Johannesburg – Although wealthy investors are still skirting around leisure property in South Africa, they are not hesitating to pour money into luxurious residential developments in Mauritius.
The stable economy, favourable tax rates and exceptionally low crime rate in this Indian Ocean jewel make it a very attractive destination for South African home-buyers looking for a holiday home or a long-term residence, said Dr Andrew Golding, chief executive of Pam Golding Properties (PGP).
The island already has a considerable South African community. According to a 2010 survey 2 000 South African families have already been granted permanent residential status on the island.
Mauritius is always a popular holiday destination and has had 950 000 visitors in the year to date.
Ever since the island opened its doors to foreign property investors with its integrated resort scheme (IRS) and real estate scheme (RES), PGP had sold more than 200 units in various such developments to South Africans.
The difference between the schemes is that the premises in a RES development could be smaller and the properties could cost less than $500 000.
These investments come at a hefty price, but buyers automatically receive residential status for property purchases of more than $500 000.
PGP’s total sales in Mauritius that include buyers from Europe, amount to 302 units for a total value of $230m.
In Tamarina, 119 villas for a total $100m have been sold, while homes have been snapped up in, among others Cape Bay, Element Bay, La Residence, La Tourelle and Villas de Tamarin.
Golding said buyers aged between 55 and 70 buy retirement homes in Mauritius, not only from a lifestyle perspective, but also to take advantage of potential tax benefits.
He said from an investment point of view properties in these developments had achieved outstanding capital growth. "In some cases growth on capital had been between 20% and 25% from the day it had been announced until the building had been completed."
He said buyers therefore benefit from an increase in the value of their investment the moment they sign the purchase agreement.
The short-term rental market is also strong. "Although rental yields vary, depending on the location and what the development offers, between 3% and 5% is the norm in the first year," he said.
The group is currently marketing new property investment opportunities in Mauritius. These include the second phase of Element Bay in the Grand Baie area in the north of the island. The first phase of 19 units had been completed and sold out. The second phase offers good value, with prices starting at $400 000.
PGP will also be involved with Mont Choisy, a new flagship development for mixed use in Grand Baie. Chris Immelman, the managing director of PGP’s projects division, said this will be one of the biggest golf-estate developments on the island and will have 500 residential properties on completion. Early indications are that prices could range between $600 000 and $1m.
He said there had been great interest because of the long wait for a golf development in the north of the island, which is a popular holiday destination.
Expectations are that Mauritius residents will also be interested.
Golding said the development is a 10-year project being undertaken by the Harel family.
Several of the island’s sugar barons had diversified into property development over the past decade after the sugar industry had come under pressure.
This was how the super-luxurious Anahita development on the east coast was established on land belonging to the Dalais family, owners of the listed Ciel Group.
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