Cook Islands Real Estate

FAQ-s :
moving or relocating to the Pacific- looking for a safe haven - investment opportunities - planting a flag - PT interests - trust accounts - international travelers (P.T's) – LLC’s and more.

Where do I start ?? What are the steps ??

The Cook Islands:

The Cook Islands are a group in the South Pacific Ocean approximately south west of Tahiti and due south of Hawaii. Local time is 10 hours behind GMT, with 9am in Hong Kong being 3pm the previous day in the Cook Islands. Its geographic location allows the Cook Islands to have strategic advantage in dealing with both the Asian and US markets.

The legal system is based on British common law and closely reflects that of New Zealand and other common law jurisdictions. The Cook Islands enjoys a highly developed infrastructure for business. There is a well-educated English speaking labour force. The country has sophisticated telecommunication links with the rest of the world and convenient air services to New Zealand and the US. There are no foreign exchange controls with complete freedom to repatriate capital and profits. It boasts the highest GDP per capita amongst the South Pacific small island nations.

The business and official language is English, with Cook Islands Maori as a second official language.

Can anyone buy property (Realty - Real Estate) in the Cook Islands?

Technically only those with direct Cook Island family blood lines or those with Permanent Residency (P.R.) status or those with a Cook Islands registered company can purchase the lease on a residential property in the Cook Islands. If you do not fall into these above 3 categories, there are other legal approaches that you can explore so that you come and live here in Paradise . Eg. You can partner with a local Cook Islander or enter into a joint venture arrangement, or you can purchase a business that is already listed for sale. By purchasing an existing business, this then satisfies the criteria of having a Cook Islands Registered Company, and from there you can explore residential property acquisition.

See our business listings (TAB on left) for businesses that are currently for sale.

Can anyone buy a Business in the
Cook Islands?

YES THEY CAN !: There are no restrictions on who can make an application to purchase a business, however, there is an application (and approval) process and I can show you how and what needs to be done.
NB: It should be understood that only Cook Islanders can start up a ‘NEW’ business in the Cook Islands. Non-Cook Islanders are restricted to purchasing an existing business ‘that is available ’For Sale’ as their initial way of entering the Cook Islands. (some exceptions listed below **)
There is an application process for doing this – and this is part of the free service that Cook Islands Real Estate Ltd offer to those wishing to come here.
Once you have been successful in purchasing a business, you will then be given the necessary government approvals to come and live here

This is the easiest and most straight forward way of entry if you are looking to come and live in the Cook Islands.

** There are other ways for Non Cook Islanders to be able to enter the Cook Islands

Some alternatives can be
(a) Form a J.V (Joint Venture) with a Cook Islander, where the Cook Islander is a majority shareholder in a local company.

‘Joint Ventures with Cook Islanders are encouraged and the greater the participation of Cook Islanders the greater the opportunity for approval as an Investor in the Cook Islands’.

(b) Identifying a business venture that is outside that which is considered to be in the reserved investment areas:- i.e.: Some areas of investment are reserved for Cook Islanders only. Feel free discuss these points further with you Cook Islands Real Estate contact

‘There is a policy on Foreign Investments for use by Investors, Government Agencies and the Community at large. The Code provides for sectors of the economy and specific business activities reserved for Cook Islanders only. Where the proposed Investment activity is reserved for Cook Islanders, the Investment Code outlines the exceptions under which a Foreign Investor may qualify to invest in the reserve sector.

For more on this please discuss with your Cook Islands Real Estate representative

What is the nature of Property ownership in the Cook Islands ?

All property in the Cook Islands is LEASEHOLD property. – There is no FREEHOLD property available.

Q: What is leasehold? A. These are properties where an owner (Lessor – being the indigenous landowners) leases real estate to buyers (lessees) for specific time periods.

Q. Why would anybody buy leasehold? A. Leasehold properties are usually less expensive than comparable ‘fee simple’ properties.

Q. What is fee simple? A. Also known as FREEHOLD : It's the type of ownership where a buyer purchases a property outright and has the right to use the property indefinitely. Of course the buyer must pay his/her mortgage, real estate taxes etc, to retain the right to the property.

