|
From:TheBahamasWeekly.com Let's Talk Real Estate - James Sarles
An
important point to keep in mind is that it is very difficult to make
broad statements about the state of the Grand Bahama real estate because
there are many different real estate markets on the Island. There is a
big difference between raw land, lower income homes, high end beach
front homes, condos and duplexes. No one would ask you how the weather
is in the United States because that’s too general. The weather is of
course different in Buffalo, New York then it is in Phoenix, Arizonia.
So when looking at real estate we have to identify what sector of the
market we are talking about especially when looking at trends.
One
of the biggest problems we have on the island in my opinion for the
local residential housing market is lack of jobs and good paying jobs.
This lack of jobs has caused the local residential prices to fall and
the banks are being very picky about lending money. If the job market
improves you will see the real estate market in the residential market
and all sectors of the market improve. It’s that simple. Jobs create
consumer confidence and the ability for buyers to borrow money from the
banks for mortgages. Not only can people borrow money but homeowners
can pay their current mortgages. We need a little break on Grand Bahama
Island and I am hoping that the Canadian Sunwing program with Grand
Lucayan and a few other programs that we hear are the drawing board will
come to fruition. The government and the Port keep telling us about the
new investors coming so I will be positive and hope that at least one
of these new projects comes on stream soon. It will only take a few new
investors to make a big change on this little island that still has
tremendous potential.
If
you look at The Freeport News there are growing pages and pages of foreclosure homes being sold by the banks. As long as there is a huge
supply of bank sales it will be difficult for a “normal” seller to sell
their home at good prices so they can move up, move down or change
address because buyers can buy bank distressed homes at highly
discounted rates if they have cash, a good job and good credit. Real estate is about movement and without movement you have stagnation which
creates a dead market. So in light of all this we don’t need a crystal ball to tell us that there is high unemployment , an oversupply of
homes, a big supply bank foreclosures, banks not lending money and a
flat real estate market with prices going down because sellers can’t
sell due to lack of buyers.
So
the future of the residential market in the short term is going to be
more of the same for 2013 with regards to price. The good news is that
we are starting to see buyers again so we will see more transactions in
2013 and and these numbers will continue to increase in 2014 and 2015 if
the experts are right. This is a general statement of the future of
the entire market in the residential sector which does not mean that
there won’t be buyers and sellers but the market will be very
competitive and the majority of sellers will have to continue to be
patient in the residential local housing market. If you are a seller in
this sector be patient and do EVERYTHING you can to make your house
competitive in this very difficult market. Hire a professional real
estate agent and price your home for exactly what it’s worth. The
strategy of pricing a home high and letting buyers make a lower offer
can backfire. If you are a seller you are in competition with every
other house on the market and there are more homes on the market than
there are buyers hence it’s a buyer’s market.
Is
the real estate market dead? The answer is no. The real estate market
is slow in the residential sector however there are other some sectors
of the market which are showing some signs of growth. Income producing
properties, some vacation rental properties, and commercial property
are showing signs of recovery even in these difficult times. If you are
an investor with access to cash or bank financing there are really
good deals in this sector of the market. In all sectors of the market,
sellers have had to lower prices with buyers locally and from abroad
coming to our “depressed economy” looking for a deal. The good news for
buyers is that sellers are getting real and willing to take a real look
at offers. The offers are few and far between so real offers are being
considered.
|
I have been a real estate broker on Grand
Bahama Island for many years and I have a few gray hairs to prove it.
As a broker the number one question that people always ask me is what
is the future of real estate on the island. No one has a crystal ball
that can see the future exactly but with the current state of the
economy there are many factors that give us an indication of the Future
of Real Estate on Grand Bahama Island.