Cape Verde Property Investments
Why Invest in Cape Verde?
Cape Verde, the small tropical island archipelago off the coast of Africa is fast becoming a major point of interest for both the serious property investor as well as those wanting a holiday home in a stunning and convenient location. The following points have contributed to Cape Verde climbing fast on the international property arena as a secure all round investment:
" Undergoing major infrastructure and development to encourage tourism.
" Property prices forecast for rapid growth as the islands become an established holiday destination in the medium to long term. ( 22% per annum)
" Direct flights from the UK and Europe
" Politically stable with a strong economy
" Wonderful truly year round climate
Climate
Cape Verde is located just an hour and a half on from the Canary Islands and is on the same line of latitude as the Caribbean. Because of this, the islands benefit from a yearly average temperature of 23 - 28º and are classified in meteorological terms as a dry tropical climate with low humidity.
The islands beaches also have very pleasant water temperatures of no less than 21º making for an all year round pleasurable swimming and holiday climate.
Location
The islands are the closest tropical destination to the UK & Europe.
This situation means tourists can enjoy a complete tropical holiday with half the length of flight times and distances to travel than other tropical locations. Direct flights are available from the UK and are becoming more frequent which has contributed to improvements in tourism, economy strength and capital growth.
Glorious white sandy beaches, crystal clear waters, stunning mountain views and tropical plantations has seen Cape Verde recently voted no.1 tourist destination for 2007 by Expedia.com
Capital Growth
As an emerging market it is the early investors who will receive the highest returns as the Cape Verde market starts to expand.
Prices are presently increasing at 11% p.a. and rising as the market becomes more established. Investors purchasing at the Paradise Beach resort are forecast to see returns on their investment at 22% in the first year.
Continued growth in tourism, flights, government investment incentives, mortgages and infrastructure will provide a constantly growing demand for property which could see price rises year on year of 25% - 30% in the near future.
Rental Potential
Increasing tourism and sensible development laws established by the government to protect the islands from overdevelopment are the combining factors that have led to a healthy rental forecast for investors. Predicted rental yields are between 6% - 8% p.a.
Taxation
As with every other country there are a number of taxes applicable to your purchase and sale of property in Cape Verde.
As part of the 6% buying costs, 3% of this is attributable to Transfer Tax.
Annual holding Taxes are paid every year in April and are 3%. This is calculated on 25% of the attributed property value. These can be paid in 2 installments.
Capital Gains Tax is charged on the sale of your property if the sale value exceeds a 30% increase on your purchase price. This is due 30 days after your completion and is taxed at 3% of the gain. Inheritance or Gift Tax is charged on all property in Cape Verde that is transferred by means of Inheritance or Gift. This again is calculated as 3% of the attributed Value.
The contents of this webpage should not be taken as an authoritative statement of Cape Verde law and practice. Neither the author nor the publisher are responsible for the results of actions taken on the basis of information contained in this summary, nor for any errors or omissions. This text is not intended to provide legal, accounting or tax advice.