Today’s Editorial February 06: An economic silver lining

Among all the doom and gloom over the global economic crisis and how it has – and will continue to – negatively impact us here in the Cayman Islands, comes a good news story.

Despite the crash of the real estate market and the drying up of mortgage funds in the United States, our own realtors report the market is busy here.

This shouldn’t come as a big surprise. Prices of real estate have come down, making now probably the best time to buy at least since Hurricane Ivan in September 2004.

In addition, investors are nervous about the stock market and even banks – especially overseas banks – these days. In times like this, many investors believe that it’s not the return on their money that is important, but the return of their money.

Cayman real estate, because it is tangible and has historically always gone up in value over the long run, represents a safer investment in these uncertain days. It might take three to five years before prices appreciate enough to represent a good return, but our real estate will give a return.

Real estate here also offers a safe investment for other reasons. There is only so much land on Grand Cayman, and aside from a couple of land reclamation projects, there isn’t any more being made. Grand Cayman, with its relative safety, clean environment, modern infrastructure and friendly nature, is still a desirable place for many – Americans in particular.

Even in a financial crisis, there are still many Americans who can afford an annual vacation, and Cayman offers a warm respite to the winters up north.

Of course, now is also a good time for first-time homeowners to buy Cayman properties, or for those looking to upgrade their current home.

Credit might have dried up in the United States, but here banks are coming up with dynamic loan offers at some of the lowest interest rates ever seen.

All of this is great news for the Cayman Islands. The government is facing severe reductions in its revenue stream because of the downturn in the economy and its effects on other aspects of the financial industry. Anything the real estate industry could offer in the way of additional stamp duty revenues, would be most welcomed.

But the real winners could be Cayman residents, who can find deals now that might not come this way again for a long, long time.

Credit might have dried up in the United States, but here banks are coming up with dynamic loan offers at some of the lowest interest rates ever seen.

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