A Guide to Real Estate Law in St Lucia

Saint Lucia continues to be an attractive destination for second home owners and property developers. The real estate market is a dynamic one with increasing demand in the second home and luxury home markets, especially post COVID-19.

There has been increased volume and velocity in the real estate sector, in particular from the United States, United Kingdom and Canadian markets, with increasing growth in the European market.

As a major tourism destination, the tourism industry in Saint Lucia significantly influences the real estate market. The island’s stable political environment and economic policies make it an attractive destination for real estate investment. Foreign investors often explore opportunities in the market, taking advantage of tourism incentives offered by the government and the country’s appeal as a tourism destination.

The new Aliens’ Landholding Licence Act, introduced in March 2020, makes property purchases significantly easier with its two-stage process.

The first stage, the certificate of eligibility, is a due diligence process that clears an applicant to acquire property on the island. An applicant may apply for a certificate that is valid for 12 months, or a certificate that is valid for ten years. Once granted, the certificate allows an investor to acquire multiple properties during its validity.

The aliens’ licence is the second stage of the process and is the final step to allow the applicant to acquire a property. This licence is specific to the property to be acquired and is required to allow a conveyance of property or acquisition of shares in a non-alien company to occur.

The holder of a certificate of eligibility may, after acquiring a property, apply for an Alien Investor Entrance Permit. This permit will allow a holder to remain on the island indefinitely for as long as they retain title to the property and obviates the need to apply for extended stays via the Immigration Department. Although this permit does not allow the holder to work on the island, it has proven very popular with property owners who want to enjoy extended stays on island.

A key development in 2024 has been the introduction of the Tourism Development Act. This act creates a cohesive legal framework, improves sector standards, encourages more sustainable tourism products, and expands the scope of projects eligible for fiscal incentives. In addition, the act allows for the certification of tourism products, including residential properties, operating in the tourism market.

Apartments, condominiums, villas and cottages that provide accommodation for visitors are captured under the rubric of tourism accommodation and owners are deemed tourism operators. Persons operating in the online hospitality service sector, such as AirBnb and those operating through local management companies or independent websites, are brought into the tourism sector in a more formal sense.

Certification has also been streamlined to ensure greater adherence to other local legislative requirements.

Some of the most common problems in real estate transactions relate to persons placing deposits on properties without getting legal advice, and not having formal written contracts in place, not having title searches carried out at the outset, making offers and entering into agreements before knowing where the consideration for the sale will come from. Other concerns include sellers attempting to sell and being in breach of conditions attached to their aliens’ landholding licences, contracts being unclear as to what happens to a deposit in the event that an aliens’ landholding licence is denied, and applicants for aliens’ landholding licences not making full disclosure regarding any conviction history.

The legal and regulatory landscapes are constantly evolving and becoming more complex. Due diligence and compliance takes are essential – from scrutinising property titles to navigating regulatory frameworks, these twin pillars ensure a secure foundation for transactions, protecting both the interest of buyers and sellers.

To that end, effective June 2023, legal practitioners engaging in real estate work were required to register with the Financial Intelligence Authority as a supervised entity pursuant to the Registration of Supervised Entities Act.

Recent trends highlight Saint Lucia’s continuing appeal to buyers in the second homeowners’ market and property developers with increased activity post COVID-19, particularly from the US, UK and Canadian markets.

The property-owning process has streamlined with the new Aliens Landholding Licence Act and government policies remain friendly to property investors.

The move to introduce holistic tourism legislation, with the inclusion of the property sector providing service in the tourism market can only enhance the island as a real estate investment destination.

As a small island state, it is imperative before embarking on any real estate journey that a potential purchaser or investor connects with a reputable real estate professional or legal expert for the most up to date and specific information regarding the current state of the real estate market in Saint Lucia.