Real estate is a commodity not unlike stocks, bonds, crude oil, and gold. And just like those tangible goods, real estate rides a cyclical roller coaster of ups and downs.
Just prior to the 2019-20 pandemic, real estate across the globe was relatively flat. At that time, there were plenty of homes for sale in Curaçao that had been on the market for several years with little interest or offers from either local or foreign buyers. Surprisingly, even at very low prices, no one seemed interested in the numerous available seafront properties and homes in coveted neighborhoods.
But after the pandemic, real estate prices across the globe, including Curaçao, began a steady climb due to the rise of digital nomad-hood, optimism concerning the post-pandemic economic climate, and historically low interest rates.
While it is true that foreigners have been buying property in Curaçao, and always have, this is not the sole reason prices have risen. And right along side of those foreigners, many local Curaçaoans have been heavily involved in significant real estate purchases and development. From Bandabou to Bandariba, large tracks of plotted land and developed housing projects are held by local interests involved in land banking and sales.
It is therefore inaccurate for Fundashon pa Konsumidó (Consumer Foundation) to attribute the island’s rising prices for homes and land to nonresident purchasers. The reality is that a healthy supply-and-demand free market economy is at work in Curaçao.
So what is there to investigate? A trusted and robust investment climate is a gift any country’s government would welcome. Moreover, government meddling in such things rarely delivers a desired outcome, as nearby Venezuela and Argentina have demonstrated over the years.
The phrase “what goes up must come down” is especially true of real estate. The island’s home and land prices are currently up, but that won’t always be the case. As with all cyclical commodities, a time will come when the buyers are few and the only thing going up is the inventory of unsold property. In turn, this will lead to lower prices and the return of a buyer’s market. All by itself.
Gunsor Buther