Serene and simple living set alongside sandy beaches and sapphire skies – it is all that many people desire from their ideal holiday. And the Caribbean has it all plus more!

Time out from the hectic rat race should never be underestimated and this is what the Caribbean does best. Many of the Caribbean economies are pegged to the US economy and with the extremely favourable exchange rates of the pound against the dollar seen over the past 12 months, now is a great time to make a property investment in the Caribbean.
 
Once reserved for the more affluent and glamorous sectors of society, the Caribbean is fast offering options for the cheaper and cheerful niche seeking a property investment overseas. The rise of low-budget airlines has made this ever more possible. BMI now flies to Antigua and Barbados, and XL Airways operates flights direct from London to Barbados, Antigua, St Lucia, St Kitts and Tobago. English is widely spoken and understood throughout the Caribbean, thus the islands are perfect tropical getaways for Brits and North Americans alike.

Barbados is the heavyweight champion of utilising its assets for the tourist trade. However, other islands are steadily realising the money that tourists bring with them and are battling to attract North Americans and Western Europeans. Barbadan property is notoriously pricey, with developers struggling to fit more developments on the west coast and moving onto other parts of the island instead to offer investment opportunities. And Barbados is a sound place to make your investment in Caribbean property, but with such an established tourist market it is experiencing its fair share of development and construction. But which island is looking to offer the biggest returns on your property investment?

Andrew Sparrow, Sales & Marketing Director SANDS' Adams Bay resort, Bequai says, "Buying property for investment is dependant upon seeing a place pre-development and recognising that it is a platform to attract long-term lifestyle buyers. The real challenge is to locate in the Caribbean islands that are undeveloped and unspoilt. The Caribbean typically attracts those seeking the beach, the palm trees and beautiful clear waters. There are so many islands and I recommend visiting as many as possible before making your investment. The main things I look for are:
The Island: low crime, welcoming and happy people, great beaches and plenty of areas to explore in complete safety (mountains, rivers, waterfalls, pools).
The development: socially integrated (what's the developer doing to position the property development as a welcome addition to the local people?), environmentally sensitive (what's being done for the efficient use and maintenance of resources?), amenity rich (what more is there to do other than sit on the beach?), sustainability (it looks/sounds like the dream place, but what has been agreed for the long-term maintenance of your home and your services?)

Some of my favorite islands and property developments in the Caribbean are located in the Dominican Republic, Dominica and The Grenadines. From Cap Cana in the Dominican Republic with its Top 10 residential development ranking internationally, to Hampstead in Dominica set amongst perhaps the most beautiful island in the region, with its aspirations of Top-10 Ultra luxurious Eco experience, to Adams Bay in the little island of Bequia in St Vincent and the Grenadines."

The Dominican Republic is one of the largest Caribbean islands, and receives a sizeable chunk of all tourists to the Caribbean, around a quarter in fact, and this figure is expected to keep growing. Over the past few decades the political situation in the country has become ever more stable and the government is now spending a lot of money on making the island more appealing to visitors. Poverty is still an issue for much of the people living on the island, however beaches, roads and power systems are all being redeveloped, and the recent opening of El Catey airport is another plus point for the island, as well as high-end golf courses. Property prices are thought to be rising by about 10-15 per cent annually.

Like the Dominican Republic, Grenada's government is encouraging actions that will increase tourists visiting the island. The minister of Tourism has been actively supporting developments on the island, and Grenada is now one of the Caribbean islands benefiting from rapidly increasing tourism. In fact, it one of the fastest growing tourist spots in the whole Caribbean.

St Lucia with its French and British colonial background, has a decently established tourist influx, who enjoy the volcanic landscape as well as the pristine beaches. There are a number of all-inclusive resorts on the island such as the well-known Sandals, as well as good quality golf courses. Rodney Bay is also a prestigious yachting centre putting St Lucia on the list of drop-by destinations for many wealthy visitors in the Caribbean. Growth of the island's market has been touted for the next five years.

Antigua is another fairly well-established part of the Caribbean property investment market, with a loyal but fairly under publicised following. However, like much of the region it has benefited from high-profile exposure of the Cricket World Cup and the series of Pirates of the Caribbean films. Since 2004 the government has also put the development of tourism to the island as high priority, with development of the airport and promotion of its beaches and golf facilities. Property prices there are consequently doing very well are definitely an area to keep a beady eye on for investment potential.

St Vincent and the Grenadines are other islands of particular interest in the Caribbean. In particular the new international airport is due for completion in 2011, helping to keep ease tourists into the region. St Kitts and Nevis are at a similar stage of development, with a few interesting options for investment available.

The Bahamas Islands are slightly out of the Caribbean belt, but for many are grouped under the same umbrella. Located to the east of Florida, Grand Bahama Island and Nassau are well developed for tourists, each with international airports and ferry ports. Casinos, restaurants and hotel complexes have formed resorts in places such as Freeport, Lucaya and Paradise Island. Geraldine says there are a number of alternative islands ripe for investment other than the Grand Bahama and Nassau: "The property market in the Bahamas, in particular Great Exuma, has been rising rapidly in spite of the fall in property prices in Florida. Prices have been on the increase for a number of years since the opening of the five-star resort The Four Season in 2004. The place has now been discovered by celebrities and discerning tourists." Eleuthera is another Bahamas island where a number of resorts are being constructed.

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Caribbean property buying process
Buying into most of the Caribbean developments is easy enough. However, each island offers slightly different conditions.
For many of the islands, including St Lucia, St Kitts and Antigua, non-residents are required to gain a Landholding Licence, which can be applied for through local lawyers, times vary to gain the relevant paperwork. It will usually require a criminal record check in the UK.
Capital gains tax and stamp duty varies by island, there are a number of appealing tax incentives offered by the different governments. In Barbados there is no stamp duty but there is a land tax, dependent on purchase price. In Antigua stamp duty is 2.5 per cent of property value.
Mortgages through certified income are available for up to 70 per cent, offered by local banks such as the First Caribbean Bank. Research the exact stipulations for the island where you are looking to invest. 
Self-certified or non-status loans, for the most part, are not available.
When buying property in the Caribbean, you need to take out adequate insurance, which will cover you in the event of hurricane damage.

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Article published July 2007