Q. What do I need to know if I'm going to purchase Cook Islands leasehold real estate?
A. There are several things:

• Find out what is the remaining term on that particular section of land or property

• Find out if there are any restrictions, on the use of that section or land

• Find out if there is any annual 'land rental' that needs to be paid.
Q: What is land rental?
A: This is an annual amount of money that is paid to the original landowners, as payment, to use or reside on that section of land

Can I re-sell this leasehold property onto someone else should my wishes or circumstances change
? A: Yes, you can resell at any time. ( N.B. there are no capital gains tax in the Cook Islands

Q. What about financing?
A. Properties with short leases will be difficult to finance. For example, if you're looking at a property with 10 years left on the lease, the bank is not going to give you a 30 year mortgage. They might give you a 5 year mortgage, which means you'll have much higher monthly payments

Are there any catches? There are no catches providing that you fully understand the structure of leasehold, such as :

Whoever buys that property is buying a leasehold property. Q: What does that mean?
A: A price is paid for that property which gives the new owner the right to live there or use that property (uninterrupted) until the end of that lease term.
You don’t actually own the land but you have the legal right to use that land, and have full legal ownership of all the buildings and out-buildings (if any) that sit upon that land. If your needs or situation should change at any time, you also have the right to sell this property . (N.B. There are no capital gains taxes on the sale of property)

Quick Property Facts

• The maximum term of any lease = 60 years.
• There are NO capital gains taxes on the sale of property in the Cook Islands.
• The are NO council rates or government taxes on property in the Cook Islands.
• There are NO Water Rates (water is FREE) in the Cook Islands.
• Domestic Garbage collection is also FREE to all households in the Cook Islands.
• Any land rental that needs to be paid, is based purely, on the un-improved value of that land.

Comparing Leasehold Properties .

• It is very difficult to compare leasehold properties, unless they are two land parcels of similar size, in the same location and same lease terms. All land in the Cook Islands is Leasehold and each property will invariably have a different lease term.

• When viewing properties on Cook Islands Real Estate websites, if you see a property with a price that is a lot lower than all the others, it could have a very short lease period remaining.


• Leasehold purchases can make what may seem like the unaffordable, very attainable:. E.G. In Tupapa Village (Eastern side of the island of Rarotonga), we recently sold a residential leasehold property of 3000 sq. m (3/4 acre) in size, it is a waterfront section, with a modest 4 bedroom home situated on this land but it also had uninterrupted ocean views.The section ran all the way from road side down to the shore line of beach side. Sale price was N.Z $395,000.
OBSERVATION: If this had been a freehold property, it could have been listed for in excess of $1.5 million, easily.

• Another property. Titikaveka Village – south side of island of Rarotonga - Residential section, 1000sq m (1/4 acre), with a 4 bedroom home, large veranda on 3 sides of the home and located only 600 meters to the beach front, the home itself only 5 year old, sold for N.Z $155,000.
OBSERVATION: again, in a Freehold situation, the ‘bare land’ could possibly be three times that price.

Commercial properties tend to be a little higher in asking price as there is a commercial value obtained (business income) derived for the use of that section and buildings, again however the leasehold value of the lands is minimal when compared to a freehold purchase of similar

Who are the Local Commercial Banks ?

ANZ (Australian and New Zealand) Banking Corporation

Westpac Banking Corporation

BCI - Bank of the Cook Islands.

Both ANZ and Westpac are very safe banks. Both are AA+ rated and based out of Australia with worldwide connections. It would be rare to find USA banks with the same ratings. The Cook Islands also have Capital Security Banks that will hold foreign currency deposits where they actually receive interest.
In the USA, it is now rare to get interest rates on deposits.
All 3 banks provide very good interest rates on NZD deposits.

Foreign Investment into the Cook Islands

The Cook Islands' government actively encourages foreign direct investment and the establishment of new enterprises and business activities that make a positive contribution to the economic and social development of the country. All foreign investment in the Cook Islands is governed by the Development Investment Act 1995-1996. The Act provides for general investment regulations and requirements.

The Development Investment Act 1995 - 1996

All foreign organization or companies wanting to set up in Cook Islands must first obtain approval and register their planned activities.

