Upscale real estate market looking up
Barbados prime property market has rebounded, even as the economy continues to struggle.
Not only has global real estate and property consultancy firm Knight Frank reported a ten to 15 per cent increase in the sale of upscale property here last year, but the island is also generating the majority of property searches among foreign buyers mainly from Britain, Canada, and the United States.
The company’s international residential research representative, Kate Everett-Allen, reached these conclusions in Knight Frank’s Caribbean Prime Residential Insight 2014.
News of the positive outcome was echoed by the firm’s head of Caribbean sales Christian De Maillac.
“2003 marked a watershed for several property markets in the Caribbean, with Barbados and the British Virgin Islands in particular seeing sales volumes increase. Purchasers have started to see real buying opportunities in the market,” De Maillac said.
Everett-Allen said that based on the empirical evidence, 2013 “saw a marked turnaround in Barbados’s prime market as confidence levels amongst buyers picked up”.
“Supply continues to outpace demand but the market is rebalancing. Sales volumes increased 15 per cent in 2013 year-on-year, this strengthening activity has seen prices start to stabilise following several years of declining values,” she said.
“The government’s new Entry and Reside permit is contributing to stronger enquiry levels. It allows persons who invest a minimum of $2 million in Bajan property to gain an indefinite special entry permit. To qualify, the funds must originate from outside of Barbados.
“Foreign interest remains focused on the key locations of St Peter, St James and Christ Church. The new development market is starting to pick up with a few boutique developments along the beachfront emerging,” she added.
The researcher pointed out that “larger” Caribbean markets like Barbados and The Bahamas, where residential and leisure development “had been expanding rapidly in 2007 [and] 2008, felt the “reverberations” of the global financial crisis.
And while she also noted that some islands have seen luxury prices fall by 30 per cent since 2007, Everett-Allen said “the rate of decline has slowed significantly in the last 12 months”.
“Purchasers have started to see buying opportunities in the market as some vendors have adjusted their asking prices in line with achievable values, acknowledging the effect of the global financial crisis on market sentiment,” she said.
“Critical to this turnaround has been the renewed confidence amongst buyers from Europe and the US. The eurozone debt crisis no longer represents the destabilising force that it once did for the global economy.”
But she cautioned that “despite the revived optimism there remains a large inventory of properties on the market across the Caribbean”, noting “those vendors that want to sell need to price their home realistically as buyers are highly price sensitive”. (SC)