Global Market Guide: Cayman Islands
As one of the most popular destinations among the high-net-worth, the Cayman Islands is revered for its sunny beaches, quality service and new luxury construction. In this month’s Global Market Guide, we take an inside look at the current state and the predicted future of the luxury real estate market in The Cayman Islands.
Residential real estate in the Cayman Islands is traditionally transacted by brokers and agencies. The Cayman Islands Real Estate Brokers Association (CIREBA) regulates the industry by running the MLS and providing training services for brokers. As a member of the organization, brokers can take on listings on an exclusive basis and represent vendors on an exclusive basis. Legally, brokers in the Cayman Islands cannot act as a buyer’s agent, however many brokers build strong relationships with buyers for future sales opportunities.
CURRENT HOUSING MARKET
The current housing market in Cayman Island is very strong due to the strong economy that has been cultivated by the government over the past 25 years. Because of its stable economy and safe environment, the area has become a very attractive place for international investors. The Cayman Islands is seeing a boom market with prices in key markets rising in an exponential fashion. Ten years ago, the maximum price per square foot was $1000 per square foot and the current price is almost $2000 per square foot for the same developments showing a 100% increase over the past decade. This high demand is fueled by a very positive economy and a welcoming attitude among international investors.
ATTRACTING LUXURY BUYERS
Luxury buyers in The Cayman Islands are looking key factors in their next home: quality, design, amenities and above all, safety. The Cayman Islands is very stable economically compared to other Caribbean islands, and the area has managed to avoid many of the hurricanes and natural disasters that have plagued other countries throughout the past 20 years.
New construction is very prevalent in The Cayman Islands and includes new developments as well as high- net-worth-individuals (HNWI) moving to the island to build their own properties. This new construction is good for the economy because it reflects the faith that the residents have in the area. Commercial construction fueled by growth of the off-shore finance industry is also prevalent and has created jobs opportunities for residence generating a greater demand for residential real estate. The government has also been instrumental in fueling new construction by investing in roads, schools etc. which are instrumental to the infrastructure in the area.
LUXURY BUYER PROFILE
Luxury buyers in the area are comprised of both local and international buyers. The area has developed a sturdy economy over the past 30 years that has allowed locals to become very wealthy by international standards creating stability between locals and international investors. On an international level, most of the residents come from North America with a recent increase in Asian and UK buyers. The Cayman Islands is a UK territory and the off-shore finance industry is primarily UK based so many employees in the industry have flocked to the Cayman Islands.
Buyers are also attracted to the international level of service that is offered in the area as well as the opportunity to purchase locations for future generations. Brokers are seeing the children of previous buyers who have purchased property years ago come to the island to stay in the homes of their parents and grandparents or to buy their own homes to pass down to their future offspring.
CURRENT POLITICAL CLIMATE
The Cayman Islands is known as one of the most politically and economically stable places in the Caribbean. This political stability has become increasingly more attractive as political uncertainty has plagued many other areas of the world in recent years. Many buyers find comfort in the political and economic stability in the area.
GROWTH IN THE MARKET
The current market in The Cayman Islands is quite strong and our member predicts that if this trend continues, the area will continue to see growth in the next 5 years (between 3%-5% per year). The exponential growth on Seven Mile beach that has been recorded in the past few years will probably not continue at the same rate, however our member predicts that there will be continued steady growth in the area due to the stable economy and continued investment in the local infrastructure.
With a stable economy, growing demand for new construction and an influx of both foreign and local buyers in the area, the market in The Cayman Islands is booming and showing signs of continued growth in the next few years. The area is seeing both strong growth in the residential and tourism industry. There are plans for a new Hilton hotel on the island which will attract high-end tourists and contribute to the infrastructure of the area.
Special thanks to our member IRG – International Realty Group Ltd. for providing their insights about the luxury market in The Cayman Islands.
For more information about properties in The Cayman Islands, browse here. Take a look at the last edition of our Global Market Guide for information on the luxury real estate market in San Miguel de Allende, Mexico.