Government plans to increase housing supply in Trinidad and Tobago


The residential real estate market has experienced fluctuations through the boom and bust cycles. During the 1990s and into the 2000s, buoyed by high energy prices and large amounts of foreign direct investment (FDI), there was a corresponding increase in property development. As a result, the prices of homes rose by more than 400% from 1991 to 2006. This drove up the price of properties in the wider north-west region and in the areas around Point Lisas Industrial Estate in particular. Prices also soared in Tobago, where FDI created a vibrant villa segment in the tourism industry, with this activity tapering off in 2006. The global recession of 2008 saw Trinidad and Tobago’s real estate sector decline as demand decreased sharply, leaving many projects uncompleted or halted. It is estimated that the prices of houses on the market fell by 20% from 2007 to 2009. The subsequent collapse and bailout of CL Financial, which was T&T’s largest private developer, placed a further strain on the government’s already-stretched resources. However, unlike many of its Caribbean neighbours, the market experienced a marginal recovery between 2014 and 2015, though the slump in energy prices, coupled with declining demand for housing from expatriates, saw a reversal of some gains.

Residential Segment

The country’s residential market is still subdued. The median house price fell by 5.9% to TT$1.2m ($178,000) during the year to September 2017, with quarter-on-quarter prices falling by 14.3%, according to the Central Bank of T&T (CBTT). Industry stakeholders expect the local market to remain weak while the economy slowly recovers. Given that the purchase or sale of a property is one of the largest financial transactions a family or an individual may undertake, changes in property prices have a substantial impact on potential home buyers and sellers. To better understand the market, professionals in the industry have called for more comprehensive data on property sales prices. The Association of Real Estate Agents of Trinidad and Tobago (AREA) has begun to implement a multiple listing system, which is intended to be a database of all property sales made by its members; however, it is not yet fully used by members, who represent only a portion of those involved in property transactions, diluting its usefulness as a data tool. Even in the absence of comprehensive data, industry experts widely expect that rental and sales prices will continue to soften given T&T’s broader economic climate.

Average Prices

Despite this general swing, price trends will vary depending on the market’s demands. “There is a lot of activity, but only within a limited stock of properties priced under TT$2m ($297,000),” Kathryn Hosein, owner of real estate agency Property Match, told OBG. “There is high demand for move-in ready homes in a nice area for a reasonable price.” Despite this demand, Hosein says sellers will still need to adjust their price according to what buyers are willing to pay.

In the high-end areas of western Trinidad, there is a large supply of modern houses averaging TT$3.7m ($549,000) per unit. Moving further outside of the west and Port of Spain area, prices tend to decrease, with the price for three-bedroom houses ranging from TT$1.8m ($267,000) to TT$2.2m ($326,000). In Tobago a two-tier market serves local home buyers and the vacation rental market. Local buyers tend to look for housing below TT$1m ($148,000), which is in short supply. The tourism market starts nearer TT$2m ($297,000) for a small villa or condo, reaching TT$3.5m ($519,000) for a well-located three- or four-bedroom villa with pool.

With the downsizing of many multinational companies and the subsequent decline of the expatriate community, rents for a large number of properties, particularly in the western region, have fallen substantially. For the expatriate and upper-income markets, lease prices vary greatly, starting from TT$9500 ($1400) per month, with some paying significantly more. Within the local middle-income market, residential rents for apartments and properties in gated communities typically range between TT$3000 ($445) and TT$20,000 ($2970).

Office Space

The government is one of the main renters of office space in T&T. According to the auditor general’s FY 2016 report on public accounts, the government spent TT$480m ($20.7m) on rental properties, some of which were not being used. In June 2017 the government released a formal response, stating that the current administration had saved a total of TT$90m ($13.3m) by making property management a priority since taking office. However, the following auditor general report found that rent paid by ministries and departments was in excess of TT$790m ($117m) in FY 2017, noting that in many cases rent was being paid without formal lease agreements in place, potentially leaving the state in a vulnerable legal position.

In the private sector there has been a considerable slowdown in business activity, which has led to the current glut of commercial buildings available for rent. As a result of the subdued demand, competition is rising, with companies increasingly seeking out more modern facilities. Although T&T’s capital city – Port of Spain – remains the financial, administrative and commercial centre of the country, urban challenges such as parking and traffic congestion, coupled with the ready availability of office space in non-urban areas, have prompted many commercial businesses to seek alternative locations. In recent times a number of local and international organisations have sought to consolidate their offices across the country to a single location in one of T&T’s developing commercial districts in Aranaguez, Trinicity, Arima, Chaguanas or Couva.


