Investment Property Abroad

Cape Verde, this year’s hottest emerging market, is attracting developers, investors and homebuyers from all over the world – from Ireland in particular.

This is one of 2007’s most rapidly growing markets yet up until recently it was completely unheard of. Most people had never even heard of Cape Verde let alone known where it was.

Now, with promises of serious capital appreciation over the years it’s one of the most talked about hot spots on the map.

Cape Verde (Cabo Verde)
To some extent, Cape Verde shares a similar geographical position to Ireland – in the Atlantic Ocean, at the very edge of the continent. The weather however is a different story…

It’s perpetual springtime here, with year round sunshine and average air temperature of between 22 and 27C and the sea temperature of 21 to 26C. Not a cloud or patch of rain in sight!

Cape Verde is an African country made up of ten main islands and five islets. The main islands are Santiago, Santo Antao, Boa Vista, Fogo, Sao Nicolau, Maio, Sao Vicente, Sal, Brava, and Santa Luzia.

The country gained independence from Portugal in 1975. Ever since 1990, they’ve been a pluralist democracy. Cape Verde covers an area of 4,033 sq. km, with around half the population living in Santiago (or Sao Tiago in Portuguese). This is home to Cape Verde’s capital city – Praia.

Cape Verde is on the same latitude as Barbados; it has a perfect tropical dry climate with very little rainfall. It’s three degrees warmer than the Canary Islands.

The islands are known for their stunningly diverse landscapes, with; endless white sandy beaches, crystal clear warm waters, formidable volcanic peaks, lush green vegetation and lunar-like desert-scapes.

Like the Canary Islands each individual Cape Verde Island is vastly different from the other with its own individual character, attractions and charm.

For the moment, most of the development is taking place on Sal, Santiago and Boa Vista, but it looks like Sao Nicolau, Maio and Sao Vicente are set to follow.

Investor’s paradise
Cape Verde is perfect for pure investors, whether they’re looking for a buy-to-let purchase or just want to increase their wealth through property appreciation.

It’s literally a virgin new-build property market. With cheap labour and good value for money properties, Cape Verde offers exceptional value for money for both developer and investor alike – much more so than traditional tourist hot-spots like Spain, The Canaries, Portugal and Greece etc.

The government realizes that Cape Verde’s future lies in tourism. They’ve seen it rise by 25% over the past four years and are keen to make sure it keeps on rising. They hope to see “annual tourism figures double to over 500,000 by 2015”, according to Dominic McGlynn of Sambala Developments.

Property Appreciation
Property appreciation (the key to investment security) is almost guaranteed on Cape Verde.

The Government aim to “permit only low-rise development and to promote eco-tourism and its own lively Creole culture”, according to Maria Rosario de Luz, the adviser to Cape Verde’s minister for economic growth.

The construction of new developments will be restricted in order to avoid the overdevelopment problems that have plagued many markets recently – most notably Spain.

So therefore, with a big demand for properties and a smaller demand of properties available (demand exceeding supply) investors can sit back and just watch their properties go up in value.

Cape Verde’s rental Potential
Tourism, which is growing steadily, drives the rental market. And, with year-round sunshine and some fantastic beaches, investors can rent out their properties all year long at tourist prices.

From an investment point of view this adds a huge degree of stability to any Cape Verde property purchase. It’s a key factor for investors, assuring them of Cape Verde’s solidity as a profitable and secure investment location.

On Cape Verde, it’s doubtful that your property will be left empty, for any significant time period.

The Cape Verde Island chain is located around 400 miles off the west coast of Senegal (Africa) about one hour south of Spain’s Canary Islands. It has a landscape, culture and atmosphere all of its own – completely distinct from the mainland.

Cape Verde is a land of stark contrasts; from its fiercely volcanic landscapes, to its endless sandy beaches, lush green forests and vast deserts.

Often called the “new Canary Islands” Cape Verde is very similar in both landscape and climate to its northern neighbours.

