Rip, roaring real estate

Patricia Lazzari,  President of the Association of Real Estate Agents (AREA),  says the real estate industry is now riding a vicious roller coaster. She said that the country was now seeing a large gap in property pricing, specifically in the Port-of-Spain area, where prices have virtually skyrocketed. The market demand for such property now falls between the area of $200,000 to $1.5 million, after which it slows down considerably. “Once you can afford to ride it out, you usually come out safe in the end,” Lazzari, Director of Eckel Quesnel and Lazzari Real Estate Professionals, said. “You just have to keep on top of it all the time.” “It is a very difficult industry,” she said in an interview, noting that property prices have been climbing steadily during the past three years. She says she does not know when it is going to end. Her advice to real estate agents is to hold on tight and hope for the best.

“I don’t see that they are going to fall in a hurry because construction prices continue to go up and once they go up building prices will go up and property prices are bound to go up as well,” she said. “I don’t know when it is going to end.” Whether the supply could meet the demand is another question, she said. Not many people can afford to go higher, although Lazzari noted, there were some individuals who were on the market for costly, investment-type properties ranging in cost from $1.5 million upwards. This group is very small though. Those in the middle income bracket are starting to feel the pinch. “The middle income earners are in the most difficult position right now, because property prices have gone so high. Young people getting married and looking for a home will find it difficult to afford one because I don’t know if salaries are going up at the same rate.

“To afford a $1.5 million property if you are using financing for the entire thing, you will be paying at least $15,000 a month in mortgage fees and most people don’t make that kind of money,” she estimates. The new trend, she revealed, centred around persons who were already property owners, reselling to purchase these high priced properties. At present, there were not many first time buyers who could afford to purchase in today’s market, she said, unless they moved out to East or Central Trinidad. And even then, finding affordable property is quite a task. “It’s kind of frightening because you are wondering, where are people going to get the money. Our phone rings all day with people looking for property we just don’t have.”

Independent real estate agent, Wayne Anton, shared Lazzari’s sentiments, saying that the demand for properties in the West, in and around PoS, stemmed from the large number of persons who worked in the city and who wanted property there. Most, he said, wanted  to avoid having to face the daily traffic situation getting into and out of the city. “This is a supply and demand business,” he said, “and this will continue to happen unless the business sector decentralises more and moves things out of the city.” In the meantime, East Trinidad is fast becoming a beacon for investors who are closely eyeing the Millennium Estate Development project in Trincity, which is being undertaken by Home Construction Limited (HCL).

Lazzari says though that this still did not mean that market demand was being met, since the prices of these properties did not differ much from those in Western Trinidad. In the past, she said, HCL Trincity properties were of middle income and lower middle income values. “You could get a nice property there for between  $400,000 to $500,000. “It was affordable, not too far away from PoS and you had the option of renovating as the years went on.” While the new golf course development is going to be a beautiful one, she said the prices now being offered are not much different from PoS prices. “So what you are finding is that people who would have bought in PoS might consider buying there just because there is nothing left to buy in PoS,” she said.

She thinks a lot of people are going to buy these HCL properties as investments to resell later on. The one major deterrent by those considering a move to the East was the traffic situation. The only solution Lazzari could see was for Government to move forward with the expansion of the highways, specifically the interchange at the intersection of the Churchill Roosevelt and Uriah Butler Highways. “There are beautiful developments in the East, but the traffic to get there is horrendous and until they continue with that highway project and open it up, I don’t know how many people are going to take up the offer of moving East,” she said. Lazzari also raised the issue of foreign investment into the local real estate market.

Foreign expats employed by energy companies generally rented properties for the duration of their stay in Trinidad. However, she said, there were some who fell in love with the country and purchased properties here in hopes of returning. There were some cases where such properties were rented out and the money reinvested back into the sector. Additionally, she continued, a number of Trinidadians living abroad could be found purchasing land or houses in Trinidad to prepare for their return.