after sales activity jumped significantly in recent months.

But there are indications, too, that rents are being inflated to an uncomfortable level.

Sue Plathe of Joy Lusher Real Estate, said the authorities need to bring the issue of affordable housing to the frontburner.

"Rental prices are well up there,'' she said. "Judging from the number of calls we are getting from studio, one or two bedroom apartments and the lack of availability, it is reason for great concern.

"Not only is there a lack of availability, but supply and demand forces have pushed up rents to levels that are considerably higher than they've ever been in the past.

"It's very difficult for the average person to afford. I don't know where the answer lies, but the potential is there for the problem to become increasingly serious. I don't know if using a portion of the base lands is the answer, but affordable housing is an issue which should require pretty prompt attention.'' Realtors see post-Referendum recovery already, taking extra jobs to get ahead.

"When I see a one bedroom apartment renting for $2,000 a month, who can afford it? It's not just people at the lower end of the market that are having difficulties. I'm finding professional Bermudians, as well as blue collar workers having tremendous trouble finding affordable housing.'' In terms of sales, she agrees with other realtors that the market is looking better than it has in years. There are exceptions.

Still somewhat slow are sales of Bermuda market only condominiums and Bermuda market only executive homes.

She said of the latter: "That's only because there is so little offered on the market for sale. For the first time in years, people are getting such a good rental return on their investments that they are choosing to rent, instead of sell.'' But she joins with other realtors in embracing a period of brisk sales activity.

Arthur Jones of Jones Waddington said, "It's pretty steady across the board as far as I can tell. There is more confidence out there. There is much more activity in general. I don't know that prices have recovered totally.

"But there is fairly strong demand again, if you have the right property at the right price. The non-Bermudian market is still not exactly where it could be. There's been an improvement but a lot of people are not purchasing because they are put off by the tax.'' Said Chris Dapena of The Property Group, "For the property market in general, prices remain soft. It's a buyer-driven boom.'' Drew Horsfield of Bermuda Home said, "In the nine months to December, we have sold 80 properties with a value of $34 million. That compares with 80 properties sold for the entire prior year for $39.5 million. Last year's results were a little skewed by the sale of Wreck House for over $7 million.

"Volume is up and I think the market is quite strong at the moment where properties are competitively priced. We are finding that prices have to be within five percent of market value to sell within 60 days.'' Roderick DeCouto of Roderick DeCouto Real Estate said, "While 1996 was nothing to shout about, things started to perk up a bit during the latter part of the year.

"And already in 1997, I see a definite improvement. We're getting calls from many people interested in buying. And we have contracts that are now completing that began near the end of the year.'' Said Mr. Horsfield, "There is also quite strong activity in the non-Bermudian market. I would call it a post Independence recovery. About 14 properties were sold in 1996, since the Independence Referendum. In the year preceding that it was only five.'' Bermuda Home is working on a house price index, a statistically-based system that would enable sales people to track how prices are doing. They would arrive at a percentage change up or down.

Mr. Horsfield said, "We're going to use the existing data base from Bermuda Realty and Bermuda Home in a rather complicated regression model that values properties. Weighting systems would survey homes on a number of fronts, including number of bedrooms, neighbourhoods and size of the lot of land.

"This should be in place by June. It would measure across the market the increase or decrease in prices. We have to control for location and square footage, as well, with everything being factored into the model.

"We want to have the ability to know if prices have gone up and at what percentage.'' BUSINESS BUC