Title and Ownership:

Can foreigners own property on Guam?

Yes, individuals may own one residential property (house or condominium) in their own name. If they want to own more than one property, they must form a Guam Corporation.

Are properties on Guam fee simple or leasehold?

Almost all residential single-family homes are fee simple, while residential condominiums are both fee simple and leasehold. Commercial properties may be either fee simple or leasehold. Generally, leases can range from 75 to 99 years.

How is property ownership documented on Guam?

All real property transactions must be in writing. While there is no requirement for recording real property transactions, the general practice (which is prudent business practice) is to record them with the Department of Land Management. The Department of Land Management will only record original documents that have been properly executed to include any required notary signatures. Banks will require all mortgages and leases to be recorded prior to loan disbursements.

What are ways for someone to hold title to property on Guam?

Similar to the US mainland, individuals may hold title to property on Guam in several ways: sole ownership, joint tenancy, tenancy in common, trust, partnership, or corporate. You should consult your attorney and financial advisor to see what type of ownership is best for you.

Financing:

What kind of loan programs are available on Guam?

Guam has all of the standard loan programs that are available on the US mainland, including FHA, VA, Conventional, ARM’s, First Time Buyer (USDA Rural Housing), and Construction. Typical loan to value ratios range from 75% for investment property to 90% (with Private Mortgage Insurance) for owner occupied property financed with conventional loans. Loan to value ratios can reach 100% under first time buyer programs and the VA guarantee loan program.

Are interest rates the same as the US mainland?

Yes, generally rates on Guam are similar (or slightly higher) to those offered in Hawaii and on the US mainland.

Property Management:

How much do property managers charge on Guam?

The majority of property management is handled by licensed realtors who charge between 5% and 10% of the monthly income generated by the property they manage. Their services may include leasing, collecting, coordinating repairs, depositing rents, paying bills, etc.

Taxes:

How much are property taxes on Guam?

The current assessed value for Guam property is 70%. The tax rate is comprised of two parts, one for land and one for improvements. The current tax rate for land is 1/8% of the assessed value, while the current tax rate for improvements is 1/2% of the assessed value.

Are there any other taxes related to investment in real estate on Guam?

As a property owner on Guam, you must apply for a business license. In addition, you must pay a Gross Receipt Tax (GRT) equal to 4% of the income earned on your property. The GRT is waived on the first $50,000.00 earned on an annual basis.

Can I do a 1031 tax free exchange on Guam?

Yes. You can complete a 1031 tax free exchange on property sold or purchased on Guam. You should consult your financial advisor to make sure you understand and follow all appropriate IRS requirements for completing a 1031.

Using a Realtor:

How much do realtors charge for commissions on Guam?

Real estate commissions are not set by law. They are negotiated between property owners and brokers. The standard commission for residential property (single family homes, condos, townhouses) is 6%. The standard commission for commercial property is 3%-5%. The standard commission for vacant land is 8%-10%. The standard rental commission for residential property is equal to one month’s rent for leases of one year or longer. Generally, longer term leases (3 years or longer) are negotiated.

Do I need a realtor to show me properties on Guam?

No. Like many places on the US mainland, owners may sell their properties by themselves, without the assistance of a realtor. Buyers may also purchase properties without the assistance of a realtor. If you are new to the island, or this is your first time buying or selling, it is a prudent practice to employ the services of a licensed realtor who can help you understand the market, manage the home buying or selling process, and find the right home.

Who pays the real estate commission on Guam?

The general practice is for the seller to pay the commission.

What is the MLS?

Licensed realtors on Guam belong to the Guam Multiple Listing Service (MLS) which provides a network for marketing your property through more than 400 realtors. Once listed, your property will be submitted to the MLS by your realtor, providing all other realtors on Guam with information on the property so that they can find potential buyers or renters.

Insurance:

Do all properties on Guam need typhoon insurance?

No. Banks will waive the requirement for typhoon coverage on portfolio loans where the house is all concrete with evidence that metal typhoon shutters have been installed. All loans sold in the secondary market to Freddie Mac or Fannie Mae require typhoon insurance regardless of whether or not the home has typhoon shutters.

Can I obtain title insurance on property I purchase on Guam?

Yes. You may obtain an owner’s policy that remains good for as long as you own the property. If you obtain financing secured by real property, the bank will require a lender’s policy during the term of the loan. If you buy both an owner’s and lender’s policy, most title companies will give you a discount. Title insurance is a one time fee.

Do you have any questions on Guam or its real estate market? If so, please email us and we’ll get back to you as soon as possible.