A Home in the Sun

Have you ever thought of buying your own Caribbean home or hideaway? David Renwick reviews the possibilities in five different islands

Bois Cotton, an up-market property which came onto the market in St Lucia this year for upwards of half a million dollars. Photograph by Home ServicesMarina and dining facilities three minutes from Rodney Heights, St Lucia, part of the Rodney Bay resort. Photograph by Rodney BayNew villas at the Jolly Harbour development in AntiguaNew villas at the Jolly Harbour development in AntiguaPart of the popular Rodney Bay development in St Lucia. Photograph by Rodney BayWhen Sanctuary Resort Development opens on Tobago’s west coast, it will offer 35 villas, a full range of sports and services including a bird sanctuary next door

A home in the Caribbean sun is the dream of thousands of people who live and work in colder dimes. They come to the Caribbean as visitors from North America or Europe, then decide this is the kind of place where they would like to have a second home for return visits each year.

For many, the Caribbean dream home has replaced the traditional ambition of North Americans for a winter retreat in Florida or, for the British, a secluded cottage in the south of France.

Caribbean governments, for their part, welcome expatriate interest in local property. Many go out of their way to encourage it, seeing foreign retirees or home-owning regular visitors as a useful extension of the tourist trade.

Barbados was one of the first Caribbean countries to attract foreign home buyers, way back in the 1950s, and it has traditionally enjoyed what one real estate agent there — Bill Mallalieu, managing director of John M. Bladon and Co. — describes as a “stable” property market. “The transfer tax of IO% on the purchase of a property, and 8%, on a sale, means that speculation is discouraged, and values have risen gradually and predictably over the last 40 years.”

But that situation is now changing, as increasing amounts of foreign money pour into the region in search of the sun. Seafront properties in Barbados (430 kilometres, 250,000 people) are now rising well over the $500,000 mark (all figures are US dollars). They are difficult to get, as only a few come onto the market. Away from the sea, houses appealing to middle-class Europeans and North Americans now range from $100,000 to $225,000. Elaborate up-market homes go for $475,000 or more.

The fact that Caribbean property prices are expected to rise faster than inflation for the rest of the decade is not necessarily bad news for the prospective foreign buyer. The property then becomes an even better investment for the retiree or holiday homeowner, since it is a reliable store of long-term value.

In St Lucia, for example, homeowners can expect to see their properties double in value every seven years or so. In Tobago (300 square kilometres, 47,000 people), after a period of stagnation, land prices have begun to spurt upward, rising by 200-300% since 1990 and showing every indication of continuing to rise for the rest of the decade.

Seafront developments in the Caribbean are among the best property investments for the future. Although coastal properties can be hard to find in well-developed markets like Barbados, the search is easier in islands like Antigua and St Lucia. Marine-front town-house condominiums are available in St Lucia for $200,000. In Antigua, 2-bedroom condominiums in the 502-unit Jolly Harbour marina development sell for between $125,000 and $134,000. In the Marigot area of St Lucia, fronted by a secluded bay, a holiday villa costs about $95,000.

If the expatriate buyer prefers to buy land and develop the accommodation for himself, $50,000 will secure half an acre in St Lucia “with good ocean views”, according to property consultant Jonathan H. Everett of Home Services. Similar half-acre plots in Antigua (280 square kilometres, 80,000 people) run from $20,000 to $325,000. High end properties, such as the St James’s Club and Jumby Bay, offer larger lots of one or two acres “with prices well past the million-dollar mark”, says Geoffrey D. Pidduck, managing director of Caribbean Properties Ltd. at Jolly Harbour.

Smaller properties range from $1 to $15 a square foot, with building costs varying from $45 to $200 a square foot. Like most Caribbean territories which attract foreign property investment funds, wide price differentials are characteristic of Antigua. While a “comfortable” vacation home can be purchased for $125,000, a “lavish” villa with pool and grounds can set the buyer back as much as $2 million.

The differential is not as wide in Grenada (120 square kilometres, 110,000 people), which has been slower than either Antigua or St Lucia to take off as a property market for expatriates. Anthony I. McLeish, managing director of Bain and Bertrand Realtors Ltd., says “well-designed tropical homes” cost between US$150,000 and $400,000.

At the southern end of the Caribbean, the property development momentum is quickening in Tobago, where three major locally-financed projects are now in progress. The Neal and Massy Group, the Caribbean’s largest conglomerate, is responsible for two of them — 13 plots of 13,000 square feet each along the Auchenskeoch/Buccoo Road known as the Evergreen Development (each sells for US$26,756), and the 308-acre Courland Bay Development, with 1,000 feet of beach fronting its western boundary. Single family residential sites are being prepared here, as well as villas, townhouses and an 18-hole golf course.

Another local conglomerate, the Angostura Group, is developing 750 acres of the Lowlands Estate, which has three miles of coastline and sand beaches. The project envisages 250 individual villas on a half-acre of land, five villa cluster sites and five condominium sites. As an added attraction, 27 holes of golf will also be available.

Tobago is well placed to become a fashionable property market by the end of the decade. It is still largely “undiscovered” and has extensive potential. Real estate agent Desmond Duval estimates that there are at least 100,000 square feet of land available for immediate development in addition to the projects already in train.

Besides being a good store of investment value, Caribbean property has the added attraction of being located in a part of the world where the host population is well disposed towards visitors. Equally important, governments have gone out of their way to minimise legal restrictions on foreign ownership of property, and tax rates are kept at a reasonable level.

In Barbados, foreigners face no special requirements when buying property. In Trinidad and Tobago, the Foreign Investment Act of 1990 allows non-nationals to buy an acre of land for residential purposes without a licence. In St Lucia, a licence is needed but is easily arranged. In Antigua, a 5% non-citizen’s land-holding licence must be obtained.

Taxes on property transactions vary, from 2.5% purchase tax in Antigua to 10% in Barbados, where annual property taxes are 0.9% of the market value. In St Lucia, the vendor pays 10% on the sale of the property. The purchaser will be required to pay about 13% of the property price for his mandatory landholder’s licence and government stamp duty, plus associated services like a title search and the execution of a deed of sale.