March ushers in a fresh season and with it, distinctive real estate dynamics.
Both are “trending’ right now as we all felt this time would come. Market jitters exist for sure though not as dire as most would think. There have been about 65 price reductions in CIREBA in the last month: over half of those – interestingly! – are on properties priced over $1M. About 25 are luxury, high-end residences in places like The Ritz, Water’s Edge, Yacht Club, Crystal Harbour, etc.
Buyer demand remains strong for homes closest to George Town and on the Seven Mile Beach corridor – but savvy buyers are keeping their budget to the $1M or just under that. As always and now more than ever, cash buyers are putting in lower-than-list-price offers and getting great deals. Sadly, bank repos are coming too and cash buyers are waiting in line to get those distressed/urgent sales. Land inventory is still low and buyers are desperate to buy with little luck of finding affordable house lots.
Bank rates are literally the main culprit in our real estate situation. Again we will say if banks offered fixed rates we wouldn’t have the problems on our hands that we are facing. They have created their own problem: by raising the rates almost every single month, they have made mortgage payments harder to pay for people already struggling against inflation, cost of living and no raise in pay. Banks are now asking for more money down due to the ‘fragile market’ making buying property very difficult and many Caymanians find themselves unable to get a home of their own (or even a piece of land!). The rising rates also mean that landlords have had to raise rates to cover their debt-service. It’s a trickle-down effect that is purely in the banks’ hands to control. Perhaps Government should be stepping in to mandate the rates banks charge and put the control of the economy into the hands of the consumers, and not the banks themselves. Unfortunately banks are single-handedly controlling our entire economy in every single way.
There is plenty for the investor to consider with Cayman Real Estate – pre-construction projects abound and show no signs of stopping. West Bay has seen quite a bit of new offerings – from waterfront luxury to mid-priced condos close to the bypass roads. East End and North Side are both hopping with construction activity. The one good thing to note is that Cayman Kai (the proper area) is done with development as there is no more land to acquire, so values will continue to grow or hold their own. Hopefully the Kai area will continue to maintain it’s quaintness and charm in the face of a changing world
Grand Hyatt is nearly 90% sold out; Curio by Hilton is going up fast, One GT in town is humming along, Camana Bay continues to expand commercially and residentially and WaterMark is a phenomenal luxury residence that takes up both sides of West Bay Road, complete with an elevated walkway ala the old Hyatt Regency and Mandarin Oriental in Beach Bay sales are HOT. Cayman is a safe place to live and invest and people that live here and all over the world know a good thing when the see it. We aren’t immune to problems but we always thrive and grow whatever the state of the global markets.
It’s simply that owner’s decision and our market clientele is mixed with locals and overseas owners each doing what they need to do for their portfolio. Personally, we wouldn’t let interest rates affect your decision if you feel it’s the best one for you: over a 20-30 year mortgage period, you’ll roll through many waves of rates and when they go down, inventory will change and you don’t want to have ‘buyer’s’ or ‘seller’s’ remorse!