By NEIL HARTNELL
Tribune Business Editor
Top realtors believe the Free National Movement’s (FNM) election victory has delivered an instant boost to business and consumer confidence, and expressed hope the new administration will produce a more efficient and transparent approvals process.
Peter Dupuch, head of ERA Dupuch Real Estate, told Tribune Business he could “already see” Bahamians had more confidence and “faith in the future” within 48 hours of the FNM’s overwhelming election win.
He argued that the Bahamas had needed a change in political direction “to stop the road we were going down”, and instead create an environment where the private sector could “thrive”.
Mr Dupuch also expressed optimism that the Bahamian real estate market would experience a post-election uptick, after pre-poll uncertainty resulted in many potential buyers “holding off on pulling the trigger”.
His sentiments were echoed by Mike Lightbourn, Coldwell Banker Lightbourn Realty’s president, who told this newspaper that the Perry Christie-led administration had “done everything to hinder business”.
He added that the Bahamas, and its people, were increasingly feeling as if “everything is wrong going right down the line”, with the problems facing the country getting worse rather than better.
“I think this government is going to be easier to do business with,” Mr Dupuch said of a Minnis-led administration, “and I just hope it will be easier to get things pushed through in a reasonable amount of time.
“I’m not suggesting anything special, but people get frustrated, and buying and selling a home is already a long process. To get foreign investor approvals always takes a little more time.”
Foreign purchases of Bahamian real estate have to be approved by the Investments Board, in accordance with the International Persons Landholding Act, while residency permits have to go through the Department of Immigration.
Khaalis Rolle, former minister of state for investments, said the Investments Board had met more frequently when necessary to deal with the volume of applications, and other processes had been implemented to speed up approvals.
However, Mr Dupuch revealed that concerns over the efficiency and transparency of the approvals process continue to persist.
“I was shocked when I spoke to a couple of attorneys,” he said, “and one told me they had been involved in selling a $7 million house and had to facilitate a permanent residency application.
“It had been a year since they applied, and they had not heard from the Government. I hope it does not take that long, they eliminate the red tape and everything is on a level playing field.”
Mr Dupuch added that the real estate market had slowed pre-election, as uncertainty over the outcome prompted potential buyers to hold back.
“There were a lot of people we were showing properties to, and they were right there, ready to pull the trigger, and just holding off,” he told Tribune Business.
“I even heard comments that: ‘I’ve moved away, but maybe I should move back now’. I think we had a brain drain going on.
I know people were sitting on the sidelines, wanting to buy a house, but didn’t know what was going on with the country. Now, hopefully, they can set down roots. I hope that happens. Our economy sure needs it.”
Mr Dupuch acknowledged that the real estate market still faced obstacles when it came to banks’ reluctance to advance mortgage financing, and the number of things that “can go wrong” in completing a transaction, but expressed optimism that the FNM’s victory will bolster confidence.
“I think people will have more faith in the future, and I can see it already - in two days,” the realtor told Tribune Business. “I think there’s been a good impact on confidence.
“It just shows you how uncertain people were. I didn’t realise. I had someone tell me today that this was the first time he’d voted against the PLP, and they’re my age.
“It was a change we needed; a change that was needed to stop the road we were going down, and hopefully we will go down a new road now. I think it’s going to be great.”
The private sector over the last five years has had to contend with Value-Added Tax’s (VAT) imposition; increased bureaucracy and red tape that has led to the Bahamas dropping to 121st in the World Bank’s ‘ease of doing business’ rankings; Tax Compliance Certificate (TCC) demands; and worker-friendly labour reforms that were watered down at the last minute.
This all served to further chip away at an already-fragile business and consumer confidence, which resulted in private capital pulling back from job-creating investments and expansion. This, in turn, helps to explain why the Bahamas has seen no GDP growth for the last four years, with unemployment remaining in the ‘double digits’.
“That’s what we have to do; facilitate business,” Mr Dupuch told Tribune Business. “We have to make business thrive. They employ people. Businesses have to thrive. If you stifle business, you stifle the country.”
Mr Lightbourn, supporting Mr Dupuch, said the FNM’s election victory and change in government would send a positive pro-business signal to both Bahamian and international investors.
“I think it presents a positive outlook to the outside world because they, the Christie administration, were doing everything to hinder business,” Mr Lightbourn told Tribune Business.
“I think we’ve got a more positive business outlook for the country, which entails real estate and everything else, local and foreign.
“The ease of doing business for Bahamians and foreigners is terrible. It’s so incredibly challenging, which is why I’m hoping the new government will get things done in a more businesslike manner, rather than sitting on their asses waiting for things to be done.”
The former Christie administration’s plans to tinker with the real estate market’s foreign segment, by increasing the permanent residency investment threshold from $500,000 to $1 million, also aroused concern from developers and realtors alike.
The previous government eventually backed off to obtain further advice and feedback, but Mr Lightbourn said: “Things had really gotten bad. The country was feeling as if everything was going wrong; as you go right down the line, everything was going wrong.
“We are 121st in the world for ‘ease of doing business;’, and it is not getting better - it’s getting worse. Everyone’s got their hand out: ‘Want a quick approval, see me’.
“I’m just hoping a new outlook will see people get permits to do things properly. It’s been so bad, the business climate, that it can only go one way, and that’s up.”
Mr Lightbourn confirmed Mr Dupuch’s assessment of the real estate market, noting that activity had “recently slowed up” following a relatively strong start to 2017.
He added that an impending election, and the identity of the party in power, should make no difference to foreign real estate buyers, but “the vibes going out about the former government weren’t that positive”.