Real Estate In Cape Verde

Buying Property In Cape Verde

First Published Date: February 18, 2016

Cape Verde is a unique place to live. Officially called the Republic of Cape Verde, the country is an island nation that covers 10 islands in the central Atlantic Ocean. It is the perfect location for individuals who want to get away from it all because the islands are 570 km away from Western Africa. The islands cover 4,000 sq. km., some of which are volcanic in origin. There is often very little rainfall so the island is not very green, despite the Portuguese word for green being Verde. The population of the country is 500,000, most of which are in the capital city. Roughly 45 percent of the population lives in a rural setting, and 20 percent of the population lives below the poverty line. The literacy rate is a respectable 85 percent and the country does have a stable democracy with good economic grown and living conditions. It is currently a developing nation and that is good news for you if you want to move there. It means that the country is rising to the forefront and the property prices are going to be low.

If you are going to buy property within Cape Verde, then you should look at the following:

1.    First, you should consider that there is an immense amount of opportunity to buy property within the country. The people are friendly, it is always sunny, the sea is beautiful and the scenery is astounding. In addition, the country has a stable political and economic system, meaning you don’t have to worry about your peaceful home being turned into a military dictatorship. The country is aggressively pursing growth and tourism so that is good news if you are thinking of moving there. It means many good places to eat and many resorts to check out.

2.    There is a lot of development within the country building new homes and that is something many foreign investors are looking at. The Canary Islands are 240 km to the north and much more expensive but offer nearly the same type of living environment as you get in Cape Verde. The infrastructure is still catching up with the building but there are many places for you to buy a home within the country.

3.    The islands you should look at are Sal, Bao Vista, Santa Maria and Santiago. These are the islands with the most new developments. They offer low-density and environmentally-friendly buildings, and there are restrictions on how close to the beach buildings can be built here, meaning you will not lose your pristine views. There are also many amenities you can choose form on these islands including spas, tennis courts, gyms and more. The island of Sal has the international airport for the country and is the most developed of the islands. It is 30 km by 12 km and most of it is flat with the best beaches in the country. The island of Santa Maria has over eight km of wonderful beaches, plenty of restaurants and bars and a ferry service to the other islands. The island of Boa Vista is the easternmost island, and a place where a property boom is taking place. There is also a lot of infrastructure improvements being made there. The island is 31 km by 29 km and it has plenty of beaches, places for fiestas, a carnival and more. The island of Santiago is 75 km by 35 km and is it the largest island in the country. There are sandy beaches, mountains and it holds the capital of the country, as well as half the country’s population.

4.    If you are going to buy property on these islands, then understand that all the property in Cape Verde is sold freehold, much in the same way as is done in Portugal. A verbal agreement is done and the purchaser’s lawyer will then begin the legal search. The tax office then provides a fiscal number and a contract is signed. As the purchaser, you need to pay between a 10 and 30 percent down payment.

5.    There will be fees and costs for buying a home within the country. First, there is the transfer tax of three percent on all property purchases. You also have to pay about a 2.5 percent fee of the purchase price for notary and registration fees, plus a stamp duty. The property tax within the country is going to be three percent on 25 percent of the value of the property.

6.    You need to finance your mortgage within the country and that must be obtained on property that is already built. You cannot get a loan on a property not yet built. Often it is better to pay cash than to try and get a loan.

7.    There is no double taxation treaty between Cape Verde and most western countries. However, you will pay a tax on some other things like renter’s insurance.

8.    You need to meet residency requirements within the country to live there as well. A visa will only be good for a stay of 90 days. Foreigners can obtain residency within the country if they work for a local business, have a business that employs a minimum number of Cape Verde citizens, invest a certain amount in a new business, or have sufficient income outside of the country.

Cape Verde is a stunning country that is full of wonderful and friendly people. However, it is important that you remember it is a developing country so it might not have the same amount of amenities you are used to. That being said, it is catching up fast and with the country possibly joining the European Union, there is the chance that it will then gain plenty of benefits that will make it even easier for those within Europe to live in the country. You are not living in the third world when you move to Cape Verde, but you are living in a beautiful place that you will absolutely love.