Like the Canaries, each Cape Verde Island is vastly different from the other. Unlike the Canaries, Cape Verde remains free of mass tourism and overdevelopment. Whether or not Cape Verde will go down the same road as the Canaries is hard to say. It’s certainly growing at a phenomenal rate.

Although it’s an African country, Cape Verde has a culture that’s distinctly different to most of the countries you’ll find in Western Africa.

They have their own traditions, music, languages and religion – most countries in Western Africa are a mixture of Islam and Animism, whereas on Cape Verde the majority are Catholic Mestizos.

Located between three continents, Cape Verdeans are as likely to have a European or South American outlook on life as an African outlook.

Crioulo is the spoken dialect in the northern islands, whereas in the south they speak Krioulo. Within each island, there are many variations of these dialects making communication quite complicated.

Crioulo and Krioulo are both based on colonial-era Portuguese. You’ll often here the occasional English or West African words thrown in.

It’s hard to categorize Cape Verde. It’s a mixture of African, Brazilian and European yet at the same time it’s completely different from the surrounding continents. It’s a fascinating and at the same time bewildering country – staggering beautiful and full of exotic charm.

Property Prices in Cape Verde
On Cape Verde prices are still relatively low, especially compared to the Canary Islands, Spain and France.

Here are a few examples of what you’re likely to find online…

Studio, Sal Island
Fantastic, reasonably priced, studio in the town of Santa Maria, Sal Island,
Sale Type: Off Plan
Price: £ 47,894

Studio Apartment, Santa Maria Island
Reasonably priced, studio apartments for sale in Santa Maria, Sal Island, Cape Verde. Only 15 minutes from the airport.
Type: Studio
Sale Type: Off Plan
Price: £ 45,449

Studio, Salinas Sand, Sal Island
Off plan luxury apartment with great facilities including shared pool, jacuzzi, bar and shops and also near beach.
Type: Apartment/Condo
Sale Type: Off Plan
Price: £ 46,413
Local price: Esc 7,557,243

The Future
Cape Verde is undoubtedly one of 2007’s most hyped-up property investment locations. Developers and agents are selling it as everything from “the Caribbean on your doorstep” to the “Canaries without the concrete”. One thing’s for sure, the islands are growing rapidly and the economic outlook is very good.

This once impoverished third world country is rapidly changing into one of the most important international resorts south of the Canaries.

There are concerns however about the darker side which mass tourism often brings. Crime levels have gone up slightly on the archipelago – at one stage they were negligible.

Most will agree though, that the positive impact of tourism on the country’s economy will far outweigh the bad. Tourism is the driving force behind Cape Verde’s development and is expected to increase employment, create a better standard of living and overall help build a wealthier nation.

Last year (2006) Cape Verde’s economy grew by the highest rate in almost a decade. According to MacauHub the international Monetary Fund state that the islands recorded economic growth of 10.8% during 2006.

These figures have shocked everyone – even the Cape Verde Government who had suspected an economic growth of between 6 and 7%.

Jose Maria Neves, Cape Verde’s prime minister, states that the islands’ emerging tourist sector is largely responsible for this growth, describing it as the “main engine” driving the economy.

Along with excellent value for money properties, Cape Verde’s increasing popularity as a year round holiday destination has helped create a boom in its property market.

Out of Africa – Cape Verde
Located in the Atlantic Ocean, just 400 miles west of Dakar, this small island chain has a landscape, climate and atmosphere like nowhere on mainland Africa.

Cape Verde is full of surprises – full of contrasts; from its fiercely volcanic landscapes, bubbling with sulphur and fire to the flat, arid scrub of the Sahel.

Cape Verde is often compared to the Canary Islands – the Canary Islands before the cement mixers moved in and mass development took place. Whether or not Cape Verde will see the same consistent growth as the Canaries is hard to say. Up until recently, development on Cape Verde had been slow and inconsistent; this is changing rapidly though, as demand for properties escalates.

