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Real Estate 'Buyer's Market' Suffering 30-50% Price Drops

By NATARIO McKENZIE

Tribune Business Reporter

nmckenzie@tribunemedia.net

THE Bahamian real estate sector is a "buyer's market", realtors said yesterday, one telling Tribune Business that property values were seeing a downward trend of anywhere between 30-50 per cent.

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Mario Carey

Mario Carey, founder of Mario Carey Realty, said that while many persons were eager to list their properties for sale, they often were not prepared to face the reality of having to accept much less than they were seeking.

He said: "It's always difficult to move property. A trend is that a lot of people are eager to list but not really wanting to sell. They are not really in the reality of where the property market is right now.

"We have seen a downward trend in values of anything from 30-50 per cent. A lot of people aren't willing to accept that."

Mr Carey said some factors affecting the sale of property were location, price and financial policies, notably the unwillingness of banks to lend.

He added: "Property is not moving as it used to. It's definitely been slowed, and that can be proven by the amount of property still for sale on the Bahamas Real Estate Association's (BREA) Multiple Listing Service. Even with your beachfront properties in prime locations in the Bahamas, prices have reduced by 30 per cent. That is the prime location of property. If someone wants to sell they have to reduce the price, and a lot of sellers will just not sell because they can just hold on to their property."

Mr Carey's comments come on the heels of remarks from fellow realtor Matt Sweeting, of Bahama Islands Realty, who acknowledged in an earlier interview with Tribune Business that there was "tonnes of inventory" on the Bahamian real estate market, and the industry was set to be stuck with the excess supply of real estate "for years to come".

His prognosis is backed by data from BREA's MLS, the Internet portal that allows realtors to display properties they are seeking to sell to a wider industry/buyer audience. For the 2012 first quarter, the period from January 1 to March 31, just 19 MLS-listed properties were sold during those three months, while another 500 were listed on the system.

While cautioning that the sales numbers may not be totally accurate, as property sales towards the end of March may not be entered in time to show up in the MLS listings, Mr Sweeting said the data it provided was "a fairly good indication of what's happening in the market".

William Wong, owner and president of William Wong Realty, told Tribune Business yesterday: "There are probably more sellers than buyers right now. The banks are tightening up on the credit, so people are having difficulty qualifying for these loans.

"Construction is such a vital part of our economy. If people can't sell land, they can't build houses. The prices, I think, are competitive. I think the developers are trying to move them because it's no good for them to be sitting on them. It poses a big problem. Most sellers are willing to negotiate their price; they aren't going to give it away but they are willing to take something off the price. I don't think there are many fire sales. They are not going to give it away, they are going to sit on it."

Mike Lightbourne, owner of Coldwell Banker Lightbourne Realty, told Tribune Business: "It's a buyers market, and that's usually how that happens when you have got more sellers than buyers.

"I would say that the biggest buying opportunities are in the high-end properties, and particularly in the Out Islands. I think we will sort of be in this scenario for the next two to three years. People have to understand that sales are happening, but not at the higher prices that were achieved three to five years ago. People were buying like crazy, Bahamians and non-Bahamians."

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