Saint Kitts and Nevis: Emerging luxury property market

Real estate prices in St. Kitts and Nevis have increased steadily since the early-2000s, though the islands are still much less expensive than most Caribbean islands.

In Calypso Bay Resort, St. Kitts, resale prices of residential properties have quadrupled since the resort’s launch in 2001, says Ricky Pereira of St. Kitts Realty.

In the past four years the pace of real estate developments has increased rapidly, spurred by the arrival of the Marriott Hotel in Frigate Bay, and increased air flights into the islands.

“Since the Marriott opened, property sales and prices have increased dramatically,” says local real estate agent Brian Kassab.

In 2009, the housing market is expected to remain stable, despite the global financial meltdown. According to Coldwell Banker St. Kitts and Nevis Realty, property demand in St. Kitts and Nevis remains robust. While some banks have imposed stricter lending criteria, interest in home ownership is still strong, and lending institutions remain committed to financing in the housing market.

"There are no foreclosures here, and it is rare to even see a for-sale sign," says Kassab.

Price variations

According to recent Global Property Guide research:

  • a six-bedroom house in St. Kitts sells for about XC$1.97 million (US$730,000)
  • a three-bedroom house in Nevis sells for around XC$1.84 million (US$680,000)

In Ocean´s Edge, an exclusive residential development located in Frigate Bay, St. Kitts:

  • one-bedroom beachfront apartments sell for about XC$945,000 (US$350,000).
  • exclusive villas are priced from XC$3.78 (US$1.4) million to XC$4.86 (US$1.8) million.

In Silver Reef, a beautifully designed ‘green’ resort in St. Kitts:

  • prices of one-bedroom apartments start at XC$956,000 (US$354,073)
  • two-bedroom apartments go for XC$1.18 million (US$435,362)
  • Villas are priced at about XC$1.94 million (US$720,283).

In the recently launched Christophe Harbour, a 2,500-acre project located in the southeastern coast of St. Kitts, prices of condominiums and villas start at XC$2 million (US$750,000).

"Christophe Harbour has the island´s very best beaches, half a dozen of them," says Kassab.

In Nelson Springs Beach Villas & Spas, located in Charlestown, Nevis:

  • two-bedroom condominium units are sold for XC$1.9 million (US$705,000)
  • three-bedroom condos sell for around XC$2 million (US$745,000).

In the Sunset Ridge, situated near Mount Nevis, prices of villas start at XC$1.9 million (US$715,000). The Phase 1 is expected to be completed by late 2011.
Four Seasons Estates, located along the 4-mile-long Pinney´s Beach, remains the top choice in Nevis.

Prices of luxury villas and estate homes in Four Seasons Estates range from about XC$4 (US$1.5) million to XC$21.6 (US$8) million.

Solving housing problems

Till recently, some of the local population wasn’t very well-housed. Prime Minister Denzil Douglas began to address the housing problems in St. Kitts and Nevis as soon as he took office in 1995.

About 2,500 affordable and middle-income homes have been built during the past 13 years via National Housing Corporation (NHC) programmes. About 800 homes are currently being constructed or renovated in St. Kitts.

In Nevis, the Nevis Housing and Land Development Corporation (NHLDC) has embarked on a comprehensive home construction program to make affordable housing available.

Aside from affordable housing, the government is committed to raise housing standards.

“85% of the housing stock was damaged by Hurricane George in1998,” says Housing Minister Cedric Liburd. “In response, the government joined with USAID and the OAS…to create a plan of action for repair and upgrading of existing housing, so that these structures might be better suited to withstand future storms. The Parliament also upgraded the building codes in 2000.”

A recent study by the Caribbean Development Bank showed that poor quality housing in St. Kitts has been cut by 23% over the past 8 years. The percentage of population living in poor quality housing fell to 7.5% in 2008, as compared to 30.5% in 2000.

Citizenship-by-investment program

St. Kitts and Nevis’ Economic Citizenship Program has been in force since 1984, mainly to attract wealthy foreigners. By purchasing real estate in approved developments, the prospective expatriate (and his dependents) acquire citizenship instantly.

