Rocketing building costs have sent Bermuda’s property market into a critical state, says a veteran real-estate broker.

“There is no inventory other than in the highest price brackets,” Jane Burt, of Think Real Estate, said. “People are just not building.”

In July, the value of building materials fell 22.8 per cent and the volume of sales 24.4 per cent, according to the latest Retail Sales Index figures.

“When I started in the industry 16 years ago, it cost about $350 to $400 a square foot to build,” Ms Burt said. “Now, it is around $700. That is just a basic cost, not including high-end fixtures. That is a lot of money, even if you are just building a 1,000 sq ft apartment.”

As a result, many people are struggling to sell homes in need of updating and renovation, at top dollar.

“One-bedroom apartments and studios are now virtually extinct,” Ms Burt said.

Pandemic supply-chain challenges are a contributing factor, according to her.

In the future, she expects to see more properties constructed with alternative, cheaper materials.

“Right now most homes are built from Bermuda stone or concrete block,” she said. “There are other methods that can be used.”

She pointed to a few condominium developments that were built using styrofoam foundation forms to create a strong and well-insulated structure.

“They are energy-efficient and cool in the summer,” she said. “However, this method is just catching on. We also need to do more exploration into prefabricated housing.”

High construction costs are also affecting the commercial real-estate market.

“We have a lot of commercial real estate in Bermuda,” she said. “Unfortunately, much of it is quite dated. For top-tier commercial real estate you can still get a good return. Point House on Front Street, for example, was a great success. However, Class A commercial real estate is phenomenally expensive.”

Ms Burt said much of the commercial real estate on the market needs money invested into it in terms of plumbing, electricity and fire systems.

She thought one way to bring costs down would be to train more skilled craftsmen in Bermuda.

“It would be fabulous to see a trade school here teaching people things like plumbing, carpentry and electrical work,” she said.

Interest in developing more City residency, she believes, is a market opportunity.

Ms Burt sees interest in City life from older and younger people, and believes that 20 to 30 years from now Hamilton will have spread farther east and west with more people living in the City.

“Hamilton will also be more ‘artsy’ with more diverse food and shops,” she predicted.

Celebrating four years running Think Real Estate this month, she recalled starting out as a residential and real-estate manager at Kitson’s.

“Mr Kitson said it’s your time and really encouraged me to go out on my own” Ms Burt said.

Think Real Estate now has ten agents, and Ms Burt is working on bringing two more on board. There is also a home-cleaning branch of the business.

She is seeing a great deal of interest in real estate as a potential career.

“I get people as young as 11 asking how they can get into real estate,” she said.