How to Buy It
Island dreaming: How to buy a piece of paradise
- Fiji's finest
- Horseshoe Bay on the western coast of Matangi Island, Fiji is only accessible by boat, an important factor island buyers should consider when perusing the market. (Megan Snedden)
Obtaining whale’s teeth to give to island
chieftains for a ritualistic offering was just one of the hurdles faced by Australian couple Tracey and Jim Johnston
when they bought their own island in Fiji’s Mamanuca Chain in 2003.
Seeking a quieter life — but also income — the couple quit their jobs and sold their family home in Brisbane to purchase Wadigi Island for just over $2 million. They now own and operate a five-star resort on the island.
Seeking a quieter life — but also income — the couple quit their jobs and sold their family home in Brisbane to purchase Wadigi Island for just over $2 million. They now own and operate a five-star resort on the island.
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Despite other drawbacks, that include paying as much as $21 per kilo
for snow peas (something they could get for a few dollars per kilo at
home) and the occasional cyclone, the couple said they are happy with
their decision to buy the three-acre island. They rent a three-bedroom
luxury property to customers (among their big name clients: hotel
heiress Paris Hilton) who pay upwards of $2,459 per night to get the
private island experience sans ownership.
Owning a private island isn’t just for billionaires like Richard Branson, who actually only paid $180,000 for Necker Island. Price tags for islands range from $80,000 to $600 million. Shouldering the upfront cost is only the first of many hurdles.
Why buy an island in the first place? For some people, it’s a level of prestige. For others, it’s about new business opportunities — developing and running boutique resorts or exclusive guest houses, for instance. Still others acquire the land as investment property, to build a second home, or for corporate development.
Finding paradise
Fewer than a thousand properties can be found on the market worldwide each year, according to the Private Islands Buyer’s Guide. For prospective buyers, the majority of islands for sale can be found through websites like Private Islands Online and Vladi, though a few properties can even be found on Craigslist or real estate agents.
Asia is one of the most expensive regions to buy in, since there is fierce competition for few properties in that region. Some of the most reasonably priced islands can be found in Central American countries like Belize.
Make it work
There are several common ways islands are sold, or, in some cases, leased.
Among them, freehold leases grant 100% ownership of the land and any buildings on it. Such leases are common in Europe, the Americas, and the Caribbean. That’s how Tynan (who goes by a single name), American cofounder of blogging platform SETT, partially-purchased a five-acre island one hour by boat from Halifax, Canada. After finding the land on Craigslist, he and nine friends split the $100,000 cost. The group set up a corporation in the United States and combined their assets in order to pay in cash. As one of the mandates of the acquisition, a Canadian lawyer was required to register the deed.
The other main option, a leasehold, is less ownership and more traditional lease. With this method, buyers sign a long-term lease typically between 30 to 99 years, which grants them temporary possession through the government entity, corporation, or individual that legally owns the land.
Chris Krolow, chief executive officer of Private Islands Online, said buying or selling island property is a precarious business. Short selling seasons, lack of precedents for price setting and other complications such as obtaining building permits can hinder deals. It can take two to three years to sell a property on the international market and six months to a year on the local market, he said.
“You can’t just put up a for-sale sign on an island and have an open house,” Krolow said. “There’s a lot more play in this business than a lot of people think.”
Complications
In Fiji, the Johnstons have a 99-year lease under a local family clan called the Mataqali. Upon arrival to the island, the Johnstons had to present a whale’s tooth with a portion of ropes to the local chief as a token of respect. This was followed by a similar presentation to the regional chief Ratu Seva.
Once accepted into the community, they took out loans to complete $1 million in renovations, which included installing a sewage treatment plant.
At first, Tracey had difficulty even ordering supplies and setting up accounts simply because she was a woman. Men in Fiji typically execute business transactions.
“They didn’t want to deal with me, they wanted the boss,” Tracey Johnston said. “Sometimes I had to put my 21 year-old son on the phone and say, ‘please tell these people I am the boss’. But they got used to it.”
Fortunately for the Johnstons, Wadigi’s proximity to the mainland provides easy transport, fast shipping, and readily available evacuation if need be during storms. Regular barges, ferries, and water taxis pass by, a valuable convenience since many other island owners must charter private barges and seaplanes to their properties.
Accessibility is a major factor for many prospective island buyers, Tynan said. Often, the most affordable islands are in remote locations that require long travel hours and multiple forms of transportation to reach.
Other challenges of island ownership include tropical storms, stringent environmental regulations, beaches that must remain open for public use, and vermin infestation like sand flies and poisonous water snakes.
