How’s the real estate market? This is the question that every professional realtor gets asked at least a couple of times every workday. It doesn’t matter if the economy is booming, we are in the middle of a pandemic, or the world is in war. Real estate is always in the mind of those that want to make some money.
Regardless of the coronavirus, 2020 is no exception, and many people want to know how’s the Caribbean real estate market, what are the current trends, what is to be expected short term, what is to be expected long term, and so on.
If you talk to seasoned realtors at Caribbean Escape, they will tell you that there are things in motion. Some trends started in the summer, whereas others are in their initial phases.
Another thing that you can learn from a seasoned realtor is that it is not one market. The term “Caribbean real estate market” applies to a wide region where there are more than 700 islands, cays, reefs, and islands. The Caribean are organized into thirty territories that include twelve sovereign states, dependencies, and overseas departments.
Each sovereign state, overseas department, or dependency, has its laws, regulations, and economy. As a result, there are notable differences between the Caribbean islands. Some islands are highly developed, featuring incredible infrastructure and a high standard of living. In contrast, there are certain Caribbean islands whose infrastructure is undeveloped, poverty is high, and crime rates are even higher. That makes it quite difficult to speak of a united Caribbean real estate market.
On a positive note, all Caribbean islands are blessed with exceptional natural beauty, long sandy beaches, and one of the world’s most amazing seas. Almost by default, locals are relaxed and easy-going people, even in the islands where the standard of living is not as high as it should be.
But, if we look at the bigger picture, we can find a few common nominators that influence the real estate markets in all Caribbean islands equally. These are Caribbean real estate 2020 trends that will be felt across the entire region. Here’s what we got.
Caribbean Countries Reopening For Tourism
This is the single biggest trend that will profoundly influence the Caribbean real estate market, from the Bahamas to Trinidad & Tobago and all the islands in between.
Almost every Caribbean country is opening its borders for tourists. As expected, passengers need to meet certain conditions to enter the respective Caribbean countries. For some Caribbean countries, a negative PCR COVID-19 test within a certain period of departure is needed. Some countries don’t ask for negative PCR COVID-19 tests, but they ask for the tourists to purchase premium health insurance. Then some accept tourists only from some countries and regions.
Caribbean countries heavily rely on tourism. Reopening their tourism capacities can only boost their real estate sectors. It’s too early to tell how big that boost will be.
Real estate prices started increasing the moment the first tourists hit the Caribbean shores. More tourists equal higher real estate prices and the other way around.
The Luxury Market Has a Life on Its Own
It’s not that the luxury markets in the Caribbean didn’t take a beating during the pandemic, just that it wasn’t as severe as other segments of the real estate markets. Almost across all Caribbean islands, the demand for prime real estate was far from flat, especially from overseas investors from the US, Asia, and Europe.
Once the coronavirus pandemic started to loosen up, there was quite a movement in the summer months.
With the tourists back on the Caribbean beaches and resorts reopening for business, the luxury market seems set for additional growth.
Corona’s Second Way
The sad truth is that fall 2020 in the US and Europe introduced a second wave of coronavirus infections. Some blame the reopening of the schools, whereas others point to the cold weather, which boosts the coronavirus’s spread. Consequently, many countries plan to enforce certain restrictions to halt the spread of the coronavirus.
Many people are aware of that, and about the warm weather in the Caribbean region.
Digital nomads and remote workers are rushing to the Caribbean as they can work from anywhere where they can find a decent internet connection. The Caribbean is more than an obvious choice. Both US and European tour operators took note of that trend.
A great number of European and US citizens are moving to the Caribbean to avoid the “second wave of infections,” as well as the consequent restrictions in their respective countries. The demand for properties for rent increased in the second part of August, was persistent throughout September, and it is expected to grow in the coming months.
Investors Discover Caribbean Real Estate Markets Such as the Dominican Republic
For a long time, many considered the Caribbean real estate market as the playground for the rich and famous. What they didn’t not, but they seem to have learned recently, is that it’s possible to purchase a condo on the beachfront for as little as $150K in Caribbean countries such as the Dominican Republic.
That’s within the buying limit of millions of Europeans, Asians, as well as US citizens, that are not millionaires, yet they do have substantial savings and are making good wages.
The idea of affordable beachfront property is appealing to millions of well-standing Westerners. Can’t say that this is a major trend, but more of a modest data stream that points toward a more significant future growth.
As we mentioned in the introductory part, the Caribbeans are not a single real estate market, but a combination of many. However, the trends mentioned here are somewhat consistent throughout the region. Everything we’ve described as a trend here is data-driven. The only real unknown factor is the pace of these trends and whether they will move with giant steps or a more modest pace.