Real estate market valued at $80b - Realtors bullish on growth in 2014
Published:Friday | March 7, 2014 | 12:00 AM
Tameka Gordon, Business Reporter
Jamaica's real estate market recorded transactions valued at about $80 billion for the fiscal period ending March 2013 bolstered by investors in search of alternatives to prevailing low interest rates and low returns, industry experts say.
High-end properties did not fare well for the review period, with the prevailing buyers' market opting for properties within a $20-million to $25-million price point.
The real estate market continues to see a general housing shortage with sales within the low-income segment doing extremely well, industry experts say.
"We find that persons who were able to keep the market going last year were those looking for opportunities to invest because of the low interest rates at banks, which saw them wanting to move their money to real estate to get a good rate of return," said president of the Realtors Association of Jamaica, Carlene Sinclair.
Data obtained from the association shows that from April 2012 to March 2013, a total of 9,286 properties were transferred with a corresponding value estimated at $80 billion.
low mortgage rates
Within the current fiscal period, the number of property transactions totalled 5,989 up to October 2013, valued at just under $54 billion.
Managing director of Century 21 Jamaica, Deborah Cumming, says the market is showing signs of recovery from its slump - pointing to increased listings as developers respond to demand for middle-income houses.
"Basically, what we are seeing is that there is a lot more activity in the market," Cumming said.
"The market is also price-driven because we also get multiple offers on properties, depending on price point," the Century 21 executive said, but noted that the sector was still a far way from reverting to a sellers' market.
The performance of the real estate sector was further spurred by the low mortgage rates with the leading mortgage providers engaging in fierce competition to attract customers fed by the prevailing buyers' market, according to Sinclair, who is also a broker with Property Solutions Limited.
"There are a lot of changes in market trends," said Sinclair, while noting the "downsizing" of many persons from larger homes to town houses.
"People want gated complexes because of the security concerns and town house prices are appreciating in value because of the greater demand," she told the Financial Gleaner.
Consumers further seemed to be more accepting of communal living, opting instead for shared maintenance costs, the association president said.
Cumming adds that apartments "are where it's at". The Century 21 head noted a stronger market demand for apartments than town houses, due both to affordability for purchasers and developers seeking to maximise on land space.
"Many developers include a block of apartments even in a development of town houses," Cumming said.