Money Matters October 2008

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CARIBBEAN REAL ESTATE

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Caribbean e-books, about living, working and relocating to the Caribbean

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Costa Rica: Living There
The Golden Door to Retirement

Retirement Planning For Offshore Living: Maintain and Enhance your lifestyles spending less than 25% of your monthly budget.

Retire In Mexico: Live Better For Less. Live in Mexico and join the many other retires who have done their homework, which resulted in mexico where you can live better for less.

Escape The Corporation: How to live the life you have always dreamed of - free from the corporate slog.

Belize: Living There How to Live, Retire, Work of Invest in Belize.

Nicaragua: Real Estate Property and land bargain amidst colonial splendour.

Plastic Surgery in The Caribbean: Inexpensive, High Quality Cosmetic Surgery.

Living & Investing: In Panama Find your dream in panama by enjoying an affordable and comfortable setting.

The Portable Professional:
Using technology, log in from anywhere and earn a living. please yourself and make money doing it.

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Caribbean e-books and reports on expat living, working, retiring and relocating to the Caribbean

OCTOBER

2 0 0 8
Issue 21

An online magazine about investing, living, working and relocating to the Caribbean.

EDITORIAL

Ramblings, thoughts and occasional sense from the Eastern Caribbean >>

HOT OFF THE PRESS

Events and news from around the region >>

SUSTAINABLE LIVING

Sharing resources and best practices >>

TOURISM TREATS

Updates on Caribbean tourism, conferences>>

DID YOU KNOW?

Interesting stuff, websites, facts and more >>

Funding and finance for large developments

SPECIAL FEATURES

Journey To Belize
Costa Rica : A Home Buyer's Guide
An American In Havana
Hidden Gems : Caribbean Caves
Nicaragua: A Majestic Paradise Part 2
St Lucia : Colonial Creole Country

COUNTRY FOCUS : DOMINICAN REPUBLIC

The Dazzling Dominican Republic

Dominican Republic : Business is Booming

Dominican Republic : Real Estate Haven

MONEY PAGES

Mortgage Matters Good advice on mortgaging your Caribbean dream and retirement home >>
Investors and Funding Insider knowledge on funding for your developments >>>
Passports to Offshore Security Economic citizenship, 2nd passports, protecting assets >>

PROPERTY PAGESS

Caribbean Investor And Owner Notes News and opportunities from CaribProperty Club Notes>>
The Rich Report Offshore insights from a Manhattan realty guru>>
Off-Plan Pre-Development Offers Our recommended deals from the best developers >>
Pick of the Month Editor's choice of interesting business and real estate opportunities >>

M O N E Y P A G E S

MORTGAGE MATTERS
by CONTI Financial Services
Established in 1994, Conti has helped thousands of people to arrange their mortgages in more than 45 countries. Its experienced teams of specialists ensure that every step of arranging your mortgage is handled promptly, efficiently and professionally.
And, through partnerships with expert companies, Conti can also provide
help with areas like insurance, legal advice and currency exchange.

HOW TO BUY A PROPERTY IN THE CARIBBEAN

The Caribbean - the full package

Ask most people to choose their ultimate holiday destination during the British winter, and it's likely that the Caribbean will come out a winner. It's got the full package: sunshine, beaches, English language, affordability, and only an eight-hour flight away.

And it seems that the playground of the rich and famous is becoming more affordable. The depreciation of the US dollar against major currencies such as the British pound and the euro, has made Caribbean properties more attractive from a European point of view. More affordable perhaps, but not necessarily cheap. Property prices in the more popular and developed islands can easily reach over $1 million for a property near the beach. The cheaper Caribbean properties tend to be found in Jamaica, Aruba and the Dominican Republic.

Ultimately, the decision to purchase property in the Caribbean is one of either investment or lifestyle, in some cases both. And many experts agree that the Caribbean offers good investment potential. As an established tourist market, not to mention a hot spot for holiday-homers and retirees, the desirability of these islands is unlikely to diminish. Consequently, rental returns tend to be good, especially as this is a year round market.