Cape Verde has a cultural and charm that’s distinctly unique from the mainland. While most West African countries are a mixture of Islam and Animism (the belief that souls inhabit all or most objects), most Cape Verdeans are Catholic Mestizos. Their outlook on life is as European as it is African.

On the northern islands they speak Crioulo, whereas on the southern islands they speak Krioulo – both are based on colonial-era Portuguese with the occasional English and West African words thrown in.

Cape Verde defies generalizations. It’s hard to say exactly what makes it so different from its neighbours or what makes each of the individual islands so different from each other. It’s a fascinating yet bewildering country.

Property for Sale in Cape Verde
Here are a few examples of what you’re likely to pay on Cape Verde…

Studio Apartment Property for sale in Santa Maria, Cape Verde
Lovely reasonably priced, studio apartments for sale in Santa Maria, Sal Island, Cape Verde. Only 15 minutes from the airport.
Type: Studio
Sale Type: Off Plan
Price: £ 45,449

Studio apartment property, Salinas Sand, Sal, Cape Verde
Studio apartment for sale in Santa Maria in Sal Cape Verde. Off plan luxury apartment with great facilities including shared pool, jacuzzi, bar and shops and also near beach.
Type: Apartment/Condo
Sale Type: Off Plan
Price: £ 46,413
Local price: Esc 7,557,243

Studio Apartment Property on Sal Island, Cape Verde
Fantastic, reasonably priced, studio apartments for sale in the town of Santa Maria, Sal Island, Cape Verde.
Type: Studio
Sale Type: Off Plan
Price: £ 47,894

What will the Future Hold for Cape Verde…
Cape was once regarded as a tiny windswept archipelago, literally in the middle of nowhere and of no real importance whatsoever.

Now it’s being labeled everything from the “new Canary Islands” to Barbados without the jetlag”. The hype is phenomenal. Some people are skeptical as whether or not the islands will measure up.

The local Cape Verdeans seem confused by their newfound transitional state – impoverished Third World country, stroke super slick international resort.

It appears that crime levels on Cape Verde, although once non-existent, are slowly starting to rise and there are concerns about the darker sides of tourism.

Overall, the positive impact of tourist on Cape Verde should far outweigh the bad. The economy is booming and employment should rise as the tourism industry thrives and the nation becomes wealthier.

“Bemused by the architects’ plans for a huge coastal development on Santiago laid out before him, one minister is said to have exclaimed: ‘Why would they want to come here? All we have is sun and beaches’”.

Recently an article by Robert Nurden (The Telegraph) looked at 2007’s most lucrative emerging market – The Cape Verde Islands.

Initially the Cape Verdean Government thought their islands would be of no interest whatsoever to northern Europeans. It didn’t take long to convince them that all Europeans wanted from a holiday destination was sun and beaches.

After seeing the demand for property on the archipelago and the how much tourism will benefit their economy, the government is now welcoming European investors with open arms. They’re literally throwing money into the islands’ infrastructure and development.

Many UK buyers are purchasing property on Cape Verde as a retirement home – a chance for a new beginning – where you can have a relaxed and healthy lifestyle in perpetual sunshine and warmth. It’s certainly a more adventurous and exotic option than say opening up a bar or restaurant in Benalmadena or Fuengirola.

Cape Verde Islands
Cape Verde is an African country, consisting of ten inhabited islands. It’s located in the Atlantic Ocean, about 400 miles off the west coast of Senegal, about one hour south of the Canary Islands. The people living here are a dynamic mixture of African, Portuguese and Brazilian.

UK and Irish buy-to-let investors along with the Italians have has a huge impact on the country’s rapidly developing infrastructure.

It’s the closest tropical paradise to Europe – just five-and-a-half hours (direct). Last year Astraeus Airline started its direct flights from Gatwick and Manchester. They fly once a week.

Why Choose Cape Verde
One of the archipelago’s biggest attractions is its close proximity. It’s been described “Barbados without the jetlag”.

