From the Emerald Isle to Cape Verde
It’s 2007’s hottest emerging market and is attracting tourists, developers, homebuyers and investors from all over Europe – Ireland in particular.
Up until recently though, no one had ever even heard of Cape Verde or had any idea where it was. Now, with promises of serious capital appreciation over the coming years, Cape Verde is one of the most talked about locations on the map.
Background Cape Verde (Cabo Verde)
Cape Verde is an African country made up of ten main islands and five islets. It’s located off the west coast of Senegal. It shares a relatively similar geographical position to the Emerald Isle – in the Atlantic Ocean at the most westerly point of the continent. Maybe this is part of the attraction to the Irish.
The climate however is a slightly different. Unlike Ireland, where it rains even when it’s not raining and is cloudy even when it’s sunny, On Cape Verde, it’s permanent summer with endless blue skies every day of the year. This I’d imagine, is the real attraction for the Irish.
Cape Verde’s Rental Potential
Cape Verde’s future lies in tourism and to a large extent, so does the success of its property market.
The government knows this and is keen to make sure that the figures keep on rising. Over the past four years, they’ve seen the number of visitors increase by 25%.
The goal is to see “annual tourism figures double to over 500,000 by 2015”, according to Dominic McGlynn of Sambala Developments.
Tourism (or lack of) can have a massive impact on the property market. In Cape Verde’s case it drives the rental market and is the backbone for most buy-to-let investments.
Year-round sunshine means that investors can rent out their properties all year long at tourist prices. With better accessibility and an increasing amount of visitors every year it’s unlikely that there’ll be any periods where the property is left vacant.
Good rental potential is paramount for any buy-to-let investment. Cape Verde’s climate and healthy tourism industry provide investors with a huge degree of stability. They’re both key factors – assuring buyers of Cape Verde’s solidity as a profitable investment location.
Property Appreciation
This is the key to investment security – whether or not you’re property will go up in value and on Cape Verde it’s almost guaranteed. On some of the larger developments prices have already “increased to the tune of approximately 30%”.
According to Maria Rosario de Luz, the adviser to Cape Verde’s minister for economic growth, the Government “permit only low-rise development and promote eco-tourism and its own lively Creole culture”.
On Cape Verde, the government intends to restrict the construction of new developments. They don’t want the overdevelopment problems Spain and various other markets have had recently.
Investors who get in at the beginning will be in a “win-win” situation. With a bigger demand for properties than the amount available, they can sit back and watch their properties go up in value.
The Main Players
Apart from the Irish, who certainly seem to have an eye for a bargain, the English are also swooning over Cape Verde. Although not as accessible as the Canaries, to the north, Cape Verde’s charm seems to have won them over. More recently, the Germans and other investors from the Nordic regions have discovered Cape Verde.
So it’s not just the Irish. Everyone seems to pouring money into this tiny, once unheard of, chain of Islands.
For recent investors, this is very reassuring – seeing the property market flourish and the infrastructure develop. For would be investors, this is a sign that it’s now time to make a move!, before property values hit the roof.
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