While most other property markets have hit a bit of a downturn, the Cape Verde Islands (known as Cabo Verde locally) is now leading the way as the new kid on the property investment block. With a long and varied history dating back some 500 years, these Islands have now become a target for the savvy property investors among us, looking to find the next property hotspot.
So why would one look to invest in the Cape Verde Islands, as opposed to existing more "stable" economies and property markets such as Spain, France or Cyprus? Well, the main draw has to be the huge potential for strong capital gains over the long term.
It's true that the former Portuguese colony of the Cape Verde Islands has been regarded in recent years as one of the poorest countries in the world, but this is in financial terms. The Cape Verde Islands are extremely rich in many other ways and has lots to offer investors and holidaymakers alike. So let's take a brief look at just what this group of 10 small islands has to offer us.
One obvious draw when considering investing in the Cape Verde Islands has to be the climate. With a year round sub-tropical climate similar to that of the Canary Islands, it's no wonder that people have high hopes for Cape Verde as the next hot tourist destination.
If you are looking to purchase here in order to rent the property as a holiday home, then the weather has to be a major factor. With fantastic year round weather and between 10 and 12 hours of sunshine per day, it is an ideal winter break destination and within only 6 hours flying time of most European countries.
Traditionally, the service driven Cape Verde economy has been heavily affected by its agriculture and natural resources, but the flourishing tourism industry has now helped to reduce the agriculture GDP (Gross Domestic Product) which stands at around 12% in 2000 but is now at a much lower 6%. The tourism industry is responsible for around 11% of the GDP and this is set to rise as the countries tourism industry is set to increase dramatically in the coming years.
Generally the economy of the Cape Verde Islands is pretty stable although the country itself does not have an external public debt but saying that the country does have strong ties with the IMF (International Monetary Fund) and does not receive significant funding and aid from a number of other countries.
Another plus is that the currency (CVE Cape Verde Escudo) is tied to the Euro, so enjoys the same strengths as the Euro. The Euro is also now widely accepted on the Cape Verde Islands which is an added bonus.
The Tourist Industry
With its rich and natural tropical beauty, glorious year round weather, perfect water temperatures, an abundance of diamond white beaches and all the water sports you could want, Cape Verde is an ideal holiday destination for those looking for a change from the normal short- haul package destinations.
There are many indications that the Islands are set for a huge boost in visitor numbers. There were around 20,000 visitors per year to the Islands in 1991. This number now stands at over 200,000 per year and is growing significantly each year.
It is also worth noting that many notable media companies, newspapers and specialist travel programs have also been giving the Cape Verde Islands lots of exposure recently including the BBC, Place In The Sun and the Daily Mail.
Another major indicator is that two of the major carriers that fly there, Thomson and Astraeus have been looking to expand their flight numbers in the country due to demand.
Although the Cape Verde Islands were discovered in the 15th century, the method of transport was undetected via boat and although we can now fly to the Cape Verde Islands directly, flights are generally not as regular as some of the other flights you will find to the more common holiday destinations.
If you are traveling from the UK there are flights available from London Gatwick, Manchester and from Birmingham but the flights offered are weekly so you will probably find that you will need to stay for 7 or 14 day periods.
The flight time from the UK is around 6 hours and flights can be obtained from a number of carriers including Thomson Fly and Fly Astraeus. There are also a number of other European carriers offering flights to the Cape Verde Islands.
The Real Estate
Well, when it comes to potential for capital growth then Cape Verde is the perfect choice for investors looking for maximum return.
Prices for properties on Cape Verde start at just 50,000 GBP for one bedroom apartment with villas starting at around 185,000 GBP.
Many developers are also offering guaranteed rental income for 2-3 years which offers exceptional value. Its also worth mentioning that developers are claiming that 70% capital growth is highly possible over the next 24 months.
With international mortgages also available for 85% Loan To Value, Cape Verde could very well be the next big property investment hotspot. The Islands have so much natural beauty and coupled with the year round weather, increasing tourist numbers and a surge in outside commercial investment, the Cape Verde Islands represent a huge opportunity for the savvy property investor.