For many months I have been writing about the changing tide when it comes to buying Seven Mile Beach properties, reminding prospective buyers that prices are rising and the volume of inventory is diminishing quickly. This means that the window of opportunity for buyers is narrowing, so action is needed now to avoid disappointment.
To underscore the shift in focus from a buyer’s to a seller’s market, I think it is useful to look at sales from a particular condominium complex located on Seven Mile Beach – the Meridian, a gorgeous upscale development built in 2005, of which there have been three sales in recent months.
On Oct. 28, 2016, a three bedroom unit of 1,923 square feet sold for US$1,850,000, having been on the market for 626 days. A similar sized three bedroom unit sold on March 14, 2017, for US$1,995,000, having been on the market for just 62 days. On Sept. 22, 2017, I sold a similar sized three-bedroom unit sold for an impressive US$2,325,000, having been on the market for 196 days. Other examples include a unit I sold at Villas of the Galleon (a two bedroom) that went for full list price of US$995,000, and four units at Plantana that sold over the same time period with each one selling for a higher value, as further evidence that the prices have changed.
The clear appreciation in value for these properties is evident.
In these instances, the buyers have been savvy people who understand the market and who can relate as to the seismic shift on Seven Mile Beach that is currently taking place. These buyers appreciate that the market has changed and have been willing to pay the new market price, which may seem like a premium for the property. These buyers epitomize the type of buyer who I have seen of late; these are individuals who have educated themselves about the Cayman Islands real estate marketplace and who perhaps own more than one property in Cayman, building their portfolio of attractive Cayman Islands assets. Generally, they are a mix of residents and overseas buyers who have studied the movement in the local market and who are prepared to pay current prices, realistic in their understanding of market pressures that are producing ever-increasing price points in the Cayman Islands.
It is my view that buyers in general need to wake up to the fact that we are now in a new pricing structure and, as a result, it is important to encourage would-be buyers that they need to act now, otherwise the opportunity might be lost for them. If you are interested in buying a property, search for an agent who can give you good price comparisons and take heed of their suggestions. Look for someone with an acute local knowledge of the market to ensure you are given accurate information from which you can base your investment decisions. Timing has never been more crucial, as people become more aware of this increase in prices. Inventory just is not available any more, hence the flexibility in pricing is almost non-existent.
Smart Seven Mile Beach clients are seeking an asset that will work for them. We are fortunate that Cayman has had consistent market appreciation and we have not felt the impact from economic downturns in other parts of the world. They want one that will show steady appreciation, one that brings a return, does not cost too much to maintain (or net zero), one that can be locked up and left for periods of time and one that will work well for themselves and their families over the coming years. They realize that they have this in a Seven Mile Beach property and are willing to pay the price for this valuable asset.
New Development: Stone Island
Stone Island is the address in the Yacht Club community. Three model homes have been completed and show off the different upgrade options. Buyers experience this high-end project with all the top-class finishes, fixtures and fittings we have come to associate with Mr. Wellon and his team as a lifestyle producer. A draw for families, this gated community will feature townhomes from US$2,300,000 and up. The developers have taken great care to cultivate a real community feel to this location, with a communal pool area for residents (in addition to their own private pools), a gym, tennis courts and entertainment area, and a clever design so that any disturbance by traffic is kept to a minimum. All of this on your own secluded island, overlooking the waterfront. At this writing, I am pleased to report that Stone Island has already sold five units and have another three in process. Phase 1 will have a move-in date of mid-2019.
New Development: Rum Point Club
Rum Point Club, a brand new development, is currently breaking ground in the district of North Side, thereby filling the luxury condo void that currently exists at the location. The Rum Point Club has already shown that the market for such a development is ripe, with 36 units in total and 13 under contract … 38 percent sold.
Construction for the foundations is under way for this beautiful, contemporary set of units, with a March 2019 move-in date. The range of condos is impressive, with one, two, three and four-bedroom options available, and second floor units have access to pool and the beach from a balcony.
These condos will make ideal vacation homes and as such, a luxury rental booking agency contract has already been signed to ensure that owners get the best service of their investment.
James Bovell is broker/owner at RE/MAX Cayman Islands.