Eastern buyers boost caribbean market

“For a long time nobody regarded luxury homes as an asset class – they were just a luxury,” says Vere Bruce-Gardyne, managing director of the estate agency division of Letterstone, a property developer and fund manager with projects in Central Europe and the Caribbean. “That has changed over the last five years as the market has opened up to the expanding global middle class and their increasing ability to travel.” He has seen a huge increase in demand from Russian buyers for top-end $3.5m+ (?2.4m) properties in the Caribbean, as a whole new wealthy class looks to move equity out of their home economy. And there are early signs of something similar from Chinese and Indian ­buyers. In some prime locations, they are able to make that equity much more tax-efficient, as well. “One of the things that led us to tax-friendly ­Caymans and St Kitts was that a lot of our larger investors are either offshore or have some kind of ­non-domicile status,” says Simon Hill, chief executive at Letterstone. Income on property on St Kitts is not taxed – but some property owners may choose to re-domicile entirely. “St Kitts and Nevis is one of the countries of the Eastern Caribbean where there is a well-functioning government-sponsored investment programme, allowing foreign nationals a fast-track to full citizenship through ­investment in approved projects on the island,” says Hans Mallalieu, sales manager with Newfound, which is ­developing its Ocean’s Edge and Pinney’s Estate resorts on the islands. “Under this programme, persons making a minimum investment of $350,000 in an approved project are eligible to apply for citizenship in the Federation.” Economic citizenship is not a cheap option, but among the benefits is tax-free status on foreign income, capital gains, gift, wealth and inheritance. “There is demand for medium- to top-end apartments in warm places, which means that top-end prices keep going up,” says Mr Bruce-Gardyne. “And in the dollar zone especially there’s a ­currency play involved as well – our St Kitts homes are 20 per cent cheaper for sterling buyers than they were when we initially did our figures.”