Two successful young real estate agents — one of them doing $9.7 million in sales in the last six months — have identified what they call a 'gaping hole' in real estate: the under-$250,000 townhouse or condo suitable for a hungry under-35 market.
"There are young professionals and other first-time buyers who may be property virgins but they know exactly what they want and we don't have it here, " said Ryan Knowles, one of several young agents at Mario Cary Realty. "These people don't need the most prestigious location. They are willing to trade the 3-bedroom with large backyard for a smaller turnkey apartment or townhouse and they also know they are buying for investment purposes. What they want is what we don't have enough of — a one- or two-bedroom townhouse or condo in a secure community with maybe a fitness centre, pool and high-speed computer and IT connections. They want 'easy to maintain' so they can walk out, lock the door and not worry about it. They have a lot of interests, they want to get up and go. They want to own a home, not have the home own them."
Demand for the $200,000-$250,000 condo or townhouse is so great, says Knowles, that when Hampton Ridge condos (Westridge, near Sandyport) went on the market in 2008 with units priced at $249,000, the project sold out in a few months. "And that was when the housing market was at its lowest," he noted. "Those condos have already appreciated. One re-sold a year later for $375,000."
Sales associate Matthew Sweeting, who like Knowles is appealing to a young market, agrees. Last week he sold a property with an asking price of $249,500. Sweeting presented an offer for nearly that the day after he listed the property and the seller accepted. Flyers were still going out by e-mail.
Knowles cites another example. "At $269,000 pre-construction Vizcaya in Westridge, two-bedroom condos, sold out completely prior to completion," said the agent with three years experience and a sales record of nearly $10 million in half a year.
"Today a gate is not about snob appeal. It is about safety and a sense of security, an intangible comfort that adds intrinsic value to property. And where people used to fear that a one-bedroom would be hard to sell or re-sell, the demand for smaller units is increasing all the time," he said. In April, ground will be broken on a new development of 36 units in western New Providence with pre-construction prices of $280,000. Knowles and Sweeting both predict an almost instant sell-out.
"We are painfully short of what the young, qualified public wants. Media houses understand it. Shoe stores, places that sell cell phones and tech equipment — they all get it. But developers have been slow to recognize the potential of the youthful buyer," said Sweeting.
As for the starter market firing up the real estate industry, the irony is not lost on the founder of his firm, Mario Carey.
"After many years with another major firm, I broke off to go on my own to focus on luxury properties, devoting myself to clients in Ocean Estates, Old Fort Bay, Albany and Lyford Cay, as well as transactions of private islands," said Carey. "While the very high end market has had its challenges during the worst of the global meltdown — and now with the additional local tax burden affecting the luxury market — the interesting thing to see is how the local market in starter homes is driving the bulk of real estate sales."
According to Carey, the lack of available housing has had other repercussions.
"High-priced housing is adding to the brain drain. We have young, educated Bahamians who want to come home, but don't because they say they cannot afford to live in their own country unless they live (with their parents)," said the veteran broker. "You'd be surprised how many qualified buyers there are out there who want to be homeowners. The market is begging for communities of one- to two-bedroom townhouses or condos for under $250,000. It's a good investment vehicle for a developer and a very good sign for the future of the country. I encourage developers to hear this call to fill what these young real estate professionals are calling a gaping hole."
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