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Prices down, but properties in demand

Natasha Beckles

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Leading independent global property consultancy Knight Frank LLP has reported a gradual decrease in property prices in Barbados during 2011 although luxury properties remain in demand.
According to Christian De Meillac, head of the company’s Caribbean desk, prices declined between five and ten per cent with a significant surge in sales activity towards the end of the year.
“Homes in the most established resorts as well as beachfront residences generated the most interest.
“The average price for a prime property on the island now stands at approximately US$900 per square foot.
Although the prime market saw price corrections between ten and 20 per cent, De Meillac noted that Barbados proved better insulated than some of its smaller, less well-connected Caribbean neighbours.
“Most buyers that approach us are seeking a turnkey home.
“Few want to undertake renovations, buy off-plan or take on a self-build.
“In 2011, I would estimate only five per cent of buyers bought a home off-plan on the island, a figure that has dropped significantly in the past decade,” he said in a recent report on the local property market.
According to the Knight Frank Global Property Search website, when compared to 2010, in 2011 there was a 70 per cent increase in searches for properties in the US$5 million to US$15 million bracket.
Searches for properties valued below US$1 million and between US$1 million and US$5 million increased by 15 and 25 per cent, respectively. However, searches for properties over US$15 million declined by almost ten per cent.
The research showed that buyers from the United States, Canada, Britain, France and Ireland are targeting the island’s most expensive properties, with over 25 per cent of searches undertaken by these nationalities relating to properties priced higher than US$5 million.
De Meillac noted that with momentum in the market improving and the fact that minimal stock has been added to the island’s property market in the last three years, the supply-demand equilibrium is “tighter” than it has been for some time.
“Add to this the scale of wealth generation globally and Barbados’ limited inventory, and we expect demand to continue to strengthen, prices to stabilize and possibly rise in the best locations,” he said.