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Antigua and Barbuda: Overview

Last Updated: Jan 23, 2008

House prices are red hot in Antigua

It is boom time in Antigua and Barbados. The logic of buying delightful beachfront property while the US dollar is weak has become apparent to retirees in the UK and Europe, now daily arriving on flights from London. The rich and famous are also being drawn to once-dowdy Antigua, the larger of the two islands.

The International Herald Tribune recently praised Antigua as ‘newly chic’, noting that it has attracted mansion-buyers like Giorgio Armani, Richard Branson, Timothy Dalton and Eric Clapton.

The highest price rises have been seen on Jolly Harbour beach on Antigua’s beautiful West coast, where prices have risen fourfold over the past two years. This is greater than the price-rise during the entire previous ten years. Property values have also risen 60% -100% over the past two years at Jumby Bay, Antigua’s equivalent to Mustique – which limits on the number of people who can come in every year. Detached town houses on the islands have also doubled in the same period.

One attraction this tiny tropical paradise (pop 70,000), previously frequently overlooked in favor of its flashier Caribbean cousins, is its picturesque English Harbor, where Admiral Horatio Nelson once based the British fleet. But more important is that Antigua has been so far been left out of the building boom in the rest of the Caribbean, despite some hotel construction in the 1980s. It is rare for lots to become available. The mountainous terrain makes it difficult to develop.

“We have 365 beaches, but not a lot of beachfront property is actually available for sale,” says Geoffey Pidduck, the head of Trade Wind Realty, who sees a very considerable increase in demand. “Despite the limited supply people continue to want to buy beachfront properties, so the prices of beachfront properties have gone up by four times during the past two years.”

However, a significant amount of construction is now underway, with developers like La Perla International, an Amsterdam-based luxury home builder, moving in to sell projects like Princeton Estates. Princeton has five houses of as much as 5,000 square feet (465 sq. m.), each on a hillside with ocean views and priced at around $2.7 million. La Perla is also developing in JG Estates, with custom villas at $200,000. Both projects are sold out.

According to Global Property Guide figures, a 2 bedroomed house in Antigua might cost around US$400,000, while A 3-bedroomed house might be worth around US$640,000 (November 2007). But these are very rough estimates, and the range of variation is large.

Foreigners are required to get a license if they want to acquire property in Antigua and Barbuda.

Read Price History  »

RENTAL YIELDS

Last Updated: Nov 25, 2008

Very nice, but very expensive

Houses in Antigua, the centre of the rental market, are priced at US$351,000 for a two bedroom home and a whopping US$855,000 for three bedrooms or more. 2008 yields are unavailable, due to the scarcity of data.

Barbuda is a tiny island, often described as being so underdeveloped, that it is positively deserted. There are hotels, but the island’s main inhabitants are Frigate birds. Barbuda is easily accessible from the island of Antigua. and though tourists are drawn by the wealth of natural activities, there is barely a real estate market to speak of.

Read Rental Yields  »

TAXES AND COSTS

Last Updated: Jan 19, 2009

Antigua and Barbuda’s rental income tax is high

Rental Income: Net rental income is taxed at a flat rate of 25%, withheld by the tenant. Income-generating expenses and depreciation expenses are deductible from the gross rent to arrive at the taxable income.

Capital Gains: There are no capital gains taxes in Antigua and Barbuda.

Inheritance: There are no taxes on inheritance in the islands.

Residents: Residents are taxed on their worldwide income at progressive rates, from 10% to 25%.

Read Taxes and Costs  »

BUYING GUIDE

Last Updated: Apr 01, 2008

Buying costs are high in Antigua and Barbuda

Roundtrip transaction costs are around 21% to 24% of the property value, inclusive of the agent’s commission (5% to 7%). The biggest chunk of the cost goes to stamp duty at 10% (7.5% paid by the seller and 2.5% paid by the buyer). The buyer also pays for the alien landholding license fee (5% of the property value).

Read Buying Guide  »

LANDLORD AND TENANT

Last Updated: Jun 06, 2006

Tenancy protection laws

Short-term leases, a week’s time or so, are the most common tenancy agreements in Antigua and Barbuda.

Read Landlord and Tenant  »

ECONOMIC GROWTH

Last Updated: Jan 23, 2008

Moderate economic growth

Antigua and Barbuda’s economy largely depends on tourism which in turn is determined by economic trends and social trends of foreign markets. Weather conditions also directly affect the tourism industry and the country is very vulnerable to hurricanes.

Part of the present economic buzz stems from the happy way in which the Bird Family’s rule ended. For decades Antigua and Barbuda's politics were dominated by the Bird family. Vere Bird led the country into independence in 1981. He remained in office till 1994, when he was succeeded by his son, Lester, who then spent a decade in office. But behind this stability was a succession of scandals and allegations of corruption.

The opposition United Progressive Party led by Baldwin Spencer won a landslide victory in general elections in March 2004. A lifelong labour activist, Baldwin Spencer was born in the working-class community of Green Bay, and he promised that "crimes committed against the people" would not go unpunished. But to date the government has been clearly pro-business.

Antigua and Barbuda’s economy grew an average of 3.2% per year from 2000 to 2005. The GDP growth rate for 2005 was 2.4% and an average growth rate of 2.6% is forecast for 2006.

People visiting Antigua and Barbuda increased an average of 9% per year from 2000 to 2004, whereas stay-over visitors to the islands increased an average of 4% per year over the same period. Total number of visitors to the islands is 768,209 in 2004, of which 245,456 are stay-over visitors.

 

  • Moderate yields
  • High transaction costs
  • High rental income tax
  • Tourism dependent economy
  • Minor ownership restrictions

RESIDENTIAL PROPERTY FACTS
Price (sq.m): $4,275 For a 200 sq. m. property, usually an apartment. Rental Yield: n.a.
Rent/month: n.a. Income Tax: 20.00% Assumptions: Owners are a non-resident couple drawing US$ / €1,500 per month in rent, with no other local income.
Roundtrip Cost: 28.0% The total cost of buying and then reselling an apartment. Includes:

* all transaction taxes and charges:
* lawyers' and notaries' fees
* agents' fees

Assumptions: The buyers are non-resident foreigners. The apartment cost US$250,00 / €250,000. 		Cap Gains Tax: 0.0 Assumptions: The property was bought for US$250,000 / €250,000, and sold 10 years later, after a 100% appreciation.
Landlord & Tenant Law: n.a. Rating is based on a detailed study of each country’s law and practice.
JANUARY 2008
AUGUST 2007
JUNE 2007
DECEMBER 2006

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