To qualify, the foreigner should satisfy the following:

  • A minimum investment of XC$945,000 (US$350,000) in pre-approved real estate developments in St. Kitts and Nevis
  • Payment of a cash sum of XC$94,500 (US$35,000) for the head of household and XC$40,500 (US$15,000) for each additional family member


APPROVED DEVELOPMENTS FOR ECONOMIC CITIZENSHIP

SAINT KITTS NEVIS
Calypso Bay Resort Botanical Gardens
Christophe Harbour Bush Hill
Golf View Carino Hamilton Estate
Half Moon Bay Villas Cliffdwellers
Heritage Plantation Fern Hill Villa Development
Horizons Villas Fort Ashby Beach Club
Kittitian Hill Four Seasons Resort Estates
Leeward Cove Jones Estates and Red Hawk Ridge
Marriot Vacation Club Sunset Ridge (Live Nevis)
Ocean’s Edge Mount Nevis Hotel
Pirate’s Nest Nelson’s Springs Beach Villas and Spas
Royal St. Kitts Hotel and Casino Oualie Beach Resort
Sea Lofts Paradise Garden Estate
Silver Reef Resort Rawlins Plantation
St. Christopher Club Royal Getaway Estate
Sundance Ridge The Hermitage Plantation Inn Villas and Estates
Sunrise Hill Resort


The Economic Citizenship Program provides the following benefits:


  • Full citizenship, for the applicant and all eligible family members
  • Dual citizenship is permitted, without the requirement to notify the applicant’s home country, and without any need to reside in St. Kitts and Nevis
  • Passports will be issued, and may be easily renewed
  • Visa-free travel to more than 60 countries worldwide
  • Full residency status and the right to work in St. Kitts and Nevis
  • Tax free status on foreign income, capital gains, gift, wealth and inheritance tax
  • As a Commonwealth citizen, the applicant receives preferential treatment in the UK (e.g. applicant’s children may enter the UK to study without the need to apply for student visas. After studying, they may work in the UK for 2 years without needing a work permit.)

Sluggish mortgage market

The mortgage market in St. Kitts and Nevis has been sluggish for the past decade, as property purchases by foreign buyers are mostly paid in cash. Total property loans amounted to XC$362 (US$134) million in 2007, up 5% from a year earlier, according to figures from the Eastern Caribbean Central Bank.

A number of local banks offer home financing to non-residents. The maximum loan-to-value ratio is usually 60%, with loan terms of 15 years. Mortgage interest rates are typically tied to the US prime rate or LIBOR. The Eastern Caribbean dollar, the official currency of St. Kitts and Nevis, is pegged to the US dollar, at XC$2.7 to US$1.

Stable rental market

The long-term rental market, though small, is stable due to strong demand from non-resident workers and foreign students living in the country.

Because of limited supply, students, professors, corporate lessees and many others need to compete for the few rental properties available. However, occupancy rates are difficult to determine and vary enormously, due to the influx of short-term vacationers during “season” from December to mid-April.

Inland three-bedroom houses with pools rent from XC$3,240 (US$1,200) to XC$6,750 (US$2,500) per month.

In Frigate Bay, two-bedroom houses command monthly rents from XC$2,160 (US$800) to XC$2,700 (US$1,000). In Ocean´s Edge, flats let for XC$4,860 (US$1,800) to XC$14,040 (US$5,200) per month.

Transition stage

The economy of St. Kitts and Nevis has experienced strong growth during the past two decades, with an average 4.2% GDP growth during the period 1993 to 2008. However, the islands have occasionally hit trouble. In 1998, hurricanes damaged about 85% of housing stock. In 2001, the 9-11 terrorist attacks sapped economic growth.

Economic growth rose to 6.4% in 2006, mostly as a result of diversification into tourism and construction related to the Cricket World Cup. In addition, the government aggressively has promoted light manufacturing and international financial activities, to fill the gap left by the sugarcane industry.

Sugar used to be the backbone of the economy. However, decreasing world sugar prices prompted the government to close the sugarcane industry in 2005.

In 2008, the economy grew 3.5%, up from 3.1% growth in 2007.