The Tribune

By NEIL HARTNELL

Tribune Business Editor

nhartnell@tribunemedia.net

A Bahamian realtor has renewed his call to raise the threshold above which foreign home buyers can qualify for permanent residency to $1m as part of a strategy to “take the strain” off raising taxes.

Mario Carey, founder of Better Homes & Gardens Real Estate MCR Group, told Tribune Business that - besides increasing the present $750,000 benchmark - the Government should also mandate that foreign purchasers contribute at least $250,000 to financing social needs and help to build the community of which they are now part.

Suggesting that such contributions can be made via investments in government securities, such as Bahamas Registered Stock, he argued that the current threshold “hasn’t kept up with the cost of living and inflation” and needs to be increased given the post-COVID hike in construction costs.

“I still believe the $750,000 for entry level permanent residency, that number should go up to a minimum of $1m with a further $250,000 invested in a sovereign wealth fund or government bonds to help social services, the elderly, education, special needs, feed the population. Anything to help the people,” Mr Carey told this newspaper.

“Real estate can be the vehicle to do that, especially with that entry level price. Residency is a golden ticket. Raise the bar and they don’t have to keep raising real property tax. The market could absorb another $250,000 in the permanent residency requirement. For people coming offshore for estate planning, tax purposes, $750,000 is a bargain.

“It hasn’t kept up with inflation at all. Since the pandemic came in, building costs have gone up by 30 percent. It hasn’t really moved with the times. The permanent residency programme has not kept up with the cost of living. It’s a huge opportunity for The Bahamas, and takes away the strain of raising taxes.”

Mr Carey added that such reforms would put an end to foreign buyers acquiring Bahamian real estate, obtaining permanent residency and then ‘flipping’ or immediately selling on properties and exiting the jurisdiction without contributing anything to community building.

Meanwhile, he told Tribune Business he feels “very bullish” on the Bahamian real estate market’s prospects for 2024. “I think we’re showing healthy signs for 2024,” the Better Homes & Gardens Real Estate MCR Group founder said. “Just talking to a lot of my client base, they are feeling very comfortable, very positive barring no COVID issues, no world war issues. Nothing drastic.

“It seems that the general consensus is that hard assets is the name of the tune, moving money and digital assets into real estate and gold. Real estate, we don’t make any more of it. The Bahamas is a testament to the tourism industry, maybe nine million visitors last year. The Bahamas is in a fantastic position with airlift. Stuff is moving. There’s a lot of interest. I feel very bullish.”

While the Nassau and New Providence market will continue to perform well, Mr Carey voiced concern that “prices are creeping up for the average Bahamian” and, as result, it is “becoming more difficult” for locals to afford their own home and become property owners.

With financing coming back to Abaco, he added that islands such as Exuma and Eleuthera are also poised to do well. “I think that if there was a website listing all the major projects going on in The Bahamas it would be pretty impressive,” Mr Carey said.

“I see people who have left The Bahamas now coming back. They are mostly expatriates who have tried some other places and are now coming back because they kind of miss it. I would think the market this year will probably be stronger once we can meet demand with inventory. Once we can sustain that I think we will have a good if not better year.

“People feel very confident. There’s a lot of money out there. Money trying to find places to go. We’re also getting the sense that the crypto market is seeing some recovery from the FTX collapse. There’s a lot of positive signs. Bitcoin has gone up quite a bit in the past couple of months which is goods news.”