The weather on Cape Verde is generally nicer than on the Canaries – which is quite impressive. It’s slightly hotter and more consistent – a perfect beach climate. It stays hot and sunny all year round, making it ideal for renting, whether it’s winter, summer, spring or autumn.

Cape Verde’s landscape is incredibly varied. You’ll see spectacular volcanic peaks, along with endless sandy beaches and lush green vegetation – very similar to the Caribbean Islands.

It’s still an emerging market. Investors who move now are still getting in at the beginning. Anyone who buys now will reap the benefits of the sharp increase in property values a few years down the line. As the islands are continually developed and nurtured property price increases are literally guaranteed.

Cape Verde is relatively crime free – especially when compared to modern-day Britain. It’s also politically stable, largely efficient and technologically advanced.

Investing In Cape Verde
A few years ago, buyers were investing solely for investment reasons; buy-to-let and property appreciation etc. They’d often buy in bulk, sometimes up to 10 apartments or more.

Things have clearly changed though. There’s not many UK buyers are looking to set up permanent residence on the islands (yet) – not like in Southern Spain and the Canaries.

There are however growing numbers of buyers looking for a holiday home that they can use themselves for a couple of weeks in the winter and rent out the rest of the year.

Most of the developments on Cape Verde are still in construction. There’s only a handful actually finished. Properties are in big demand. And with a price increase of 18 per cent last year, buyers are keen to get in quick.

Now is the time to move, as prices are still low. The starting price for an apartment is still as little as £30,000 – something you won’t find in Tenerife!

At the other end of the scale, a villa with six bedrooms, six bathrooms and a pool can be picked up for less than £350,000.

“The new Canary Islands”
Cape Verde is often labeled the new Canary Island mainly because of their similar location and similar climate.

But there is a danger that they might turn into another version of their less culturally diverse neighbours to the north – with widespread mass tourism and development.

The scale of development suggests that this seems inevitable.

It’s true, they are getting busier but as of yet, these paradise islands remain unspoilt, natural and bursting with indigenous Cape Verdean culture and charm.

One of the most popular and lucrative investment options throughout Spain, the Canary and Cape Verde Islands is buying off-plan.

Although it can be a gamble, if successful, off-plan projects greatly benefit the developer and estate agent as well as the buyer.

For developers, it’s a way of reducing their risk, while at the same time using someone else’s money to finance their project.

Estate agents make very generous commissions, when they sell an off-plan development. They’re normally quite easy to sell too. Amateur speculators are often very keen to buy into an investment option with a strong reputation for “guaranteed high-returns”.

Plus, they can make the sale, take the commissions and run. They don’t have to worry about complaints or hassles from the buyer who takes possession two years down the line.

A significant proportion of UK investors looking to buy property in Spain and the Canaries will choose off plan. Most of them are amateur speculators looking for that risk free, high return investment.

Buyers can make considerable savings when they buy off-plan. It has numerous advantages…

Advantages
Ideally, what you should end up with is a lower cost, high quality property, that’s risk free.

Price
This is the biggest advantage of buying off-plan. You can expect to pay around 10 – 30% less than you would for a similar resale property in Spain.

Developers charge less as a form of compensation. They’ll compensate you for taking the risk – as paying hundreds of thousands of euros for a property that hasn’t even been finished, or even started does involve a degree of risk.

You’re also being compensated for providing the developer with the money they’ll need to help finance the development.

Quality
What you get with an off-plan investment is a property made with the most up to date building materials using the latest construction techniques. They’re much higher quality than traditional Spanish constructions – which can be quite bad. In Spain and the Canaries a brand new property should be the highest quality in the market.

Over the past few years, building regulations have been tightened, encouraging much higher standards. They’re constantly improving – so the newer the property, the higher the quality. Having said that, it ultimately depends on the spec. offered by the developer – what kind of development he plans on building.

