With ten islands, beautiful views, and a warm climate, it’s perhaps not surprising that Cape Verde has become an investment prospect in recent years. Whether you want a holiday home or are interested in retiring in the sun, operating in any property market can be difficult. Fortunately, we’ve compiled all the information you need in this fantastic guide.
Have a question about buying property in Cape Verde? Let’s see if we can answer it!
Step 1 – Do Your Research
Before even looking at apartments for sale in Cape Verde, you should never ignore the research phase. Just because everybody is talking about Cape Verde and the investment opportunities on the islands, this doesn’t mean you should drop everything and throw your money in this direction immediately. Instead, spend some time learning about the country and how everything works.
Allow us to give you a brief introduction;
- It’s generally stable in terms of both the social and political side of things
- Beautiful scenery awaits in most areas
- Crime levels are low
- There’s a unique blend of West African and Portuguese culture
- The government encourages investment and even offers tax incentives in return
- Health services are good and continually improving
- Certain legislations restrict new building developments which means the scenery shouldn’t be ruined any time soon
Thanks to the investment incentives, there are now brilliant facilities and opportunities for entertainment. For example, you’ll enjoy golf courses, casinos, and various tourist attractions.
As long as you do your due diligence, you can remove most of the concerns that come with buying property in Cape Verde and feel confident in the decision.
Step 2 – Understand the Market
Now you know about the country as a whole, it’s time to focus on the property market. For those interested in property for sale in Cape Verde, you should know that the many new developments have meant that most properties are off-plan. For investors, there are some buy-to-let opportunities as well as hotel investments.
The reason why the Cape Verde property market is so different is because each island has its own character and charm. Unfortunately, there’s no way we can give ‘average’ prices because every island is different. What we can say is that prices are generally lower than what people think for the so-called ‘island living’ and this is because there’s still work to be done in the infrastructure.
Step 3 – Consider Locations
Since we’ve just discovered the uniqueness of each island, your next consideration is location. Where should you be buying property in Cape Verde? Essentially, we can split the country into two sets of islands;
- The Sotavento Islands
- he Barlavento Islands
Containing seven islands, Sal is perhaps the most well-known island for property seekers on the Barlavento Islands. Stunning sandy beaches lined with many bars and restaurants, it’s the most popular alongside Santa Maria (a fishing village) and Espargos.
For African culture, you want the capital island which is Santiago. Santiago itself has a capital on the south coast and this is called Praia. Surrounded by mountainous rainforest and opportunities to watch animals and get involved with water sports, this is another popular choice.
Finally, we can’t ignore Boa Vista which has a total of 55km of beaches; these are largely untouched and will offer sights to remember for a long time to come. As the new international airport continues to expand in terms of airlines, it’s more accessible than ever and you have a choice of wonderful islands.
Step 4 – Start The Buying Process
You’ve done your research, you’re happy with the market and a specific location, all that’s left now is to get started. Regardless of what type of property you’re choosing, we highly recommend seeking legal and professional help. Although foreigners are welcome to invest in freehold property, there is a danger of over-complicating the process if you aren’t careful.
For example, many people are caught out with the process of getting a Personal Fiscal Number. With the right assistance, this is all handled on your behalf and you can relieve the pressure from your shoulders.
As time goes on, the professional will inform you of what you need to pay and when. For example, you’ll normally pay a 10% deposit once the Promissory Contract is signed. From here, you’ll sign the Escritura before a notary and you’ll then be a homeowner in Cape Verde.
Investing in Buy-to-Let or Hotel Accommodation
Elsewhere, buying property in Cape Verde doesn’t necessarily mean you’re moving in. When investing in buy-to-let properties or hotel accommodation, the process will differ slightly. With the latter, for example, the company will provide assistance, set up financial meetings, and arrange an inspection trip.
Just a quick note on mortgages, the system is still unreliable compared to what we have in the UK. Most banks only allow mortgages for properties already built; considering the majority of the market is off-plan properties, this is a problem. Therefore, many people will remortgage their UK property to free up some cash or use another source of cash.
This may seem a little frustrating, but it’s actually a good thing (stay with us!). As mortgages are hard to obtain, the prices of properties remain low. When mortgages are easily accessible, demand will outstrip supply and the prices will increase.
Step 5 – Fees, Costs, And Taxation
Finally, every transaction has features we all dislike; fees, costs, and taxation. Though impossible to avoid, it is possible to make things easier for yourself. On all property purchases, there’s a 3% flat-rate transfer tax. On top of this, the transaction will have registration fees, notary fees, and stamp duty. All in all, you can expect to pay around 6% of the transaction in fees and costs when buying property in Cape Verde.
Again, we recommend legal advice here because they will offer tailored advice. This being said, we’ll note that there’s no double taxation treaty between the UK and Cape Verde. Also, some investments will bring tax advantages so make sure you ask your legal advisor.
All that’s left to do in step six is enjoy your new home or investment. Congratulations!
Invest In Cape Verde in partnership with The Resort Group Global specialize in marketing luxury beachfront properties with fixed net incomes & proven track records of capital growth plus up to 5 weeks of personal use.