Billionaire Richard Branson owns several. Magician David Copperfield has a dozen. Singer Celine Dion is trying to sell hers. And tech titan Larry Ellison is closing a deal to buy nearly all of the Hawaiian island of Lanai.
PHOTOS: Private islands for sale
Private Islands Inc., a Toronto-based island marketing firm, lists about 500 islands worldwide from less than $50,000 to more than $100 million, Chief Executive Chris Krolow said.
U.S., Canadian and British buyers make up about 80% of the market; far-flung locales such as the Caribbean have a more international buyer base, he said. The Bahamas and Belize are hot, as is Panama. In the Mediterranean, Greek islands are popular.
"Before the recession, a lot of islands were priced by owners who had what we call Coke-bottle glasses," Krolow said. "They put crazy price tags on their islands."
Price drops in areas such as the Bahamas and a sense that values have bottomed out have brought increased interest in island ownership.
"It has opened the door to people looking," Krolow said. "They are more comfortable now."
Ego, extravagance and identity play roles in some high-profile trophy purchases, experts say, but others are motivated by privacy and security.
"These types of people are looking to create something for themselves, to put up a flag and say, 'This is my own little country,'" Krolow said. "They all tend to be very entrepreneurial. Not just the wealthy, but those who are determined to do something different."
Celebrities have long populated the ranks of island owners, including Marlon Brando, Nicolas Cage and Johnny Depp. Even those not pursued by paparazzi can understand the desire for seclusion these days, said clinical psychologist Stephen Goldbart, co-founder of the San Francisco-based Money, Meaning & Choices Institute.
"We are all living in a world where there isn't much privacy," said Goldbart. One of his clients has bought an island, and several others are interested in making their own purchases. "The need for feeling safe and secure has increased radically since the economic downturn."
Island buyers tend to fall into two groups: people who are making lifestyle choices and entrepreneurs developing resorts.
Oracle Corp.CEO Ellison's recent deal to buy 98% of Lanai could be considered an example of a trophy purchase since ownership has been a money-losing proposition for seller David Murdock, the Los Angeles billionaire who controls Dole Food Co.
The estimated $500-million deal makes little sense from a financial standpoint, said Paul Habibi, who teaches real estate at the UCLA Anderson School of Management. Among the reasons he cites are a lack of resort potential because of a mostly rocky beachfront and scant infrastructure.
"It is probably more of a quality-of-life investment — a pride-of-ownership purchase," Habibi said. "Who wouldn't want to own a Hawaiian island?"
Murdock, though unloading the 141-square-mile island, is keeping his Lanai home and some other assets, including a woodworking shop and 1,000 rare orchid plants.
Dion and her husband, Rene Angelil, put their private island up for sale in Quebec in late spring. The couple, who also own a home in Florida, could seldom get to their island mansion because of Dion's touring schedule, so they listed it for sale at more than $29 million.