How do I finance the purchase?

One of the first considerations for anyone buying a property in the Caribbean is how they’re going to finance the purchase. There are generally two options here – either raising capital on existing property in your home country by means of an additional or new mortgage (providing you have sufficient equity), or alternatively, taking out an overseas mortgage secured on the Caribbean property.

Releasing cash from the equity of an existing property may help to secure the overseas property quickly – let’s face it, who doesn’t like to be paid in cash? But being a cash buyer does present some risks, especially if specialist, independent legal advice isn’t sought. For example, issue may arise over problems with title to the property if this has not been competently and thoroughly investigated.

As the overseas lending market has developed and become more competitive over the past 20 years or so, people are increasingly taking out an overseas mortgage to finance the purchase of their property using a bank or financial organisation in their chosen destination.

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In many cases, this means achieving a better interest rate than raising money on a property at home. However, the biggest advantage to choosing this route is that the lender will do its own checks on the property, ensuring that a proper legal title exists, that the property is registered in the buyer’s name and that a valuation takes place to check other issues such as proper planning permission and building licences are correct.

The Caribbean mortgage market does lack the sophistication and range of products available in the mature mortgage markets of North America and Europe. But a mortgage specialist, such as Conti Financial Services, will have familiarity and understanding of the lenders and will know of any restrictions and administration requirements, which can save you a lot of time, cost and hassle when arranging a mortgage.

The types of mortgages available in the Caribbean are similar to those offered at home. There are a variety of interest rates and these can be fixed or variable. The interest rate payable is usually driven by how much of a loan is required compared with the value of the property (the ‘Loan to Value’ or LTV).

Generally speaking, the bigger the deposit you have to put down on a property, the more competitive the mortgage deal will be. In the Caribbean, you’ll be expected to have at least a 30% deposit, the minimum loan is $500,000 or £250,000 and the mortgage can be on a repayment or interest-only basis. The length of the mortgage term may be shorter than you’re used to at 15 to 20 years.

The buying process

If you’re buying an off-plan property, you’ll be asked to make stage payments. This will usually consist of an initial 10% deposit, and payments for the remainder of the balance will depend on the development you’ve chosen. Even though you’re buying a new-build home, your independent lawyer will need to search for the Register of Title.

If you’re buying a resale property, you need to find a lawyer as soon as a price has been agreed. You’ll usually be required to pay a 10% deposit on signing the purchase agreement and this cash is kept in the vendor’s lawyer’s escrow account until you pay the balance on completion and it is all transferred to the seller. The whole process takes a few months.

Many of the Caribbean islands have different currencies, including the Barbados and East Caribbean dollars, but the majority of property transactions are conducted in the US dollar, even on the islands where it is not the official unit of currency.

Research, research, research

As with any other destination, it’s of paramount importance that you do your research before buying a property in the Caribbean. Take specialist legal advice and enlist the help of a tax expert, especially if avoiding tax is one of the main reasons you are buying there. It’s important to get it right in the first place and avoid complications further down the line.

And don’t be tempted to rely solely on rental returns to pay your mortgage, especially if your repayments are in US dollars and therefore subject to currency fluctuations. The rental market in the Caribbean is strong, but you can never take this as a given.

AUTHORS: CONTI Financial Services

Click here for more information about CONTI
Click here to view Caribbean developments
Click here to view Acanto Condo Hotel luxury Apartments (photos)

Campeche Playa, Golf, Marina & Spa Resort is in the historic city of Campeche, in the state that bears that same name and lies within the Yucatan Peninsula. The resort is built amongst a background of immense landscapes and archeological wealth (next to the sites of Edzna and Calakmul, two of the most impressive remains from Mayan culture). The 304 hectare complex will include:

*3,000+ apartments,
*two luxury hotels,
*town center,
*Yacht Club with a 150 boat capacity sports marina,
*commercial area (restaurants, luxury boutiques, etc.),
*medical clinic,
*preservation biocenter for the Carey Turtle,
*Golf club which includes the first 18-hole ecological golf course in Latin America, designed by Jack Nicklaus with the highest category “Signature”.