Risk Free Investment
In Spain, you’re entitled to a number of guarantees from the developer. The law covers you for different types of build defects over different periods.

If you buy off-plan, you’re property will be guaranteed against the most serious structural defects for 10 years. And if you buy a property form a developer that’s just been finished, you should get the same guarantee.

Flexibility
To some extent, you can have your own creative input into what the property will look like (colours, floorings, certain fixtures etc.). Developers can be very flexible on this. The degree of flexibility varies considerably from one developer to the next.

Selling the property
If you change your mind about the development and want to sell the purchase contract before the property is finished, you might be able to sell it on to a third party and make a huge profit in the process.

This has certainly been the case in the past and has also been one of off-plan investing’s greatest attractions.

Nowadays though, things are different. In Spain’s popular coastal areas, like the Costa de Sol, overbuilding has become a problem, making it more and more difficult to sell on properties before completion. On the Canaries and Cape Verde however, this is much less of a problem.

Buying a property off-plan can be an extremely lucrative investment option. Over the years, developers and agents as well as buyers, have it has made a lot of money from it.
For the developer, it’s a way of reducing risk. It’s also a way of financing part of their project with someone else’s money.

Estate agents like to sell off-plan as they can earn very generous commissions from the developer. They’re generally easier to sell because or their reputation for providing high returns on investment. The estate agent can just take the commissions and run. They don’t have to worry about any hassles from the buyer later on down the line.

Buying off-plan does however, have a downside…

Delays
The most obvious disadvantage is that you have to wait for long, sometimes uncertain periods before you can either live in or rent out the property. For but-to-let investors, they cant’ obviously gain rental income until it’s fully finished and furnished.

This is however only a disadvantage in some cases, as for some buyers it may suit them and could therefore be seen as an advantage.

Second Rate Locations
A problem that has been getting worse every year in Spain is overbuilding. A lot of the sought after coastal locations in popular areas are taken up. All that’s left for new developments are second and third line locations often with motorway views.

This however, is only true of places like Marbella on the Costa Del Sol. In newer locations like Murcia, Cadiz, Almeria and Fuerteventura, there’s still plenty of space for front line development.

Uncertainties
The fact that the property hasn’t been built yet can cause all kinds of uncertainties – uncertainties that can turn into genuine problems…

Between the time you sign the contract and the delivery of the property. Developers can run into all sorts of problems; everything from bad weather and bad project management to problems with planning permission and even insolvency.

New developments rarely finish on time, regardless of what the sales organisations tell you. So, it’s very advisable to build this into the contract and whatever financial plans you might have.

Inconsistencies
One of the biggest risks for anyone buying off-plan is that they might end up with a property that doesn’t match the plans and specifications that they had initially signed for.
Apart from the fact that developers are notorious for promising one thing and delivering another, actually understanding what the plans and specifications mean in terms of finished product can be quite difficult for anyone outside of the construction industry.

This is apparently one of the biggest complaints off-plan buyers have. Known as “Under build”, it’s where you pay for more than you get.

Guidelines
In Spain, as a buyer you’re entitled to insist on adequate documentation regarding the build specifications from developers before you go ahead and purchase. The Spanish consumer protection laws gives you significant rights when it comes to off-plan purchases.
If you experience any problems with build quality or find that the developer has failed to meet the correct specifications, you are urged to file complaints against him.

So the most important thing to do is check that the developer’s plans and specifications are sufficiently detailed to minimise any such problems. Ideally, check the details with your lawyer. Find out how the developer plans to deal with any of these problems, should they arise.

According to a recent article by Mark Stucklin, from Spanish Property Insight “63% of British buyers end up using the lawyer recommended to them by their estate agent. Of these, 20% report being very dissatisfied with the legal service they receive.”

He goes on to point out that using a lawyer appointed by the estate agent is unwise in most cases and that ideally you should choose an independent Spanish lawyer – one with no connection or obligations to the agent.

