Real estate in Jamaica is on fire

BY JAY BRIJPAUL

Despite the pandemic, real estate in Jamaica is booming. Foreign buyers are paying premium for high-end properties and the real estate landscape is rapidly changing. Jamaica is quickly becoming a tourist resort and a safe haven for social distancing. According to the managing director, Walter Zephirin, of Seventh Heaven Properties, vacation homes are priced from US $800,000 to US $10 Million.

Curtis Martin, the managing director of JN Bank mentioned that “Jamaica represents some of the Caribbean’s most prime real estate.” He continued to add that “coupled with an intoxicating culture and penchant for capturing and capsulating great memories, the island makes investment in property an easy decision for many who want to.”

With low interest rates, first time buyers are qualifying for bigger mortgages and this acts as a catalyst for real estate transactions. Petal James, chief of branches at JN Bank, at the general meeting of the Realtors Association of Jamaica (RAJ) recently said that “investments in the sector have been resilient and reliable for many owners as properties continue to hold their value and have even increased in worth, despite the climate. And, while some levelling off has been predicted, prices are not expected to decline.”

Pearnel Charles Jr, the Minister of Housing, Urban Renewal, Environment and Climate Chang affirmed that “the Government is focused on advancing a housing policy that should ensure that every Jamaican has access to safe, legal and affordable housing solutions, and that means developing housing that will be sustainable. It also means that we want persons to have the opportunity, access and support to buy homes and to afford their homes.” The CEO of Better Homes and Gardens Jamaica, Edwin Wint mentioned that “every crisis creates opportunities and there are good opportunities in the market for people to buy real estate now, despite the pandemic.”

Jerome Jarrett, client partner manager at JMMB Bank, said that “there has never been a better time in the recent history of real estate (in Jamaica) that so many factors are in favor of the buyer.” He further implores that “recently, the government announced a reduction in NHT (National Housing Trust) rates, making it one of the lowest rates it has ever been; … we also saw a lowering of stamp duty and transfer tax rates (last year); coupled with more affordable terms of financing, due to the highly competitive space right now.”

With the pandemic, short term rentals such as Air B&B suffocating. the rental market is depressed while real estate prices are still climbing. With more young professionals working from home, there is demand for home offices. Many are moving out of the big cities such as Kingston for smaller towns where they can enjoy bigger properties at an affordable price. It is expected that once the pandemic is over, there will be a surge in tourism, resulting in escalating rents.

Realtors Association of Jamaica (RAJ) president, Donovan Reid reiterated that “house and land prices are going up and are expected to continue doing so for some time. Reid explains that the rising price of real estate for purchase during the 2021 will come from demand still outstripping supply, as well as from the devaluation of the local dollar against its US counterpart.” According to Mr. Reid, “foreign exchange will play a big role in real estate prices, because quite a few elements within the construction sector comes from overseas. We have also taken note of rising prices for development land, which can be used to construct apartments, condos and town houses.”

As a realtor working within the Caribbean community, I must say that the Jamaica diaspora’s most burning desire is to return home for retirement “They want to feel the rain.” Azanell Properties took a giant leap forward by launching the Jamaica Diaspora Magazine. Doreen Buchannan, chairman of Azanell Properties cited that the idea behind the magazine is to unite Jamaicans around the world. The intent is to bring valuable real estate investment opportunities to the diaspora and at the same time show off beautiful Jamaica. Their on-line version will allow the diaspora to display their goods and services, thereby establishing an association where they can embellish each other.

This is a great time to invest in Jamaica’s real estate. While prices are high in the urban areas, it is still reasonable in the rural districts. With escalating home prices in the GTA and low interest rates, many are refinancing their home and using some of the equity to buy a property in Jamaica.