Despite the occasional cyclone, the Johnstons said relocation to an island is the life-changing experience they had hoped for.
When regional chief Ratu Seva inherited prominence, the Johnstons were invited to his initiation ceremony. They escorted the new leader and his warriors by motorboat to take a customary swim at natural pools around the main reef. As each person of the chiefdom hierarchy took a turn diving in, they pointed to Tracey Johnston and invited her to swim—a ritual typically only for men.
“It communicated that I was accepted, I was part of their family,” she said.
THANKS TO THE BBC FOR THIS FEATURE.
You can’t just put up a for-sale sign on an island“The transition was really complicated, but we wanted to run a business that would provide us a relaxed income and get my husband out of the corporate life,” Tracey Johnston said.
Owning a private island isn’t just for billionaires like Richard Branson, who actually only paid $180,000 for Necker Island. Price tags for islands range from $80,000 to $600 million. Shouldering the upfront cost is only the first of many hurdles.
Why buy an island in the first place? For some people, it’s a level of prestige. For others, it’s about new business opportunities — developing and running boutique resorts or exclusive guest houses, for instance. Still others acquire the land as investment property, to build a second home, or for corporate development.
Finding paradise
Fewer than a thousand properties can be found on the market worldwide each year, according to the Private Islands Buyer’s Guide. For prospective buyers, the majority of islands for sale can be found through websites like Private Islands Online and Vladi, though a few properties can even be found on Craigslist or real estate agents.
Asia is one of the most expensive regions to buy in, since there is fierce competition for few properties in that region. Some of the most reasonably priced islands can be found in Central American countries like Belize.
Make it work
There are several common ways islands are sold, or, in some cases, leased.
Among them, freehold leases grant 100% ownership of the land and any buildings on it. Such leases are common in Europe, the Americas, and the Caribbean. That’s how Tynan (who goes by a single name), American cofounder of blogging platform SETT, partially-purchased a five-acre island one hour by boat from Halifax, Canada. After finding the land on Craigslist, he and nine friends split the $100,000 cost. The group set up a corporation in the United States and combined their assets in order to pay in cash. As one of the mandates of the acquisition, a Canadian lawyer was required to register the deed.
The other main option, a leasehold, is less ownership and more traditional lease. With this method, buyers sign a long-term lease typically between 30 to 99 years, which grants them temporary possession through the government entity, corporation, or individual that legally owns the land.
Chris Krolow, chief executive officer of Private Islands Online, said buying or selling island property is a precarious business. Short selling seasons, lack of precedents for price setting and other complications such as obtaining building permits can hinder deals. It can take two to three years to sell a property on the international market and six months to a year on the local market, he said.
“You can’t just put up a for-sale sign on an island and have an open house,” Krolow said. “There’s a lot more play in this business than a lot of people think.”
Complications
In Fiji, the Johnstons have a 99-year lease under a local family clan called the Mataqali. Upon arrival to the island, the Johnstons had to present a whale’s tooth with a portion of ropes to the local chief as a token of respect. This was followed by a similar presentation to the regional chief Ratu Seva.
Once accepted into the community, they took out loans to complete $1 million in renovations, which included installing a sewage treatment plant.
At first, Tracey had difficulty even ordering supplies and setting up accounts simply because she was a woman. Men in Fiji typically execute business transactions.
“They didn’t want to deal with me, they wanted the boss,” Tracey Johnston said. “Sometimes I had to put my 21 year-old son on the phone and say, ‘please tell these people I am the boss’. But they got used to it.”
Fortunately for the Johnstons, Wadigi’s proximity to the mainland provides easy transport, fast shipping, and readily available evacuation if need be during storms. Regular barges, ferries, and water taxis pass by, a valuable convenience since many other island owners must charter private barges and seaplanes to their properties.
Accessibility is a major factor for many prospective island buyers, Tynan said. Often, the most affordable islands are in remote locations that require long travel hours and multiple forms of transportation to reach.
Other challenges of island ownership include tropical storms, stringent environmental regulations, beaches that must remain open for public use, and vermin infestation like sand flies and poisonous water snakes.
Despite the occasional cyclone, the Johnstons said relocation to an island is the life-changing experience they had hoped for.
When regional chief Ratu Seva inherited prominence, the Johnstons were invited to his initiation ceremony. They escorted the new leader and his warriors by motorboat to take a customary swim at natural pools around the main reef. As each person of the chiefdom hierarchy took a turn diving in, they pointed to Tracey Johnston and invited her to swim—a ritual typically only for men.
“It communicated that I was accepted, I was part of their family,” she said.
THANKS TO THE BBC FOR THIS FEATURE.
