Cape Verde: still growing at breakneck speed
Cape Verde Islands, an archipelago of ten islands and eight islets off the west coast of Africa, is now famous as a property hot spot.
Each Cape Verde island and islet offers a distinct ambience any traveler will surely enjoy – hilly, flat, lush, and dry (except in August, September and October). Not to mention, the beaches are spectacular! And although tourism has encouraged developments in the islands, it maintains an unspoiled beauty perfect for a get-away.
Tourism in the islands has been growing at a breakneck pace of 25% annually over the past five years. Tourist arrivals jumped from 67,000 in 2000 to 183,000 in 2005, and are expected soon to zoom past the 1 million per annum level.
This small island nation has the highest standard of living in West Africa. It is the only African nation to rate a 1 – a perfect score – on the US democracy advocacy group Freedom House’s “Freedom in the World” report, which assesses the level of political freedom and civil liberties around the world.
A former Portuguese colony, it maintains close and special links with Portugal and the Euro zone. Lonely Planet has even named Cape Verde one of its top 10 destinations in 2011, calling it “an archipelago that looks and feels as if it were born from a Caribbean mother and an African father”
It has white beaches, mountains, and snorkeling sites, properties are still relatively cheap. Infrastructure in the island is currently being developed and upgraded. A building boom is now taking place in the Islands, as developers anticipate tourist interest.
The most popular islands to visit are Sal, Boa Vista, and Santiago.
The country’s capital, Praia is a busy city overlooking a bay in Santiago. However, it is crowded and poor, and usually overlooked by tourists who are more drawn to nearby Cidade Velha – the old city (recently granted Unesco World Heritage Site status) – or to the more tourist-ready islands of Sal and Boa Vista.
The big draw is Boa Vista, which receives 38% of all tourist check-ins and around half of all overnight stays. Its popularity among tourists has raised its real estate profile as well. A one-bedroom apartment in Boa Vista can go from €55,000 (mid-price) upwards. Residential properties of varying sizes and values on the island, such as those at the Santa Monica Beach Resort and Spa development, offer rental yields of up to 7% for the first five years.
Buying facts: Foreign nationals may freely purchase residential properties on the Cape Verde Islands. Real estate transactions are done in the national currency, the Cape Verde Escudo (CVE). However, most new constructions are quoted in either euro or British pounds. The escudo is tied to the euro at CVE 110.265 = 1 Euro.
Each Cape Verde island and islet offers a distinct ambience any traveler will surely enjoy – hilly, flat, lush, and dry (except in August, September and October). Not to mention, the beaches are spectacular! And although tourism has encouraged developments in the islands, it maintains an unspoiled beauty perfect for a get-away.
Tourism in the islands has been growing at a breakneck pace of 25% annually over the past five years. Tourist arrivals jumped from 67,000 in 2000 to 183,000 in 2005, and are expected soon to zoom past the 1 million per annum level.
This small island nation has the highest standard of living in West Africa. It is the only African nation to rate a 1 – a perfect score – on the US democracy advocacy group Freedom House’s “Freedom in the World” report, which assesses the level of political freedom and civil liberties around the world.
A former Portuguese colony, it maintains close and special links with Portugal and the Euro zone. Lonely Planet has even named Cape Verde one of its top 10 destinations in 2011, calling it “an archipelago that looks and feels as if it were born from a Caribbean mother and an African father”
It has white beaches, mountains, and snorkeling sites, properties are still relatively cheap. Infrastructure in the island is currently being developed and upgraded. A building boom is now taking place in the Islands, as developers anticipate tourist interest.
The most popular islands to visit are Sal, Boa Vista, and Santiago.
The country’s capital, Praia is a busy city overlooking a bay in Santiago. However, it is crowded and poor, and usually overlooked by tourists who are more drawn to nearby Cidade Velha – the old city (recently granted Unesco World Heritage Site status) – or to the more tourist-ready islands of Sal and Boa Vista.
The big draw is Boa Vista, which receives 38% of all tourist check-ins and around half of all overnight stays. Its popularity among tourists has raised its real estate profile as well. A one-bedroom apartment in Boa Vista can go from €55,000 (mid-price) upwards. Residential properties of varying sizes and values on the island, such as those at the Santa Monica Beach Resort and Spa development, offer rental yields of up to 7% for the first five years.
