Market overview – US and Cayman
Cayman’s traditionally busy winter season generally sees an influx of visitors from the United States, all keen to escape the cold weather and enjoy some sunshine during the bleak winter months. We have already seen a healthy start to our tourism season, kicked off last month with a well-attended Pirates Week festival.
This year, I believe we are most definitely at a turning point in the market, with a higher than average demand already showing for condominiums on Seven Mile Beach over US$3 million and the mid-to-high range of residential homes with canal fronts and other splendid amenities in the US$1.5 to US$2 million price bracket. And demand is not only coming from overseas investors, but locally as well, as residents seek to upgrade their homes and put down roots.
It is my opinion that demand for such properties will move quickly in the coming months, so if you are looking for a home in this price range I would suggest you lock into a price now, before an increased market appetite drives prices up.
This positive outlook is mirrored in US house sales statistics at the moment, with prices remaining higher all year than during the same timeframe in 2011. In the recently released RE/MAX National Housing report, it states that the median home price rose 2.1 per cent higher than the median seen in October 2011 and this continued the trend that saw nine months in a row of higher prices each month versus the same month a year ago.
In the report, Margaret Kelly, chief executive officer of RE/MAX LLC, said, “2012 is looking like the turnaround year for housing, with significant increases in sales and prices. However, we recognise that this recovery is still fragile and dependent on more reasonable lending and regulation. If qualified buyers can obtain mortgages and more inventory comes to market, this recovery could become even stronger next spring.”
Positive moves for the industry
Now that the old Hyatt hotel is finally being dismantled, I believe we are beginning a new era for Cayman’s tourism product. With the prestigious Hilton chain creating a brand new offering in its place, and the old Courtyard by Marriott eventually to become a Kimpton hotel, I believe the Cayman Islands is seeing the much longed for rejuvenation to its product that bodes well for strengthening the industry and thereby, the economy as a whole. A higher inventory of rooms means more visitors, which will mean more buyers.
In addition, it was recently announced that the Grand Caymanian resort is to become a Holiday Inn, substantial investment has taken place in the Grand Cayman Marriott Beach Resort, as well as in the Westin Grand Cayman Seven Mile Beach Resort and Spa and the Comfort Suites.
The Ritz-Carlton, Grand Cayman was also sold at auction just recently to a US-based private equity firm and construction began this year on Morritt Properties’ East End resort development, The Londoner, all positive moves that enhance tourism here.