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Experts Say Caribbean Price Increase Inevitable
February 11, 2010Article by Ray Withers
Price increases are inevitable in the Caribbean property market according to experts. As sales, which began increasing last spring continue to intensify, experts believe developers will soon feel pressure to increase their turnover, international property investment consultancy Property Frontiers has stated.
The firm’s director David Cox said in a recent press release:
“Overseas property sales have been increasing since last April, and the Caribbean has seen among the fastest growth in sales volumes. This is because lifestyle buyers, mostly wealthy ones have been predominant in the market, and the Caribbean is the ultimate lifestyle choice.
“Lifestyle buyers had kept the Caribbean markets going anyway, so prices didn’t have to come down in most places. This leaves developers well placed to capitalise on the increasing demand to increase their turnover.”
The release went on to explain the idiosyncrasies that have existed in the Caribbean property market over the past 12 months — how no one is sure what caused the increase in sales; was it the special offers or was it the fear of international economic doom subsiding at the first hint of recovery — before rightly stating that the why is irrelevant; increased sales will bring increased prices sooner rather than later.
One aspect the release didn’t cover is the potential effect that any increase in prices could have on the market. Whenever anyone covers the comeback from stimulatory measures in any market, the careful measure necessary in doing so to avoid a second crash, is also covered, but not here.
Luckily in this case the reason for that is; without too much careful measure, the price increases are likely to have little or no effect on the market, as long as they are introduced slowly enough.
This is because, stimulatory measures in the Caribbean property market, have been in the form of incentives like free furniture packs, and in the removal of unnecessary luxuries like spas and moorings. Therefore Caribbean developers can increase prices in-line with increasing the value of the property. As long as the buyers still feel that they are getting a good deal then there should be no legible drop in sales.
David Cox said on the subject:
“We deal with the higher end section of the Caribbean markets, with £300k properties in Grenada, and £1million properties in Trinidad & Tobago, so we see that people are always willing to pay that little bit more when they feel they are getting value for money, so as long as the developers can keep that balance in check the transition will go smoothly.”
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