In the Caribbean, a $1.87 Trillion Real Estate Market Can’t Find Its Builders

Developers across the region have the land, the demand, and the plans. What they cannot get is the money — and a growing body of evidence suggests the gap is structural, not temporary.

KINGSTON, Jamaica — July 31, 2026

When the National Housing Trust opened applications for a new residential scheme earlier this year, 10,000 Jamaicans submitted inquiries for 841 units. The trust processed the queue the only way it could: it picked names.

That ratio — roughly twelve applicants for every available home — is as precise an illustration as any of the central contradiction facing Caribbean real estate. Across the region, the demand for housing is not in question. What is in question is why, in a market valued at $1.87 trillion and growing at more than five percent annually, developers consistently find that the financing to meet that demand does not exist on terms that make building viable.

The answer, according to developers, lenders, and regional economists, is structural — and it is not improving fast enough.

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The Missing Middle

Jamaica’s housing deficit is now estimated to exceed 150,000 units, a figure that has grown for years despite the existence of public programs designed to contain it. The National Housing Trust, which pools mandatory payroll contributions from Jamaican workers and channels them into subsidized mortgages, completed 1,546 housing solutions in its most recent reported fiscal year — a number its own data shows fell 42 percent from the prior year, partly because of a strategic shift toward private-sector partnerships that has yet to yield the volumes the agency projects.

The gap the NHT cannot fill is where the dysfunction becomes most visible. Properties that the market has come to describe as “affordable” in Jamaica now enter at roughly J$30 million — approximately US$193,000 at current exchange — while research from Jamaica Homes, a real estate analytics publication, identifies J$8 million as the price point at which demand becomes, in its words, “overwhelming.” The NHT’s own maximum loan ceiling for a single applicant purchasing on the open market is J$12 million for properties priced at or below J$14 million, a limit Prime Minister Andrew Holness raised in June 2025 as part of a package of housing reforms that also expanded loan limits for co-applicants to J$23 million. The gap between the ceiling and the market entry point is not a rounding error. It is the segment where the largest share of Jamaicans actually live.

Private developers occupy that gap at their peril. A studio apartment in Kingston was listed at J$18 million in 2024, according to data compiled by the real estate platform NewLocay — roughly two to three years of median household income. A three-bedroom home in any of the capital’s middle-income suburbs carries a price that puts it beyond the reach of NHT financing and below the threshold that attracts the premium developer capital flowing through the region’s luxury segments.

“The squeeze is not coming from one direction alone,” Jamaica Homes wrote in an analysis published in May. “It is the accumulation of several pressures arriving simultaneously.”

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Why the Financing Isn’t There

Understanding why Caribbean developers struggle to capitalize projects requires understanding how regional lending actually works, rather than how it is assumed to work.

Commercial mortgage rates from Jamaica’s major lenders — JN Bank, Scotiabank Jamaica, Sagicor Bank Jamaica, JMMB Bank, and NCB Jamaica — currently range from 8.5 percent to 12.5 percent for qualified residential borrowers, according to rate data compiled across those institutions in 2025. Developers financing construction rather than purchasing finished units face more demanding conditions: hotel construction loans in the broader Caribbean have been quoted at 11.5 percent interest with a 55 percent loan-to-cost ratio from traditional lenders, according to Adam Greenfader, chair of the real estate advisory firm AG&T, who has structured more than $2 billion in Caribbean project financing over three decades. At those terms, a developer must arrive with nearly half the project cost already in hand before a lender will consider the remainder.

Most Caribbean developers do not arrive with half the project cost in hand. That is, in part, the problem.

Greenfader’s firm reviewed more than $200 million in Caribbean development transactions through its capital access platform and found a consistent pattern in projects that were rejected: developers requesting full financing — “100 percent of costs, with zero equity contribution” — while also lacking the documentation that any professional capital source would require before committing funds. Signed offtake agreements, pre-sales data, environmental clearances, architectural approvals, and audited financial statements were frequently absent. “We are looking for every single type of guarantee possible,” one participant in a capital forum organized by the firm said.

The lender’s-eye view of Caribbean real estate is further complicated by risk that is not metaphorical. Hurricane Melissa struck Jamaica in November 2025, causing damage the Inter-American Development Bank’s investment arm, IDB Invest, estimated at US$8.8 billion — approximately 41 percent of the country’s 2024 gross domestic product. That figure sits alongside the baseline context that most Caribbean economies carry debt-to-GDP ratios exceeding 70 percent. When an international lender prices Caribbean risk, these are the numbers it prices.

The result is a market segmented in a way that serves almost no one optimally. Projects are too small to attract the institutional capital funds that operate efficiently only at scale, yet too large for Caribbean equity markets that remain, by global standards, thin. International lenders willing to engage apply country risk premiums that make their offers uncompetitive. Local lenders apply underwriting standards that require collateral structures most development-stage projects cannot provide. “Capital has not left the market in 2026,” Greenfader wrote in a recent analysis. “It has changed form.” The form it has taken, for most Caribbean developers, is inaccessible.

The depth of that inaccessibility was illustrated by the terms under which the May Pen housing project in Clarendon, Jamaica — 4,500 planned residential units across nearly 600 acres — secured its initial construction financing. The loan came from Kennedy Funding, a New Jersey-based bridge lender that specializes in transactions that conventional banks decline. Angelo Butsianis, the financing intermediary who arranged the deal, said that Kennedy Funding “were the only lenders that I knew of that could close a loan in the Caribbean.” The loan amount was $2.28 million — a figure that, while meaningful at the project’s initial stage, underscores how dependent Caribbean development financing is on the willingness of non-traditional lenders to enter markets that mainstream capital avoids.