Prices start at $345,000 for a two bedroom, two bath apartment with terrace and jacuzzi, and Golf Membership.

Construction of the mega-development is scheduled to be completed in four phases, with a total build-out by the year 2010. During the first phase, the hotel, marina, golf course, town center and 1,243 units will be built, and is expected to be operational by mid 2009.

For more information:

CLICK HERE

Dominican Republic - Real Estate Haven Investors and Funding

PANAMA ISLAND - $165,000

• Live in an island paradise complete with lush green jungle ambience.
• Acreage includes two private docks with private cove.
• 25 minutes by boat to Bocas Town.
• Less than 5 minutes from grocery stores and famous Crawl Key restaurants.
• Beautiful coral reefs in your own front yard for snorkeling and diving.
• Sportfishing less than 10 minutes away.
• Famous Zapatilla Islands less than a ten minutes boat ride.
• Share your land with tropical birds, monkeys and sloths.
Property includes pineapple and coconut trees and a variety of other fauna.

US VIRGIN ISLANDS - $110,000

Seller of the two acres listed in the rainforest on St. Croix is motivated to sell! This property is listed at $110,000 - but $90,000 will take it! Gorgeous, gently rolling hills, lovely knoll top for building, wonderful mature trees, including fruit trees, make this a stellar purchase. Only 10 minutes from the best beaches in St. Croix, 15 minutes to the airport, and 5 minutes to one of St. Croix's best and most famous bars - The Domino Club. This is a nice, lush area with wonderful neighbors and huge appreciation potential.

DOMINICA - $ 42,000

A great property nestled in the valley of Despor. This land has fabulous mystical views of the Morne Trois Pitons. If you want to build in the country but have all the utilities at you fingertips this is the piece of property for you. It is very fertile, there are bananas, pineapples and coffee growing in abundance. Also, there is a prominent plateau that is elevated where one could build a dwelling house. The price of this listing is considered attractive. .87 ACRES

DOMINICA - US$ 75,000

This property is in a really pretty area on the Atlantic side of the coast. Set off the main road, it is elevated with great views of the ocean, in tandem also with the mountains. There is always a breeze that keeps you as cool as the proverbial cucumber. This could be a good site for a home; the land is very fertile and anyone who chooses to live here could live a self sufficient life as there is a stream on the land plus all the utilities from the road. 3 ACRES

DOMINICA - $ 199,750

The ideal property for the adventurer. Great land next to the most lovely river. This is definitely for the eco minded person as it is very much a private location. Pure nature. Hydro power for the electricity would probably be the way to go. 18.75 ACRES

MONTSERRAT - $270,000

Move in ready, two bedroom, two bath villa with both mountain and sea views situated on property to take advantage of trade winds and beautiful sunsets over the sea. In addition to the two bedrooms, the villa has a dining/living area, a library, large gallery surrounding the 23'x14' tiled pool on the first floor, downstairs has a laundry room with additional toilet , and a studio or workshop area. All have ceramic tile floors. The roof was re-shingled two years ago and all windows have new screens. The villa has much storage and closet space including additional storage area in the "pool room" under the pool. The property consists of three lots, together making up 1.07 acres.

MARGARITA ISLAND - $450,000

This property of some 12,800 m/2 (approx 5 acres) size, at present contains a simple, but charming typical 3 bedroom RANCHO (local style architecture) 240m/2 of construction, on 2 levels, in the centre of the park. There is a Spa with 2 rock pools to enjoy our therapeutic mountain spring water, - also 2 Bathrooms, 3 Toilets, a Therapy or aux. Bedroom w. Shower, an outdoor Shower, & 2 Gazebo for tropical bird observation & wonderful ocean views. Also an 80,000 litre water-tank, filled from the same spring source, and a solar power installation of approx. 1kw/h. The 600W wind generator will be replaced.