Bahamas will remain a ‘hot market’ for years to come
NASSAU, BAHAMAS — The Bahamas Real Estate Association (BREA) president has cautioned against ‘panic selling’ in the wake of Hurricane Dorian.
In an interview with Eyewitness News Online, Christine Wallace-Whitfield said the association was aware there were “vultures” trying to take advantage of the emotional turmoil due to the record storm.
Wallace-Whitfield said, “I would encourage everyone to take a deep breath, let the emotion and turmoil of the historic storm Dorian and its aftermath to settle before making any rash decisions.
“The Bahamas will remain a hot market for years to come and I would just urge people not to rush on any decision.
She continued, “We know there are vultures out there but we hope there is no panic selling which would only affect the value of other properties. Deep breath all around. The Bahamas people love, both local and ex-pat, is still The Bahamas we all love.”
“Our main concern is ensuring we can provide housing for all the persons displaced from the hurricane in Abaco and Grand Bahama. Many people have relocated to New Providence and there is a shortage in supply of rentals,” she said.
Wallace-Whitfield noted that when talking about property values it is very important to distinguish Grand Bahama and Abaco, as they are two different islands with unique property situations.
“Property values in the affected islands likely will see a price reduction as many properties are damaged and the economy will take a while to recover. However, there will be a demand for rentals in those areas for people working in the construction industry helping in the rebuilding efforts,” she said.
“Dorian will have less immediate property value impact on Grand Bahama where a largely local population is now in the process of figuring out the way forward with regard to repairs or rebuilding in most areas, though different, of course, at East End,” Wallace-Whitfield said. “There, the long-term impact will be about zoning, coastline management and matters related to climate change where property owners have already suffered severe loss of beachfront. May be looking at a whole new and different kind of building, maybe even stilt homes, a lot of solar, wind or hydro power.”
The BREA president noted that Abaco is dependent to a much larger extent on second homeowner market.
“For those whose homes were severely damaged or destroyed, the decision to rebuild will be dependent on a number of factors that are somewhat out of the actual homeowner’s control – if they were insured and want to rebuild, can they get insurance, will their community qualify for coverage going forward?
Wallace-Whitfield continued: “What provision will be made to ensure that there will be communication and a consistent power supply? Will there be an increase in property tax for foreigners to cover some of the expense to rebuild? The thing is there is a lot of competition for the second homeowner in the market now — Cayman, for instance, making it very attractive, and Florida, our number one competitor.”
Prime Minister Dr. Hubert Minnis announced on Sunday that East Grand Bahama, Abaco and the Abaco Cays will be designated as special economic recovery zones for an initial period of three years. The model of the zones and the tax benefits and incentives mirror established economic empowerment zones created in several inner-city communities in New Providence.
Minnis said residents in the impacted zones will also receive up to 50 per cent valued-added tax (VAT) credit on the sale of real property, “provided that such sale will be immediately followed by material construction on or enhancement to the property or the utilization of the purchased property to material commercial activity”.
Properties that are underdeveloped, not repaired or refurbished to habitable conditions will not benefit from the concession,” Minnis said.
Commenting on that announcement, Wallace-Whitfield said: “This is great news to assist in the reconstruction and recovery of the affected islands. This tax incentive will definitely be a great incentive for people to rebuild their lives without having to be concerned about additional taxes.
“This is also a reminder for home and business owners in the country to ensure you have adequate hurricane and flood insurance for your property as we are prone to these events in our region.”
She continued, “With regard to distressed properties, excellent idea to invite investment groups or investors to buy multiple units. Excellent opportunity for Bahamians looking for investment. Occupied properties are more valuable and less of a safety hazard than unoccupied and can be readily transformed into temporary or longer-term leasing options for those displaced by Dorian.
“Each investor or group can specify requirements for rights to occupy, including repairs,” Wallace-Whitfield added.