Demand continues to outpace inventory in the Caribbean’s booming real estate market, as 2019 shapes up to be a banner year for realtors across the region. Property professionals gathered in Miami recently to discuss trends and issues affecting the Caribbean market, and the mood was optimistic with the industry showing very healthy growth across the board.
“We are seeing a huge amount of new development across the islands, specifically resort hotels but also the low density luxury villa model for the purpose of short-term rental traffic,” says Ian Hurdle of luxury real estate brokerage firm The Agency which hosted the inaugural Caribbean Real Estate and Investment Summit in Florida last month. “The byproduct of that focus is that people need to come in to work to both construct and manage these projects and as a result we are seeing an upswing in more affordable product by way of single family homes and apartments and long-term rentals.”
Regional hotspots
The Forbes Real Estate Council has identified The Bahamas, Bermuda, the Cayman Islands, St Vincent and the Grenadines and the US Virgin Islands as the markets to watch in 2019 and adds: “Overall, we see the Caribbean real estate market poised for significant upswing over the coming year, with many opportunities. Buyers should look to capitalize by investing now, as growth accelerates and home prices begin to rise.”
Hurdle, who is Managing Partner of The Agency’s Turks and Caicos office, says destinations such as The Bahamas, the Caymans and Turks and Caicos are success stories partly because of their proximity to the US. “Any of these destinations is reachable in a short space of time compared to the Eastern Caribbean, and all are building to Florida Code and embracing the very best architecture that the region has to offer,” he says. “As Hurricane Irma showed, the recovery time because of this build quality and time, as well as infrastructure, ensures that an investment on these islands is not such a risk versus others. As a result we are seeing more and more direct flights coming in from the US which leads to an increase in tourism and a surge in real estate activity.”
Turks and Caicos in particular enjoyed a strong performance in 2018 with sales increasing by 11 per cent year over year to reach over US$ 247mn. And more growth is on the horizon with the planned construction of an international airport in North Caicos.
Saint Lucia may be at a disadvantage in comparison to those markets closer to the US, but the island still enjoys steady interest, especially from foreign buyers. The sector has seen a boost from the country’s healthy Citizenship by Investment Programme (CIP) which generated EC$ 66.4mn last fiscal year. Foreign investors can qualify for a passport with a minimum US$ 300,000 purchase of approved property. Recent CIP real estate initiatives include Phase 3 of the Resort and Residences at Honeymoon Beach in Canelles, which is expected to break ground shortly.
More to come
Hurdle predicts that Saint Lucia will start to see more business from US clients in the coming years, saying: “The traction we are getting on the islands close to the east coast [of America] will spread east, and Antigua, BVI, USVI, Puerto Rico, St Kitts and Saint Lucia will start to attract more North American consumers in addition to the heavy traffic flow they currently receive out of Europe and Asia. The main difference will be the seasonality — no longer will we see a peak season from just Thanksgiving to Easter. I predict we will see more activity into the later months on these islands, as we are seeing [in the western Caribbean].”
He is optimistic about the regional market as a whole, saying there is room in the market for everyone. “Demand for product is at an all-time high. Development is booming. Build quality is drastically improving. Tourism numbers are increasing quarter on quarter regionally. The lifestyle and the water and beaches are still a dream to most, but opportunities at all price points are becoming more and more available.”
Selling the Caribbean
If they are going to capitalise on this renewed interest and business, realtors in the region will have to be dedicated and engaged, according to Hurdle who spoke at the ‘Selling the Caribbean’ conference in April. “The days of posting a picture in a magazine and waiting for a tourist to come on vacation and call you because they like the picture are long gone. Realtors in our region need to be proactive if they are to be successful in selling the product and that means thinking outside the box and going to the customer versus waiting for the customer to come to you.
“‘Knowledge is power’ is cliche but it is apt given that we know our product and our markets cold; we now need to relay that knowledge to an international audience. We are dedicated to providing the best possible service to our consumers. Not all of us run off ‘island time’ and ‘soon come’. Communication is key.”
And communication was top of the agenda at the summit, which Hurdle says was a valuable chance for realtors and other industry players to get together and share their experiences. “We welcomed guests from all sectors: real estate agents from the Caribbean, South Florida, New York and Los Angeles; developers; new and existing hoteliers, architects, among others. It was a testament to the continued interest and strength of this regional market.
“There are so many misconceptions about investing in the region, and to have so many experts come from the various islands to share their knowledge was extremely gratifying. Working together we can bounce ideas off of each other, learn the pros and cons of investing in any one jurisdiction and guide potential buyers accordingly.”
