Government is standing firm on its crackdown on property sales to foreigners.

In a Ministerial Statement issued last night, Home Affairs Minister Randy Horton said: "It is time to turn off the tap" of land being sold to non-Bermudians.

Controversial new property regulations dictate that foreigners are now only able to buy homes which have an annual rental values (ARV) above $126,000 and are being sold by non-Bermudians.

"Over the years, more and more of our land has gradually been sold away to non-Bermudians," Mr. Horton said. "This may be hard for those who have made a lucrative career in the business of selling to non-Bermudians; however, this is one issue where the Government must make a stand. It is imperative that the people of this country are given an opportunity to have land ownership in the country of their birth."

Government's land policy was to preserve undeveloped land, commercial property and the majority of housing stock for Bermudian ownership, he said.

The new policy limits the amount of homes foreigners are allowed to own Island-wide to around 300 ? or 1.5 percent of the available housing stock.

"Some non-Bermudians are undermining the policy by acquiring residential, commercial and undeveloped land using companies, Bermudian individuals and Bermudian trusts as 'fronts'," the Minister said.

"The intrusion of non-Bermudians into the protected local real estate market is one of the factors that have driven the price of even modest properties beyond the reach of all but the wealthiest Bermudians. The Government is determined to retain these properties for Bermudians and this initiative is the first step in that effort."

Mr. Horton gave two examples of 'fronts': first, Non-Bermudians were getting "unscrupulous" locals to get bank loans for undeveloped land, which the non-Bermudian will build a home on which exceeds the ARV, allowing foreigners to purchase it.

Second, a non-Bermudian finds a property in the desired location, but it is below the minimum ARV. Then a local land speculator sets up a trust which buys the property with the non-Bermudians' money in the form of a mortgage.

"The building is bulldozed and a new larger house constructed to the design of the non-Bermudian with the non-Bermudians money," he said. "The law was recently tested in a 'fronting' case and found to be so weak that a prosecution was not possible"

The law was amended to crack down and uncover these 'fronts', he said, and punish offenders.

According to the Bermuda Immigration and Protection Act 1956, "non-Commonwealth non-Bermudians (aliens)" are only allowed to own 400 acres in any one parish or a maximum of 2,000 acres Island-wide.

"Figures maintained by the Registry General show that aliens legally own nearly 1,900 acres," he said. "It is important to note that although only about 1.5 percent of houses are available to non-Bermudians, nearly 15 percent of Bermuda's landmass is owned by aliens. This apparent contradiction arises because a large number of those foreign-owned properties are below the current ARV minimum."

As land sold to foreigners can take 50 years to return to Bermudian hands, he said new limits will be placed during the five year land freeze.

"The total amount of land including that legally owned without a licence by Commonwealth citizens will be determined and new acreage limits set" he said. "Recognising that it was speculators who were selling land reserved for Bermudians to non-Bermudians, the Government believed it was important that they received no warning of the intention to place a freeze. It is probable that consultation with realtors and law firms would have tipped off the speculators who would have done all they could to get as much land sold to non-Bermudians as possible".

Government understood the perception that locals who own land above the minimum ARV or owners of units in the "designated condominiums" will be disadvantaged by the crackdown.

"However, the 'freeze' is unavoidable if more land reserved for Bermudians is not to be lost," Mr. Horton said. "It is common when major structural changes are brought about, that some people believe that they are disadvantaged".

Locals selling to locals will maintain stability in the Island, he said, and if foreigners start selling land to locals, the balance of land ownership by Bermudians will be tipped in Bermuda's favour.

"If our land continues to fall into the hands of non-Bermudians, there will be no land to build homes for our people. Some will perceive that they have been hard done by; however, an outcome that gives the land of this country back to its citizens is the best possible means by which the great majority of Bermuda's most precious physical resource is to be protected for future generations of Bermudians," he said.