Is now a good time to buy real estate?
– Banker, Experts Weigh In
“It is always a good time to buy because properties (in Jamaica) are always appreciating in value,”
Manager for Lending Products
Kingston, Jamaica – January 21, 2021 – As most sectors of the local economy continue to feel the impact of the disruption triggered by the COVID-19 pandemic, prospective home buyers may be apprehensive.
Notwithstanding the uncertainties, taking the leap towards home ownership should not be deferred. That’s according to at least two real estate experts and a representative of a leading mortgage lender, who all say the market indicators for real estate in Jamaica remain favourable.
They argue that the sector is currently one of the least affected by the coronavirus pandemic and that interest rates on mortgages remain at the lowest they have been in decades, property values continue to appreciate, and demand remains stable.
“It is always a good time to buy because properties (in Jamaica) are always appreciating in value,” said Rohan Hoilett, Manager for Lending Products at Scotiabank Jamaica.
Donovan Reid, President of the Realtors’ Association of Jamaica, also agrees that despite the economic downturn, it is still a good time to buy real estate.
“This is because values are appreciating and if you are an investor, real estate is solid especially in times like these where the (return on) other investments may not be as robust,” the RAJ president said. Based on his assessment, Reid said the Jamaican real estate market remains stable as demand has kept pace with pre-COVID levels, explaining that demand is strongest for mid to lower income properties, which are those selling below $50 million.
Commenting on trends in trends in the industry, Andrew Issa, CEO of Coldwell Banker Jamaica Realty also concluded that the market is showing resilience in the price range between $20million and $50 million.
“In 2020, we performed 8% above 2019 which was a record year. This was achieved through diversification,” he points out however he also believes that the market will not see the true effect of COVID until the end of Q1 2021.
Regardless of the value, Hoilett projects that demand will gain momentum in the months ahead “because more persons are working from home and they are going to want to find something that’s accommodative of that. Additionally, persons seeking investment opportunities are increasingly looking at real estate as a safer alternative to yield returns than other types of investments and therefore we anticipate continued high demand for real estate”.
But as buying real estate is a substantial financial commitment, Hoilett says prospective buyers should first assess their personal financial situation, especially with the current economic uncertainty caused by the pandemic, before embarking on such a major undertaking.
“Personal situations including job security should factor highly and persons should always leave room for leveraging and financing in case of any issues. For example, it may be that your job is safe but your partner’s or spouse’s may not be as secure. Ensure that after you have paid all mortgage expenses you still have funds left over. We recommend that now more than ever, buyers should ideally have 6 months’ worth of expenses saved in an emergency fund,” Hoilett highlights. Hoilett also encourages customers to read their mortgage agreement and ask questions wherever they are not clear on terms.
“At Scotiabank, we have a very efficient, transparent mortgage process” Hoilett remarked.
“We know this is a significant undertaking for most customers and we are committed to offering them the best experience. Further in our role as financial advisors, we ensure that our customers do not over extend themselves and assume more debt that they can afford”.
Scotiabank has been increasing its focus on mortgages for the past few years offering highly competitive mortgage rates to customers. Customer can currently access mortgage financing from the Bank at interest rates as low as 6.99%.