Barbados Property Market Report
November 2009
Over the past twelve months, the effects of the economic downturn around the world have washed onto the shores of Barbados and have, especially over the past six months, made their presence known in the Barbados property market.
The 2009 Barbados real estate market can be described to date as thin—the total number of transactions has been reduced across the board: luxury, residential, property investment have all been affected by the changes in lending practices and the changes to the buyer profile.
We are seeing first time buyers who have been left out of the booming market until recently approaching cautiously, with the majority of the local demand coming for small plots of land or single family homes.
The characteristics of those looking to purchase property in Barbados have changed. The buyer is now less spontaneous, more opportunistic, more specific on what they are looking for and how much they are willing to spend, and are demonstrating a higher level of due diligence before they purchase. In general vendors are showing themselves to be moderately responsive, with those who own leveraged properties obviously the most willing to bargain.
The Luxury Barbados Property Market
Property prices in the luxury residential side of the market have discounted on average by 25-30% against 2008. Buyers who rely on mortgages for luxury purchases are no longer buying as a result of changes to banks’ lending practices. The low value of the pound (relative to the USD and BBD) throughout the earlier part of the year was also a major factor for the buyer to consider.
Beachfront Barbados Properties
There is significant inventory of apartments, so buying opportunities favour those who are looking for beachfront investments of this type.
The Market for Residential Property in Barbados
The residential market is also experiencing discounting, but less than what is being reported for the luxury end of the market. Banks have lowered their residential mortgage rates by 1-2% over the past year. The decrease in interest rates, coupled with the discount in property prices, makes this an opportune time for buyers—especially in cases where the sellers may be distressed and looking for a quick sale.
Barbados Property Investment
Major Caribbean banks have reduced the lending limits for real estate loans and in some cases have eliminated real estate loads for the time being. The current lending limit does not allow for any new developments to take place, unless they are fully funded.
Forecast for 2010:
We anticipate that with a strong pound, low interest rates, Europe coming out of recession, Canada standing on strong footing and Barbados being the choice destination that the number of property transactions should increase throughout 2010.
The Grove, Barbados:
The new development we have in mind is ‘The Grove’ - the new townhouses adjacent to the planned Limegrove Lifestyle Centre in Holetown, St James.
The residential component of the Lifestyle Centre is The Grove. The first 8 hillside villas (townhouses influenced by loft living) have just been launched - the show home has not yet been completed and we have sold 2 units and have an offer on a 3rd. The list price is US$1.325m. The show home we expect to be open to the public in the first quarter of the 2010 calendar year. These units are very spacious with 3,433sqft of living space - including a private patio pool on the ground level.
The Limegrove Lifestyle Centre is the most exciting development in Barbados at this time- it is the first ever mixed use development: live/work/entertainment. Many major brands have already committed to the retail aspect of the project including: Louis Vuitton, Ralph Lauren & Cartier.
See Also: Barbados property market report (1), Aylesford International (1)
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