As we welcome in a new year, I thought I’d take this opportunity to provide a recap of the Cayman Islands real estate market for 2024 with respect to volume, transactions, inventory, and overall pricing as well as provide some insight as to where I believe our market will be heading into the new year.
Please note that all figures included in this article are taken from CIREBA and are quoted in US dollars.
A look at sold transactions and volume
In 2024, the total number of sold transactions was 858, which is up from 725 in 2023, a 18.3% increase. With respect to volume, 2024 saw $1,021,510,654 in sales, which is up from $954,689,774 in 2023, a 7% increase.
One Billion Dollars
It could easily be said that the Cayman Islands real estate market is now officially a $1 billion industry.
2021 was a record-breaking year for real estate in the Cayman Islands. It was the first time in our industry’s history that we hit over $1 billion in sales volume.
In 2023, total sales volume went down to $954M but with a few key developments such as The Watermark and the Grand Hyatt completing in 2025, it wouldn’t be unrealistic to think the market will hit $1B again this year.
New listings
When you look at new listings, we saw a total of 1,561 new listings in 2024. This number decreased very slightly from 1,605 in 2023, a 2.7% decrease. With respect to the value of these new listings, 2024 saw $2,632,793,053, which is down from $2,692,491,090 in 2023, a 2.2% decrease.
The decrease in new listings is not surprising. In 2023, I listed 73 Lakeside units which amounted to 5% of all the listings in 2023.
Average price per listing – solds and new listings
The average price per sold listing has been increasing year-over-year. In 2020, the average price of a sold listing was $987,131. In 2021, that climbed to $1.016M a 3% year-over-year increase. In 2022, that number rose to $1.104M, which is an 8.7% year-over-year increase and in 2023 was $1.178M, a 6.7% increase, which is a 19% increase in just 4 years.
In 2024, the average price per sold listing was $1.183M a slight 0.4% increase over 2023. It is important to keep in mind in 2024 there were 858 total sold transactions, of which 73 of them were units I sold at Lakeside and undoubtedly these have brought down the average sale price for 2024.
When you look at new listings, we are a slightly different story. In 2020, the average price per new listing was $1.119M and in 2021, that climbed to $1.528M a 36.6% year-over-year increase. In 2022, that number rose to $1.813M, which is an 18.6% year-over-year increase. Then in 2023 we saw a decrease in average price. In 2023, the average new listing price went down to $1.678M, a 7.4% decrease. As with the Lakeside sales noted above, all 73 listings were live at the end of 2023 and would have impacted the overall average.
In 2024, the average price per new listing was $1.650M a 1.7% decrease over 2023. This doesn’t mean prices are coming down. We are seeing more lower priced properties and developments hitting the market which is affecting the overall year-over-year percentages.
Inventory is up
The average monthly number of active listings at the end of 2024 was 1,842 compared to 1,609 in 2023, which is an 14.5% increase. As of writing this article, there are currently 1,819 active listings of which 366 are pending and 230 are pending/conditional which means only 1,223 are actually available for sale.
There are several things which should be taken into consideration when looking at inventory. Our population continues to increase, and it currently estimated at 90,000+ which is a huge jump over the last few years.
It is important to note that inventory hit a 5-year low in 1,444 units versus an average of 1,842 listings. That is only a difference of 398 listings for a population that has probably increased by 25,000+ people during the same time period.
So, yes, year-over-year, there is slightly more inventory in the market, but the population size is increasing, and we know from experience that many people when they move to Cayman start out as renters and eventually purchase property.
The value of existing inventory
Not surprisingly the value of the active listings in the marketplace has continued to rise. In December 2022, the value of active listing inventory hit $3 billion for the first time in our industry’s history. Ever since then this number has been climbing higher and higher and increased to over $3.5 billion in December 2024.
2025 and beyond
2023 was a year of transition with respect to the Cayman Islands real estate market as it was on a global basis. The pressures of increasing inflation, rising construction costs, and rising interest rates impacted all sectors of the market.
2024 saw the Cayman Islands real estate market get back to “normal”. We saw traditional slower seasons during the Summer and Fall and a much busier high season. Interest rates are starting to come down and inflation seems to be leveling off.
In mid-December, the US Federal Reserve announced its third and final interest rate cut of the year, reducing its benchmark by 0.25 percentage points to between 4.25% and 4.5% which is great news as the borrowing rates in the Cayman Islands are pegged to the US rates.
But what is the outlook for interest rates in 2025? The Federal Reserve expects to cut its influential federal funds rate at a slower pace in the new year than previously anticipated. Why? Job growth in the US exceeded expectations with unemployment falling to 4.1% in December 2024 plus an anticipated 3.3% increase in inflation in 2025.
2024 did not see the same level of activity at the higher end of the market compared to previous years. In particular, activity at the higher end of the market was quite soft during the last half of the year.
Since December and moving into January, the activity in this segment of the market has picked up substantially especially along Seven Mile Beach and with high end homes. The activity we are seeing now is much more like we would expect at the end of the year.
For much of 2024, the marketplace was being buoyed by local buyers versus foreign particularly impacted by the US election. Local buyers will continue to be important in 2025 due to supply and demand. Foreign investment has begun to tick up and the lowering of interest rates helped and will continue to help into the new year.
2025…supply and demand
There are several reasons we are not seeing price drops but ultimately it comes down to supply and demand and right now the demand for property in the Cayman Islands will continue to grow.
As I’ve touched on in several articles, the Cayman Islands has a unique real estate market. We are a very desired location, and people are continuing to relocate for numerous reasons but the most common are:
- Our incredible lifestyle.
- Investment opportunity including the relocation of family offices.
- Our tax neutral status.
- Employment opportunities as so many of our cornerstone industries including banking and legal services continue to grow and expand.
- Medical care including the new cancer facility at Heathy City along the Seven Mile corridor.
The more people who move here, the more demand for housing, but the supply of new housing is slowing down.
Like most industries, the real estate industry in the Cayman Islands will go through changes throughout 2025. When buying or selling property, it is important to work with someone you can trust, who is an expert in their field, who has multiple years of experience. If you have any questions regarding buying or selling property in the Cayman Islands or anything related, please do not hesitate to reach out to the Bovell Team at +1 345 945 4000.