Most problems with a Caribbean rental purchase are visible in the paperwork before completion. They are missed because buyers fall for the view, and because the questions that matter are unglamorous ones about reserve funds and roof age.
These twelve questions are the ones we would ask on our own money. Ask them in writing during due diligence, on the Dutch side or the French side, and expect documents rather than reassurance. Where a seller cannot answer, that is information too.
None of this is legal, financial or tax advice. Confirm your position with your notary and a qualified adviser, because rules change.
1. What are the association dues, and exactly what do they cover?
In a condo building at Cupecoy, Maho or Simpson Bay the dues are usually the largest fixed cost you will carry, and they are payable whether the unit earns or sits empty. Coverage varies enormously between buildings. Some include building insurance, water, internet, security, pool and grounds. Others cover common area cleaning and little else. Two buildings with identical dues can leave you with very different bills.
Ask for: the current annual budget, the dues per unit, and the figures for the last two years so you can see the trend.
2. Does the building permit short term rentals?
This single answer can invalidate your entire business case. Some buildings set a minimum stay of seven or thirty days. Some run a mandatory internal rental programme. Some allow holiday letting today and could restrict it by owner vote next year. Buyers regularly model holiday rates on a unit that is not permitted to accept a holiday booking.
Ask for: the bylaws and current house rules in writing, plus any amendments in the last three years. Read them yourself rather than relying on a summary.
3. What is the windstorm insurance premium, and what is the deductible?
Hurricane Irma made landfall on 6 September 2017 and the insurance market has priced the region carefully ever since. Windstorm cover is the expensive component, and the deductible is often a percentage of the insured value rather than a flat sum. That means a claim can require a large cash contribution from you at the worst possible moment. Hurricane season runs from 1 June to 30 November, so timing your purchase does not remove the exposure.
Ask for: the current policy schedule and a fresh quote in your own name, including the windstorm deductible in dollars, not just as a percentage.
4. When were the roof and the building envelope last renovated?
Salt air, sun and storms age a building faster here than in a temperate climate. The roof, the windows, the railings and the exterior render are what stand between you and a claim. A building that has replaced its roof and fitted impact glass since 2017 is a materially different risk from one that patched and carried on.
Ask for: dates and scope of major works, the contractor, any warranty still running, and any engineering or condition report the association holds.
5. What were the actual occupancy and revenue for the last two years?
Projections are marketing. Statements are evidence. You want the real calendar for the specific unit, month by month, so you can see how much of the year came from the middle of December to the middle of April, how the property performed in the late August to October trough, and whether March genuinely filled around the Heineken Regatta and SXM Festival.
Ask for: two full calendar years of owner statements showing gross revenue, nights sold and every deduction taken. A summary sheet prepared for the sale is not the same thing.
6. Who manages the property, at what rate, and what is inside the fee?
Full service short term management commonly runs around 20 percent of gross revenue, but two managers charging the same can deliver very different net results. What matters is what sits outside the fee: platform commission, linen, consumables, deep cleaning and markups on repairs are frequently extra. You also need to know whether the agreement transfers to you and how you would exit it.
Ask for: the management agreement itself, including term, notice period, fee basis and the list of chargeable extras.
7. What do the utilities actually cost?
GEBE electricity on the Dutch side is expensive by regional standards and a rental with air conditioning running for guests through August consumes a great deal of it. Add water, TelEm connectivity and television. Owners who are new to the island routinely underestimate this line by a wide margin, and it comes straight out of net income.
Ask for: twelve months of actual GEBE bills for the unit rather than an estimate, plus details of any solar, inverter or cistern already installed.
8. Is there a rental pool, and what are its terms?
Some resort style buildings operate a pool in which participating units share revenue rather than earning from their own bookings. It can smooth income and it can also mean you subsidise weaker units, or that you cannot control pricing or block your own weeks. Some pools are optional, some are effectively required.
Ask for: the pool agreement, the revenue split formula, how personal use is treated, the distribution history for two years, and how an owner leaves the pool.
