Counting the Gains: Caribbean Closes 2025 With Resilience and Charts an Ambitious Course for 2026

Publication Date: 3 January 2026  |  Coverage Period: 3 December 2025 – 2 January 2026

Morning Briefing

• Caribbean-wide 2025 GDP growth estimated at 3.2 per cent, ahead of global average despite hurricane disruptions.
• Jamaica records its strongest full-year tourism performance since 2019, with stopover arrivals surpassing 3 million.
• Guyana’s 2025 oil revenues fund the largest infrastructure budget in the country’s independent history.
• Caribbean hotel bookings for January-March 2026 running 12 per cent ahead of equivalent 2025 advance reservations.
• IMF December 2025 assessment praises Jamaica’s fiscal discipline, upgrades growth forecast for 2026 to 2.8 per cent.
• Several Caribbean property developers announce major new mixed-use projects for 2026 groundbreaking, signalling strong investment confidence.

2025 in Review: A Year of Recovery, Resilience and Rising Risk

The Caribbean’s economic story in 2025 was, in essence, a story of resilience tested and largely maintained. The year began with the continuing expansion of the region’s tourism-led recovery from the pandemic years, continued with the disruptions of an active Atlantic hurricane season that caused damage across several island states in the September-to-November peak period, and closed with strong holiday season visitor flows that pointed toward a confident opening to 2026. The arithmetic of the full year — Caribbean-wide GDP growth estimated at 3.2 per cent by the International Monetary Fund and the Caribbean Development Bank — understates both the exceptional performance of individual outperformers like Guyana and the Dominican Republic and the genuine hardship experienced in jurisdictions directly affected by storm activity.

The narrative of 2025, however, was not simply one of recovery and growth. The year also consolidated several structural challenges that are likely to define Caribbean economic and investment conditions for the rest of the decade. Property insurance unaffordability reached new severity across the Eastern Caribbean. Housing supply deficits widened in nearly every Caribbean jurisdiction. Cost-of-living pressures squeezed household finances and eroded real wage gains in the majority of Caribbean labour markets. And the fiscal constraints of many Caribbean governments, while gradually improving in aggregate, left limited room for the large-scale public investment in infrastructure, housing and climate adaptation that the region’s structural vulnerabilities demand.

For investors reviewing their Caribbean positions and strategies entering 2026, the year-end picture presents a familiar duality: compelling long-term fundamentals — scarcity, amenity, diaspora demand, improving governance — sitting alongside real and growing operational risks from climate, insurance market dysfunction and housing market dysfunction. Understanding how to navigate that duality is the defining investment challenge of the current Caribbean market moment.

Jamaica: Fiscal Discipline, Tourism Record and the Property Market’s Dual Speed

Jamaica’s 2025 economic performance was broadly positive by the standards of a decade that has required constant navigation of global headwinds. The IMF’s December 2025 Article IV assessment praised the government’s continued adherence to its fiscal rules, noting that Jamaica had maintained a primary fiscal surplus for the seventh consecutive year and had reduced its public debt-to-GDP ratio to below 80 per cent — a threshold that had once seemed aspirational rather than achievable. The IMF upgraded its Jamaica GDP growth forecast for 2026 to 2.8 per cent, reflecting expected gains from tourism, business services, agriculture and the ongoing construction pipeline.

Tourism delivered a landmark result: the Jamaica Tourist Board confirmed in December that full-year 2025 stopover visitor arrivals had surpassed 3 million for the first time, a symbolic milestone that represented a recovery not only to but beyond the pre-pandemic high watermark of approximately 2.7 million set in 2019. The achievement reflected the sustained expansion of airlift to Sangster International Airport in Montego Bay, the continued growth of boutique and eco-tourism product outside the traditional resort corridor, and the remarkable global reach of Jamaica’s cultural brand — driven by music, cuisine and sport — in attracting visitors who might not previously have considered the island.

Jamaica’s property market in December 2025 was operating at the familiar dual speed that has characterised it for most of the decade. The upper and upper-middle market — properties above J$25 million — remained active, with demand from returning diaspora members, expatriate professionals associated with the tourism and business services sectors, and a small but growing cohort of non-Jamaican international buyers attracted by the combination of cultural richness, improving infrastructure and relatively competitive pricing compared with other Caribbean markets at equivalent quality levels. The affordable and lower-middle market remained severely constrained by supply, with National Housing Trust application queues extending well beyond the agency’s near-term delivery capacity.

