There are many sound reasons for investing in property in the Cayman Islands. Not only is it a uniquely beautiful place, it also has the most perfect climate in the world (well, nearly perfect if you don’t count the hurricanes!).
The main reasons why so many people choose to buy a home here however, are because there are no annual property taxes. And not only are there no restrictions on foreign ownership, overseas investors are positively encouraged. All property is registered under a unique block and parcel number so every owner is registered and the Government guarantees that right of ownership. Anyone wanting to buy themselves a piece of real estate can look at the records regarding any piece of property and check whether there are any liens, charges or restrictions on it.
A one time stamp duty fee of between 5-7.5% is payable on all property transactions depending on where the real estate is located and the nationality of the purchaser.
Buying property in the Cayman Islands is as straightforward a process as anywhere in the western world and with so many clear benefits and advantages the country has a thriving property market that has around US $1,600,000,000 worth of property on the listings at any given time. The island is also home to around 180 property professionals who can help investors find the right purchase. And with many of them offering professional management services, they can help find tenants for investors who want to make an income from the property they have purchased. The island has no shortage of legal experts either to help ensure the smooth transition of your purchase.
As Cayman is one of the world’s leading offshore financial service centres and free of income tax, property taxes, capital gains, inheritance and any other form of direct taxation on earnings and profit it makes a great choice for those seeking to use property as part of their financial portfolio. With numerous financial experts on hand to help investors raise the finance or utilise their own money and a favourable tax environment, Cayman is a very attractive place for property tycoons large or small.
With a successful tourist product and a rapidly growing population Cayman offers an ideal opportunity for investors looking to buy real estate that they can lease on the long term residential market. With more than 50 percent of the workforce coming from outside the country, the rental market is buoyant. And while local residents often choose to invest in their own property, many of them are here for relatively short periods and require rental accommodation. Even those who will eventual buy their own home will lease for the first few months they are on island. Investors who wish to buy a property to enjoy as a second or vacation home can usually expect to cover their running costs by placing their property in the rental pool for overnight tourism when they are not using it.
Cayman has an exceptionally high standard of living and one of the highest Gross Domestic Products in the world. This means that while property can be expensive, investors who choose to lease their property on a long term basis can see a significant return on their investment of between 8-10 percent. Moreover, prices have consistently risen year on year which means owners who invest in order to see the capital investment mature are rarely disappointed. With no taxes to pay on the income gained from leasing or from the return on the growth in value of the property Cayman is a desirable location for property investors from all over the world.
According to local property professionals anyone who is coming to the Cayman Islands to work for more than three years is also likely to benefit financially from buying a property as opposed to renting for the full time period that they are in residence. The expenditure on rent is often not much less than a mortgage, and buying also provides capital investment. Even workers who leave the island after three years can continue renting out the property and sitting on the investment for future growth. Cayman banks are generally keen to grant mortgages to suitably qualified applicants although interest rates are higher than in Europe and North America.
Another lucrative option for residents and foreign investors is land purchase. One of Cayman’s many advantages is that once you have purchased raw land there are no obligations for you to do anything with it. In other words you can invest in a small plot and then wait until you can afford to build on it or wait until you want to sell it to another purchaser at a higher price. With no taxes to pay or obligations to meet throughout the year, it is a simple and straight forward way of watching your money grow. It can also add to the point total for residents seeking permanent residency. Some sub-divisions of land however do come with covenants and investors may be expected to build a certain type of property within a certain time period. However, your real estate agent or broker will be able to advise you on the circumstances of any purchase.
Ever since the 1960s overseas investors have sought to put their money in Cayman Islands real estate in order to enjoy a tax free return. And as the sector continues to grow there is no sign that the islands are falling out of favour with those who know a good investment when they see it.