HOME PRICES JUMP 60 PERCENT ON GUAM

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By Gaynor Dumat-ol Daleno

HAGÅTÑA, Guam (Pacific Daily News, Feb. 7) - 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.

[PIR Editor’s Note: According to its website, the Captain Company was formed in 1997 by W. Nicholas Captain in response to the growing need for professional real estate valuation and consulting services in the Western Pacific.]

As of December last year, the median price for a single-unit home reached US$170,000, a steep rise from when the local real estate market hit bottom in 2003. Four years ago, median-priced homes went for US$106,500.

"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 US$10 million per month, to US$50 million per month, Captain said.

Though home buying 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.

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 Governor 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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