Guyana’s Oil Wealth: Year Three of Transformation

Guyana closed 2025 as the Caribbean’s undisputed economic growth leader, with the National Bureau of Statistics reporting full-year GDP growth of approximately 32 per cent — a figure that, while driven primarily by the continued ramp-up of oil production rather than broad-based economic expansion, nonetheless generated fiscal revenues that funded a transformation in the country’s public investment programme. The 2026 national budget, presented to the National Assembly in December 2025, allocated Guyana’s largest-ever infrastructure investment envelope, covering new roads, expanded utilities, an accelerated housing programme and significant investment in public health and education facilities.

The property market consequences of this fiscal expansion were highly visible in Georgetown and its surrounds. The Housing Ministry’s Low Income Housing Programme accelerated deliveries in the fourth quarter of 2025, with several new communities on the East Bank and East Coast Demerara receiving their first residents before year end. Commercial property values in Georgetown’s central business district continued their upward trajectory, as international oil company offices, hotel developments and professional services firms competed for a limited stock of Grade A commercial accommodation. The expatriate residential market — catering to ExxonMobil, Hess and CNOOC employees and their families — remained the region’s most intensely supplied premium rental market, with monthly rents for high-specification houses in Providence and Nandy Park consistently exceeding those achievable in Port of Spain or Kingston for equivalent property types.

The Holiday Season Dividend: Caribbean Tourism Enters 2026 With Momentum

The December 2025 holiday tourism season delivered strong results across the majority of Caribbean destinations. Hotel occupancy in the key Christmas and New Year window — the Caribbean’s most valuable booking period by achieved rate — was reported at 92 per cent for the North Jamaica coast, 88 per cent for Barbados’s West Coast, 95 per cent for the Punta Cana corridor and 85 per cent for Nassau and the northern Bahamas, according to data compiled from hotel group communications and industry associations during the reporting period.

The advance booking data for January through March 2026 — the balance of the Caribbean’s peak winter season — was running approximately 12 per cent ahead of equivalent 2025 advance reservations, suggesting that the strong 2025 outturn was not a one-time event but part of a sustained upward trend in Caribbean tourism demand. Airlines serving Caribbean routes reported high load factors on January departures from North American and European origin cities, with several routes operating wait-listed for the peak February school holiday period.

For Caribbean property markets, the holiday season tourism data has direct relevance to short-term rental yields, hotel investment return projections and the pricing of tourism-adjacent residential property. Investors considering Caribbean property acquisition in the early weeks of 2026 were operating in an environment of demonstrated tourism strength, improving financing conditions from the Bank of Jamaica’s rate cuts, and a development pipeline that, while active, was not adding supply at a pace that would materially dilute existing asset values in the near term.

Regional Property Developers Signal 2026 Confidence

The closing weeks of December 2025 and the opening days of January 2026 saw several Caribbean property developers make significant announcements about new projects scheduled for 2026 groundbreaking. In Jamaica, one of the island’s most established private residential developers announced a 350-unit apartment complex in Portmore, targeting the first-time buyer and young professional market at prices starting from J$8.5 million. The project — which incorporated solar panels, rainwater harvesting and hurricane-resistant construction as standard features — was described by its developer as a deliberate response to the intersection of the affordability challenge and the growing consumer demand for climate-resilient housing.

In Barbados, a new mixed-use development on a former agricultural site in the St Philip parish was announced, combining affordable residential units, a neighbourhood retail centre, a community health facility and a rooftop solar installation capable of supplying a significant portion of the development’s electricity needs from renewable sources. The project, developed with support from the Caribbean Development Bank’s housing finance facility, was positioned as a model for how the island could expand its affordable housing stock on available land without sacrificing environmental standards or community amenity.

In the Dominican Republic, two major hotel groups announced new luxury all-inclusive developments on previously undeveloped stretches of coastline in the country’s Samaná and Pedernales provinces, reinforcing the country’s pipeline as the Caribbean’s most extensive by both unit count and investment value. The Pedernales project, in particular, attracted attention because of its location in a province that has historically been one of the Dominican Republic’s most economically marginalised — government investment in road infrastructure and a new international airport in the region had unlocked development potential that investors were now moving quickly to access.

The Hurricane Season’s Economic Ledger

Any honest year-end accounting of Caribbean economic performance in 2025 must acknowledge the hurricane season’s contribution to the debit side of the ledger. The 2025 Atlantic season, which ran from June through November, was characterised by above-normal activity consistent with the NOAA forecast issued in May 2025. Several Caribbean territories experienced direct storm impacts that disrupted tourism activity, caused property damage, strained insurance markets and required emergency government spending that diverted resources from planned development programmes.

