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Why buy vs. rent in TCI?

Most people that buy villas in TCI do so simply because they want to stay in their own place whenever they visit. But many of those villa buyers – either right from the outset or later on – take advantage of TCI’s immense popularity by renting their villa to other vacationers during the times they can’t be there themselves. 

Buyers with that perspective view their villa’s income-generating potential as more of an added bonus than a determining factor in their decision to buy. Their view is that if their property generates net income that’s great, but if it doesn’t then they’ll just stop doing it. It’s a ‘no harm, no foul,’ kind of outlook. 

1. Why is it a good idea to diversify your asset holdings with real estate property?

Investment advisors often recommend diversifying financial assets, such as stocks and bonds, into hard assets such as real estate, in order to hedge against financial market volatility. 

In addition, investing in real estate rental property tends to provide a more regular, predictable, income flow (via rent payments) than dividends do, as a complement to long-term gains achieved through asset appreciation. 

Lastly, of course, real estate investments can often be financed, creating greater leverage and returns. 

2. Why (and when) is it a good idea to buy real estate property abroad?

Foreign real estate investments serve as a hedge not only against stock market volatility but also against domestic real estate market volatility, and indeed against national economic and currency volatility more generally.

Vacation destinations such as the Caribbean – often present a greater value for money than domestic ones. This is because foreign markets typically have fewer multi-level regulatory burdens inflating the cost of acquisition and restricting options for making profitable improvements, and less demand brought about by government and private-sector financing options.

3. Why is the Turks & Caicos a great choice for holding foreign real estate as an investment?

TCI scores highly on all of the non-price issues noted above that may concern investors contemplating investment abroad. TCI has a stable democratic government, with a UK-appointed Governor for oversight, and a strong and effective judiciary based on English Common Law. TCI enjoys one of the fastest growth rates in the Caribbean.

Foreign property ownership: TCI has fee simple property ownership guaranteed by the British Crown and equally applicable to all buyers – whether foreign or domestic. Moreover, foreign buyers can qualify for either Temporary or Permanent Residency based on their property purchase. 

Local tax & currency control policies: TCI has a strong, pro-business orientation that is reflected in its tax & currency policy. Thus, there are no direct taxes in the TCI – including no property, income, capital gains or estate taxes – and no currency exchange controls. With no need for title insurance, no recurring property taxes, and affordable property insurance, the cost of property ownership in TCI is low.

As our final thought, if the absolute worst came to the worst: the world’s economy collapsed, and all of your investments became worthless overnight, would you rather be holding a piece of paper manifesting your 1% share in a now-utterly valueless company? Or the keys to your very own luxury villa on a tropical island? Buy land, they’re not making any more of it!

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