Why you’ll need a lawyer
Buying a property in Spain is a relatively straightforward process, but like in the UK, it can be detailed and sometimes complicated, especially if you don’t have fluent Spanish. Unexpected costs and problem can arise. This is why you need a lawyer, preferably one who speaks English and is completely independent from the estate agent.

For a second-hand property, your lawyer needs to make sure that the seller actually owns the property – that it’s his name on the title deeds.

In Spain, debts belong to the property not the owner, so he’ll need to make sure all debts are paid, otherwise you could end up buying into all sorts of stress and hassle.
You and your lawyer should meticulously check the contract and make sure that the property fully corresponds to the details in the title deeds – ie, size, number of bedrooms etc. These are just two of the most fundamental checks the lawyer has to make. He’ll have to do many more.

For off plan purchases, the lawyer’s role will involve checking the contract and making sure that it gives exact details of the type of property he’s going to build, with all the specifications and that all the correct licences and guarantees are adhered to.

What’s written down in the contract is your only real security when dealing with new developments. If the contract is faulty or incorrect, you could find yourself in big trouble.

The contract should specify a date for completion. Although new developments are nearly always finished late, your lawyer can help make sure the time frame is both reasonable and realistic.

Independent Spanish Lawyers
In most cases, UK buyers will just use the lawyer that’s been appointed by the estate agent. Initially, it seems like the obvious choice.

For buyers who come over on inspection visits, time is so limited that they rarely have enough time to find their own lawyer. So they just make do with the agent’s lawyer.
One of the main reasons buyers end up unsatisfied with the legal service they receive comes down to the agent’s motives.

In Spain, estate agents are highly motivated by closing sales; closing as soon as possible. They can make very juicy commissions off them. They want to sell to you as quickly as possible and will recommend any lawyer who’ll facilitate this – their own in-house lawyer being a prime candidate.

You can never be too sure about the relationship between the agent and their appointed lawyer. They could have all sorts of deals going on – anything to secure a quick sale.

This is why, ideally, you should find your own Spanish lawyer; one that’s independent of the real estate agent or developer. You need someone that can give you impartial advice and who works solely for you and in your best interest.

Try and find a lawyer before you start the purchase process – before you even contact the agent, if you can. This way, you won’t be pressurised into using their lawyer.

Finding a Lawyer
The British Consulate can provide you with a list of English-speaking lawyers right throughout the Spain and the Canaries. Checkout the following link – (British consulates in Spain) (http://www.spanishpropertyinsight.com/british_consulates_in_spain.htm )

Buying a new home in Spain
Buying property in Spain is very straightforward, once you take a few precautions. Thousands of people happily and successfully set themselves up in Spain every year. Most of them never look back.

Along with corruption scandals and land grab issues, overdevelopment and oversupply have led to Spain’s current property situation. According to industry figures more than 800,000 new homes were built last year (2006) which is four times the amount buy in the UK.

Experts say that the main problems stem from the “glut of properties available after the furious building spree of recent years”.

A recent article from Gavin Stamp looks at how people see Spain’s recent property crisis.

Richard Leigh, from Wiltshire comments that “There are a lot of negatives around and I have no doubt that property values will go down in the short term”… “In the long term, I think prices will come back quite quickly. For those who hold their nerve and hang on, I don’t think there will be a problem in a couple of years time.”

On the other hand Ron Sillett, a retired teacher comments “The market is virtually dead”. He’s been trying to sell his property he bought near Malaga on the Costa de Sol for quite some time now.

The Spanish Property Market
Spain’s dramatic growth has been spurred on by low interest rates, rapid economic growth and an almost insane demand for properties from both Spaniards and foreigners.

Many people have made a lot of money investing in Spanish property, particularly off plan investments, which are normally sold off at a very handsome profit, upon completion.

But things have changed…

Overdevelopment has led to mass saturation levels, and this has logically occurred in the most popular resort areas. Prices are stagnating and properties are going unsold. Some UK buyers have even reported making a loss on their investment.

