It's an elite club
Richard Branson owns one and so do Johnny Depp and Leonardo DiCaprio. Baba Ramdev became a proud owner of one in 2009. You too can join the club. All you have to do is to purchase an island.
There are many islands out there for you to choose from. But in some places, it's impossible for foreign investors to secure a piece of island real estate. "The likes of Thailand, the Philippines, Indonesia and even India forbid foreigners from securing freehold objects, some preferring to offer leases to clients," says Farhad Vladi of Vladi Private Islands, which has 40 years of experience in island buying and selling.
A majority of the island business takes place in a few regions such as Western Europe, the Caribbeans, New Zealand, Australia and North America. According to Vladi, islands around Connecticut, Long Island, the Brittany Coast in France, the Mediterranean Coast and islands close to Venice are all regions that generate a high demand and high prices."Whilst some of these countries still require a permit, this often proves to be something of a formality, with the authorities keen to run a background check about the buyer and to check whether his / her intentions are in line with government policy," he says.
Buying an island can be an investment, but the economic atmosphere can affect such plans. "Nautilus island in Maine, once valued at $12 million dollars, was be sold recently by its owner only for $2 million." says Vladi.
For a home amid the waves
Till 2009, there was only Baba Ramdev, among Indians, who was part of this elite club of island owners. The Little Cumbrae, an island of 700 acres, was gifted to him by Sam and Sunita Poddar of Glasgow. This now serves as the overseas base of the Patanjali Yog Peeth Trust (PYPT), co-founded by Baba Ramdev. This conch-shaped island, which also boasts of 13th century castle, now serves as a destination for holistic healing.
Today, many others in India seem to be joining this bandwagon. "We are dealing with three Indian clients at the moment," says Chris Krolow, CEO, Private Islands Inc, which has a list of 700 islands, of which 100 are reserved for select buyers. However, unlike clients from other countries, Indians don't usually purchase an island for the sheer pleasure of the experience; rather it is for investment purposes or for developing a resort. "Indian clients usually prefer turnkey projects where everything is ready on the go. But there aren't too many islands like that," says Krolow. Vijay Mallya was reported to own islands in Lakshadweep and in Europe. But his spokesperson denied that.
Surprisingly, it is the older generation, aged 50 and above, that is interested in purchasing islands, while the younger lot opt for urban properties and apartments. There also seems to be a shift from island buying to island tourism, with even celebrities preferring the security and anonymity that an island holiday gives. This has resulted in more island rentals than island sales. For instance, while Vladi Private Islands has been involved in more than 2,400 island sales, it has been responsible for a whopping 26,500 island rentals. As far as sales are concerned, the current trend, according to Vladi, is that the "majority of island buyers are governments, provinces, nature trusts and nature conservancy groups, interested in securing islands for conservancy reasons. It's possible to say that out of 10 island purchases, nine are accounted for by the aforementioned group."
What will it cost you?
There are islands available for as little as $ 20,000-50,000 or Rs 1-3 crore, but they are not likely to be "quality" islands. "Despite the apparent saturation of islands, only perhaps as few as 5 per cent can be described as quality islands," says Vladi. The prices in the "lower quality" category have dropped due to the number of islands on the market. "That's why it is possible to buy an island for $50,000 in places like Canada, Scandinavia and even some parts of the US," he adds. However, chances are that these cheaper islands are located in remote locations and are very expensive to build on. Also, it may be more time consuming to get permits there. "However, new technology, such as water filtration and high speed internet, have made even these remote islands liveable. So that has helped the market," says Krolow.
It is all very glamorous to dream about a hideaway at sea, but there are lots of factors to consider before buying that island. First and foremost is access. "One has to see how far the island is from the mainland. Let's say you have a vacation of two weeks, then you don't want to spend four days just going back and forth," says Krolow. If you are an avid boater and wish to not just explore the island but also the waters, then you should opt for an island in open water rather than going for inland islands located in lakes. Also, keep in mind the weather pattern, the political climate, the size of the land and the water depth.
And don't forget managers. It is a big issue in the island market. Many owners of islands have problems finding the right manger to take care of their island.
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