The Canada Pension Plan (CPP) Faces Depletion?

The Performance of the Canada Pension Plan

First Published Date: June 11, 2010

The Canadian Pension Plan is very important to many people because it serves as a good chunk of their monthly income when they retire. To ensure that the Canada Pension Plan always has money in it, the Canada Pension Plan Investment Board oversees the plan to ensure that it keeps growing to accommodate the growing population of Canada. Under the direction of the Finance Minister at the time, Paul Martin, the CPP Investment Board was created in 1997 as an independent organization that monitors the funds in the CPP and invests them. Every three months it reports on its performance and a professional team oversees the operation of aspects of the CPP fund, while also planning out the direction of the investments.

In order to provide more money to those who will be retiring, especially baby boomers, the Canada Pension Plan Investment Board decided to use 45 percent of its assets to invest in securities located outside of Canada, including in Western Europe and the United States. The Investment Board has also been investing heavily in emerging markets because, as the board states, Canada as one market cannot accommodate the future growth of the pension plan.

According to most estimates, to sustain the population in 2020 that will be using the Canada Pension Plan, the CPP must grow at least 4.1 percent per year. By 2010, the CPP Investment Board had grown to $147 billion. The next 40 years also see some benchmarks for the CPP Reserve Fund that the CPP Investment Board hopes to achieve to accommodate a growing population:

·      2015:  $200 billion

·      2030:  $592 billion

·      2050:  $1.55 trillion

The performance of the CPP has varied in the past few years, as has the CPP Reserve Fund, which grows based on the contributions by Canadians. In the past few years, the CPP Reserve Fund has grown and fallen over the years, seeing a rate of return that was highly fluctuating:

·      March 2003 Total Value: $55.6 billion Rate of Return: -1.1 percent

·      March 2004 Total Value: $70.5 billion Rate of Return: 10.3 percent

·      March 2005 Total Value: $81.3 billion Rate of Return: 8.5 percent

·      March 2006 Total Value: $98.0 billion Rate of Return: 15.5 percent

·      March 2007 Total Value: $116.6 billion Rate of Return: 12.9 percent

·      March 2008 Total Value: $122.7 billion Rate of Return: -.29 percent

·      March 2009 Total Value: $105.5 billion Rate of Return: -18.6 percent

The large fall in 2009 was because of the recession that hit the world due to the credit crisis that began in the United States. However, the increase in 2010 was expected to be roughly seven percent, which would allow the CPP Reserve Fund to increase for the first time since 2008.

The Canadian Pension Plan needs to grow at a continuous rate to ensure that there is enough money available for the growing retiring population in Canada. With millions of Baby Boomers retiring and not enough of subsequent generations to prop up the Pension Plan, the Pension Plan needs to grow to ensure everyone has enough money when they retire using the Pension Plan. As long as there are no more years like 2009, it should continue to grow to meet those needs.

Time is Right For Spanish Real Estate

Property in Spain

First Published Date: Oct 1, 2010

Due to financial troubles in the country, property prices in Spain have fallen to their lowest levels in recent memory. Many North Americans and Europeans are now looking at possibly getting a second home in Spain to take advantage of the nice weather, beautiful landscape and friendly people. Unlike buying property in third-world countries and developing nations, when you buy in Spain you are moving to a country that is a world leader. So, if you are going to buy property in Spain, what do you need to know as a foreigner?

Spain does not have limitations like other countries in foreigners buying homes, so it is actually quote easy to buy a home there. The first thing you need to think of is where you want to live in Spain. Spain has a huge amount of space, and there are many different regions. Do you want to live near the beach, or do you want to live near the mountains? Do you want to live in a city, or a small rural village? Find out where you want to live, before you start looking for property to buy.

When you know where you want to live, contact an independent legal advisor in that region. They will have a clear understanding of the legal system of Spain and they will know the language better than you in most cases. Make sure your advisor is working for you and not tied to any property dealer who you are going through because that could be a conflict of interest that just costs you more money.

