Monday, March 23, 2009

Letter from a Property Investor

As I survey the property world scene, it seems that those areas with dynamic growth have equal potential risk attached to them. I?ve decided to avoid much of Eastern Europe and the former Soviet satellites. Bulgaria does not have such a good climate and there is only a limited number of resorts that have skiing to provide two seasons of tourism. Accessibility and infrastructure have a long way to go before they can support the tourist expansion that now seems inevitable with all the development going on. I have my doubts that renters and holiday-makers in sufficient numbers will be choosing Bulgaria to fill all the property construction currently underway.

Although there?s no denying the boom going on I prefer to avoid anywhere with even a hint of political risk. With current upheavals in the Middle East I?ve decided to avoid Dubai and the Emirates even though they?re remote from anything going on at the moment ? who knows what the future may hold.

Spain is overshadowed by the new land grab regulations. Only recently there were many more arrests of those involved in the planning scandals, the impact of which is still to be felt by many overseas property owners who have made Spain their home.

Having recently returned from Barbados and St. Lucia I must say I like this area of the world for my next investment. It?s both politically and economically stable and appeals to both the European and US markets. Properties are sold in US$ and Americans are increasingly making the Caribbean their destination of choice as it?s close to home and has a year round good climate. The recent appreciation of Sterling to the dollar is a nice bonus.

St. Lucia has been voted one of the world?s most beautiful islands by Conde Nast magazine. The description did not disappoint when I saw it for myself. With its vast rain-forest, white sandy beaches and the World Heritage Pitons, it justifies its description as one of the loveliest of the Caribbean islands. Property prices are well below neighbouring Barbados and there are several very interesting opportunities just launched and available off-plan. I chose a 2-bed apartment at The Landings in Rodney Bay. It?s a great new marina, which has just started construction. It?s similar in concept and has the same builder as Port St. Charles in Barbados, a sell-out 220 unit marina development but, The Landings is some 40% cheaper.

I?ve bought my apartment with the furniture package and it will be included in the rental pool. This guarantees me an income of a minimum of 6% p.a., for the first 2 years. Afterwards, my apartment participates in a pool of income generated by all the rental properties to ensure each owner a fair share. Owners can use their property for up to 12 weeks a year during which time they do not participate in the rental pool. This is a great way of owning a holiday property as it provides flexibility as to how often I use it, it generate a good income when I am not using it and I have none of the usual running costs to pay as, all of these are paid out of the rental pool. Added to that, its hassle-free as The Landings is run like a hotel with concierge and all the other 5* services one would expect. All of which is available to me when I am in residence.

The development team have a good deal of experience in both construction and resort management in St. Lucia. This may not boast some of the spectacular returns I?ve seen touted elsewhere but I feel I?m in safe hands and if the gains are more modest they look more secure. That will do me fine.

Look for future editions of my property investor newsletter, which I hope, will enable readers to benefit from my experience.

Julius Nehorai

International Web Realty

www.internationalwebrealty.com

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