The Tribune

• MLS data shows ‘turning to buyer’s market’

• Demand slows from ‘frantic pace’ post-COVID

• Available properties above $800k ‘down 20%’

By NEIL HARTNELL

Tribune Business Editor

nhartnell@tribunemedia.net

Major realtors yesterday contradicted data showing new home listings rose “up to 1,492 percent” in the 2023 third quarter by arguing that inventory shortages mean The Bahamas remains “a seller’s market”.

George Damianos, Damianos Sotheby’s International Realty’s president, estimated to Tribune Business that the number of properties available for sale at $800,000 and over was “down a minimum of 20 percent compared to what it would have been pre-COVID” due to the surge in demand experienced when pandemic-related lockdowns were eased.

While he, Mike Lightbourn, Coldwell Banker Lightbourn Realty’s president, and John Christie, HG Christie’s president and managing broker, all agreed that buyer demand has moderated from those 2021 and 2022 “hey days”, the trio also asserted that the reduction in properties available for sale will help maintain price levels and ensure this nation stays a seller’s market.

This, though, is contradicted somewhat by Morley Realty’s 2023 third quarter market report, which found there was “a significant increase in the volume of new listings” for both existing homes and land across the five main island markets of New Providence, Grand Bahama, Exuma, Eleuthera and Abaco.

The report, covering the three months to end-September 2023, agreed there were “continued signs of a market slowdown” given that “the abnormally strong market and related frantic pace” of market activity in the two years immediately following the COVID pandemic were unsustainable.

However, while closed real estate sales “appear to have returned to pre-pandemic levels”, new listings continue to increase - possibly as sellers try to catch the boom’s tail-end. The Morley Realty report said data for the six-month period covering the 2023 second and third quarters “shows signs of supporting the theory when supply exceeds demand - turning from a seller’s market into a buyer’s market”.

David Morley, Morley Realty’s principal, was yesterday said to be travelling and off-island, and could not be reached for comment. However, the firm’s analysis employs data obtained from the Bahamas Real Estate Association’s (BREA) Multiple Listing System (MLS).

While the MLS does not cover all real estate sales and market activity, since BREA has not made membership mandatory, all the large and major firms - along with all their agents - are both members and participants. As a result, it is felt sufficient data is captured by the system to make it a more than reasonable gauge of Bahamian real estate market activity and trends.

“The Bahamas real estate market data from the 2023 third quarter showed continued signs of a market slowdown primarily because of the year-on-year decline in the number of closed home sales in each of the five island markets,” Morley Realty wrote in its analysis.

“This slowdown continues from the 2023 second quarter and was expected, knowing full well that the abnormally strong market and related frantic pace seen in 2021 and the first half of 2022 could not be sustained. Even though the volume of year-on-year closed sales may be down, the volume in each of the first three quarters of 2023 appears to have returned to pre-pandemic levels.”

Turning to the trends revealed by the figures, Morley Realty added: “Another consistent market change noted in the 2023 third quarter data was the significant increase in the volume of new listings in all the island markets in both homes and land year-over-year.

“New listings of homes across the island markets in the 2023 third quarter increased quarter-over-quarter up to 87 percent, and increased in volume year-over-year up to 1,492 percent. New listings of land across almost all the island markets in the 2023 third quarter increased quarter-over-quarter up to 168 percent, and increased in volume year-over-year up to 3,250 percent.”

Morley Realty agreed that market demand will remain strong through year-end 2023, with the Bahamian economy poised “to continue to ramp up” as tourism returns to pre-COVID strength. However, it added that the increase in properties available for sale - as based on the MLS data - could impose downward pressure on prices and increase the time taken to find purchasers.

“The increase in the inventory of properties provides buyers with more selection and soon may result in an increase in days on the market, a decrease in the listing-to-sale price ratio and a shift towards lower median prices despite the apparent strong purchasing demand,” the real estate firm said.

“The data from the 2023 second quarter and 2023 third quarter show signs of supporting the theory when supply exceeds demand, turning from a seller’s market into a buyer’s market.” However, the top realtors at other major real estate firms all cited a shortage of available-for-sale inventory that they say will sustain both existing prices and a “seller’s market”.

“It has slowed a bit, there’s no secret about that,” Mr Damianos told Tribune Business of market activity and buyer demand. “I think it’s also because inventory has sort of shrunk. That’s all having an effect. It’s just normal, nothing to worry about, but maybe this time next year we’ll have a different read.

“I think from the seller’s point of view they’re saying there’s not much out there, so therefore we will ask a higher price for the property we want to sell. If it doesn’t move, time will tell you have over-priced it, but if it does move it shows you have balanced supply and demand. If you get too aggressive, the property will sit on the market for longer than usual.

“I would say inventory is down a minimum of 20 percent compared to what it would have been pre-COVID. Definitely in my space, $800,000 and above.” His two colleagues gave similar assessments of Bahamian real estate market conditions.

“It still looks good,” Mr Lightbourn told this newspaper of market activity. “It’s not what it was but it’s still going well. That’s the best way to put it.” Asked whether buyer demand was moderating to pre-COVID levels, he replied: “I think it’s still better than that.”

And, informed of data showing a growing trend towards a seller’s market, the Coldwell Banker chief replied: “I’m disagreeing with that. There’s a shortage of inventory, generally speaking.” This was echoed by Mr Christie, who said: “I think the market is still solid. I think it’s slowed down somewhat from the hey day, but there’s still solid interest and the market is still strong.”

Describing the moderating of demand as “something like”a return to pre-pandemic levels, he added: “The inventory is way down, but that has everything pushed up in terms of price. If you want to buy something, there’s not a lot out there, so you’re naturally more motivated to buy. If you wait you’re going to lose it, so we’re still in a seller’s market. Regular things coming on to the market are selling quickly if priced right.”

Morley Realty’s report showed that the number of new home listings in New Providence increased “tremendously” by 1,492 percent year-over-year during the 2023 third quarter, and by 33 percent quarter-over-quarter, to stand at 191 for the three months to end-September. New vacant land listings also increased by 1,050 percent year-over-year, and by 32 percent compared to the 2023 second quarter, to hit 115.

Abaco, meanwhile, saw new home listings increase by 725 percent year-over-year for the 2023 third quarter to reach 33. New vacant land listings on the island also rose 293 percent year-over-year, and by 16 percent compared to the 2023 second quarter, to hit 59.

Similar trends were experienced on Eleuthera and Exuma, where new home listings for the 2023 third quarter jumped by 550 percent and 600 percent, respectively, year-over-year. Vacant land sales on Eleuthera were also up 1,267 percent compared to the 2022 third quarter at 82, which also represented a 116 percent quarter-over-quarter rise. Exuma vacant land sales were ahead by 311 percent year-on-year.