The world is still reeling from the effects of the financial crisis, one of which was to completely collapse sales of Cape Verde property to foreign buyers. The Tortuga Beach and Spa resort launched to off plan buyers in 2007 but it might as well have not bothered. When thousands of people lost their shirts on Dubai property, everyone became extra cautious about off plan property, very few would risk it, and with very few buyers overall this meant no one.

But now Cape Verde is experiencing what can only be called a surge, or at least a flurry of overseas demand, with most of the buyers coming from Britain and snapping up off plan properties. What’s changed?

Well, it is partly to do with the fact that confidence is generally returning to global economies, partly to do with the fact that the UK economic recovery is solidifying, but it is mostly because of a growing desire for Brits to invest in their own pension funds, and the fact that Cape Verde property is an investment that is both safe and capable of bringing good returns.

For years the British middle class hadn’t to worry about their pension, we all lived under the security of the state pension for all. But as people continue to live longer and longer and with no reduction in the percentage of people wanting to live work-free, for the first time in the modern British era the state pension for all is falling into jeopardy.

So more and more of us have sought to invest in pensions. Before the financial crisis we were quite happy just to sheepishly put our money into high street pensions. But we all know what happened there, the stock market crashing took all our pensions with it.

So, there we were left with a need to invest in our own pensions, and knowing that high street fund managers might not be the best people to help us in this respect. For once, the government response to this quandary actually helped. The Self Invested Personal Pension allows us to invest in stocks and shares from internationally recognised exchanges, gilts, bonds and commercial property.

SIPPs combined with the growing desire among Brits to build their own pension funds are certainly a main reason for the increasing sales of Cape Verde property. But this is only because Cape Verde has become known as one of the world’s investment safe havens.

SIPP investors invest in property because they want a safe, long term investment, although they are usually looking for moderate-good rental returns as well. Cape Verde property is a good long term bet, because of its growing popularity and lack of building space.

Cape Verde offers the attributes of the Caribbean, within a short-haul flight of Europe and Britain. Because of this, although it did suffer at the hands of the financial crisis, tourism to Cape Verde grew strongly before the crunch and is set to grow even faster as the world recovers. Cape Verde property is also comparatively cheap compared to that of the Caribbean.

Undoubtedly the Cape Verdean developers have helped themselves. You have the three phases of Resort Group’s Melia Franchise which have sold rapidly in the last 18 months, and almost entirely to British SIPP investors, because the packages were geared to be the perfect SIPP investments.

Only resort and hotel properties are allowable as part of a SIPP, because the properties are part of a commercial entity in the resort. SIPP property investors are told to look for resorts with brands capable of achieving good occupancy, and where the rentals are pooled between owners.

Sol Melia has a turnover in excess of €1 billion, 2 million registered customers and 4.5 million hits per month on their online network, and on all three phases the rentals were to be pooled between owners of similar units.

Tortuga Beach Resort and spa offered a 10% rental guarantee in year one and continued rental management as part of the resort, the 1400 unit Dunas Beach Resort offers 15 years rental management with 50% of the NET rental income being distributed and shared by pools of similar sized units, and Llana Beach offers investments in 5 star hotel suites. Together, and sharing facilities makes this an incredible resort on Sal Island.

The bookings are already flowing, and with the aforementioned shortage of space to build on these rugged beach-fringed islands of Cape Verde, it is easy to see why SIPP investors are boosting sales of Cape Verde property.

I thought it was only right that I should write one for my own blog, and so I am undertaking the arduous task of charting my ultimate top 5 property investments for 2009 and 2010.

Egypt:

I have recently fallen in love with Egypt, and it is my hot tip of the day (the one I tell my friends and relatives to go for if they ask me). For the price of a mid-range saloon I could buy a luxury apartment in Hurghada, one of Egypt’s fastest rising tourism destinations.

Hurghada is doing a roaring tourism trade at the moment, especially with Brits, who, keen to holiday outside the Eurozone are finding the low living costs in Hurghada an additional draw.

Property is so cheap in Hurghada because it is still in a very early stage of its development, with more developments in progress than useable holiday accommodation. There is a risk factor in that, as well as the risk factor for buying property off plan. But if you do your research carefully including several trips to the development then all those risks become benefits.

You are buying in cheap because you are buying into a building site, the value of the investment when it is a luxurious apartment on a world-class resort in a popular tourism destination is impossible to say accurately, but it will certainly be a lot more than the 12,000 – 20,000 GBP that you can buy in for now.

Egypt property is a versatile investment choice, because you can buy in with the hope of making short-term profit when more of the resorts are completed than not, but if that doesn’t pan out the profit will still come over the long-term.

