U.S. Virgin Islands’ major property markets have had several lacklustre years. St. Croix has obviously performed well in 2015, while St. John and particularly St. Thomas remained weak.
In St. John, where most high-value properties are located, the average home sales price increased modestly by 3.4% y-o-y in 2015, to US$1,074,847, according to Islandia Real Estate. This is in sharp contrast from price declines of 1.5% in 2014, 10.9% in 2013, and a decline of no less than 31.3% in 2012. In contrast, the average condominium sales price in St. John did not maintain the significant rises of the years 2011-2014 and actually declined by 49.2% y-o-y in 2015, to US$363,054, according to Islandia Real Estate. Despite this, St. John condo prices remain far higher than those in St. Croix. Condo prices peaked in St. John in 2014, reaching an all-time high of US$714,924. St. John also saw lower land prices in 2015.
In St. Croix, the largest of the U.S. Virgin Islands, the average home sales price surged by 21.2% to US$403,550 in 2015 from a year earlier, after a modest annual rise of 4.23% in 2014, and y-o-y drops of 18.8% in 2013, 10.1% in 2012 and 2.9% in 2011, based on figures released by Re/Max Team San Martin. Average condo prices rose by 28.5% in 2015 to US$192,440, the highest level since 2011, according to Re/Max Team San Martin.
In recent years there has been strong demand for condo units in St. Croix, with more condominiums built near hotels and resorts in St Croix and St Thomas.
In St. Thomas, where the USVI’s capital Charlotte Amalie is located, the average home sales price fell 27% in 2015 to US$658,460, according to Re/Max Team San Martin.
Home sales in all the territory’s major islands continued to fall in 2015.
In terms of value:
US Virgin Islands’ property prices remain far below their pre-crisis levels.
St. John remains the US Virgin Islands’ most expensive island, even though square metre prices of houses have fallen in the past four years, according to Global Property Guide´s research of April 2015. In 2011, house prices ranged from around US$5,300 to US$8,400 per square metre in St. John. Now, the price range is around US$4,500 to US$5,700 per square metre.
The same downward trend is observable in St. Croix. In 2015, the average square metre price of houses in St. Croix was around US$1,800, sharply down from around US$3,400 four years ago.
Likewise, in St. Thomas, the average price per square metre of a 120 sq. m. condo fell to US$2,950 in 2015, from US$3,200 in 2011.
The USVI’s property market is expected to continue to recover this year, as more visitors are now coming back. However the USVI remains vulnerable to the overall state of the global economy.
The U.S. Virgin Islands saw a housing boom from 2000 to 2007, with nationwide home sales prices surging by 90.1%, according to the USVI Bureau of Economic Research. The condominium market experienced even bigger price rises, of an average of 133.8% over the same period.
However in 2008, home prices dropped 11.8% while condominium prices fell by 2%. Home prices in St. John/St. Thomas saw the biggest decline of 28.5%. In 2013, home prices finally increased by 22.1% while condominium prices continued to drop, by 15.9%.
PROPERTY PRICE CHANGE (2000-2014)
|HOME PRICE CHANGE (%)||CONDO PRICE CHANGE (%)|
|St. John/St. Thomas||146.8||-39.1||49.6||8.4||161.8||-11.9||-3.8||1.4|
|US Virgin Islands||90.1||-16.0||22.1||5.6||133.8||-11.4||-15.9||-3.0|
|Source: USVI Bureau of Economic Research|
In 2014, the home market recovered, with home prices rising by 5.6% from a year earlier. St. John/St. Thomas registered an 8.4% y-o-y rise in home prices while St. Croix saw an increase of 5.2%.
The condo market also showed some improvement, with prices falling by just 3% y-o-y in 2014. Condominium prices rose slightly by 1.4% in St. John/St. Thomas and by 0.4% in St. Croix.
From 2008 to 2013, the average number of homes sold in the whole territory was 296 units per year, down from an average of 508 units from 2003 to 2007, based on figures from the USVI Bureau of Economic Research. Over the same period, the average number of condo units sold also declined to 238 from 513 units every year.
In St. John, land prices plummeted by 49% y-o-y in 2015, to an average of US$208,680 per transaction, based on figures from Islandia Real Estate. St. John continues to have the most expensive land in the territory, but land prices in 2015 were actually the lowest in almost 15 years.
From 2009 to 2011, the average land price in St. John dropped sharply to US$304,000 from an average of US$551,000 from 2004 to 2008, mainly due to the global crisis.
On the other hand, in St. Croix, land prices rose by 5.9% y-o-y in 2015, to an average of US$79,035, according to RE/MAX Team San Martin. Despite the increase, land prices in St. Croix remain far below the average land price of US$110,000 from 2003 to 2009.