While this is true, and there is much uncertainty about the Spanish economy it has still consistently enjoyed growth of more than 3% in recent years.

Lesser know parts of Spain like Costa Calida in Murcia now appear to be showing strong capital growth, according to Andrew Ward, managing director of Equity Property Portfolios.

The Canary Islands too, Tenerife in particular, remain strong, with property sales still rising. Year round sunshine being their major selling point.

The future
For the first time in years Spain is a buyers market. You simply have look at it as a long-term investment. Buying a good quality property while prices are affordable (not spiralling upwards) could yield a profitable investment 10-15 years down the line.

Many experts agree that talk of an outright “crash” is premature and that the market is just slowing down and will eventually pick up again in a few years.

Astrid Schilo, chief European economist at HSBC comments that “Investment in the Spanish construction sector and consumption will slow,”…”But I don’t think there will be a collapse in the Spanish economy.”

Economic considerations aside, Spain will always be popular (especially with UK buyers) because it’s, quite simply, a very nice place to live.

Spain has been a “home away from home” for the Brits for many years. It’s got everything; the beaches, the climate, the nightlife, the landscape, the cuisine, and a very relaxed pace of life.

It’s also an incredibly cheap place to live, especially compared to the UK. Most of the people speak English in the resort areas and there’s a huge ex-pat community of English homeowners, so prospective buyers often feel at home, as soon as they arrive.

Spain is more than just a “fly by night” property investment location; it’s a real and genuine place to live.

Richard Leigh seems optimistic… “People will always want to go to Spain because it is a nice, sunny place,”…”The golf courses are great and it has great shopping for those who don’t want to play.”

Casa Quest is literally a one-stop-shop for all your Canarian property needs. It’s where you’ll find the largest and most varied selection of property for sale in Tenerife, Lanzarote, Fuerteventura and Gran Canaria). This unique website displays thouands of properties from the most reputable and well establshed estate agents on the Canary Islands.

Apart from providing access to a vast array of properties, Casa Quest also provide links to legal advice, mortgage and finance specialists, furniture and furnishing suppliers etc.

Using the most up to date search technology, Casa Quest have created a site where you can search through the properties on site and build up a portfolio (in your own time) before you decide to contact the real estate agent representing the properties. It’s simple but very effective.

Investing in the Canary Islands
At the moment, investing in the Canary Islands seems to be a much safer option than in mainland Spain, where prices have dropped by as much as 20% from last year (2006). The Canary Islands, on the other hand, have seen continual growth. Many investors are now trying to sell on the mainland and reinvest in the Canaries.

Lanzarote Investments
For many years Puerto del Carmen has been the main investment area on Lanzarote. Nowadays investors and developers are focussing more on Playa Blanca and Costa Teguise. These two areas offer a wide variety of new developments and properties that have potential to make very large returns on investment.

Tenerife Investments
For the last 30 years Tenerife has been a very popular investment area. Every year more and more homebuyers and investors are choosing Tenerife, because of the perfect climate, spectacular landscapes and beaches, excellent nightlife, and also because of the rising value of property and the large rental returns you can make.

Fuerteventura Investments
Compared to some of the other islands, Fuerteventura is a relatively new Property investment area. It’s only in the past five years that the market has really taken off. People have recently made massive returns on investments on rental properties and off plan investments.

Gran Canaria Investments
There’s a huge demand for property in Gran Canaria at the moment. Prices are increasing on average between 10 – 15 % per annum. This paradise island offers fantastic opportunities in buy to let investment and property appreciation.