The economic costs of the season’s Caribbean impacts were distributed unevenly, as they always are. Major tourism resort infrastructure, which is typically built to high engineering standards and insured at commercial replacement values, demonstrated greater physical resilience than the residential housing stock of lower-income communities, much of which is owner-constructed and uninsured. The disparity in storm resilience between the formal and informal housing sectors — and the social consequences of damage concentrated in communities least able to self-fund reconstruction — remained a recurring and unresolved feature of Caribbean vulnerability to Atlantic storms.

The construction sector benefited from the post-storm recovery dynamic in the affected territories, as reconstruction spending created demand for building materials, labour and project management services that partially offset the disruption costs. However, the net economic effect of storm impacts remains negative: the resources consumed in rebuilding to the previous state do not create new productive capacity, and the insurance market consequences of active seasons — rising premiums, reducing coverage, growing uninsured exposure — carry forward as structural headwinds for property markets in subsequent years.

Caribbean Leaders This Month and Year

Based on evidence available during the 3 December 2025 to 2 January 2026 reporting period and over the full 2025 calendar year:

Fastest economic growth (2025): Guyana — approximately 32 per cent full-year GDP growth driven by oil production expansion makes Guyana the Caribbean’s and one of the world’s fastest-growing economies by this measure.

Best tourism performance (2025): Jamaica — the 3 million stopover visitor milestone is the Caribbean’s most symbolic tourism achievement of the year, confirming the island’s full recovery from the pandemic disruption.

Most stable fiscal environment: Jamaica — the IMF’s December upgrade of Jamaica’s growth forecast and praise for fiscal discipline represents the strongest sovereign credit signal for any Caribbean economy in the December period.

Strongest development pipeline: Dominican Republic — new hotel announcements in Samaná and Pedernales confirm that the country’s pipeline extends well beyond the mature Punta Cana corridor into frontier development zones.

Best affordable housing innovation: Barbados — the mixed-use St Philip development combining affordable housing, retail, healthcare and solar energy represents the Caribbean’s most integrated community development model announced this month.

Strongest holiday season tourism: Punta Cana, Dominican Republic — 95 per cent hotel occupancy in the Christmas and New Year window leads all major Caribbean resort destinations.

Most dynamic property investment announcement: Jamaica — the 350-unit Portmore apartment project combining affordability, sustainability and hurricane resilience represents the region’s most thoughtful private sector housing innovation of the month.

Overall Caribbean performer of 2025: Guyana — for the sheer scale of economic transformation delivered by oil revenues, with consequences felt across the Caribbean’s investment and economic landscape that will define the region’s narrative for years to come.

Looking Ahead to 2026

The consensus among Caribbean economic analysts as the new year opened was cautiously optimistic. The global interest rate easing cycle, if it continued as broadly expected, would provide meaningful support to Caribbean mortgage markets, construction finance and government debt servicing costs over the course of 2026. The tourism demand pipeline appeared strong, with advance reservations suggesting another year of above-trend visitor volumes. Guyana’s oil production would continue its ramp-up, providing a major growth engine for the Caribbean economy as a whole even as its wealth remained concentrated in one nation.

The risks to this relatively constructive outlook were real and familiar. Another active Atlantic hurricane season — which could not be excluded given the warming sea surface temperatures that have characterised recent decades — could disrupt tourism, damage property and strain insurance markets. The property insurance affordability crisis, unless addressed by structural reforms at the government and industry level, would continue to erode household financial resilience and constrain the development market in the Eastern Caribbean. And the housing supply deficit, which was widening faster than governments were able to close it, would continue to generate social pressure and economic inefficiency that limited the full realisation of Caribbean economies’ growth potential.

For property investors, 2026 opened with a clear investment thesis: Caribbean residential real estate in well-located tourism markets, supported by strong rental demand and improving financing conditions, offered a compelling combination of income yield and capital appreciation potential for long-term holders with the financial capacity and patience to navigate the region’s structural complexities. The investment community’s growing sophistication about Caribbean market dynamics — evident in the quality of due diligence and the selectivity of capital deployment visible in 2025 — suggested that the region was maturing toward an asset class characterised by informed, institutionally-backed investment rather than the speculative and opportunistic capital that dominated earlier cycles.

The Caribbean Property & Investment Review is published monthly and covers developments during the preceding calendar month. All factual statements reflect information publicly available at the time of publication.