Donovan Reid, President of the Realtor’s Association of Jamaica (RAJ), says there has been a noticeable shift in short-term rentals in Jamaica, with many of the properties that are currently on the market being occupied by locals.
Mr Reid said this could be attributed to the COVID-19 pandemic and the current restrictions, which have caused a reduction in the number of foreigners visiting the country.
“The pandemic has undoubtedly affected short-term rentals in a similar way to how it has affected the tourism market, with hotels operating at 30 per cent occupancy. The decline in visitor arrivals has seriously affected the short-term market,” informed Mr Reid.
He further noted that, “What we have observed during the pandemic is a little shift in the short-term rental market with some take up by locals, especially with the downturn in the entertainment sector. This shift to locals is more evident during the local holiday periods and weekends.”
The RAJ president, however, pointed out that the minor influx of locals in the short-term rental market may not continue when the pandemic is over.
He also advised that persons, who have invested or are seeking to invest in an income property should not be deterred by the global pandemic.
Mr Reid pointed out that are inherent risks in all investments, but the bright side is that the value of real estate in Jamaica has remained constant. “Investors, who are able to wait out the storm, will be able to recover some of the losses incurred. For others, they can look at other options which are available. They can investigate the feasibility of participating in the long-term rental market or place the units up for sale,” he stated.
He noted that the outlook for real estate in Jamaica continues to be positive.
Carlton Earl Samuels, Chief of Development Financing at The Jamaica National Group, agreed with Mr Reid’s outlook, further pointing out that “it’s still a good time to invest in the housing market”.
“As a matter of fact, all the projects that we have financed, especially those on the North Coast has seen tremendous success,” he informed. “Additionally, the project we’re doing now in Hanover, which is 428 units is almost sold out.”
Mr Samuels said projects financed by The JN Group in Mammee Bay have also all been taken up. “We are doing another one in Ocho Rios and the demand is very good. Therefore, I am still very bullish about the market, based on the demands that we have seen.”
The banking executive noted that the housing sector is ripe for investment. “I think if we wait until the economy stabilizes then by that time there’s a possibility that the prices may go up. It is now a buyer’s market, and so, buyers should take advantage of that.”
Mr Samuels also encouraged developers to look at the opportunities available, especially those within the lower to middle income segment of the market, where the demand remains buoyant.
Meanwhile, the RAJ president added that the uptick in development properties, particularly apartments and strata complexes, offer lucrative investment opportunities, especially in the Corporate Area where rental prices are higher.
He noted that areas adjacent or adjoining the existing Toll Road network in the south coast in St. Thomas and Manchester, also present great investment opportunities, especially with the construction of the new highway and extension of the Toll Road.
“The North Coast continues to provide solid investment opportunities,” Mr Reid said.
He further noted that as it pertains to long-term or traditional rental properties, there has been no significant changes.
“In fact, prices have remained fairly stable in most segments of this market,” he informed.
Mr Reid said some landlords of short-term rentals have repurposed their properties to serve in the long-term market, while others have opted to ‘sit out’ the famine with the hope that the market will rebound later this year.