Bahamas Real Estate Brokerage Firm, Engel & Völkers just released their 5-year market report, which shows positive growth signs for a number of areas in the local real estate market. The report extracted and analyzed over 1,800 residential sales on the Bahamas Multiple Listing Service (MLS), the real estate industry's central database for property listings and sales. The report analyzes sales price, property sizes, days on the market (time it takes to sell), average price per square foot, number of bedrooms and the sales price to listing price ratios.
Some key metrics of the report show an overall 48% increase in Bahamas residential unit sales and a 47% increase in the Nassau/Paradise Island single family sales price over the 5-year period. Elbow Cay and Treasure Cay in the Abaco Cays was the market hotspot with a 110% increase in residential sales over the same period of time. The report also analyzed the Cable Beach versus Paradise Island long-term rental yield, which showed Cable Beach outperforming Paradise Island over the past 3 years by an average of 1.9%. Engel & Völkers broker, Colin Lightbourn says, "The higher return for Cable Beach is based primarily on the higher prices on Paradise Island and the fact that the rental market thins out once you hit the $5,000/month mark." 90% of rentals in Cable Beach for the 5-year period were under $5,000 while 69% were under this price on Paradise Island. In the luxury market, Old Fort Bay is the hotspot with an average sales price of a residential home around $3,000,000 and an average home of 5,455 square feet.
It should be noted that the data in the report is only a portion of The Bahamas real estate sales activity. According to the MLS site, 379 of the estimated 600 agents are currently active in the MLS and only transactions signed with an MLS agent and completed and/or are reported make it into the MLS data. Over the last couple of years, there have been developer-sold projects like Albany, One Cable Beach, and One Ocean on Paradise Island amongst other projects that do not get reported in the MLS. "The fact that the MLS shows growth with all these sales also taking place indicated that the real estate market is performing at an even higher level than the Bahamas Multiple Listing Service data indicates." He says more accurate and complete data can be made available through the development of a centralized database of all sales which would be available to banks, insurance companies, realtors, and government agencies primarily for property tax assessments.
Looking ahead, Lightbourn says, "2019 should be a strong year overall. We will see an unprecedented level of new inventory on the market that will have a contemporary style and an emphasis on exclusive amenities. Each developer is investing in new marketing campaigns that will attract an increased level of buyers to the island." He also feels that more Bahamians should be taking advantage of investment opportunities in the country. "Treasure Cay, for example, has had an average sales price around $343,000 during the last 3 years. The ability to enter the market at this price and operate an income producing property is an attractive investment. Bahamians also do not have to property tax in the family islands which puts thousands back into income each year." Lightbourn feels areas like Rainbow Bay and Gregory Town in Eleuthera, Cable Beach on New Providence, as well as locations in Exuma and Abaco offer investment opportunities.
Over the longer term, Lightbourn feels that residency purchasers, the vacation rental market, the development of more amenities, improved ease of doing business and environmental protection will help to grow both the real estate and hospitality industries.
Engel & Völkers is offering buyers, sellers and developers complimentary customized market reports for communities and islands around The Bahamas. The report can be downloaded here.