Allowing work permit holders to purchase condominiums could stimulate the island’s struggling real estate market and provide relief for Bermudian owners seeking to sell their properties, leading industry figures said yesterday.

Brian Madeiros of Coldwell Banker Bermuda Realty, Penny MacIntyre of Rego Sotheby’s International Realty and Sharon Cranfield, chairperson of the real estate division of the Bermuda Chamber of Commerce, were responding to a government pledge in Friday’s Budget Statement that it would advance measures to stimulate the market.

Mr Madeiros, who is president and chief executive officer of Bermuda Realty, said there is an over supply of condos in Bermuda.

His agency’s data shows that some 107 condos are on the market, and on average take more than 850 days to sell.

When condominiums were first introduced in Bermuda, Mr Madeiros said, properties in designated developments were available for purchase by work permit holders.

He said: “Overseas buyers were very often senior business leaders working in Bermuda, committed to their community and our island.”

Mr Madeiros said an annual rental value threshold was instead introduced, meaning that work permit holders were no longer able to purchase condos.

He said: “Correcting this may assist to increase sales transactional volume and permit those Bermudians that find themselves in difficult and distressed situations to remove this burden and move on with their lives.”

He said an uptick in sales would have “a significant impact on job creation in the construction and home-related industries”.

Ms MacIntyre, a partner at Rego Sotheby’s, said she was “very much” in favour of allowing work permit holders to purchase condos.

“Right now, the only opportunity for a work permit holder to buy is on a resort property, and there is limited opportunity there,” Ms MacIntyre said.

“Where the real estate market has suffered, and has since the 2008 market crash, is in the condominium market.

“Work permit holders are here, they understand Bermuda and if they wish to make a commitment here with a real estate purchase, that bodes well for so many areas of Bermuda, including the reno and construction industries. It would also mean those work permit holders would engage with Bermuda far more.

“I hope to see that happen because the condo market for over a decade has suffered the most out of the entire real estate industry.”

Ms Cranfield said the chamber is watching with interest to see what strategies the Bermuda Government is considering in support of struggling Bermudian sellers of property.

She said owners of mid-range value condominiums are the largest group of sellers on the market.

Ms Cranfield said the real estate division of the chamber is in favour of allowing work permit holders to purchase condominiums.

She said: “What we need at this point is a new and hitherto untapped revenue stream. Work permit holders can already purchase houses and opening up condos to them as an alternative would provide a new group of buyers at all financial levels so that all Bermudian sellers have the opportunity to sell, get out of debt and reinvest in what may be a more suitable property.”

Ms Cranfield added: “We believe the trickle-down effect of increased condo sales to this group of buyers would lead to work for all types of contractors for refurbishment of interiors, increased sales of homewares and home improvement products.”

She said it would also “go a long way to creating a new homeowner, one who would now be more vested in Bermuda than they were, with funds staying here on-island rather than being repatriated overseas”.

Mr Madeiros and Ms MacIntyre also called for a faster turnaround in the issuance of licences required by non-Bermudians who seek to purchase homes here.

Mr Madeiros said: “The challenge in the market is the length of time it takes to process the application, which is currently approximately six-plus months, which does not compare favourably with our competitors.”

Ms MacIntyre added: “Bermuda is the only jurisdiction where it takes this long. The norm is six months from the date the contract is signed, but I have seen instances where it has taken eight months.”

She warned that the island’s competitors had stolen a march on Bermuda.

“Other jurisdictions, which we are competing against, turn around approvals in five to ten days,” she said. “They give guarantees. Cayman does it in ten days, and Turks and Caicos turns it around in two weeks.”

Mr Madeiros said each such sale “generates immediate tax revenue through the licensing fee and stamp duty and very often creates opportunities for our struggling construction industry when new buyers decide to renovate older properties”.

The agency boss also urged Government to focus on the needs of small and medium-sized enterprises, which he said are a major source of job creation with some estimates saying they account for more than 60 per cent of jobs in a community.

Mr Madeiros said: “If the SMEs in Bermuda were growing and creating new jobs rather than shedding them, the employees working in SMEs would assumedly have greater confidence as it relates to making what is probably the most important purchase of their life, the purchase of their home.

“Does our current population support our existing SMEs, or is consolidation or ultimate shrinkage inevitable? Would a growing SME industry produce a positive stimulus for our real estate market? I would think so.”

Bermuda recorded approximately 200 real estate transactions in 2019.

Mr Madeiros said that level of activity mirrored results in 2012, which he called “the worst-performing year in recent recorded history”.

He said a regularised market in Bermuda that doesn’t price people out should produce 450 sales transactions annually.