Buying facts: Foreign nationals may freely purchase residential properties on the Cape Verde Islands. Real estate transactions are done in the national currency, the Cape Verde Escudo (CVE). However, most new constructions are quoted in either euro or British pounds. The escudo is tied to the euro at CVE 110.265 = 1 Euro.
RENTAL YIELDS
Last Updated: Dec 31, 1969
Property is selling like hot cakes in Cape Verde
About half of the 482,000 population live in the biggest island, Santiago, which is home to the capital city, Praia. However, tourism is largely concentrated in the island of Sal, which has the country’s only international airport capable of receiving charter flights from Europe. New and bigger international airports are scheduled to be opened in Santiago, San Vicente, and Boa Vista.New developments are rising in almost every major island in anticipation of the boom. Capital values are rising by 10% to 15% annually. Yet property in Cape Verde is still a bargain at around €1,200 to €1,650 per sq. m.
Because the 'opening to tourism' is new, it makes little sense to talk of yields. But local realtors say that a studio unit in Santa Maria, Sal, worth €81,000, can bring in a 8% to 9% yield.
TAXES AND COSTS
Last Updated: May 15, 2009
Rental Income: Rental income earned by non-residents from leasing Cape Verde property is subject to 20% final withholding tax.
Capital Gains: Capital gains tax for non-residents is levied at a flat rate of 20%.
Inheritance: Any property transmitted by inheritance or by gift is taxed at a flat rate of 3%.
Residents: Residents are taxed on their income from Cape Verde at progressive rates, from 15% to 45%.
Capital Gains: Capital gains tax for non-residents is levied at a flat rate of 20%.
Inheritance: Any property transmitted by inheritance or by gift is taxed at a flat rate of 3%.
Residents: Residents are taxed on their income from Cape Verde at progressive rates, from 15% to 45%.
BUYING GUIDE
Last Updated: Aug 07, 2006
The total roundtrip transactions cost, i.e., the cost of buying and selling a property, is around 18%, inclusive of the realtor's 5% commission. A lawyer is needed, and will cost 3% of the purchase price. Other costs include Sales Tax (3%), Conveyance Tax (3%), Registration Fee (2%) and Title Deed (2%). The buyer pays for all costs, except the realtor’s commission.Property buyers are advised to open two accounts, one in Escudo and the other in Euro. Escudo cannot be transferred out of the country but Euro can.
LANDLORD AND TENANT
Last Updated: Sep 08, 2006
Rents: The landlord and tenant are free to agree on the rent, and the due date of payment.
Tenant Eviction: The lease is automatically renewed at the end of the term, and the landlord may only terminate in very limited cases. He needs to file an eviction request in court, involving substantial delays.
Tenant Eviction: The lease is automatically renewed at the end of the term, and the landlord may only terminate in very limited cases. He needs to file an eviction request in court, involving substantial delays.
ECONOMIC GROWTH
Last Updated: May 24, 2011
Verde is the colour of hope and development
Formerly a Portuguese colony, Cape Verde (pop. 507,000, GDP/cap US$2,679) became independent in 1975. It now has a stable democratic system, though initially after independence a one-party state was established by the African Party for the Independence of Cape Verde (PAICV), under the leadership of Aristides Pereira, who ruled until 1990.Growing pressure led to multi-party elections. Antonio Mascarenhas Monteiro of the Movement for Democracy (MpD) succeeded Pereira, serving two five-year terms. In 2001, Pedro de Verona Rodrigues Pires was elected president, returning power to the PAICV. He was reelected in 2006.
The economy has grown strongly from a low base. From 1980 to 2005, real GDP per capita grew by 128%, and 7% annually from 1995 to 2005. GDP growth is expected to be 7.7% in 2006. Inflation is 0.7%, closely linked to the eurozone’s inflation.The number of people below the poverty line was 36% in 2002, of whom 21% are unemployed. Cape Verde has limited natural resources, and can only support limited agriculture or pasture.
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