Even though prices of homes in Spain are very low, that does not mean you shouldn’t look at what you can afford. Having enough equity to buy a home will help you a lot, but if you need to get a mortgage, most Spanish banks will offer you a mortgage of 60 to 80 percent of the home price. That means you have to come up with 20 to 40 percent of the home price as a down payment. That can be a lot of money for higher end homes but luckily with record low prices, your down payment will be low as well. The more you have, the more you can get and the less of a mortgage you will be saddled with. Just like you would anywhere else, do your research and shop around with Spanish banks for the best rate. You want to pay as little as possible in interest.

Lastly, you need to have proof of income with your last three pay-slips, six months of bank statements, and a credit report will help when getting a mortgage. Your debt load cannot exceed 35 percent of your total monthly income if you are going to get a Spanish mortgage. It is important to not that that debt load includes your possible Spanish mortgage.

Spain is a beautiful country, so why not take advantage of the low prices now and move there where you can enjoy the scenery, friendly people and amazing food and culture.

This Credit Card Payment Trick Saves You Money

Credit Card Interest Tip

First Published Date: February 28, 2016
all know it’s in our best interest to pay off credit card balances each month so you don’t get hit by the high interest credit card companies charge you. However, it may not possible for some of us to pay off balances in full. Today, I will like to show you a simple trick that that will save you money if you carry balances.

Credit card companies mainly use two methods to calculate interest. These are average daily balance method and daily balance method. As it sounds, average daily balance is the average of your daily balance for the full billing period. This average is multiplied by the daily interest rate and then multiplied again by the number of days in the billing period.

The daily balance method is much simpler than the average daily balance method, although both methods generate same the interest charge. The daily balance method looks at your interest charge daily for the billing period and adds each day’s interest to get your interest for the month.

So if you look at these methods carefully, you will realize that by paying several times (instead of paying once) on your bill every month when you carry balances, you will save money on interest charges, as paying several times will bring down your daily balances and averages several times for the billing period. Any partial payment will have the effect of lowering the interest you pay.

For example, if you are paying $200 towards your balances once a month, paying $50 in 4 weeks or several times throughout the month will generate less interest. On small balances, this trick may not trigger significant savings, but the savings will be noticeable on higher balances.

Keep in mind that if you are paying balances in full, you don’t need this trick, as you are not paying interest anyways. If you would like to find out more on how your credit card charges interest, read here.

Foreign Investors' Black Money Is Canadian Real Estate's Real Problem

Canada Implements New Mortgage Rules

First Published Date: February 29, 2016

The days of buying expensive homes with only 5 percent down payments are gone in Canada. Starting Monday, Feb 20, 2016, new mortgage rules kicked in that require 10 percent down payments to buy homes on the portion costing more than $500,000. What this means is that there is still a 5 percent down payment required up to $500,000 and anything above $500,000 will require 10 percent.

To tame the skyrocketing real estate market in Canada, measures are being taken to make it harder for buyers to buy expensive homes with little down payments. For homes costing below $500,000, the requirement is still the same (the aforementioned 5 percent down payment) and there are no rule changes for homes costing more than 1 million dollars; they require a 20 percent down payment.

My Take

I doubt this will have much of an effect on soaring real estate prices. Canada has become a safe heaven for foreign investors with illegally-earned money. In the 3rd world countries from where these monies are flowing through, millions of dollars are not a problem as they are mostly earned from bribes and not honestly earned like hard-working Canadians earn their salaries.

I have heard stories from buyers from countries like China, Russia, and Bangladesh, where their salaries cannot be more than $25,000 a year, are buying 6 to 7 condos or houses in palaces like Toronto and Vancouver and paying more than a million dollars in cash apiece.

Canada has no procedure in place to verify incomes for foreign buyers and such buyers also don’t pay income taxes on their Canadian real estate properties. So these people are making their black money white in Canada, as once they sell their real estate property in Canada (that was bought with black money), it becomes a legitimate transaction and the money becomes white.