney to confirm the government-assessed value before making an offer — it may differ from the asking price.
- For properties near the CI$2M threshold, the 10% rate creates a significant jump. A CI$1.95M property costs CI$146,250 in stamp duty; a CI$2.05M property costs CI$205,000.
- Consider this cliff effect when negotiating purchase price on properties near the threshold.