- Carlington Wilmot/FreelancePhotographer
Palermo Apartments on Waterloo Road, in the Kingston 8 area.
Dennise Williams, Staff Reporter
REALTORS IN the Corporate Area agree on one thing - there are not enough townhouses and apartments being developed to meet the demand of their clients.
However, enterprising individuals have come to market with one-bedrooms, super-studios and luxurious townhouses to try to satisfy the demand.
But there is a catch. Many, if not all, of the new developments are being sold "presently under construction."
Thus buyers are being asked to pay for real estate that is either still on the drawing board or with only a few blocks laid.
A quick view of the Gleaner's classifieds reveals that agents are actively marketing these properties to prospective buyers. Areas such as Merrivale, Armour Glades, Kingston 8, off Old Hope Road and Sunrise Crescent are a few of the local areas of new developments.
CLOSE NEIGHBOURS, GREATER SECURITY
Realtors interviewed by Sunday Business say that the demand is driven by the perception that close neighbours in a gated community offer greater security.
At Tony Walker Construction Realty Ltd., Sunday Business was told, "it is simply security. People prefer gated communities."
And the cost of units in these "under construction" gated communities range from J$3.5 million for a one-bedroom to US$300,000 for a three-bedroom townhouse.
Said Coldwell Banker Jamaica Realty, "In the Dillsbury area of St. Andrew we have a development of three-bedroom townhouses that have just been approved. These units are 3,100 square feet, and will cost US$300,000. But is not uncommon for units to sell for J$12 million to J$15 million."
Realtor, Alton Thompson, tells Sunday Business that townhouses sell like hot bread.
"There were not many townhouses on the market the other day. Right now these new construction projects make a happy time for me. In my listing, I have five different sets of townhouses, but none is under $7 million. Even so, last Sunday, I got 30 calls for an ad placed. Previously, I had listings for townhomes in the Millsborough area for $14.5 million and these are not completed but have been sold. In the Clieveden area, those townhouses and apartments were in the $12.5 million region, and are 90 per cent complete, and even before they were put up, they were snapped up."
At Tony Walker Construction Realty Ltd., Sunday Business was informed that the 'under construction' properties have also helped business pick up.
"Sales are pretty good. We sell about three units per month. And every two months, we get about six townhouses and six apartments to list."
However, for those in the market for under $7 million townhomes, there are units under construction for $5.7 million in the Kingston 19 area.
Although the prices for newly-constructed apartments remain firmly at the starting price of $3.5 million regardless of the area of town.
FUELLING COSTS
But, in terms of what fuels the cost of townhouses and apartments, the reasons are varied.
One is location. Said Mr. Thompson, "Kingston 6 (Liguanea) is the place to be. People want to be close to their job and not fight traffic."
Other realtors tell Sunday Business that upscale communities in St. Andrew such as Billy Dunn, Millsborough, Waterworks and the like go fast at the asking price.
Another factor is the cost of the inputs.
Tony Walker Construction Realty states, "The cost to build apartments and townhouse complexes are high. The labour, materials and fixtures cost. And the quality of fixtures also go into the price."
Indeed, Mr. Thompson tells Sunday Business that his clients in the $7 million to $9 million range expect the standard ceramic tiles, security and parking, but they also expect them to be of the highest calibre. He says that clients are even demanding clay tile roofing, as this is the newest rage in amenities.
For his upper-end clients, Thompson states, "Swimming pools, a double-car garage with video and audio security features are the norm. A high-end property will not sell without these extras."
The cost of the land to the developer also plays a part in the final costing.
Realtors tell Sunday Business that an empty lot in the Corporate Area can run as high as $15 million for one acre.
A fourth factor is demand.
Said Tony Walker Construction Realty Ltd., "Supply will never catch up to demand. There is not enough land space in the Corporate Area."
And so, as the properties come on stream, there will be purchasers ready to put down money.
NOT READY FOR PURCHASE
However, there are those who balk at paying for something that is not ready for them to possess.
Said Hope Codlin & Associates Realtors, "most people want a place to live now and when they see new construction, they think that they have time before paying down. But that is not true. It is best to come in and pay down and begin the purchasing procedures."
Currently marketing one- and two-bedroom apartments, Hope Codlin & Associates requires an initial deposit of 20 per cent, a further deposit of 20 per cent in 90 days and completion of payment when the property is completed in April 2004.
But for those who are nervous about purchasing a work in progress, Coldwell Banker states, "We always recommend that our clients have legal representation. The paperwork is tremendous for a new development. The purchaser must be in clear understanding of any escalation in costs, the construction period and the date of completion."
