6 Dreamy Caribbean Islands Where It’s Easy to Buy Real Estate
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If you have ever dreamt of living somewhere with year-round sunshine, consider looking a little south of Florida, to the Caribbean islands. These tropical paradises offer a laid-back lifestyle that make you feel like you’re always on vacation, and real estate prices (and the cost of living) in these locales tend to be significantly lower than in the United States. Several islands are making it easy for American investors to buy property—and since many US cities like New York, Chicago, Boston, Philadelphia, Dallas, and Miami offer direct flights to these destinations, you could be sipping a rum punch at your Caribbean beach house in under five hours.
The US Virgin Islands
According to real estate agent Carla Rayman Kidd, a certified international property specialist with Coldwell Banker Realty, buying property in the USVI is basically the same as purchasing a house in the rest of the United States. (You also don’t have to deal with obtaining a visa or the hassle of currency conversions.) There are technically 50 islands that make up the US Virgin Islands, but the best known ones are St. John, St. Croix, and St. Thomas, which are famous for their stunning white sand beaches. The US Virgin Islands have the distinction of being the only territory in the US with coasts on both the Atlantic Ocean and the Caribbean Sea. You can find stunning oceanfront homes for less than you would pay back on the mainland, and there are cute smaller cottages available too.
Puerto Rico
As with the USVI, buying in Puerto Rico is relatively easy, thanks to its status as a US territory. But Kidd notes that getting a mortgage can be challenging in Puerto Rico because not all US banks will lend to buyers there. (And Spanish is the predominant language which can also complicate things for non-speakers.) But Puerto Rico does offer generous tax incentives to real estate investors as part of Act 60, which is enticing Americans to buy homes in areas like historic San Juan. That area has upscale oceanfront neighborhoods like Ocean Park and Condado; nearby Dorado Beach is home to the Ritz-Carlton Reserve and high-end residential communities offering large homes and luxury condos.
Cayman Islands
This British territory south of Cuba is comprised of three islands: Grand Cayman, Cayman Brac, and Little Cayman. Its relaxed tax laws make it an appealing place to buy real estate (and for companies to stash money, but that’s a whole different story). ”The Cayman Islands have few restrictions on foreign ownership, and the stable market and absence of property taxes, coupled with a strong rental market, make buying real estate relatively easy and appealing,” says Cristina Ford, director of development for RE/MAX Caribbean and Central America. Just keep in mind that foreign investors do have to pay a stamp duty and transfer fee when buying homes. The stamp duty rate is 7.5% of the total cost of the house, and the transfer fee will set you back between 01.% and 0.5%.
Turks and Caicos
The upside to buying a home in Turks and Caicos is that it’s well-known for being beautiful, fun, and close. The downside to buying a home in Turks and Caicos is that it’s well-known for being beautiful, fun, and close. Turks's popularity has caused prices to increase, and there aren’t many move-in ready homes on the market right now. Still, if you can afford it, Turks and Caicos is a smart and easy investment. “There are no restrictions on who can purchase real estate in the country and financing is available to a foreign buyer either with a local bank or private lending institution,” says Louise Peterson, general manager at Coldwell Banker Real Estate Turks & Caicos. There is also no income tax, corporate tax, capital gains tax, inheritance tax, or annual property tax—and if you pay more than one $1 million for your property, you may be eligible to apply for a Permanent Residency Certificate. There is a lot of building going on right now, so it’s a good time to take advantage of pre-construction opportunities.
The Bahamas
The Bahamas are a series of nearly 700 sun-drenched islands (though only about 30 are inhabited), and each spot has its own distinct vibe: There is bustling Nassau with its rich culture and vibrant party scene; the sleepy Abacos islands, which are known for their world-class boating; chic Harbour Island; and many more. The Bahamas are especially popular with American buyers because they are so close and easy to get to and “the Bahamas encourages foreign investment by offering annual and permanent residency to homeowners who invest $750,000 and up, with accelerated consideration for purchasers investing over $1.5 million,” says real estate agent Heather Lightbourn Peterson, global luxury specialist at Coldwell Banker Lightbourn Realty. If you want to buy more than two acres, you’ll need a permit Bahamas Investment Authority, but the application process is usually smooth. The Bahamas is also attractive because it doesn’t have capital gains or inheritance taxes, and annual property taxes are low.
The Dominican Republic
The Dominican Republic has become a popular retirement spot for Americans. “The number of US Citizens living in the Dominican Republic has continued to grow annually by approximately 10 percent over the last few years,” says H. Michael Heuser, broker-manager at Coldwell Banker Punta Cana. This can be attributed to the island’s beauty, relatively low cost of living, excellent healthcare, and Retirement Visa program. While there are a variety of types of properties on the market, condos are some of the most cost-effective. According to Heuser, purchasing a home in the Dominican Republic is easier than ever, and many condo developments are offering a tax exemption that waves the one-time three percent Transfer of Title Tax, and the Annual Property Tax of one percent is exempt for 12-15 years. Touristy areas like Punta Cana have strong rental income potential if you want to rent out your new condo, but they still feel quiet and peaceful enough to get away from it all.
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