A NEW ECONOMY IS FAST EMERGING IN FREEPORT- GRAND BAHAMA AND WHY OWNING YOUR FIRST VACATION RENTAL INVESTMENT ( A HOME, VILLA, COTTAGE, OR CONDO) SHOULD BE IN FREEPORT/LUCAYA
Once the playground of the rich and famous, there are visible signs that Freeport is on the way back. Freeport has had some challenges as a result of the 2004 hurricanes and the global financial crisis of 2008. There were a few hotel closures resulting in job losses combined with further losses from the global crisis. However, there is visible evidence that a new tourism market is fast emerging. Less than ten years ago you would find only a handful of Freeport and Grand Bahama residents offering vacation rentals on websites like AIRBNB, HOMEWAY, VRBO, and others. Today the numbers are nearing the 200 mark on the AIRBNB website.
Pardon the pun, but this is a direct result of a perfect storm.
Negative Elements of the storm
(1) hotel closures
(2) 2008 global crisis
(3) loss of jobs
(4) loss of long term rental income
(5) increasing number of foreclosures
Positive Elements of the storm
(1) Residents are resilient, caring , entrepreneurial, ever increasing number are owners of vacation rental properties
(2) Freeport- most unique destination / natural beauty
(3) Vacant rental market exploding globally
(4) Quality communities throughout the island offering diverse amenities and experiences
(5) A large inventory of real estate at an attractive price
(6) Expanding and improved medical facilities on the island…
RICH HISTORY OF LUXURY DESTINATION FOR THE RICH & FAMOUS
Since the days of American Prohibition in the 1920s, the Bahamas have been a favourite getaway for those looking to kick back, relax and have some offshore fun, far from heavy-handed US laws. In the the late 1950s and most of the 1960s, Freeport, Grand Bahama was the go-to destination for Rat Pack party boys like Frank Sinatra and Sammy Davis Jr, who turned the town into their own private playground of jazz, cigars and card games. Billionaire aviator Howard Hughes loved it so much he bought his own hotel called the Xanadu Beach Resort & Marina
Just a 30 minute flight from Palm Beach Florida, many flocked to the Lucayan Beach Hotel & Casino ( now The Point at Our Lucaya….. and later Kings Inn ( Princess hotels) to gamble, golf, shop ( International Bazzar), fish, long walks on fun times on secluded beaches and dine at Freeport’s top restaurants, both gourmet and native. Today, new and old travellers come from far and near to relax, unwind, reunite with old friends and make new ones. Second home owners, ( primarily baby boomers), are increasing in numbers and those who have moved to Freeport very rarely move to another destination or sell their real estate investments.
ATTRACTIVE DESTINATION FOR FAMILIES AND COUPLES
There are very few tropical resort destinations that offer the uniqueness, beauty and charm that Freeport/ Lucaya does.
Today’s visitors and investors like Freeport for many reasons but at the top are it’s natural beauty, friendly people, low density ( about 55,000 residents on the entire island), some of the world’s best unspoiled beaches, big game fishing, several golf courses, warm weather year round ( average of 88 F in summer and 75 in winter), twenty miles of canal waterways, awesome communities, all stakeholders put an emphasis on maintaining it’s eco- sites, diverse nature reserves and parks, diverse architecture that is complimentary to the tropics in general and the islands in particular, wide roads, low crime rate, cleanliness and the absence of a visible concrete jungle in it’s city center. Additionally, for business or leisure, Freeport has the most advanced and sophisticated infrastructure in the region with strict zoning laws that are conducive to continuous growth. It is estimated that the city of Freeport /Lucaya can sustain a population in excess of 500,000 + residents, and is on the way to becoming a smart city.
NATIONAL PARKS
The Rand Nature Centre is named after its founder…
The Grand Bahama Nature Tour has a 4.5 star rating from 238 reviews.
Here is one of those reviews.
Best Six Hour Trip!”