Property for Sale (Tenerife, Lanzarote, Fuerteventura and Gran Canaria)
Here’s a few samples of what you find on the Casa Quest site…(www.casaquest.com)

House in Granadilla, Tenerife
Montae Acojeja, Granadilla. Half built Canarian house with electricity, water and sewage systems in place. Kitchen set in cave adjoining the house.
Price: €96.150 EUR
£ 64.100 GBP

1 Bed Villa in Corralejo, Fuerteventura
Pueblo Canario is a new development on the outskirts of Corralejo with 162 villas constructed in an authentic Canarian style. On sale at the moment is the 1 bed semi-detached and 1 bed detached.
Price: €135.250 EUR

Studio in Los Cristianos, Tenerife
Nice studio in Los Cristianos. There is a swimming pool on the complex.
Price: €55.000 EUR

Rural Plot in Buzanada
Rustic plot of 610 m2 with possibility to build.
Price: €100.700 EUR
£ 67.150 GBP

Online Support
With Casa Quest you get an unbiased view of the whole buying and selling process. It’s an information site aimed at giving you the most honest and up to date information regarding property for sale in the Canary Islands.

At the moment, some of the most lucrative overseas investment property areas are Spain, Australia, Barbados, Brazil and Cyprus.

They represent significant off plan, residential and buy to let opportunities; off plan often providing the biggest return on investment (if properly researched).

Spain has always been looked upon as a safe and steady overseas investment area. Demand for properties here has been rising steadily since as far back as 1988. There are currently over 1.1 million holiday homes in Spain owned by foreigners – and half of these are from the UK.

Spain is no more than three hours away from any UK Airport and now low cost airlines are flying more frequently to more and more destinations in Spain and the Canary Islands.

Apart from the low mortgage rates Spain also has the climate; the beaches; the cuisine; the nightlife; the infrastructure; a vast and varied landscape; art, architecture; music; culture; and every type of outdoor sport activity imaginable. It’s no wonder Spain is looked upon as a sound overseas investment area.

Australia has solid economic climate, which helps boost the property market and create continual demand and investment opportunities.

Investors are looking for overseas investment property for sale within Australia’s major coastal cities and tourist hot spots. With its amazing climate and very high quality of life, property in Australia is now highly sought after. The fact that they speak English is a big attraction for UK investors, a lot of whom actually end up relocating here after a year or so.

Barbados has significant investment potential, both as an area to live and an area to invest in. As well as being spectacularly beautiful, it has a booming economy and excellent infrastructure, along with stunning beaches, a perfect climate and very friendly people.

Brazil is an emerging market with very good potential. The market is stable with high growth and excellent returns on investment. The cost of living here is amazingly low – just 20% of that in the United Kingdom and Europe.

Cyprus offers excellent value for money (North Cyprus in particular). You can buy property here for significantly less than you could in Portugal, Spain and France. The property industry in Cyprus is now very well established.

Investment options (off plan or buy to let)
If you really want to get the most out of your investment and don’t immediately need to live in the property, off plan property is the best way to go.

It’s quite simple. You buy property in a new development at a low price and by the time it’s finished it has gone up in value significantly.

Off plan properties are priced very attractively for a quick sale. Developer’s will try and sell units as quickly as possible, in order to reduce the required capital outlay and minimize their own risk.

Normally you’ll have to pay an initial deposit, followed by installments at fixed dates until the project is completed. The advantage of this is that you only need a small mortgage. You can eventually borrow more money as the payments fall due. In this way, you enjoy substantial savings on interest.

Another advantage of off plan investment is that you get to choose from the best selection of properties. If you get in at the beginning all the most attractive properties are still available – the penthouses, corner units or properties with larger gardens – which all usually sell first.

In buy to let situation, you buy a property and rent it out as soon as possible. Ideally the rent should cover the cost of your mortgage and if you’ve planned it well, you might even have some money left over.

In order for this to be successful, you need to get to know the local letting market. Targeting short-term visitors during peak seasons can bring in high rents over a short period (normally July and August). On the other hand if you have a year round tenant you’ll receive a (lower) fixed rental income all year round.

When buying to let, it’s important to purchase a property that will rent out well, not just one that you’d like to live in. Speak to your local agent for more information on renting in the area before you purchase.