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Realtors talk of tough times

Local realtors are anxious to hear what sort of relief will be granted as a result of the government review on the land policy for home-ownership by non-Bermudians.

One realtor told

The Royal Gazette, the only thing that will revive Bermuda’s ailing real estate market is a complete turnaround on the new policy implemented by the PLP Government.

Buddy Rego, President and CEO of Rego Sotheby’s said he is hopeful the existing policies will be amended.

He is also hoping permanent residents will be allowed to buy property along the same lines that apply to Bermudians.

“That would help the market, the collective concerns of realtors are already known to government. I for one am looking forward to hearing something back on this issue soon.

“There’s little in the form of a market turnaround in sight without the relaxation of current land ownership policy.”

In an interview with

The Royal Gazette in January, Mr Rego said he hoped the land policy changes would be implemented this year to allow Bermudians to sell their homes to non-Bermudians, allow permanent resident certificate holders to purchase properties as Bermudians and drop the requirement for non-Bermudian spouses to have special licences to buy property.

Since then he said: “I think my outlook is the same, unless these things change.

“It’s a problem because people have to wait six months for a licence. In some cases they are losing out on opportunities to buy certain properties that get sold while they’re waiting for approval.”

Agency Manager at Coldwell Banker Bermuda Realty, Susan Thompson said: “We can make a sweeping statement saying prices have dropped between ten 30 percent since 2008.”

Although it is difficult to quantify how much prices have dropped, she said: “I did some quick figures based on current data, the $450,000 $800,000 market represents 29 percent of the current active residential market.

“In that segment, based on the total number of sold transactions islandwide when you remove commercial, land and fractional sales, 41 percent of sales in 2011 where in this price range.”

In the company’s newsletter, Ms Thompson said: “From a buyer’s perspective, a reduction in prices is music to their ears; but for property owners and potential sellers it’s a bit like finger nails across the blackboard ... loud and unpleasant.

“Investment values have depreciated, rental incomes have fallen, and many owners are servicing debt that is no longer sustainable.

“The difference in average condo prices comparing 2010 to 2011 was only a three percent reduction which makes pricing an interesting challenge.

“While the total number of transactions are incomplete for 2011, from the totals available thus far, condominiums have already outsold 2010 and we expect the same of single family homes.

“This is good news because it means that the market is active and that price adjustments have made it possible for more people to enter the market.

Despite predictions that the recession will last for another year and a half Ms Thompson said: “We are seeing a lot of activity for the start of the year; which is nearly equivalent to our 2009 transaction levels.

“This activity combined with government’s eagerness to review current real estate policies and legislation gives us hope that 2012 will be a better year.”

Meanwhile President of Century 21 Bermuda Properties, Frederica Forth-Anglies confirmed there has been a reduction in home sales on the lower end properties due to the current economic climate.

“Prior to the recession the banks offered 100 percent and 95 percent mortgage financing.

“The ability to borrow in today’s world is more difficult as there is more risk involved due to loss of jobs, lower rents, the greater the risk the tighter the controls, therefore the lending criteria has changed.

“The loan value is generally 80 percent which means in most cases the purchasers are required to have a 20 percent deposit and there are qualified borrowers who want to buy.

Overall she said: “The sales agent of today has to work a lot harder to affect a sale.

“We must also be prepared to educate the purchaser in today’s market as to why it makes sense to buy when interest rates are low. That’s the key to increasing sales volumes.”

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Published February 28, 2012 at 8:53 am (Updated February 28, 2012 at 8:52 am)

Realtors talk of tough times

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