(Photo opposite: We decide to buy) We bought the unfinished house in March of 2005 and construction was completed in February of 2008. We bought land with an unfinished villa on the island of Anguilla in the British West Indies. We bought the land and villa as both an investment property, and as a place to escape to: we love escaping to Anguilla because of its people and extreme natural beauty. We first came to know about Anguilla, which is not very well-known in the U.S. or Panama, in the early 1990s through a friend who had been born on the island and who had recently returned to live on Anguilla. Her father owned a restaurant on Anguilla called Johnno’s. To us, Anguilla was different from many of the other islands we had visited in the Caribbean such as St. Maarten or Puerto Rico because its development model didn’t include large hotels with casinos and thousands of tourists. Anguilla developed itself for a more exclusive clientele that wanted space and privacy rather than large numbers of people. The island started to become popular with a select group of people in the early and mid-1980s, and then really took off when the 5 star resort, Cap Juluca, was finished in 1988. Cap Juluca was – and still is - considered one of the best resorts in the Caribbean.

The physical beauty of the beaches and water combined with the great food, accommodations and service are what attracted people to first visit Anguilla and then later buy and develop real estate on the island. We were part of that movement of tourists turned residents. When we decided we wanted to build on the island one consideration we thought about was whether or not we wanted to be on the beach or off the beach. Anguilla does occasionally get hit by hurricanes, and many local residents told us not to build on the beach because sooner or later our house would disappear. So we built away from the water on a place called George Hill which as it name implies is a small hill, a hill which also happens to have a great view of St. Maarten - you can also see the islands of St. Barts and Saba from George Hill.

When we finally found a property we wanted to buy, we had to apply for an Alien Landholding License, but do that there were several steps we needed to go through:

Submit plans for the project – residential house – to the Planning Department

While we did this we need to obtain some documents to push the process to the next stage. Here are some of the documents we needed:

A Bank reference letter
A Police reference letter from all the territories of residence over the past 7 years
Personal reference letter from a public figure who has known the purchaser for at least 7 years. In this case we used a U.S. judge we knew.
Copy of passport details page
Tax clearance forms from the Government of Anguilla for both the Vendor and Purchaser
4 Passport sized pictures of the purchaser

All of this along with the approval of the Planning Department needed to be submitted to the Lands and Survey Department. We paid $1,000 dollars to submit the application. When and if the License is granted, there is a stamp duty on the License which is 12.5% of the purchase price; there is also a transfer tax which is 5% of the purchase price: both the stamp duty and the transfer tax are paid to the Government of Anguilla. There is also a tax on property which is 0.0175% of the assessed building value. There is no income tax on Anguilla or capital gain taxes or inheritance tax. To rent out our property we needed to buy a rental license which cost about $2500.

We also had an interview with the Chief Minister’s office, essentially the top political person on the island. After the interview the Executive Council of the island met and decided whether to approve or deny our purchase of the land. We were approved and therefore the Alien Landholding License was issued. After the land and license was transferred to us, we had 18 months to finish construction. If you can’t finish construction in 18 months, then you pay a penalty of about $300 a month, after a year, the penalty doubles. It took us about three months to do all of the paperwork described above. Construction costs were around $225 per square foot.


(Photo opposite: Same view as photo above but with construction now complete) Now that we have the villa built and furnished we are renting the villa for $2,200 a night. The villa has 5 bedrooms: 3 with king-sized beds, one with two-single beds and one with a queen-sized bed. There is also a small apartment in the villa so more people could sleep there. We have a pool and 1 acre of land as well as a deck and outdoor-bar. You might ask yourself what is the average price of a hotel room for two people on Anguilla from December to April - about $800 a night or more, so if you have plenty of people you can breakdown the cost of renting a villa as compared to staying in a hotel. We hope the property is used for weddings, family vacations and celebrations.

It took a lot of work and time to build on Anguilla. Electrical work took a long time to finish: there are few electricians on the island. We had to import all kinds of furnishings; this was very expensive: 25% of value. Construction workers can be hard to find as the island is going through a construction boom. In fact, the government is importing construction workers from India and China to meet demand. We had hoped the villa would be completed by February 2007, but we had to wait until February 2008 to finally be able vacation in the villa. My recommendation to anyone who wants to build on an island in the Caribbean is to be patient. Patience is a virtue in the tropics.

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Anguilla Country Profile

Real Estate in Anguilla