property market in tomorrow's Budget.

They want to see a reduction in the 20 percent across-the-board licence fee which non-Bermudians buying local property currently pay to Government.

A stagger between the fees for condominiums and houses would also be welcomed, and some realtors also suggested a change in the way the fee is calculated and paid.

Non-Bermudians can only buy homes whose annual rental value is assessed at $43,800 or above. They can only purchase condos whose ARV is $15,300, according to a Government advisory issued in 1991.

The condominium market has been hit the hardest, with sales slowing considerably since its licence fee was increased from 10 to 20 percent on January 1, 1991.

House sales, on the other hand, have been relatively unaffected since its fee was increased from 15 to 20 percent the year before.

This was because foreign house-buyers tended to be so rich that the size of the licence fee was often not an overriding consideration in a sale, said realtors.

But condo-buyers were usually less wealthy individuals who did not have blank cheques to write.

Ms Cris Dapena, of Darling and Dapena, said: "The condo market for non-Bermudians has been all but killed by the 20 percent tax. In this sector, we are talking about people who are not insensitive to price.'' Mrs. Sue Plathe, who works for her mother, Joy Lusher, said the 20 percent fee was almost "insulting'' to buyers and, ideally, said she would like to see an across-the-board reduction to ten percent. "Twenty percent is too over the top. It's putting people off buying.

"At the moment, people are having to commit themselves to Bermuda in the long term just to get their money back on their property and it's just not fair.'' The average list price for a house on the non-Bermudian market was between $3.5 and $4 million.

"If someone pays $4 million for a house, they have to pay a fee of $800,000,'' she added. "By the time other expenses are taken into account, they are looking at a cost of $5 million, which is an awful lot of money.

"The 20 percent fee has definitely slowed the market down. I can think of three clients who, at the end of the day, said they decided against buying because of the size of this fee. They have said it was just ridiculous.'' Ms Dapena and Mrs. Margaret Young-Lever, of Geoffrey Bird & co., both suggested a change in the way the fee was calculated and paid.

Ms Dapena called for a capital gains tax, whereby the tax was levied on the seller of a property, instead of the purchaser.

"The tax would be a tax on the difference between what someone bought the property for and what they sold it for,'' she said.

If the 20 percent fee remained unchanged, Mrs. Young-Lever said she wanted to see a split-payment introduced.

"They could pay ten percent when they bought a house and the other ten percent when they sold it.'' The second payment would also be ten percent of the price they had paid for the property so that "if the price has gone up by a couple of million they are not faced with an extra cost''.

"Something needs to be done. I had someone last year who was very wealthy and looking for a house in the $6-$8 million range.

"But he said he could buy the whole of Marin County in California for what he would have to pay here and ended up buying a large, waterfront property in Vancouver Island. If the tax had been less, he might have bought something here.'' Mrs. Jean Pimm, of Coral Properties, called for a reduction, but not by too much. "If you make it too low then Bermudians start to become excluded from owning their own Island,'' she said.

Mr. Drew Horsfield, of L.P. Gutteridge, said: "A reduction in the fee would be helpful, particularly on condos.'' Many realtors said first-time non-Bermudian buyers were especially reluctant to give 20 percent of the house cost to Government when they were unsure of their new home.

It was not uncommon for these people to want to move to a more suitable property on the Island within a relatively short period of arriving, but the 20 percent tax put them off, they said. Instead of buying, many were choosing to rent first.