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Property Appraisal  the integrity element in property purchase
November 2011
by Clarence Hiles
February 2012

Editor Clarence Hiles reviews the Caribbean property scene

Caribbean Property Magazine-March 2012

  Moving into the 5th year of global economic decline hardly bodes well for a publication that promotes second homes and a healthy tropical lifestyle, two of the core ingredients of luxury living. Luxury items were the first commodities to be jettisoned when recession hit the headlines in late 2007 and every year since economists and journalists have battled with sparse data to put a positive spin on the year ahead. The battered cliché of “green shoots” has been crushed time and time again by reality, and realistically it is a step into the unknown to predict anything other than another tough year along the road of recovery. 

  The good news is that recessions come in cycles much like interest rates, and if it is true that “recession ends when people start to buy” then there are positive signs that better days lie ahead. More and more realtors across the region have reported more interest than 12 months ago, and the sales have started to trickle. Perhaps a long way from the rampant early 2000s, but the treadmill has to start slowly and build up pace as the market improves.

  The visionary and professional realtors and developers have already adapted to the changed environment and if any lesson has been learned from the global economic downturn then it is that new buyers will be a much more discerning and cautious group. Confidence has been eroded by some appalling disclosures at the highest level of financial institutions and investors have become a lot more prudent with their hard-earned savings. And who could blame them after what has happened in the greedy sordid world of financial services?

  The Caribbean region is a minnow in the fast moving world of high finance, investment and commerce. But therein lies its beauty, and while the investment gains may not be astronomic, the risk is lower and the ancillary rewards are immense. If you buy a second home in the region for investment then you make a calculated decision based on your own due diligence and advice. If you buy a home in the region for lifestyle, then you are almost 100% certain to make the right choice, as you already know what you like, what you want, and what you can afford. After all, despite what has happened across the world, the Caribbean islands have not changed and their beautiful sand, sea and sunshine continues to be as predictable as the sun rising. In simple terms people who buy a Caribbean lifestyle know what they are getting and they are rarely disappointed. They don’t need speculative rental guarantees, government concessions, huge discounts and citizenship offerings to attract them because they have already visited the destination and fallen in love with the location and its people. There can be no great endorsement.

  Sometimes we undervalue what we have.

  The Caribbean region’s greatest assets will always be its natural attributes and its people, and therein lies the challenge for governments and businesses to improve and protect the environment with all the fundamentals of a stable society and a buoyant economy, even in tough times. The tourism industry must be protected at all costs as it is the main economic thread throughout the region, but it has to be better administered, improved and enhanced. Governments and associated industries must drive the process, but it has to involve all the people. It is blowing in the wind to promote tourism as a national asset if everyone in society cannot share in the concept, benefit from its resources and ultimately reach a higher standard of living. All the people must benefit from overseas investment right across the economic spectrum not just the rich and famous if tourism is to become a national treasure and a viable and sustainable industry. The economic windfall could be more tourists, more jobs, less crime, more overseas investment, better facilities and amenities, and a higher quality of life for everyone. It won’t happen overnight, but the process has already started in some regions with educational campaigns to highlight the importance of everyone being part of the tourism product.

  At the end of the day the buyer will make the decision whether to holiday or to buy at a destination and perhaps even retire in the region. Some governments make the process easier than others with no purchase tax, no punitive residency taxes or licenses while others see it as a short-term fundraiser. With limited resources this may be a short-term gain, but do islands really need to offer expensive citizen packages to attract new residents and by doing so are they attracting the right kind of investors? Food for thought.

  Lifestyle is the big attraction of the Caribbean and enhanced lifestyles are the buzzwords in modern real estate marketing. Medical tourism, eco-tourism, sports tourism and Diaspora tourism are niche markets of growth, but the fundamentals of a quality lifestyle are still the key factors when buying a second home.

  In this edition we have highlighted seven Caribbean destinations and having spent time in all of them we are confident the articles will attract people to visit and perhaps buy. We trust you will enjoy the articles and let’s hope our next edition is able to report another positive year on the road to recovery.