The market for second homes in sunny climes is warming up nicely, with properties new and old jostling for the attention of younger HNW buyers, writes Catherine Moye
To be whisked away and set down on a beautiful remote island the twinkling of an eye later used to be the preserve of magic carpet fairy tales. Now not only is zipping Aladdin-like around the globe commonplace for many holidaymakers, but also developers, hoteliers and governments are on a united mission to smooth an HNW’s hibiscus-scented passage to owning a home in a tropical paradise — notably Thailand and the Indian Ocean islands of Mauritius and the Seychelles.
‘Typically, the very wealthy have three overseas homes,’ says David Forbes, head of estate agent Savills’ Private Office. ‘One in southern Europe for summer sun, another in the Alps to go skiing, and a third for winter sun, typically in the Caribbean but increasingly in the Far East.’
Furthermore, as Rob Green of high-end agents Sphere Estates points out, since the 2008 financial crisis the profile of second-home buyers has changed. A younger, more international and tech-savvy generation has come of age. When it comes to escaping winter cold, they not only yearn for guaranteed sun but also for a complete change of cultural and recreational axis.
‘Young entrepreneurs or, say, hedge fund managers doing highly stressful jobs find that they can completely shut down on, say, a Thai island, especially in high-end resorts, where the staff are highly trained to look after them,’ says Green.
Those who grew up in a Western world dominated by the Eastern-inspired wellness industry (now worth $3.7 trillion, according to the Global Wellness Institute) are typically as at home in bare feet and a sarong as they are in business suit and brogues. Mindful of this (and of a growing market in luxury spa and health holidays, especially in the Far East), there’s no shortage of developments on the market boasting a soothing East-West fusion of sleek contemporary architecture with Balinese-style gazebo outhouses, state of the art amenities and wood-carved Buddha statuary, espresso bars coupled with the fragrance of lemongrass.
Such cultural intertwining is much in evidence at Samujana on the Thai island of Koh Samui. This small hilltop development of 27 lavish villas of up to eight bedrooms, overlooking a coral cove and clear blue seas, boasts infinity pools, cinemas, floodlit tennis courts, spas, yoga and meditation classes, and chakra balancing, detox, raw food workshops (prices start at £820,000 for a three-bedroom villa).
Savills’ Forbes favours Phuket over Koh Samui, especially from an investment point of view: ‘It’s regarded as the St Tropez of that part of the world and is much more popular with rich Asians coming out of China and Singapore.’
Savills International is currently marketing the exceptional beachfront Villa Nandana at Natai Beach, a recently completed Balinese open-plan contemporary design home set out on a configuration of seven separate pavilions linked via covered walkways. (A snip at £4.24 million.)
Forbes sounds a cautionary note about owning a stand-alone house in a far-flung location, however, especially if you’re Europe-based. ‘You’ve got to deal with sand, sea, salt, security, and everything else beginning with an S. The weather conspires to destroy homes in the tropics very quickly, especially if it’s located somewhere with a wet season. And that’s before you start thinking about getting to grips with staff and so on.’
That said, recent sell-out schemes in Thailand (albeit resort-based, notably at the Four Seasons on Koh Samui) have emboldened some developers to venture further afield, into yet more distant locations. Examples are the Alila Hotels and Resorts Group’s Villas Koh Russey in Cambodia, where 132 detached beachfront villas are available off-plan.
According to Knight Frank’s 2016 Wealth Report, exposure to property as an asset class looks set to grow, with 30 per cent of its clients considering an additional residential purchase that year. Property’s advantages over other asset classes add impetus to the search for special homes in more remote locales, as well as increasing the number of property collectors worldwide. Now new businesses are springing up to service the growing numbers of HNWs with luxury properties in multiple locations.
‘Time was the super-rich never rented, let alone swapped homes,’ says Giles Adams, president of Third Homes, a premier home exchange club for (a minimum) second-home owners, who are granted ‘keys’ to spend based upon the value and location of their property (the average being $2.25 million). Put simply, you trade in some of the ‘keys’ on your second home in, say, Barbados, to access another club member’s equally beautiful chalet in, say, Gstaad or Aspen.
‘Today’s HNWs are younger,’ says Adams. ‘The era of conspicuous consumption, where people boasted of all the homes they own all over the world, has given way to a more collaborative attitude. And people want “unique”, less commoditised experiences that you only get from staying in private luxury residences.’
Begun in 2013 in the USA, where the attitude towards home exchange is more favourable, Third Homes now boasts more than 7,000 members in 86 countries and includes both resort and stand-alone homes. Adams says its greatest growth area in the past two years has been the Far East.
Mauritius boasts 93 miles of white sandy beaches and a buzzy tourist trade. Integrated resort schemes on the market there include the islands’ only residential marina, La Balise Marina, where premium apartments have their own individual mooring points. The more established Villas Valriche has just released its last phase of luxury private residences that overlook a championship golf course.
In the aftermath of the financial crisis, many of the more exotic island second home schemes were put on ice. Now they’re being bought back to market, many under fresh management. For example, Zil Pasyon Residences in the Seychelles, which is now being managed by the Six Senses spa group, comprises just fourteen homes in an exclusive resort, each crafted into the island’s granite landscape with panoramic views of the Indian Ocean and nearby islands.
‘The very top end of the market prefers the Seychelles to Mauritius,’ says Sphere Estates’ Green. ‘They think it has more kudos and is seen as mid-to-high-end, as opposed to Mauritius, which is more low-to-middle.’
Eden Island, also in the Seychelles, is a newly constructed residential marina development just off the coast of the main island of Mahé. The final phases of freehold homes, villas and apartments have just come on to the market (from £400,000).
For property purists, however, the ‘exotic’ alternative to the gloom of a northern hemisphere winter still means the Caribbean. Even there the hunt is on for something a bit more Treasure Island and Robinson Crusoe than the bustling celebrity hang-out of Barbados.
Forbes’ hot tip is Canouan Island in St Vincent & the Grenadines, which is building a top-end marina and an airport where you can land a private jet.‘This will become the very rich man’s destination in the Caribbean,’ says Forbes, ‘along with Barbados, St Barths and Harbour Island in the Bahamas.’
Resort-wise, the Landings Resort & Spa at Rodney Bay in St Lucia offers a rare (for the Caribbean) opportunity to buy two- or three-bedroom beachfront residences at the island’s only private, 50-berth marina. Prices range from £530,000 to £3.2 million.
Those looking to exchange the winter gloom for more pleasing vistas are increasingly investing in more than just a sarong and beach towel.
Catherine Moye is a travel and property writer, novelist and screenwriter
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