The Leases Restrictions Act 1976

Does not allow freehold ownership of land, persons may lease land up to five years and any longer period has to be approved by a Committee established under the Act.

The Entry Residence and Departure Act 1977

The Entry Residence and Departure Act 1977 states that anyone other than Cook Islanders and Permanent Residents (P.R’s) wanting to live and work must first obtain a residence permit.

Every foreign enterprise wishing to carry on business in the Cook Islands must apply for registration with the Business Trade Investment Board (BTIB). Foreign investment applications and the associated investment incentives are also reviewed by the Business Trade Investment Board.

Other sector specific investments shall be subject to the appropriate legislation covering the relevant sectors. e.g. banking , insurance etc

Investment areas and activities which are in the scope and capability of Cook Islanders are set aside as reserved investment areas, however, a number of investment areas have been identified as priority investment areas and are encouraged.

These priority investment areas include:

Agriculture and livestock production;
Fisheries and marine production;
Outer islands development;

Applications for incentives must satisfy certain investment criteria's before approval is granted. The types of investment incentives available to investors include import levy exemptions and work and residence permits.

EXEMPTIONS to the above: There is an area where foreign investment is encouraged in other ways, and that is via the purchase of an existing business that has been advertised locally for sale for a period of more than one calendar month. If that business is unable to attract a local purchaser, that business can then be actively advertised for sale to encourage either Cook Islanders or Non –Cook islanders, alike, to purchase.
Once an application has been submitted and approved by the BTIB (Business Trade Investment Board ) the successful purchaser(s) will be granted their work and residence permits to come and live and operate that business as a fully 100% owned operation.

Can you give me a ‘Road Map’ for the Application/Purchase process

for a Non-Cook Islander when buying a business that is currently available for sale?

Assuming that you have identified and made an offer on a business(es) that has been listed on a site like this (Cook Islands Real Estate) then the following is the road map for the purchase process.

1. An offer is agreed on by both the vendor (owner) and the purchaser (yourself). This is facilitated by your Cook Islands Real Estate agent

2. A sales and purchase agreement is then drafted up via your Cook Islands registered legal representative. (The cost associated with the sales and Purchase agreement being initiated, is usually, borne by the vendor). Your Cook Islands Real Estate agent can put you in contact with a registered lawyer

3. Your legal representative will have you complete some paperwork associated with this application and return these to his/her office (paperwork includes, copies of the picture page of passports / medical forms which are completed in your home town / police clearances initiated from your home town / a business plan of your what you will be doing with this business / names of 2 referees that can verify your existence. Your Cook Islands Real Estate representative can assist with soft copies of this paperwork, including templates for the Business plan and the medical forms which outline the test to be done.

4. Your legal representative will collate these documents and a copy of your Sales and purchase agreement and submit these to the BTIB (Business Trade Investment Board) [application fee to BTIB is NZ$750] The BTIB meet once monthly and the board consists of a Chairman and four other board members. NB The BTIB is the government body that must approve all Non-Cook Islanders wishing to purchase a business in the Cook Islands

5. The board will consider the merits of each application with the view to ‘what is the net benefit’ to the Cook Islands and Cook Islanders.

6. Upon approval by the BTIB, your sales and purchase agreement will be deemed to be now unconditional and the BTIB will (if included in the application) direct the Cook Islands Immigration department to grant the applicants their work and residency permits to come and live here in the Cook Islands and to conduct the business that they have now purchased.

7. Welcome, you have arrived !

Asset Protection : LLC's : Personal Wealth Protection : and more...

If your primary focus is on asset protection or personal wealth protection, through the use of Trusts or other related structures, then I can point you in the right direction.

At Cook Islands Real Estate Ltd , we are not involved in such matters, ourselves, but we are the feet on the street that can refer you to the right people .

There are several very qualified and experienced asset protection firms located here on Rarotonga, and they are conversant with all of the relevant laws and regulations for foreign citizens.

…Simply contact me via email and I can then put you in touch with one these firms

These companies can offer other services like :

• Formation of Limited Liability Companies
• Cost effective incorporation of Offshore Companies.
• Asset Protection trusts
• Protected Fund Investment trust

And there are Many benefits of Incorporating in the Cook Islands

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