Have your heart set on a quaint Bermuda cottage on a parcel of land?

That dream could be an increasingly tough one to realise with Bermuda realtors candidly telling The Royal Gazette in the last week that the properties available are few and far between, and they do not often come with a price tag any lower than $750,000.

Competition for listings is tight with more than 200 realtors seeking to sell an increasingly limited supply of properties.

Buddy Rego, president of Rego Realtors, said the local market was “extremely strong; the strongest it has ever been in my long memory,” with the highest prices ever and very little available on the market.

That was a view also taken by Brian Madeiros of Coldwell Banker JW Bermuda Realty who said there was “tremendous pent-up demand for properties across the board, from the first-time purchaser up to the $2 million executive properties.”

Mr. Madeiros said the current demand was also pushing premium prices even higher, with condominium market rates appreciating about 25 percent per annum. He said the level of appreciation was a little lower on the home front, but still increasing year over year.

The state of the market was also cited by Mr. Madeiros as something that had created a shift in what the consumer was looking for.

In years past it would have been the idyllic Bermuda cottage, but many were now setting their sights on condo living with the average price currently standing at $660,000. In contrast, a stand alone family home on one-third of an acre was priced at an average of $900,000.

“Condominiums are now looked at as an acceptable way to live and they can be a bit more affordable than a stand alone cottage,” he said.

All in all, Mr. Madeiros said home ownership had been put “outside the realm of possibility for some Bermudians.”

Despite the high prices, Mr. Madeiros said there had been a recent surge in interest for executive homes in the $2 million to $5 million range. He was also cautiously optimistic regarding the future of high-end sales.

“We would like to see increasing turnover in the $5 million market. And we are cautiously optimistic that this will happen if the equities market bounces back.”

Mr. Rego said those properties that did come on the market, with the exception of those in the very high-end bracket, had been selling almost as quickly as they were listed.

“There is little to choose from which has created a bit of a catch-22 in that property owners who already own but may want to sell and move to another property and now more reluctant to sell as the availability is so limited.”

Sue Lusher, owner of Joy Lusher Real Estate, told The Royal Gazette: “The inventory is pretty low, we have to really go and knock on doors. There are people (wanting) to buy but there is not enough inventory,” she said, adding that it was now “really difficult to find any property priced under $750,000.”

However, Ms Lusher said there were “quite a few” houses available in the non-Bermuda market.

A house may be sold to a non-Bermudian, with the consent of the Minister of Labour, Home Affairs and Public Safety, if it has an annual rental value (ARV) greater than or equal to $126,000.

In the case of a condominium, properties in certain developments are available to non-Bermudians, again with the consent of the minister.

Despite the limitations of a market where little under a certain price is going up on the sales block, Ms Lusher said her business has continued to do well.

“We are still doing well but we have to be a little more creative. We have to beat the bushes,” Ms Lusher said, when speaking of a market which has become, as she said “extremely competitive,” with her putting the number of licensed agents working on the Island at more than 200.

Another realtor, who wished not to be named, said the current state of the market was a point of real frustration.

He said there was the perception that realtors must be raking the money in with the high price levels that are being seen, but he said without inventory business opportunities are greatly diminished.

In the higher-end non-Bermuda market, Mr. Rego said there were homes available for sale but that some of these had been on the market for an extended period of time either as the result of, in some cases, overpricing.

Mr. Rego said there had also been a shift in demographics those who were buying homes in the non-Bermudian market.

In years past he said non-Bermudians may have bought the higher end homes as vacation properties but that trend had diminished over time with properties now going to those who now have some corporate tie to Bermuda and may actually live in Bermuda.

In the condominium market, Mr. Rego said his firm had seen the same problem of short supply and high demand.

He said most of the new condominium developments coming on line, such as Ship's Hill and Belmont, were units available to non-Bermudians but there was still a shortage.

“There is not a large new stock being made available,” he said. The current state of the real estate market prompted one real estate executive to call for public and private sectors to put their heads together to come up with a solution on how the situation could be eased.

“We need to increase the inventory, and if we are to do that we have to get together and address this. And that means not only Government but the private sector as well.”

Although not just a Government issue, the realtor said he had concerns with the speed that planning permission for new developments was being given and the slow rate of immigration processing for construction workers' permits.

He cited any delay in either process as creating a situation where prices escalated beyond what was sustainable and with contractors being able to demand whatever price they wished, as they had more work then they could complete.