The Tribune

By NEIL HARTNELL

Tribune Business Editor

nhartnell@tribunemedia.net

The Bahamas must be “a bit more aggressive” in promoting its advantages, realtors are urging, with “the droves” of wealthy families expected to move from the UK yet to materialise.

Ryan Knowles, founder and chief executive of Maison Bahamas Real Estate, told Tribune Business that he and others “haven’t seen quite the number expected” yet as a result of changes in UK tax laws that are anticipated to impact around 74,000 ultra high net worth individuals claiming so-called ‘non-dom’ status from April 2025 onwards.

Acknowledging that it could take as little as ten of these persons to “move the needle” for The Bahamas, he added that providing increased real estate options at the market’s top end will also boost this jurisdiction’s attractiveness as post-COVID demand has slashed available inventory by between 25 percent and 40 percent.

So-called ‘non-domiciled’ persons are individuals who, for UK tax, are treated as resident but have their permanent home in another country. However, they now face having to pay millions of pounds in tax as a result of the UK government plans to scrap a tax break that enabled them avoid paying tax on their overseas income for 225 years.

The change is due to take effect from April 6, 2025, although there has been growing speculation that the newly-elected Labour government may be rethinking these plans amid concern it would force wealthy investors and entrepreneurs to flee the UK and harm that nation’s economy.

“I don’t think we’ve quite seen it in the droves we were expecting,” Mr Knowles told this newspaper of UK ‘non-dom’ interest and moves to The Bahamas, “but there have been a number of high net worth clients really at the top end of the market potentially looking at making a switch.

“There have been a couple of high-priced transactions that have occurred with a number of those UK non-dom folks looking. True, we haven’t seen quite the number we expected, but we did get some business from it and there are a number of months to go.

“It’s quite possible that as we get closer to the deadline those individuals will make a final decision and many more of them may end up making the move. We are one of several jurisdictions that would be of interest and would be attractive.”

Mr Knowles said Italy, which is closer to the UK and has adjusted its tax laws to attract wealthy overseas investors, as well as Dubai, another popular location for British visitors and investors, are among the nations that The Bahamas is competing with for the ‘non-dom’ market if the changes to UK tax law actually proceed.

However, given The Bahamas’ size he asserted that attracting just a tiny fraction of this customer base could have a material impact for the country’s economy. “If we get ten individuals who decide to move and take up residence here, that’s a material effect on our market at the high end of it,” Mr Knowles told Tribune Business.

“It doesn’t take a lot to move the needle. We’re in a relatively low inventory climate so if suddenly we have 10-15 individuals purchase at the upper end that’s going to cause quite a stir and have a definite effect on the market and push prices up further, plus maybe motivate sellers to put properties on the market if they see there are buyers out there.

“We do need more inventory. Our inventory, relatively speaking, is fairly low compared to what it usually is. It’s probably anywhere from 25 percent to 40 percent lower. We went through so much of it and it does take a while for it to rebuild. It is coming around but does take time with new buildings. On the resale side it’s still fairly light; getting better but not where it was before.”

Noting that Dubai has investor-friendly tools specifically targeted at the UK market, Mr Knowles added: “I think they’ve probably been more aggressive as a jurisdiction than we have in attracting them. Italy has been very aggressive in attracting those looking for a certain tax environment. It could be a number of things. It’s competitive stuff.”

Pointing out that rival nations may have more inventory available at the multi-million dollar price points sought by UK ‘non-doms’, he said: “I think a lot of it is spreading the word and reminding people of all the benefits of living in The Bahamas; residency, investment, the beauty and lifestyle unmatched, selling the jurisdiction and its tax benefits.

“It’s just making sure that when people are looking at different options and the best place to reside that The Bahamas is at the top of the list. We have great schools, really great medical care, are very close to the US and the US dollar and Bahamian dollar are pegged.

“All the fundamentals are there. It’s a matter of putting our hand up and telling people that we exist and are a good place to consider. Those other jurisdictions are very aggressive in going after those individuals, and we probably need to be a little more aggressive in doing so.”

Gavin Christie, broker and appraiser with Corcoran C. A. Christie Bahamas, told Tribune Business that this nation is among the destinations in play for non-doms seeking to flee the UK. “We have seen an uptick in interest and queries for The Bahamas specifically for families under this ‘non-dom’ status,” he said.

“We’ve found a lot of that interest is going to the Out Islands believe it or not. We find the European clientele tends to be drawn to more of the Family Islands than Nassau. We’ve counselled one very large client who has made a very extensive purchase already that has led to conversations with two or three more who we anticipate might not be too far behind....

“I think it’s a great opportunity for The Bahamas to position ourselves as a destination for them. We have to continue to improve our tourism product and infrastructure product so that when they come here they have access to the island lifestyle and every day amenities as well as infrastructure,” Mr Christie added.

“It’s not just ultra high net worths. We’re also starting to see a handful of professional athletes, who are at the top of their careers and made a tremendous amount of wealth based out of the UK, looking for new destinations to reside and become permanent residents.”