Reviewed September 29, 2010
This Bahamian Nature Tour was the most uniquely beautiful and the most varied excursion we have ever experienced….SEE FULL REVIEW HERE
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THE VACATION RENTAL MARKET NOW THE “IN THING
If you have been keeping a keen on the vacation rental market, you will have noticed the big heavyweights in the market like Homeaway, Airbnb, Trip Advisor and others are fighting for market share of what some market research analyst think the global vacation rental market will reach $150 + billion per anum by 2019, so where you make your first investment is important.
What these companies have in common is that they have noticed a decisive shift away from the traditional hotel travel.
In The Bahamas, the People to People program was implemented many years ago and here is what is offered.
Join People-To-People Experience Now
Our free program lets you experience Bahamian culture and cuisine as well as learn more about our history and develop long-lasting friendships with one of our many Bahamian ambassadors.
…………..Let us know which island(s) you would like to visit and what your interests are. …..we will enhance your vacation experience by sharing our way of life with you..SEE FULL DETAILS HERE
Today, renters are now experiencing this on their own terms.
The Vacation Rental market in the 700 islands & keys called The Bahamas, allows visitors to choose the island, location,home,villa, condo or cottage of their choice. The are choosing, remote locations a well as beachfront, canal front, golf course and inland properties. The main draw for vacation renters is to seek a more authentic Bahamian experience that allows them to create their own itinerary, mingle with the locals through community and cultural events, and prepare their own meals if they so choose.
Favorable reviews and testimonies like the one below from a $60 per night room not on a beach, waterfront or golf course in Freeport Bahamas by a visiting French couple, help drive new visitors to your vacation rental/s.
One of 38 Reviews of this rental:
Great stay !!! Florian has greatly contributed: he picked us up at the port, taking the time to give us a little tour upon arrival, before leaving us on a simply sublime beach ….SEE FULL REVIEWS HERE
It is nearly impossible for hotels to compete with these kinds of experiences. This rental has a 5 star rating in all of the six categories.
This review, ( July 2016) from a $225 per night canal front bed 2 bath condo Freeport, Bahamas.
One of thirteen Reviews:
These condos are phenomenal! The finishes are classy with the stainless appliances, granite counter tops, travertine flooring and crown molding….. SEE FULL REVIEW HERE
An excellent rating combined with a detailed description by guests is priceless MARKETING…!!!
After viewing all of the properties that have been rated by visitors, the average rating is 4.7 ( 5 STARS) with the lowest rating from any property was 4.0 star…!! With visitors determining the quality of your product, a five stat rating across the board for Freeport-Grand Bahama means visitor arrivals will continue to grow and in increase this market share.
Vacation rentals are gaining more traction globally not only for the local or native experiences but it is more cost effective, intimate,private and because of competition from competing properties, the service is usually impeccable. Any bad experiences and / or ratings by guests will negatively affect you ability to book guests.
Vacation rentals are fast becoming the “in thing”…postings on social media during their stay or the topic of conversation when back at work, with fiends and family lamenting on the cool rental property they got a good deal on and their invaluable experiences.
Another reason for the fast paced growth of this industry globally, from an investment perspective, is the upsides of owning a vacation rental/s being an absentee owner. Owners can be a world away, yet through the advancement of the internet, reservations can be made, the on island property manager takes care of all things related to the property ( utilities, maintenance companies, maids, in house spa-, dial a chef) and monies are deposited to the owner’s account.
NUMBER OF INVESTORS EXPECTED TO GROW
Like most aspects of real estate, as vacation rentals become more popular with vacationers, they will also become more popular for owners/investors, who will react to the increased demand. Investors are always looking for handsome rental income, capital appreciations and growth potential, and Freeport – Grand Bahama offer this. So one would conclude that if you can snag a property or multiple properties now while it’s a buyers market on Freeport -Grand Bahama, you may want to do so sooner than later.
WHY INVEST IN A FREEPORT / LUCAYA VACATION RENTAL TODAY.
(1) It’s a BUYER’S MARKET and Finding a diverse inventory of available vacation rental options is not an issue. In Freeport, there is ample opportunity for you to make a profit on the buying end, enjoy handsome rental income and because of the growing global demand for vacation rentals, finding buyers for you property when demand becomes greater than supply will command another profit should you decide to sell.
