The Diaspora Price Effect: Higher Prices, Lower Returns?

By Jevon Reid

The diaspora doesn’t have to buy YOUR house to change its value.
And this is where the Diaspora Price Effect gets really interesting.

Diaspora buyers can enter Jamaica with purchasing power tied to US, Canadian and British incomes.
But DPE actually has two sides.
There’s the constructive side…and then there’s the side that can make the market feel unfair.
Let’s start with the constructive side.

Diaspora capital can bring foreign exchange, finance construction, create jobs and, importantly, increase housing supply.
Take for example, David Mullings and Blue Mahoe Capital.

Their model is an example of diaspora and international capital being channeled into building housing, rather than simply competing for existing homes.
And that distinction matters. Because more capital building more houses can help the market absorb more demand.

But now, here’s the other side. Imagine an overseas Jamaican buys a $30 million apartment as an investment. They’re expecting appreciation and rental income. Then, imagine hundreds of investors make the same calculation.

Developers now, see that purchasing power and price expectations can move higher.
But here’s the twist: The property can become more expensive without becoming more profitable.

If everybody is buying for Airbnb, everybody is competing for the same guests. And when those returns don’t materialize, investors may switch to long-term rentals.

Now you have more landlords competing for the same tenants. So you could get:
Higher property prices… but lower rental yields. That’s yield compression.

And this is why I don’t think we should simply blame the diaspora. The diaspora may not be creating Jamaica’s affordability problem. They may be exposing it.

Because ultimately, the real question is: Are property prices rising faster than Jamaican incomes can support? And if communities with more diaspora buyers consistently experience stronger price growth… then DPE isn’t just something we feel.
We can measure it.

Should Jamaica be using that data to manage the impact of diaspora demand or should we simply let the market decide?

Because maybe the question isn’t whether diaspora investment is good or bad.
Maybe it’s whether we can make the market work for both sides.

And that’s the Bottom Line.