The global concerns surrounding money laundering, terrorist financing and tax fraud may warrant closer examination of T&T’s real estate sector. The local body tasked with monitoring suspicious transactions is the Financial Intelligence Unit (FIU). By law, any person, partnership or company in the business of buying, selling or leasing land, and those with any interest in land or buildings must be registered as a listed business with the FIU. As noted in the FIU’s annual report for 2017, warning letters were sent to 216 entities for breaches, including failure to register with the FIU and failure to rectify deficiencies that were observed in compliance audits. The highest number of these were sent to businesses in the real estate sector for failure to register, representing a total of 42 letters out of 80 for this offence. In its report, the FIU also noted that it had held a sector-specific awareness seminar in conjunction with AREA, in light of real estate being a high-risk area. AREA collaborates closely with the FIU to enhance the effectiveness of their mandate.

A major factor contributing to the unregulated nature of the sector is that anyone can work as a real estate agent, facilitating the buying and selling of properties, regardless of their level of training or professional affiliation. Sally Singh, president of AREA, estimates that only 20% of people actively engaged in property sales activities are registered with AREA, since membership is currently non-compulsory, despite being the official association of the industry and incorporated by Act of Parliament. Agents who do choose to join AREA must first be registered with the FIU, and ongoing help is provided to help them comply with the demands of FIU legislation. “As the regulatory body for the real estate sector, AREA is working with the attorney general’s office on a draft bill to ensure the regulation of the real estate industry on our twin island, and it will entail all agents being registered with our association and licensed annually,” Singh told OBG.

In the absence of formal regulations at this time, the sector self-regulates to a large extent, with many agencies and agents working directly with the FIU to perform their due diligence with clients, requiring the submission of standard “know your client” information at the start of each transaction. However, an official regulatory framework, such as that being developed by AREA and the attorney general’s office, needs to be implemented to ensure full compliance throughout the industry, as well as adherence to the standards of real estate practice and its code of ethics.

It is also expected that establishing regulation within the industry would also help to raise property tax collection rates and provide much-needed industry data. In addition, this formalisation would demonstrate the maturity of the local market to international authorities concerned with anti-money laundering, counter-terrorism financing and the prevention of tax fraud, potentially attracting higher levels of FDI.

Interest Rates

During the early to mid-2000s the mortgage loan rate averaged 9.13%, helping to fuel the housing boom. However, with fears of hyper-inflation, the CBTT decided to raise the benchmark interest rates. This had the cumulative effect of increasing mortgage rates, which reached 13% by October 2008. From 2009 onwards the interest rates were reduced, and both the basic prime rate and the average mortgage rate fell to 7.5% by November 2012, according to the CBTT. As of September 2018, the average mortgage interest rate remained unchanged at 7.5%. The basic prime lending rate of commercial banks, which had been steady at 9%, rose to 9.13% in August 2018 and 9.25% in September. With a low rate of interest available, mortgage lending remained strong over the six months to December 2017. Aided by lower interest rates, mortgage loans rose by 8% in December 2017, up from the growth rate of 5% in July. In addition, one of the leading commercial banks in T&T, Scotiabank, announced in November 2017 that it would no longer be using the central bank’s Mortgage Market Reference Rate, and would instead align its consumer mortgage rates to the Scotiabank Mortgage Reference Rate, which was at 3.5% as of June 2018.

Public Housing

For prospective buyers who cannot afford regular mortgages, the government offers alternative support in the form of the Aided Self-Help Housing Programme, launched by the Ministry of Housing and Urban Development in late 2017. To be eligible, citizens must earn less than TT$25,000 ($3700) a month, either singly or combined; have lived in T&T for five years uninterrupted; and be first-time homeowners. The first cycle of the programme offered 1000 lots of land sold at 30% of market value. The programme provides subsidised mortgages at interest rates of 2-5% through the T&T Mortgage Finance Company, and access to building contractors, pre-approved house plans and technical assistance. The initiative aims to enable citizens to manage the construction of their own homes. The government has also taken steps to allow those citizens who have a Certificate of Comfort – a document which gives a squatter on state land a personal right to protection from ejectment – to purchase land from the state at 25% of its market value. According to the Land Settlement Agency, there are more than 250 squatting sites on state lands in T&T, which are home to roughly 23,000 squatting households.


In the face of lower demand and higher competition for tenants, developers are adapting to the shifting demographics and rising requirements for improved service delivery and amenities in the office and residential segments. Longer-term growth, however, will be largely dependent on the broader economy.


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The Report: Trinidad & Tobago 2018

Construction & Real Estate chapter from The Report: Trinidad & Tobago 2018

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