- January 3rd, 2021
- in PROPERTY
It’s no secret that COVID-19 has affected the world’s economy, and both “home” and “work” have new meanings. Luckily, with relatively low case numbers and a reopening plan for welcoming visitors back to the BVI, the real estate market has shown growth.
At the first signs of a global pandemic in March 2020, the real estate market wasn’t in good shape. In fact, once the BVI had its first lockdown of the country on March 27th, early data shows the market was on track for a down year. Fortunately, the curfews started to relax as the year continued. Compared to the same timeframe (April-September) in 2019, the number of property sales was actually up 26% in 2020. This was a good sign that even though borders were closed, the market remained strong. This strength could be attributed to momentum from early in the year, and the low number of cases and ability to reopen the BVI economy relatively quickly helped to maintain some of that momentum.
Another positive change to the market has been the Belonger stamp duty exemption.
“The value of the real estate that exchanged hands in April 2019 to September 2019 was just over $20,500,000 whereas the value of real estate that exchanged hands in the same period in 2020 was just over $38,500,000. The jump in volume shows a 46% increase year over year during the same period,” said Rico Garcia of RE/MAX Best Priced Properties.
Virgin Gorda sales have likely contributed to this increase in volume by having the highest property price points in the BVI. Belonger sales have also contributed to the increased sales volume. This shows that the stamp duty exemption was a smart play for the BVI economy; it allowed for some flow of money.
There has also been an uptick in the number of buyers looking for raw land on which to develop residential property. Many BVI banks have altered current loan offerings for real estate purchases, making purchasing land more attractive and more accessible to young buyers. More parents are also now encouraging their young people to invest in real estate, in an effort to increase the chances of building long-term wealth.
More sellers are also entering the market. Much of this could be correlated to COVID-based financial hardships.
“I do believe that even without hardship, if more sellers enter the real estate market it will allow for a more impactful wealth transfer. There would be more comfortable retirements and more opportunities for the next generation of buyers. If BVI property owners were to develop the habit of trading up then it would allow for the opportunity for them to buy higher valued real estate and allow those with less capital to in turn buy more property,” said Garcia.
There are still a few BVI properties that exhibit damage from the devastating 2017 hurricane season. Most have already been sold, and while there aren’t very many currently on the market, owners continue to weigh their options. Garcia believes that more damaged properties will be available for purchase within the next three years.
COVID-19 has also affected the BVI rental market. As lockdowns caused reduced traffic during the first part of the pandemic, rent prices slowly decreased and more short-term villa rentals became long-term ones. From April 2020 to Mid June 2020, the long-term rental inventory at RE/MAX doubled. The border closures have also solidified the strength of the Belonger buyer market. The data also suggests that affordable inventory and capital have more to do with the market than Belonger status.
The Future of RE/MAX
The team at RE/MAX Best Priced Properties is committed to helping clients find their perfect home or commercial property. Their RE/MAX Collection brand is one of the world’s most-recognized marketing brands for luxury real estate. In the BVI office, they have agents that are currently certified Collection agents and carry the Certified Luxury Home Marketing Specialist certification. To qualify for the RE/MAX collection the general guideline is that the property must be at least double the value of other properties in its area. This would include properties in Trunk Bay and Cootens Bay on the ridge road, Little Mountain and Little Bay in East End and Crooks bay, Leverick Bay, Spring Bay and Mahoe Bay in Virgin Gorda.
The BVI in itself is a higher-priced market as it relates to the rest of the Caribbean. Each home will be individually evaluated to see if they meet the RE/MAX Collection criteria. Around 90% of homes in the “billionaire’s playground” like Biras Creek and Oil Nut Bay in Virgin Gorda are obvious collection properties. Each home will be entered into the RE/MAX Collection’s magazine which has a very concentrated circulation to affluent buyers in the U.S and Canada. They will also have the opportunity to be marketed in many other publications with a strong focus on affluent buyers.
RE/MAX has also been expanding and is excited about the future of the BVI real estate market. RE/MAX British Virgin Islands is currently looking for entrepreneurs who would like to start their own RE/MAX Franchise in Virgin Gorda, and Jost Van Dyke. Each RE/MAX office is independently owned and operated.
For more information:
RE/MAX British Virgin Islands
Tel#: (284) 340-2444