This time of year is always a good time to compare statistics, in order to give a feel of where the market is heading for the year ahead and beyond. I have concentrated my study in the condos and homes around the US$1.5 to US$3 million market.
Looking at the statistics as they relate to condos on Seven Mile Beach, we see that 43 beachfront condos were sold in 2018, according to statistics provided by the Cayman Islands Real Estate Brokers Association. This figure compares with 28 sold in 2019.
The fact that the figure dropped quite considerably in 2018, I believe, actually gives a poor impression of the market on Seven Mile Beach. This is principally due to the fact that there is little inventory available, and that which is coming to the market is doing so at an increased price point, and as such, this changes the transaction numbers considerably. Also, these figures do not include pre-construction properties that have been sold. If these were included, it would bring the number far beyond 2018’s figure of 43.
I feel the market on Seven Mile Beach will continue to be strong and looking ahead, I believe prices will continue to rise as availability becomes even scarcer, even with the advent of the new luxury WaterMark and Lacovia properties. What does this say as far as foreign investment in the Seven Mile Beach market is concerned? It says this market is very solid. I would tell any prospective buyers that they should not be deterred from entering this market in this current environment because they will lose out if they do not. Now is not the time to sit on the fence; it is a time to act.
Looking at the statistics as they relate to homes between the US$1.5 million and US$3 million mark, it is interesting to note we see the opposite trend, with 24 homes sold in 2018, versus 45 homes sold in 2019.
This has been driven, in a large part, due to the fact that people are seeing value in existing structures and that they are being obtained at an appropriate price on which people are prepared to act. In the past, people looking to own a home in the luxury end of the market have been prepared to build; however, increasingly, more people are now willing to purchase an existing home, due to factors such as land costs, construction costs, the availability of desirable parcels and the time and effort involved in building. People therefore have been receptive to purchasing instead.
In addition, there has been an increase in the number of people who are looking to move to the Cayman Islands, seeking to invest somewhere offshore in a beautiful property in which to reside with their family full time.
An increase in residency applications associated with such purchases has helped this sector of the market – one which, historically, has been a difficult sell.
Offering the means by which people can reside here part of the year has meant an increase in the numbers of people coming to Cayman to enjoy the wonderful lifestyle with which we all are blessed.
The good news is that there are still opportunities within this marketplace that are good value in great locations, such as Canal Point, Crystal Harbour, the Yacht Club and Grand Harbour.
Boiling down the statistics, I would say the most important message is that if you feel inclined to purchase a property, act now or you will miss out, as prices continue to go up while inventory goes down. The time is right!
James Bovell is broker/owner at RE/MAX Cayman Islands.