Market Update 2013

There has been a significant uptick in sales activity on St. Croix. Over the past three months inquiries have increased, real estate “buyer visitors” have increased and as such, the numbers of real estate showings have increased significantly…MLS statistics seem to show this.  This report omits the Commercial sector, which is erratic and skews the statistics.  This report only reflects Residential, Condominiums and Land.

For the period January 1, 2012 –  December 14, 2012 vs. January 1, 2013 – December 14, 2013, a year over year comparison, we have seen the following changes; comparing 2012 with 2013, there was a 42% increase in the number of properties selling.  In 2012 there were 168 properties sold compared to 239 properties in 2013.  Breaking it down into three categories, residential, condominiums, and land, it was the condominium category which had the greatest increase, 106%. Next the residential sector had an increase of 33%, with land lagging behind with an increase of 16%.

Now, comparing this number of units sold with the dollar volume sold, we only see a 14% increase, $43,730,952 for 2012 versus $49,891,030 for 2013. The average sale price declined -20% from $260,303 in $2012 to $208,749 in 2013. This reduction in the average sale price explains why even though there was a 42% increase in the number of units sold, the lower average sale price kept the increase in volume lower than one might have expected.

Interestingly, the sold volume of condominiums was up 129%, while the sold volume of residential was up only 6%, with land sold volume -40%. As we have seen in previous market upturns, land tends to lag behind residential and condominiums. Residential and condominium properties are selling for far less than they can be built…in many cases 50% of replacement cost. Until the average sale price figures increase significantly new construction will remain minimal as existing market inventory is slowly absorbed.

In summary it is my opinion that the real estate market on St. Croix has either found the bottom, or is very close to the bottom. Once we see average sale prices increase along with an increase in levels of units sold, my confidence of this will improve.