Dennise Williams, Staff Reporter"It seems like the real estate market has gone crazy. I read the classified ads and I know that everybody has gone stark, steering mad."
Betty Wright,a 49-year-old former model turned author has had enough of the current real estate market.
"At first, I was targeting a townhouse for $6 million but when I saw houses advertised in Waltham Gardens for that price, I know things gone. In fact, when I call agents to show me properties in my price range, all they do is carry me straight into the gun mouth. It is an insult to people. It is my money that I work hard for. I won't live in rubbish."
For her, the "gun mouth" refers to areas most of us would call 'depressed' neighbourhoods Seaward Gardens, Seaview Gardens and Whitehall. In fact, Ms. Wright believes that real estate agents contribute to the problem of high prices in the real estate market.
market forces
But those in the real estate industry say that what is facing prospective purchasers like Ms. Wright is the simple market forces of supply and demand. As the demand is great, it puts vendors sellers in the driver's seat.
General manager of JN Real Estate, Jackie Peat-Smith explains: "There is a gap in the $4.5 to $12 million range. Sellers are pushing the button and testing the market. This squeezes out a lot of people out of a position to negotiate." Mrs. Peat-Smith notes that the frustration is not just limited to Jamaica.
"We have a number of calls coming in daily from the overseas Jamaica National Building Society clients who want to buy houses in the $6 - $12 million price range. We just cannot fill the demand."
Marketing Manager of Century 21 Heave Ho Properties, George Cumming said: "Agents cannot force a property to sell for more than it is worth. If a house is in a $10 million neighbourhood, and we price a house at $12 million, it won't sell; and it makes us look stupid. That said, in areas like Kingston 6 and 8, there isn't anymore land and that's where everyone wants to be, so it puts the vendors in the driver's seat."
According to an agent who declined to go on record, another factor driving the pricing of properties is that many vendors look at the cost of newer developments when pricing their existing properties. For example, when a seller has a property that he might have considered selling for $8 million but sees similar new properties being sold for $18 million, he must in turn sell for $18 - $25 million to play catch up.
Mr. Cumming agrees. "Even fixer-uppers are priced like well-kept houses these days."
However, outside the Kingston Metropolitan Area, new housing solutions are on the horizon.
Mrs. Peat-Smith says: "Several developers are scurrying to get approvals to build middle-income properties in communities accessible to the highway. Areas such as May Pen, Mandeville, Santa Cruz and Ocrabessa are areas that developers have their
eyes on."
Mr. Cumming agrees. "We too are advising developers to look at tracts of land by the highway. We are encouraging developers to create Mona and Hope Pastures-type housing schemes that cater to professionals."
However, for people wanting solutions now, some amount of practicality must prevail. Mr. Cumming says: "I advise
people to buy a property even if it is a tiny studio. Get your foot in the door as soon as possible, even if it is in Portmore. The price will rise and that starter property can finance the purchase of your dream home."
Mrs. Peat-Smith also offers practical advice: "Let us take a first-world approach to boost your cash holdings. If you have cash on hand, develop a plan to put yourself in the position to be able to purchase the house you want. The key is to look for the appropriate savings and investments that balance your risk tolerance and the time frame you give yourself to buy property. Planning and consistent savings towards your goal is what is the key. Set your sights on a price point and save towards that."
For Ms. Wright, her decision is quite simple: "In the meantime, I will continue to rent."
Name changed.
