Property: What price paradise?

The Caribbean is the latest hotspot for holiday homes.

FUNNY, ISN'T it, the way the notion of a sun-drenched Caribbean beach shaded by palm trees becomes more inviting during the course of a freezing British winter? Perhaps not. The chain of islands that makes up the West Indies stretches from Florida right down to Venezuela, offering varying destinations from the vibrantly colourful to the restfully laid- back.

As it becomes easier and cheaper to get there - it is now possible to fly for as little as pounds 250 - high-quality estates are being developed on a number of the islands. Buying early into one of these could be a very good investment indeed, with a ready-made strong rental market and rising values.

"We originally bought at Royal Westmoreland, a development in Barbados, because of the good climate and great infrastructure," says one of the development's home-owners. "Since making our investment less than two- and-a-half years ago, our capital appreciation has increased by more than 70 per cent - or a staggering $1m over rental returns."

Barbados, the most easterly of the islands, has two excellent developments, one of which is based around an 18-hole golf course and another that is set around a man-made lagoon with apartments and villas right on the water, with their own moorings.

Royal Westmoreland, on the west coast, is a 500-acre resort where around 280 villas and apartments are being built. Of these, about 100 are completed, and 11 of the latest development of 55 detached and semi-detached three- bedroom homes are guaranteed to be ready by the millennium.

"The project continues to be carefully managed, so that no building work is carried out beside completed homes - and, by the end of next year, the majority will be quiet and free from construction," says Giles Rooney, the sales and marketing director.

The resort has a health and leisure club, a children's club, a bar and a restaurant, tennis courts and swimming-pools. Prices range from $600,000 (about pounds 375,000) for a two-bedroom villa to $1,500,000 for a five-bedroom fairway home with swimming pool.

Port St Charles, near Speightstown, is further north. Phases one and two are already built and sold, and 20-or-so people are already regularly using their homes. A total of 114 waterfront apartments and townhouses are being constructed, some of which are on an island in the lagoon. This is where the restaurant and bar, due to open in June, will be situated; there will also be two tennis courts and a gym.

"The majority of our foreign owners are English, with the others being a mixture of Canadian, Italian, American and, of course, locals," says Harry Manning, of Harry Manning Associates, the local agent. There are also British agents, in the form of Humberts and Christopher Scott. Prices range from $345,000 for a one-bedroom lagoon-front apartment to $6,500,000 for a four-bedroom beach-front villa.

The most southerly islands are Tobago and Trinidad, only a few miles from the South American coast and out of the hurricane path. Tobago is the quieter of the two - Trinidadians go there to "chill out".

Much of the 20-mile-long island is hilly and covered with rainforest - a beautiful, unspoilt place with idyllic beaches, some hardly used. Tobago has some of the best diving in the world, and developers are encouraged to protect this valuable asset.

On the south-western side, the development of the 750-acre Lowlands Estate is under way. This is near the capital, Scarborough, and the airport, and boasts its own long, wide, sandy beach. Prices start at about pounds 100,000 for a plot of land and pounds 77,000 for a four-bedroom single-storey villa. A much larger, four-to-five-bedroom two-storey villa would cost pounds 180,000, with the plot costing about pounds 130,000.

"We expect there to be serious rental potential for these properties," comments Charles Weston-Baker, of the agents FPD Savills, which is inviting offers for the development. A five-star Hilton hotel and the first show villas will be ready in November, as will the golf course; about 60 apartments and 40 plots have already been sold to Trinidadians.

The prettiest part of Tobago is in the north, and this is where the King's Bay Estate development is. Among the 600 acres of cocoa, palm and immortal trees, a small number of villas will be built, all with stunning views over the bay. In the first phase, there will be 25 large two-storey villas, all in plots of three-quarters of an acre.

The Great House, an old plantation house, is to be converted into a five-star restaurant; and down by the beach there will be a few cottages, which will form the hotel, with a beach bar and a restaurant. There will also be tennis courts, diving facilities, a nine-hole golf course and riding. Work starts on 1 April (really), and a show house will be ready by August. The Prestige Property Group, the sole agent in Britain, is selling the first phase for pounds 225,000 to pounds 325,000.

The Tobago developments will be shown at the International Property Show (01420 520777), today and tomorrow at the Cumberland Hotel, Marble Arch, London W1. Royal Westmoreland: 0171-292 5000; Prestige Property Group: 01935 825770; FPD Savills: 0171-408 5517; Harry Manning Assocs: 00 1 246 424 2661; Christopher Scott: 01983 721777; Humberts: 0171-629 0909