Real estate bug biting hard

The web site for a real estate  agency in Tobago showed 50,000 square feet located at Mt Irvine. Asking price — $1.24 million. Take the same parcel of land and divide it. Price — $870,000 each. Tobago, too, it seems has been hit by the real estate bug. Natalie Mahabir of Caribbean Estates, Lands and Villas in Tobago said residential lands close to Crown Point and Bon Accord were selling between $65 to $75 a square foot, while commercial pieces were between $85 to $100 a square foot. She attributed the increased prices to the “rental potential for villas and the fact that foreigners are buying lands because of the strength of the pound.”

Mahabir said parcels of lands were being sold at the cheaper price of between $30 to $40 a square foot. Land prices, which have been rising over the last few years, is at an all time high and going higher, the commodity itself is in short supply. Not only are houses going to be more expensive, but more town house apartments rather than single unit houses are being built. Housing Minister Dr Keith Rowley has observed that new designs will have to be made to maximise space and keep prices of units down. Real estate agents say the main reason for the increased prices is because of the huge demand and short supply of land. They say prices have doubled and in some cases tripled over the last few years.

Prices will also vary depending on the areas in which the lands are being bought. For instance, security, close proximity to schools and medical centres as well as proper amenities are key determining factors in how high the prices are. There is also the fact that land is being purchased because it is one of the safest investments. Lands in upscale areas like Westmoorings are now at least $200 a square foot, while in places like Arima it is being sold from as low as $25 a square foot. In Tobago, land prices have steadily increased over the years with the average price per square foot selling at $40, with some large properties costing millions of dollars.

Chris Fojo, General Manager of Terra Caribbean said  the average price of lands at Westmoorings is $200 a square foot while in the Diego Martin/Petit Valley areas it ranges between $65 to $95 a square foot. He said there are periods when the prices might be higher. “We just don’t have much land available, especially flat land,” he said. He said it is also increasingly difficult to develop hill side lands, because of environmental concerns and strict requirements by the Town and Country Department. Fojo said previously the prices could have been at least 15 percent cheaper for land in the West. Fojo pointed out that persons are looking for lands with necessary amenities and within close proximity to schools and medical services.

He also noted that security was a main factor and maybe a reason why there were now more town house apartments being built rather than single units. Of course because of space, the former units are preferred. Relindor Khanai of Khanai’s Real Estate agreed with Fojo, saying  that lands are scarce and as a result the prices are being driven up. He said lands in “good housing areas” in Arima were now selling from $25 a square foot. He said a few years ago the same lands were being sold at $12 a square foot.

 However in certain areas where private developers have purchased lands, Khanai said the prices were much higher. At a particular housing development in D’abadie, Khanai said land prices were between $40 to $45 a square foot.  Land is being sold for the same price at private developments in Couva, which is considered “an upscale area,” according to a spokesperson at Realtors Service in St Augustine. She said in previous years the prices were “half the amount.” Fojo believes that private developers’ actions are just a “minor contributor” in the land price increases. Regarding prices of townhouses, the HCL group recently sold some for as little as $700,000 at Trincity with other units in the upscale Millennium park to cost from $1.2 million.