The closure of a few key hotels combined with the 2008 recession, has the local economy still rebounding. This has resulted in an increase of foreclosed properties on the market and one can find quality homes, villas and condos at or below market value in all price ranges throughout the city in particular and the island in general. See available properties at our website Bahama Islands Luxury Poperties
Should you want to get in on the ground floor or in this instance THE BASEMENT, a studio condo ( not on the waterfront) that needs some remodeling, the asking price is $15,000 ( unfurnished) comprising 480 sq ft or at $31.5 per sq ft. If the buyer injects another 10-15,000 to upgrade to industry standards and commands $65 per night, at only 50% occupancy the gross return for the first year is $11,000 or one third of your total investment…see more Freeport Grand Bahama Listings here. Conversely, a studio located in a beachfront condo project is asking $55,000 ( unfurnished). At $70 per night at 65 % occupancy, the gross income for the first year is $16,600 or close to 30 % of your initial injection.
BUILDING YOU OWN PROJECT
Should you want to purchase a beachfront, canal front or golf course lot, building costs can range from $125 per sq ft on the low end and over $250 per sq ft on the high end and can be even higher depending on the quality and complexity of the finish. Businesses related to the construction industry are more than ready to supply you with all that you require, and should the need arise, they can place special orders to anywhere in the world.
FREEPORT TAX FREE ZONE
(2)Taxes: Owning a second home primarily because of the destination to be enjoyed by you, your family and friends is awesome, however, if you are investing primarily for profit, it’s going to be hard to top this TAX FREE ZONE … (also see Hawksbill Creek Agreement) … . In Freeport there are no property taxes, no taxes on income, capital gains, inheritance, distributions and earnings. Additionally, should you want to purchase vacant land and build a villa, cottage, condo development, there are incentives and concessions offered depending on the size of your development. Additionally, having a BOND allows you to import all building and related materials duty free.
VACANT LAND FOR TOURISM DEVELOPMENT
(3) The abundance of and reasonably priced miles of virgin, powdery, white sandy beachfront land and 20 miles of bulkhead canal system is quite attractive for those who wish to build the development or vacation rental property of their dreams. Waterfront vacation rentals offer the ultimate in luxury vacationing and command handsome nightly income. Beach and Canal front homes attract a variety of vacationers including boating entheuasist. Most of the canal systems are in close proximity to beach,golf courses and just minutes from the city center, Port Lucaya resort area hotels, casino and market place area.
Additional information for concessions and incentives and related matters can be found at the links below.
(1) The Bahamas vacation plan and time share act– Provides duty-free concessions for building supplies for the construction of facilities.
(2)The Hotel Encouragement Act – provides duty free entry of approved construction materials, furnishings and fixtures for hotel development as well as provides for exemption/concession from real property tax for the first twenty years of operation of a hotel/resort……
(3) The Hawksbill Creek Agreement Act– Allows the Port Area that is the FREE TRADE ZONE of Freeport, Grand Bahama, freedom from all taxes until 2054…… http://www.gbpa.com/index.php/2015-05-11-17-46-24/downloads/the-hawksbill-creek-agreement/25-the-hawksbill-creek-agreement-amendments/file
(4) The Grand Bahama Port Authority
(5) International persons landholding act……
(6) Bahamas Investment Authority
RE-BRANDING AND MARKETING OF FREEPORT AS NOT JUST A PLACE TO VISIT BUT A PLACE TO RETIRE OR OWN A SECOND HOME.
With 10,000 baby boomers ( this is a fact-see proof) retiring every day and many looking for a retirement destination outside of their country (primarily the US and Canada), we should be marketing Freeport aggressively to this demographic.
WHAT THEY BRING
Baby boomers will either buy or build their retirement home, directly contributing to the local economy and creating new construction jobs. When the home is completed they will need landscaping services, maids, etc. They may even open a business or businesses,they will shop at the local supermarket, hair salons, spas, gyms, play golf, fish and go boating. They bring a wealth of experiences from diverse professions that they can share with the local population. Deciding on a retirement destination is greatly influenced by the advancement of medical services at that destination. The increase in the number of boomers with increase the number of employed individuals in this profession.