By Anthony Morgan

Jamaica continues to experience a sellers market within the real estate sector, a year plus into the pandemic which has led to a fallout in other sectors.

The Co-Founders of Sifi Studios, developers of KEEZ, the largest real estate digital platform in Jamaica, said based on data from their app, raw property values continue to rise beyond inflation.

This is because demand continues to outstrip supply considerably, especially in the price range considered affordable for most Jamaicans.

“When properties go on the market they are snapped up pretty quickly,” said Co-Founder, Ajani Harris-Williams.

Co-Founder of Sifi Studios Jamaica, Ajani Harris-Williams

According to him, the pandemic has not been able to remove the issues on either the supply or demand sides of the market, which he believes has been to the advantage of the overall sector.

“Because of that, we’ve actually been able to survive. The lack of supply, that has actually worked in our favour,” he said.

Delving into the data, Harris-Williams pointed out that prior to COVID-19, housing ranging between $15 and $20 million had a demand ratio of 40:1, meaning there were at least 40 people interested in 1 property. In the $20 to $45 million bracket, he said there was a 20:1 ratio

Now, a year into the COVID-19 crisis, the Co-Founder said the landscape hasn’t changed much. 

“We saw a 70% drop in Diaspora demand, but on the local demand side, we only saw a 7 or 8% drop. But let’s say this demand dropped by 50%, you would still have a 10:1 supply issue in that $15 to $20 million range and you’d still have a 20:1 demand ratio in the $20 to $45 million range so there’s still a demand/supply issue,” he said.

Harris-Williams said the supply demand ratio is specific to location, price, and housing type.

He said townhouses in the corporate area, priced between $20 and $50 million, have been in high demand. Other regular homes in Kingston, St. Catherine and Montego Bay have also been attractive to buyers.

As for apartments, those he said were seemingly more expensive to customers, but have also been selling nonetheless.

“I would say their demand is a little bit softer than homes and townhouses but eventually there’s just not enough land in Kingston so at the end of the day people will have to go up,” he said.

Harris-Williams said the demand for homes over the period could have been influenced by the reduction in National Housing Trust (NHT) rates over a year ago.

“That created huge access and then they also went up from $5.5 to $6.5 million dollar benefits so two persons combined can now put $13 million together vs $11 so they have greater ability to afford more at a lower monthly mortgage rate so those things are also helping to drive that demand issue,” he said. 

The Co-Founder said the data also showed that more young people are buying homes. Outside of that, he said the spectrum generally consists of professionals who are gainfully employed and of the belief that they will be able to retain their jobs during this period.

“The 25 to 30 age range has drastically increased; that’s the bulk and that fits in with real estate worldwide. Those not yet at that level of income, what we’re actually seeing is that they are going out of Kingston to St. Catherine: Greater Portmore, as deep as Old Harbour, and Spanish Town,” he said.

Meanwhile, data from KEEZ has also indicated an increase in those opting to rent their properties due to the high demand. Harris-Williams said they have seen a 20% uptick in rentals since last year, with prices also coming down in prime real estate communities due to the pressure.

“There was a time when our sales customers were like 79-80% and about 20% were rentals. That’s now gone up to 73% sales and 27% rentals so rental volumes are skyrocketing because of demand,” said Harris-Williams.

Despite signs of recovery in the economy from the effects of the pandemic, Harris-Williams said the price point for homes should hold steady or increase slightly, but he does not expect prices to “skyrocket” over the medium term.

He believes the rental market will also continue to hold firm with attractive prices for renters over the next year.

As for the other Co-Founder of Sifi Studios Jamaica, Marvin Whitfield, he believes people should not wait to see if housing prices will go down before purchasing, especially with the cost of building materials already up 10%.

Co-Founder of Sifi Studios Jamaica, Marvin Whitfield

The KEEZ app allows users to quickly find properties all over Jamaica by connecting them with brokers and agents.

The 2 ½ year old platform also helps people submit pre-approved mortgage applications online. The company has three partner banks: National Commercial Bank (NCB), Victoria Mutual Building Society (VMBS) and Sagicor.

Since the pandemic, there has been a significant uptick in users to the platform.

“We have in excess of 10,000 downloads but the bulk of our traffic comes from website, mobile and desktop. On aggregate we have about 100,000 users per month…we were growing organically before, but COVID just put it on boosters,” said Whitfield.

According to Whitfield, 25% of users are from the Diaspora in the United States (US), United Kingdom (UK) and Canada with the majority, 75%, locally based.

-END-