Rental & Sales Market Review - Q2 2021

RENTAL & SALES MARKET REVIEW Q2 2021

RENTAL MARKET REVIEW Q2 2021

CONTRIBUTORS: Emma Hutson & Betty Cathrow

ACHIEVED RENT METRICS Q2 2021

Avg. Achieved Rent Metrics Q2 2020 and 2021 40,000 Achieved Rent (BDS)

35,000 30,000 25,000

-32%

10%

20,000 15,000 74%

10,000 5,000

18%

5%

62%

0

1 Bed

3 Beds

2 Beds

5 Beds

4 Beds 2020

• Demand for mid-term rentals which typically command higher rental rates continued to be strong, leading to higher average rental rates in all but the 5 bed category.

• We have continued to see an increase in digital nomads coming to work remotely in Barbados including families with children.

• In Q2 2021, the average rental rate for 4 bedrooms experienced the highest jump with prices increasing by 74%, followed closely by 1 bedrooms which increased in price by 62%.

• The only decrease was in the 5+ bedrooms unit sector from BDS$34,000 per month to BDS$25,000.

6+ Beds

2021

RESIDENTIAL RENTAL RATE RANGE

RESIDENTIAL RENTALS FOR Q2 YEAR

MIN

MAX

2020

$1,000

$34,000

$5,330

2021

$1,100

$60,000

$5,878

• In Q2 2021, the maximum achieved rental rate was almost double that compared to Q2 2020.

• Overall the average achieved rental rate increased by 10% (BDS$548).

AVERAGE

Q2 RENTALS BY PROPERTY TYPE

Q2 RENTALS BY NO. OF BEDROOMS

% SHARE OF RENTAL TRANSACTIONS Q2 2020 VS Q2 2021

150%

60

158%

No. of Rentals

50 40 30 20

1200% 125% 500%

10

0%

0

1 Bed

2 Beds

3 Beds

2020

4 Beds

5 Beds

6+ Beds

50% 45% 40% 35% 30% 25% 20% 15% 10% 5% 0%

47%

Apartment

2021

• There were notable increases of between 125% and 1200% in the number of properties rented in the 1-5 bedrooms categories.

• While the number of 6 plus bedroom properties rented remained steady, growth in this category is likely restricted by the low supply of these properties.

• Demand continues to be highest for two and three bedroom properties accounting for 69% of transactions.

• Demand for 1 bedrooms increased significantly from 1% to 14% of transactions driven by an increase in demand from single professionals working remotely in Barbados.

• Furnished rental properties continue to be in highest demand accounting for 87% of our achieved rentals over the quarter which accounted for 89 rentals. This has been driven by the "Welcome stamp" enquiries as an unfurnished property is not practical for stays of 12 months or less.

House

Townhouse

• Townhouses saw an increase in the market share of rental transactions of 5%.

• Townhouses in gated communities may have increased in popularity due to the security and amenities that they offer.

• While the market share of rental transactions relating to houses declined by 3%, the average achieved rental price for a house increased by 679%. This is due to the increased demand for luxury rental homes.

RENTAL LOCATIONS

Residential Commercial

Speightstown

Q2 YOY TRANSACTION % VAR Holetown

Increase in # of transactions

188% • We rented an impressive 188% more properties in Q2 2021 compared with Q2 2020 with rental transactions almost tripling from 33 rentals in Q2 2020 to 95 in Q2 2021.

• This has been driven by the demand from "Welcome Stampers" which would not have existed in 2020 as this initiative was introduced later in the year.

• In addition, during Q2 2020 the island was in lock down for April to June which would have negatively impacted demand.

Bridgetown

Oistins

Key Observations • The majority of residential rentals were clustered around the West and South Coast; Holetown, Worthing, Hastings and Speightstown.

• We saw a small movement of residential rentals moving towards the East Coast and inland in St. George.

• The commercial rental was close to the hub of Bridgetown.