The Philippines

I really am favouring countries that have shown their ability to grow economically this year; kind of like: if your (emerging market) economy can keep its head (of steam) while all those about you are losing theirs…

The Philippines is expected to grow by over 4% this year according to the International Monetary Fund, and unlike some of the economies expected to grow this year based on bumper crops that could be regarded as unreliable, the Philippines growth is based on the comparably solid worker remittances from overseas Filipinos, and on the outsourcing fuelled services sector.

Another benefit the Philippines has from an overseas investor’s perspective is its being worst affected by the Asian economic crisis at the turn of this century. This led to reforms in the banking sector which are neither here nor there in honesty, but it also led to Philippines property and commodity prices being lower compared even to its neighbouring competitors.

On top of that you have the fact that the capital Manila is a city emerging into a modern metropolitan wonder faster than most, and this means bargains in the form of off plan apartment complexes. I know for a fact that £30 grand will buy you a luxury apartment in a Manila high-rise, and in the growing financial district of Makati. As Manila’s middle class grows these properties will be in high demand, first for residential letting, and then for purchase.

Albania

I can help it, I just love Albania. Don’t get me wrong, its economy is likely to avoid the recession this year by only the skin of its teeth with a 1% growth forecast by the International Monetary Fund, and you won’t find 12% guaranteed rental yields in Albania. That said, Albania’s government is one of the most economically astute in the developing Eastern Bloc, having brought a quarter of its population out of poverty in the last decade and become a middle-income country in 2007.

Even now as most of the world is pulling in its purse-strings, the Albanian government is investing in future growth; using its new status to secure loans from the Japanese government, the European Bank for Reconstruction and Development for projects like a new terminal at the country’s largest port Duress, and a new super-highway linking the hills of Kosovo to the improved port.

Again the low price of property is not a downside in Albania; you can get a 2 bedroom luxury apartment in Tirana for just the wrong side of £50k if you know where to look. The good thing is that in Albania’s case the developments are not all resorts; many of them are suitable for the local population. This means that you can resell to Albanian’s who will be looking to buy property in increasing numbers as the economy continues to grow.

However, Albania property is very much a long-term investment; I have no doubt that in time the property being bought off plan now for £50k, will be resold for 3 times that amount, but this will only be when the local population can afford to pay that for quality housing, which may be 10, 15 or maybe even 20 years down the line

Panama

I just wrote a long article detailing why Panama property is one of my investment tips for 2009, rather than repeat or rewrite it you can read it by clicking the link above.

Repossessed Property in Developed Markets

The international economic crisis has led to hundreds of thousands of homes being repossessed around the world. For me the three main investment hot-spots where repossessed property is in abundance are: the UK, Florida (and the US) and Spain.

Many people are seeing this as an opportunity to buy cheap property, but that is not the way I recommend capitalising on it. I think people should spend the amount of money they would have spent, and use it to buy the ultimate repossessed property that they could buy.

For instance: if you are looking at Florida or Spain, then go for coastal property or property near Disneyworld in the former. But most of all buy a big property with plenty of land, especially in Spain, because this will prevent developments from springing up all around you. And in the UK it’s all about location, location, location; look for swanky up-market properties near the best schools.

So, I began doing some research into Egypt. Immediately the similarities with Morocco became apparent, but even Morocco could not compete with the low prices of luxury and high end off plan property in Egypt.

Property prices in Cairo are low, but Hurghada is the hot-spot for me. I had come across Hurghada in my direct sales role, as a rapidly rising tourism destination. Then, I’m looking at high-end 2 bedroom apartments near the beach for less than £20,000 — fool proof?

Yes, it does sound too good to be true, but as with any off plan property investment, emerging market or established, by doing the proper research the risk can be minimised.

That aside we can focus on the potential profit: Africa is often overlooked when we talk about emerging markets, and property markets, but now, as last year’s hottest emerging markets like Brazil and Russia are faltering, Africa’s emerging economies are flourishing, with Tunisia, Morocco, and Egypt all forecast to grow by over 3% this year.

The economy is based on agricultural exports from the rich Nile Valley, and also of Natural Gas, both of which have massive potential for growth. Tourism and construction are both also massive growth sectors, and there is also the potential for a growing services sector in the next few years.

Capital Appreciation

In Hurghada it is hard to find resale properties to get an idea of the immediate growth in value for completed developments, but with such massive growth in the economy and low prices one must expect that growth will be faster than the developed market average 10%. My forecast is that an off plan property in Hurghada bought now will have doubled in value within 5 years.

Rental Yields

The going rate for privately rented holiday property in Hurghada is £385.00 per week. If we take that on a moderate 10 weeks occupancy it gives you a gross rental yield of 25%. That figure will be less taxes, and maintenance costs for the property, as well as any marketing costs.