In 2015, the total value of private residential permits in the U.S. Virgin Islands increased 8.5% to US$91.92 million, according to the USVI Bureau of Economic Research. However this conceals large differences - building permits surged in St. Thomas/St. John, but plunged in St. Croix.
Most landlords cater only to short-term vacationers and holiday makers. Long-term rental residences in USVI are usually not advertised, except to locals. Most landlords only put a “for rent” signage in front of these rental apartments, which are often part of a larger house, with the landlord living next door.
St. John has the most expensive rental houses and villas. Monthly rents for one-bedroom apartments range from US$950 to US$1,800. Three to four-bedroom beach houses can cost from US$2,000 to US$7,000 per month. Recently, more condominiums have been built near hotels and resorts in St Thomas and St Croix.
Tourism is the US Virgin Islands’ main industry. It generates 2 million visitors every year, and accounts for 80% of GDP. In 2015, the number of stay-over visitor arrivals rose by 5.3% y-o-y to 769,158 while the number of cruise passenger arrivals fell by 9.8% y-o-y to 1,878,847 people.
For the first two months of 2016, the total number of stay-over visitor arrivals in the territory dropped slightly by 0.2% y-o-y to 145,644 people, according to USVI Bureau of Economic Research, and cruise passenger visits increased 5.6% to 433,750 people over the same period.
The last few years have been very tough for the USVI’s economy, despite robust visitor numbers.
USVI’s GDP dipped 5.5% in 2009, based on figures from the U.S. Bureau of Economic Analysis. After a short-lived recovery in 2010 (GDP up 1.3%), GDP plunged again by 7.5% in 2011. Real GDP then fell by a huge 13.8% in 2012, and by 5.4% for both 2013 and 2014, mainly because of the closure of the HOVENSA refinery in 2012, which caused the layoff of around 1,200 employees.
No figures are yet available for 2015, but the economy remains weak. In January 2015, the overall unemployment rate in the U.S. Virgin Islands stood at 11.6%, down from 12.1% in the previous year, according to the USVI Bureau of Economic Research. In St. Croix, the jobless rate fell to 12% from 13.6% over the same period. In contrast, in St. Thomas/St. John, the jobless rate rose to 11.2%, from 10.7%.
A brief glimpse of the charms of these marvelous islands:
St. John is known for its well-preserved natural beauty and picturesque hills dotted with lavish villas. Unlike the overdeveloped St. Thomas, real estate developments in St. John are restricted. The island is the wealthiest and most expensive of the US Virgin Islands.
St John is home to the territory’s National Park, which protects more than half of St John’s land area. The National Park includes some of the best beaches and coral reefs in the world.
Some of the condominium developments on St. John offer full ownership while others operate as timeshares or run on fractional ownership. Most of these residential projects are located in Cruz Bay. Some existing condominium developments include:
Mountainous St. Thomas is an ocean lover’s paradise. Hillside houses usually have magnificent views of the ocean. Snorkeling, scuba diving and windsurfing are popular tourist activities. St Thomas is home to USVI’s capital and largest city, Charlotte Amalie.
Recent residential developments in St. Thomas include:
St. Croix is the largest island in the US Virgin Islands, but is more laid back than the other two islands. Unlike St. Thomas and St. John’s mountainous landscape, one of St. Croix’s charms lies in its varied topography, which goes from uncrowded white-sand beaches to rolling hills to rain forests.
St Croix is nicknamed the Twin City because of its two main towns: Christiansted and Frederiksted. Out of the two, Christiansted is more developed featuring shops and superb restaurants with a modern setting. This town is also known for architectural and historic richness, present in its 18th-century Danish-style buildings constructed by African slaves. Meanwhile, Frederiksted, with its historic landmark Fort Frederik, has been the main port for cruise ships in St. Croix.
Some notable attractions in St. Croix include the Buck Island Reef National Monument, the renowned Cane Bay Wall, St. George Village Botanical Gardens and the Cruzan Rum Distillery. St. Croix is also the only island in the US Virgin Islands that has a casino, the Divi Carina Bay Casino.
The Virgin Islands Housing Authority is responsible for planning, financing, constructing, maintaining and managing public housing developments, mostly on St. Thomas and St. Croix, and it manages around 15% of USVI’s total housing stock. VIHA provides rental assistance to low-income families, elderly and disabled persons, with rentals based on the highest of three methods:
Currently, VIHA runs 3,345 public housing units. Approximately, 1,605 units are in St. Thomas and St. John, while the other 1,740 units are in St. Croix.
One of VIHA’s newest developments (and also its largest redevelopment project) is the Louis E. Brown public housing development. The project consists of a total of 224 one- to three-bedroom units for families and seniors.
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