Since the military confirmed its buildup plans in late 2005, home
prices on Guam have shot up to price tags not seen in almost a
decade, according to statistics released yesterday by The Captain
Company.
As of December last year, the median price for a single-unit home
reached $170,000, a steep rise from when the local real estate
market hit bottom in 2003. Four years ago, median-priced homes went
for $106,500.
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"We can't overlook the impact
of the military expansion," said Nick Captain, president of the
company that the local real estate market looks to for its quarterly
statistical data. Guam's real estate market was already in a
recovery phase when the military's multibillion-dollar Guam buildup
was first publicly acknowledged.
But the anticipation of a huge military expansion on Guam, paired
with international and national press coverage about it, really put
Guam on the investors' radar screens, Captain said.
And at the time of the military buildup's announcement, investors
were looking for a new place to invest after housing prices in
Hawaii and the U.S. mainland had overheated -- leaving no room for
investors' money to grow, Captain said.
"When the military announced its Guam expansion plans in late
2005, our prices were still ... relatively low ... and we were at
the beginning of the growth stage in pricing," Captain said.
What's going on in the local real estate scene, he said, is "kind
of the opposite of 'The Perfect Storm.'"
Several years ago, he said, "all the negative forces were
punishing the local real estate market."
Now, "all the stars have aligned," Captain added.
Last year's fourth quarter reflected a sales volume increase of
500 percent from the downturn, from a previous $10 million per
month, to $50 million per month, Captain said.
Though homebuying on Guam is being fueled by expectations of the
military-driven economic boom, Captain does not see home prices
falling any time soon.
There are a lot more buyers than sellers, and pricing is dictated
by demand, he said.
Rotary meeting
Captain is scheduled to talk in detail about
the real estate market at a Rotary Club lunch meeting today at the
Hilton Guam Resort & Spa.
The Captain Company's latest statistics prompted a press release
from acting Gov. Michael Cruz.
"We're working hard to make all this translate into more jobs,
higher-paying careers, housing opportunities and much more," Cruz
said.
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