Real estate faces growth hurdleson Isle of Man

London: Take the little mountain railway up Snaefell — the Isle of Man's highest peak at 620 metres above sea level — and on a clear day you have a sweeping view from the hills of Ulster and Scotland to the Lake District of England with little but sea and grass between.

The island may be small but it is not crowded. Just 2 per cent of its land mass is developed, mostly around the coast.

"It is one of the least densely populated countries in Europe," says Seamus Nugent, chief executive of Dandara, one of the island's biggest construction companies, which boasts 400 employees.

But Nugent says strict planning controls and lengthy delays — all developments must be approved by central government — have led to a shortage of houses. "We have had high population growth and not much building ... little has been done to relieve that situation. No land has been zoned for development since 1976."

Nugent says a recent drive to attract wealthy expatriates to the island, by scrapping tax on income over £115,000 (Dh683,175) annually, has been hampered by a lack of grand houses.

He says: "Planning is conservative. It is a beautiful island and people are sensitive to what goes up."

Preserving heritage

Tony Brown, chief minister, says it is a price worth paying to preserve the island's heritage.

"Our responsibility is to the island as a whole. There are places where you can have a reasonably sized development in certain areas of the countryside. But we need restrictions on the countryside. It is true that we have lost some high net worth individuals because they have not been able to see a building and move in."

However, the government has launched a review of planning to see if regulations can be eased. Its development plan allows for an expansion of the population from 80,000 to 100,000. David Kay of Kay Associates, a Douglas architectural practice, says things are changing slowly and the challenge is to work with communities.

— Financial Times