Don’t outprice J’cans from owning homes, expert warns
Published:Sunday | September 29, 2019 | 12:20 AMJanet Silvera - Senior Gleaner Writer
WESTERN BUREAU:
Jamaica Bankers Association President Jerome Smalling is warning that care must be taken to ensure that Jamaicans are not outpriced out of owning their own homes.
In a plea to real estate developers, Smalling said that he was encouraging them to invest in new housing stocks, as the prevailing low mortgage interest rates will result in an increase in demand for homes.
“The primary challenge with growth and the lowering of interest rates is that it drives the prices up. So, the lower the interest rates, you have more demand. If the stock is very low, what it will do if we are not careful and if we do not encourage every Jamaican to become a part of it, is that the prices will be driven beyond your ability to afford it. So the time to act is now,” Smalling stated.
He was speaking at the launch of the inaugural International Realtors Conference (IRC) and Expo at the S Hotel in Montego Bay, St James, on Wednesday. The IRC, set for the Montego Bay Convention Centre from December 2-8, is being staged by the Jamaica Realtors Association.
“When things are good, it can quickly get bad. Because if it is that we are not investing in new housing stocks, what will happen is that demand will outstrip the supply and will drive the prices out of the reach of Jamaicans. So I am encouraging you, the developers and anybody, to get involved in the process,” he added.
UNDERSUPPLY IN COMMERCIAL PROPERTY
Smalling said that a concerted effort should be made to try to help Jamaican nationals to take advantage of the tremendous opportunities available in the real estate market, attributable to the high demand, especially for commercial spaces.
“We understand that there is also an undersupply in commercial property and warehousing spaces. Those are opportunities for us in Jamaica,” he said.
Lauding the Government, which he said had played its part in terms of ensuring the driving down of interest rates, he said the rates are so low that every Jamaican, whether employer or employee, needs to take advantage of the opportunity.
The banker, who heads Jamaica Money Market Brokers, also contended that the real estate prices in Jamaica are tremendously undervalued, when compared to other parts of the Caribbean, and this is another wealth-building opportunity for Jamaicans.
“We looked at some comparisons of real estate prices in Jamaica relative to, say, Florida, and other places in the Caribbean, and believe you me, property prices in Jamaica are much lower,” he said.
“I suggest to you that a villa on a beach in Jamaica on average is being sold for less than a villa on a beach in Barbados.”
The IRC is expected to attract some 1,000 participants, many of them from Latin America and the Caribbean. In addition to the conference, there will be an expo featuring 100 booths.