With domestic home prices still on the rise and competition among buyers leaving many frustrated, you may be looking for something a bit different when it comes to real estate investing. For those willing to go beyond the borders of our own country, the small island nation of the Turks and Caicos Islands has proven a popular destination for Canadians, both for leisure and for investment.
To learn more about the opportunities available to Canadians in the Turks and Caicos Islands, we spoke to J. Kelly Sullivan, Managing Director of the Kokomo Botanical Resort. Sullivan himself is a Canadian with a background in real estate development who found his way to the islands in the 1990s and never looked back. Now, he hopes to share with Canadians the reason why he loves Turks and Caicos and why it can be a great location for investors.
“First of all, at a very rudimentary level, the islands welcome investors into real estate from around the world with very few restrictions,” explained Sullivan. “Canadians have the opportunity to own real estate here, just like back in Canada. And, this isn’t a leasehold type of ownership, it’s a freehold title just like you have in Canada.”
The Turks and Caicos Islands, despite being down in the West Indies, actually has many close ties to Canada that make it a great choice for Canadians. For one, they are an autonomous British Overseas Territory, meaning we share a Queen among other legal and political similarities. Also, as a result of British influence, Turks and Caicos is a primarily English-speaking country, making it easy for anglophone Canadians to get by in daily life on the islands.
There are other connections as well, like the fact that three of the most common banks on the island are all familiar Canadian names: RBC, Scotiabank, and CIBC. Once, there was even a popular political movement to have Turks and Caicos join Canada as its own province, though this never came to fruition. Finally, the Turks and Caicos Islands’ economy is largely driven by tourism, meaning visitors are treated with welcoming hospitality no matter where they go.
The other factor that drives Canadians to Turks and Caicos, both to visit and to buy, is more obvious. The Turks and Caicos Islands are located in the Caribbean with plenty of sun, the best beaches in the world, fifty shades of warm turquoise blue seas, and year-round warm weather. Plus, it experiences the second-fewest number of rainy days in the region.
Canadians love their cottages and vacation homes and many also flock to places in the southern U.S. like Florida for their sunny getaways. Sullivan points out that Turks and Caicos is really not much further away, but far enough that you can enjoy 12 months of summer weather.
“To get from the Toronto Pearson Airport to here, it’s essentially the same flying time as flying to Florida even though it’s further away because we don’t have the same volume of air traffic,” explained Sullivan. “Gate to gate, it takes about three hours and 15 minutes. So, in the time that takes you to go from Toronto to Muskoka, you’re here.”
Most investors in the Turks and Caicos Islands enjoy their property as a vacation home, with the option to offset costs of ownership with rental cash flow in the months they are back in Canada. For this purpose, owning property in the Turks and Caicos Islands can pay off hugely in lifestyle benefits over the course of your ownership.
For those looking to buy in Turks and Caicos, there can be huge financial benefits as well. For one, the process of buying in Turks and Caicos should be familiar to Canadians who have gone through the process at home, making it easy to secure ownership, even remotely. And, the country is very light on its tax policy, meaning huge savings potential for Canadians.
“From a consumer standpoint, there are limited consumption taxes. But from a real estate investor standpoint, we have no property tax, no income tax, or capital gains tax. Best of all, as a family lifestyle investment with lifetime returns, there are no death or inheritance taxes so the youngest today becomes the owner of tomorrow.”
That being said, there is a one-time stamp duty similar to land transfer tax that ranges from 6.5-10% of the purchase price. If you decide to build in Turks and Caicos, there are import duties that can get over 30%.
“The process of buying a home is identical to what you are used to in Canada. We use MLS just like in Canada. If you’re buying through a listing, you’ll work with a real estate agent like The Agency, and they’ll have their standardized offer of purchase forms. All the major agencies have offices here in Turks and Caicos. They mostly deal with resales, but you can also go right to the developer as well.”
Finally, Sullivan explained, though the islands are a popular destination for the rich and famous, there are other options the Kokomo Botanical Resort & Spa where prices are actually competitive with homes and recreation properties in Canada.
“The average house price in the GTA right now is around $1.3 million. We have fully furnished Caribbean cottages in a gated residential resort that are priced at less than half the price of homes in the GTA. Prices here are also on the rise, but right now you can own a Caribbean cottage in the Turks and Caicos Islands including all closing costs (i.e. stamp duty, legal fees, and income guarantee), for as little as $525,000. You can’t even buy a cottage up north for that price.”
The Kokomo Botanical Resort & Spa, centrally located on Providenciales, is now offering units to investors looking for their own place under the sun. Kokomo features 38 private cottages nestled into a botanical garden property. The resort features a freshwater oasis pool, a Balinese spa pavilion, a private dining restaurant, and a kilometre of nature trails. It’s all located just a short trip away from Turks and Caicos’ famous Grace Bay Beach, one of the top-rated beaches in the world where the resort has its own private beach club.
If you are interested in visiting the breathtaking Kokomo Botanical Resort to experience some accessible luxury with well-curated island vacation experiences, connect with Mr. J Kelly Sullivan at their website.