Demand for real estate in Barbados remains low, resulting in a significant fall-off in prices in some segments of the market.
This assessment from Terra Caribbean, a leading real estate company, which carries out research on the industry yearly.
Speaking to reporters today at the launch of the company’s annual publication, The Red Book, Chief Executive Officer Andrew Mallalieu said they had noticed an increase in supply in some segments of the market in recent times as a result of the lower demand.
“Real estate prices have fallen and they have fallen significantly in Barbados in certain segments. Certainly, residential land for Barbadians could have fallen between 20 and 40 per cent,” said Mallalieu.
“Separate a few things and you look at residential land for Barbadians, the prices have come down significantly and that is as a result of two things: one, our economy is terrible and two, the amount of supply coming on the market has increased significantly.”
“So at the same time we see a fall in demand, we see an increase in supply and that has affected prices,” he explained.
He reported a different case with beachfront properties, with prices being stable in some cases and, to a lesser extent, improvement in others.
Pointing to a chart showing the beachfront condominium price index between 2007 and 2014, Chief Operating Officer Hayden Hutton said condos on the west coast generally netted a higher price per square foot, compared to condos on the south coast.
“Throughout the downside of the market, it seems as if the south coast condo product has been more resilient and has held their values more strongly than the west has. There are various factors that influenced that, (including) the quantity of supply. We hold the view that there is an undersupply of condos on the south coast market,” said Hutton.
Although he could not say if there were more people putting up their properties for rent because they were unable to sell them, Mallalieu said “there are certainly more properties for sale than perhaps we have seen in the past, and there are perhaps more properties for rent as well. It is a reflection of the general market conditions”.