By all accounts, the residential real estate market in the Cayman Islands is in boom territory, as demand increases, the economy continues to be healthy, and consumer confidence is on the rise.
Property sales have set records over the past two years, and it’s a seller’s market, said Jeanette Totten, president of the Cayman Islands Real Estate Brokers Association and co-owner with her husband Robert Totten of Cayman Luxury Property Group.
“Properly priced properties tend to sell quickly,” Totten said. “Even in this market, buyers know if something is overpriced, and so they will not even make an offer on it.”
There is a consensus among brokers and real estate agents that the most action is in properties along Seven Mile Beach and in South Sound. And, “anything oceanfront,” said Heidi Kiss, broker and licensed partner, Engel & Völkers, Cayman Islands.
“Seven Mile Beach is always robust,” she noted, adding that now, “West Bay is doing well … as it is so close to many of the hotels [and] hotel staff like the short commute.”
Totten said, “West Bay has become more popular for people purchasing investment affordable rental properties. With the bypass, it has become an easier commute than going east.”
Kiss said one-, two- and three-bedroom condos are selling well for family homes and vacation rental homes and are also selling well for rental income properties.
While the popularity of Seven Mile Beach has long been established – and continues with such new developments as Aqua (Bronte Development), Seacrest (The Butler Group) and The WaterMark (Fraser Wellon) – Kim Lund, owner/broker at RE/MAX Cayman Islands, pointed out that homes and condominiums are also being developed opposite Seven Mile Beach. These include Stone Island Residences (Fraser Wellon) and Olea (Dart Real Estate and NCB Group), among others.
Meanwhile, other areas of Grand Cayman are now seeing plenty of new development.
“In South Sound and Grand Harbour, the residential development is prolific,” Lund said.
In Grand Harbour, or across from Grand Harbour, for instance, Arvia (Davenport Development’s luxury canal-front condos), Aura (NCB Group’s ocean-view condos), Grand Palmyra (Palmyra Developments’ housing for “active families”), Indigo Bay (luxury villas by Charlton Developments), and Paraiso (on North Sound, developed by Trident Properties) are all scheduled for completion in 2020. All phases of Periwinkle (a sustainable community close to Grand Harbour, developed by Periwinkle Ltd.) are set to be completed by 2022.
South Sound is seeing new development in FIN (luxury residences by Mike Ryan and Dale Crighton), South Bay Residences (Palmyra Developments), The Sanctuary (a boutique development by TerraMare Properties, John and Robert Hurlstone), the Tides (NCB Group) and Vela (Davenport Development).
Other areas of Grand Cayman, including Savannah, Red Bay/Prospect, North Side, East End, Bodden Town, Rum Point, Governors Harbour and Cypress Pointe North/Crystal Harbour, are also seeing new development.
Even so, “We still need at least 3,000 more condos and homes in the next several years,” said Kiss. “We still have a shortage of housing, and that will continue.”
Engel & Völkers’ “January 2019 Month End KISS Real Estate Market Report” states that there were 1,497 properties listed on CIREBA for all three islands. Ninety-six listings are pending, and 209 are pending/conditional. According to the report, there were 119 new listings in the past 30 days, up from 50 last month, and in the past 30 days, 49 properties sold and closed.
The robustness of the market is underscored in the market review for 2018 by Coldwell Banker, which cited CIREBA statistics that “the average sales price for all properties sold this year by November 2017 was US$650,000.
“That is a very impressive average,” the Coldwell Banker review states, “considering it covers all types of property.”
While lower inventory and rising prices may have set the stage for new development, there are many reasons for the growth.
“Many buyers are existing residents and frequent visitors who are seeing real estate as a good investment, as well as a residence,” said Lund. “Rental rates are similar, in many cases, to what a homeowner would pay monthly for their mortgage, and now with real estate appreciating well, purchasing a home has become more attractive, especially with so many new developments offering a good choice of locations, prices and residential styles.”
Totten noted, “the prosperity of younger people who are now wanting to own their own homes.”
Kiss and Totten said buyers tend to be North Americans, with Totten adding that “stability, no VAT (value-added tax) or property tax like The Bahamas, for instance, and a high standard of living” attract buyers to Cayman properties.
Kiss cites “consumer confidence, clean water, low crime rate, amazing restaurants, and our government is stable, proactive and is getting things done” as among the drivers of increased interest in local residential real estate.
All agree that the future, at this point, looks bright.
“With several new high-end developments already underway, the Cayman Islands’ status as a luxury real estate destination in the Caribbean will further solidify in 2019,” Anthony Hitt, president and CEO, Engel & Völkers Americas, wrote in an article published in Forbes magazine in February.
Hitt also noted that GDP growth in the Cayman Islands “was reported to have increased 2.8 percent in 2017 and was projected to grow another 3 percent in 2018.”
As long as the economy remains healthy, the real estate market should continue to do well, brokers said.
“I don’t think [the market] will rise as quickly as it has in the past two years,” Totten said, “but instead it will be a more steady increase in prices and sales.”
Kiss noted that, “Typically, Cayman has not had the sharp increases in prices. We are slow and steady, what every long-term investor is looking for.”
Lund added, “As long as any future economic slowdown is not a major recession, the local and overseas demand for property and the ongoing growth in our population and tourism indicates that we should see sustained growth over the next five to 10 years.”