YTD STATS AT A GLANCE Transactions 88%

Rental Revenue 153%

Average Rental Rate 34%

Lead Volume 63%

SALES MARKET REVIEW Q2 2021

CONTRIBUTORS: Emma Hutson & Betty Cathrow

SALES PRICE RANGE FOR RESIDENTIAL AND COMMERCIAL INCL. LAND

ACHIEVED SALE METRICS Q2 2021

Average Achieved Sale Price by Parish Q2

Achieved Sales (BDS)

3,500,000 3,000,000

RESIDENTIAL SALES FOR Q2

2,500,000 2,000,000 1,500,000 1,000,000 500,000 0

Christ Church

Saint James

Saint George

Saint Saint Joseph Michael

2020

Saint Peter

Saint Philip

YEAR

MIN

MAX

AVERAGE

2020

$87,000

$10,000,000

$1,064,918

2021

$105,000

$3,200,000

$664,561

2021

• In Q2 2020, averages were bolstered by the sale of 2 luxury villas priced between $5 mil and $10 mil.

• Sales in this bracket were absent in Q2 2021 but activity between $1 mil and $4.95 mil was very strong with 11 sales in Q2 2021 vs just 2 in Q2 2020.

• Christ Church saw a notable increase in demand with 5 sales above $1 mil and an overall increase in transactions of 250%.

This was driven by Harmony Estates Development and the popular land developments at South View and The Grove.

• The average sales price in St. James in Q2 2020 was bolstered by the sale of one penthouse for $10 million. However, overall demand increased with 75% more transactions in Q2 2021.

• The average achieved sale price remained steady in St. Peter, but there were 60% fewer transactions.

Overall activity strengthened with the number of sales transactions doubling in 2021.

Q2 RESIDENTIAL SALES BY PROPERTY TYPE

2020

25%

2021

10%

29%

33%

58%

2%

13%

0%

4%

8%

20%

30%

Apartment

40%

25%

50%

Apartment Building

60%

House

70%

80%

Land

2% 90%

100%

• The number of houses sold in Q2 2021 quadrupled compared to Q2 2020, this was driven by the volume of homes sold at Harmony Estates.

• The same number of apartments and apartment buildings were sold in Q2 2020 & 2021.

• Although the volume of land sales transaction in Q2 increased by 50% in 2021 the proportion of all transactions decreased.

Townhouse

DISCOUNT TO SALE RANGE FOR RESIDENTIAL AND COMMERCIAL

SALES LOCATIONS

ACHIEVED SALE PRICE FOR Q2

Residential Commercial

Speightstown

YEAR

MIN

MAX

AVERAGE

2020

-1%

25.4%

6.1%

2021

-4.9%

32.2%

5.5%

Holetown

Bridgetown

• Average discount levels moved from 6.1% in Q2 2020 to 5.5% in Q2 2021.

• The closing of this gap on negotiating off the listed sales prices is a likely result of increased demand coupled with decreasing supply, a promising sign of some strengthening in the market.

• We have seen an increase in the number of properties receiving simultaneous offers as evidenced by our selling one property at 4.9% over the listed sale price in Q2 2021.

Oistins

• The majority of residential sales were located on the South and West coast of Barbados.

• Christ Church experienced high demand with 17 sales clustered at the Harmony Estates development, 7 at South View and 3 at The Grove.

• 2 agricultural lots were sold in St Thomas that have permissions for single dwelling residential use.

YTD STATS AT A GLANCE Transactions 64%

Sales Revenue -8%

Lead Volume

26%

CONTRIBUTORS:

Emma Hutson

Betty Cathrow

The data in this report is solely from the transactions completed and statistics recorded by Terra Caribbean.

A COMPLETE LOOK AT 2020

Rental & Sales Market Review

Rental & Sales Market Review

Q1 2020

Q2 2020

Rental & Sales Market Review

Rental & Sales Market Review

Q3 2020

Q4 2020

Somerley, Worthing, Christ Church, BB15009, Barbados Tel: +1 (246) 434-9000

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