The Cayman Islands real estate market is flourishing even with our industry’s close down between March 22 and June 3 due to COVID-19. During this time, we couldn’t operate as usual, but many agents were still working behind the scenes and in fact more than US$77 million in sales were completed during that time based on CIREBA (Cayman Islands Real Estate Brokers Association) stats.
At the end of 2020, total sales volume was up from US$639,279,161 to US$666,480,657, which is a 4.26% increase year-over-year. But, when you look at overall transactions, 2020 was down over 17.45%. In 2020, 686 properties sold in the Cayman Islands versus 831 in 2019.
This means that real estate prices, as a whole, are rapidly increasing. In 2020, the average US$ per transaction was US$971,546 up from US$769,289 in 2019, which is a huge increase of 26.3% year-over-year.
“2020 has been a stellar year for the Cayman Islands real estate market,” added Kim Lund, Broker/Owner of RE/MAX Cayman Islands. “We anticipate this trend to continue into 2021 and beyond as our pending sales (transactions that have no conditions pending and thus will go to final sale) are up over 91% year-over-year. Pending sales as of the end of 2020 exceed US$140,847,733 up from US$65,584,178 in 2019 with the bulk of these being condominium developments currently under construction.”
Sales volume for new-to-market listings for the year was down 4.5% but sales transactions were down more than 13.57% illustrating that there were less new listings that hit the market in 2020 versus 2019. In fact, when looking at the sales transactions alone, there were over 206 less new listings to hit the market in 2020 versus 2019.
“2020 was definitely a unique year for our industry,” added James Bovell, Broker/Owner. “We have seen an increase in international buyers many of whom are looking for a safe place to either relocate or purchase a second home. In some of these cases, we are working with buyers who have never even been to the Cayman Islands before. How our country came together and handled the management of COVID-19 has positively impacted both our country and its ongoing desirability from foreign investors.”
Even though the new-to-market listings were down in 2020, the overall number of active listings increased by 4.69%. The 12-month average for active listings was 1,540 in 2020 versus 1,471 in 2019. The majority of active listings in 2020, as was also the case in 2019, were residential properties with 80% of those being condominiums.
Another contributing factor to this year’s sales volume increase was the pension withdrawal program.
Earlier this year, government amended the National Pensions Law to allow local workers to make withdrawals from their pension accounts. More than 36,000 applications for withdrawals were approved amounting to more than $443.5 million. This means almost half of the 73,000 private pension accounts in Cayman were subject to withdrawals. (Source: Cayman Compass, December 23, 2020)
In some cases, the pension withdrawal program enabled many buyers to enter the market sooner than anticipated while others took the opportunity to use those pension funds to upgrade their current living situation.
All signs indicate that the real estate market will continue to grow and flourish in 2021 as our borders open up and welcome both returning and new visitors, many of whom will become real estate investors. Additionally, more than US$1.7 billion of new developments are currently in or about to start construction, offering many new investment opportunities.