9. What is the reserve fund position?
The reserve fund is what pays for the next roof, the next generator and the next repair after a storm. A building with a thin reserve is a building that will issue a special assessment, and you will be an owner when it does. Compare the reserve against the age of the building and the cost of the next major item, not against a number that simply sounds large.
Ask for: the reserve balance, the funding policy, the most recent reserve study if one exists, and the last two years of association minutes.
10. Are there arrears, pending special assessments or disputes?
Owner arrears are a leading indicator of trouble, because the shortfall is made up by the owners who do pay. A pending special assessment attaches to the unit, and you need to know before completion whether the seller or you will bear it. Ongoing litigation, an insurance claim in dispute or an unresolved construction defect all belong on the table.
Ask for: a written statement from the association confirming the unit is current, the level of overall arrears, and any assessment, claim or dispute approved or under discussion.
11. What is the title position, and who is verifying it?
On the Dutch side the notary is a neutral officer of the law who acts for the transaction rather than for either party. They verify title, draft the deed of transfer, confirm taxes are settled and register the transfer at the Kadaster. Foreign nationals may own freehold with no nationality restriction. On the French side the notaire performs the equivalent role under French law. In both cases you want to know what is registered against the property, not just what the seller says.
Ask for: confirmation of registered ownership, any mortgage, lien, easement or right of way, boundary position, and confirmation that outstanding taxes and dues will be settled at completion.
12. What will it cost to exit, and how long will it take?
Entry costs on the Dutch side run roughly 5 to 6 percent, made up of 4 percent transfer tax and a notary fee of roughly 1 to 2 percent, rising to about 6 to 7 percent with a local mortgage. On the French side the combined entry cost is nearer 8 to 10 percent. On exit, the Dutch side applies no capital gains tax, while a French side resale at a profit can be taxed at up to 34 percent with relief where it was the seller’s main home. Then there is time. This is a small island market and marketing periods are commonly measured in months rather than weeks.
Ask for: a realistic marketing period for comparable units in that building, and run the entry figure yourself in the buyer cost guidance in our property tools.
Who answers what
| Question | Document that answers it | Source |
|---|---|---|
| Dues, reserves, arrears, assessments | Budget, reserve statement, minutes, estoppel letter | Association or building manager |
| Short term letting rules | Bylaws and house rules | Association |
| Insurance and deductible | Policy schedule and a fresh quote | Insurer or broker |
| Revenue and occupancy | Two years of owner statements | Seller and rental manager |
| Utilities | Twelve months of GEBE and TelEm bills | Seller |
| Title, liens, registration | Land Registry search and draft deed | Notary, via the Kadaster |
| Roof and renovation history | Works records and condition reports | Association and seller |
Perguntas frequentes.
Which of these questions matters most?
Two. Whether the building permits short term letting, because it can invalidate your plan outright, and the association’s financial position, because dues, arrears and a thin reserve produce costs you cannot control after completion.
Do I need a lawyer as well as the notary?
The notary is neutral and acts for the transaction, not for you. Many buyers are comfortable with that, and some prefer independent advice on structure, tax or estate planning. If your purchase is unusual or you are buying through a company, take separate advice.
How long should due diligence take?
Long enough to receive and read every document above. Association records and insurance quotes can take time to produce, so ask early. Do not let a short deadline push you into completing on documents you have not seen.
Are the questions different on the French side?
The substance is the same. The framework differs: the notaire operates under French law, entry costs run higher at roughly 8 to 10 percent, an annual taxe fonciere applies, and capital gains on resale can be taxed. Compare the two regimes in the Dutch versus French tool in our property tools.
What if the seller will not provide the documents?
Treat it as a finding. Association records, insurance schedules and owner statements are ordinary requests in a serious transaction. Reluctance usually means the answer is not flattering.
Before you sign
Put all twelve questions in one email, send it early, and hold the answers against the numbers in your model. Property that survives this list tends to be property you can hold comfortably through a soft season and a storm year.
We can request these documents for any unit in our current listings and go through them with you line by line. Contact us to start, or read about the team first. Confirm anything touching tax, title or law with your notary and a qualified adviser before you commit.
