The Tribune

By ANNELIA NIXON

Tribune Business Reporter

anixon@tribunemedia.net

An over-saturation of Airbnbs and vacation rental properties is continuing to impact both Exuma’s housing market - especially long-term rentals - and its hotels.

Reginald Wood, management consultant at the Exuma Palms Resort, said many accommodations have been converted from long-term rentals to Airbnbs this contributing to the island’s housing crisis. He added that the market is not regulated and non-Bahamians have become operators in the rental property space - “a rather controversial topic here right now”.

“You build a rental property, you develop a rental property, and I guess you can rent it for long-term. If you want it to be an Airbnb... It's not regulated. So there's no quotas in place whereby you must have a certain amount of this class, for this market, at a certain amount. For Airbnb, it's just whatever you want to rent your property as,” he added.

“And that conversation can open into what is a rather controversial topic here right now, and that is who is being allowed to develop rental properties here in Exuma and The Bahamas at large. And when I say that I mean non-Bahamians, because a rental property, any income-generating property, is a business. To operate a business in The Bahamas, you need what? A Business Licence, especially as a non-Bahamian. 

“And if we got to move it from the narrow term and say, you need a Business Licence, what is the broader, more correct term nowadays is: Are there the proper permissions to operate that said business? We won't get into that here today, but then that is something that is a rather contentious issue right now.”

Mr Wood said Airbnbs and vacation rentals take away occupancies from hotels. “It affects the hotels,” he added. “We have our wonderful tourists who come in. They love the island. They say, 'Oh, I want to buy a piece of property. I want to build a home here so we can have a second home, a third home to come and visit.'

“It always starts with one. But nowadays we're not at the starting point any more. We're well along in that. And so you have hundreds, hundreds of expats here, foreigners who came, liked what they saw and bought property [and] developed it. 

“However, a vast majority of those properties are being utilised now as income-generating properties. They are being rented out as Airbnbs. These same homes the people got a permit to build a home or vacation home for themselves, they're renting their homes. And, obviously, every Airbnb night means a night that a hotel doesn't get. I mean, it's just simple math.”

Calling for the vacation rental market to be regulated, Mr Wood said that would include a collaboration between the Ministry of Tourism and Ministry of Housing.

“And from the genesis, it would also involve the Ministry of Works with the issuance of the permits to go and build these buildings because the Ministry of Works is issuing a permit for what they are being told is a vacation home,” he added. 

“So the Smith family is building a vacation home. When they come down, they can stay in their vacation home. So Ministry of Works is issuing these permits on that basis. 

“If the Smith family said: 'We want to develop this property as an income generating property, an Airbnb,' the process is totally different. Inland Revenue becomes involved because, why? There's some tax that you have to pay on that - on the income generated,” Mr Wood continued.

“The property would then be registered under... housing and tourism. It would be monitored. They would have to do reports on the income being generated, and then there's taxes owed to the Government in the form of the daily room tax and VAT. It's a whole different dynamic. Like I said, it's unregulated right now.”

Mr Woods said Bahamians unable to afford upscale, high-priced accommodations struggle to find housing in Exuma. He said there is a need for more affordable housing for the “lower budget [and] for people coming through to do work.” In recent months, Mr Wood had to source workers from New Providence to complete renovations to the hotel, resulting in a need for accommodations.

“But thankfully, because it's a hotel, we were able to utilise some of our rooms here,” he added. “Because we were closed, we had rooms unoccupied. So yes, that is a serious thing.”

Chester Cooper, deputy prime minister and Exuma’s MP, last year acknowledged Exuma’s housing crisis and announced that with Keith Bell, minister of housing, the Government is looking to build affordable subdivisions. Mr Cooper said the construction of homes in the island’s capital, Georgetown, would be announced.

“In addition, we are seeing some new builds on the island,” he said. “We will announce shortly the construction of homes in the area of Georgetown behind the Exuma Health Facility.

“This is an area where government owns extensive acreage, and we have been looking, along with the mMinister of housing, to see how we can create subdivisions in that immediate vicinity. So yes, this is an issue. It's not only an issue in Exuma – it’s an issue all across the islands.”

Mr Wood said Mr Cooper’s announcement was noble but “with government projects, the usual response is, 'We'd like to see it’.”

“We're in an election cycle so a lot of things become thought-up for the campaign trail,” he added. “We are smack dab in the middle of an election season. Not to undermine or disparage anything the DPM has said, but it is what it is. We've been doing this for a while. But it's like I said, it's very much needed, and it will be very noble. Whether it's the private or the public sector, we do need more affordable housing here in Exuma.”