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Capital is Moving, But Toward Different Things

The Caribbean Development Bank approved $464 million in financing in 2025, a 50 percent increase over the prior year, with disbursements of $429 million. The surge has been directed primarily toward infrastructure, energy, and airports — sectors where the development finance case is clearest and where borrowing governments offer the most straightforward credit profiles. Residential housing, where the social need is most acute and the commercial returns are most constrained, has not been a primary beneficiary of that increase.

Elsewhere, the picture is more nuanced. Sygnus Capital, Jamaica’s largest alternative asset manager, has deployed more than $700 million across private credit, private equity, and structured investments in Jamaica, Puerto Rico, and St. Lucia over the decade since its founding. At the firm’s tenth-anniversary review, its chief investment officer, Jason Morris, noted that the Caribbean would require “roughly US$100 billion in climate- and resilience-related investments annually” — a figure that dwarfs the current institutional capacity of any regional or multilateral financing vehicle.

The firm’s chief executive, Berisford Grey, offered a structural comparison: the alternative investment market in the Caribbean currently represents less than 0.05 percent of regional GDP. In the United States and other advanced economies, equivalent markets represent 7 to 10 percent of GDP. The gap between those numbers is a proxy for the capital that does not reach Caribbean real estate development, and Sygnus projects the Caribbean market could reach 3 to 4 percent of GDP over the next decade — a trajectory that, if realized, would represent a meaningful change, but one measured in decades, not years.

IDB Invest, the private-sector arm of the Inter-American Development Bank, graduated its first cohort of Caribbean fund managers earlier this year through a training initiative that brought together more than 50 participants from 30 firms across 15 countries. The initiative produced the Caribbean Community Resilience Fund, which reached a first close of $94 million, anchored by IDB Invest alongside the Caribbean Development Fund, Allied Climate Partners, regional pension funds, and family offices. The fund’s manager, Sygnus Capital, has projected equity returns of 14 to 18 percent in U.S. dollar terms — returns that may attract additional capital but that also reflect the risk premium the market continues to demand.

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What Governments Are Trying

Jamaica’s government response has accelerated in 2026. The Urban Development Corporation announced plans for a housing project exceeding 20,000 units to be developed across multiple Jamaican parishes — an ambition that would, if completed, represent the largest public housing program in the island’s modern history. Whether the UDC’s financing arrangements, which depend in part on the same constrained development finance environment that limits private developers, can sustain that pipeline is a question the agency has not yet answered publicly.

The NHT, for its part, is explicitly repositioning itself as a catalyst for private-sector development rather than primarily as a direct developer. It controls a land bank valued at J$6.52 billion and has transferred projects representing more than 4,400 housing solutions to private developers through its Guaranteed Purchase Programme, committing to buy completed units at agreed prices. That structure removes some demand risk from developers — they build knowing the NHT will purchase — but does not solve the upfront construction financing problem that stops many projects from breaking ground in the first place.

Blended finance experiments across the wider Caribbean, in which development finance institutions take first-loss positions to lower the risk profile seen by commercial lenders, are at an early stage. The OECD and IDB Group, in the Caribbean Development Dynamics report launched in April 2026 at a ministerial dialogue in Port of Spain, identified diversification of financing sources — including green bonds, sustainability-linked instruments, and debt-for-nature arrangements — as a strategic priority. None of those instruments addresses the immediate supply gap in residential housing.

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The Cost of Staying Still

Prime residential values across the Caribbean rose 27 percent over the five years through 2025, according to data from Savills, the property services firm. Jamaica issued 4,822 new mortgages worth J$82.9 billion in the most recently reported period, a 12.8 percent year-over-year increase that reflects genuine demand among the population segment with access to mortgage credit. The Cayman Islands recorded $1.021 billion in residential sales in 2025, with transaction volumes up 18.3 percent. The Bahamas saw a 54 percent surge in sales in the fourth quarter of 2024.

Those numbers capture a market that is performing strongly for those who can participate in it. They do not capture the 150,000 Jamaican households without adequate housing, or the share of Caribbean workers who have concluded that homeownership in their own country is not a realistic expectation within their working lives.

When developers cannot fund projects, fewer units are built. When fewer units are built in a market where demand is growing, prices rise. When prices rise faster than incomes, the share of the population priced out of ownership expands. This sequence has been playing out across the Caribbean for years, and it has been most damaging in the middle segment of the market — too expensive for public housing programs, too modest for premium capital. The financing gap is not the only reason that segment is undersupplied, but it is a primary reason, and it is the one that policy has most consistently failed to address.

“It is not a functioning market,” Jamaica Homes wrote of the NHT’s oversubscribed schemes. “It is a queue.”

Until the development financing environment changes in a way that allows private builders to bring supply to exactly the segment where demand is most acute, that queue will not shorten. Whether the instruments now being constructed — blended finance facilities, regional fund networks, government guaranteed purchase programs — prove adequate to the task is the question that will define Caribbean real estate for the decade ahead.

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Research for this article drew on data from the National Housing Trust, IDB Invest, the Caribbean Development Bank, AG&T, Sygnus Capital, the Hope Research Group, Jamaica Homes, Savills, and public reporting from the Jamaica Information Service.

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