The tourism impact on the US Virgin Islands' property market
After the downturn in the US Virgin Islands’ housing market caused by the dramatic crash of the prices, the USVI Bureau of Economic Research has now reported that some parts of the market are starting to recover. Now that the economy is also beginning its recovery, the buyer’s interest in the real estate property purchase is orientated towards the main islands Saint Johns, Saint Thomas and Saint Croix along with the smaller but historically distinct Water Island.
At the present time they offer around 3,345 public housing units which are designed for short-time rentals mostly in the holiday season. Unfortunately the long-term rental market is still small and orientated towards the locals rather than the vacationers.
Currently in the mountainous Saint Thomas, two to three bedroom family houses sell for around US$ 350,000 to US$ 650,000. Two-bedroom oceanfront residences are priced between US$ 300,000 and US$ 400,000. The isle is a preferred destination because of the typical hillside houses that offer wonderful view of the ocean. Along with the comfortable stay, tourist can enjoy water sport activities such as snorkeling, scuba diving and windsurfing. Some of the most innovative residential developments are the Dolphin Cove, the Cabrita Point Estate and the seventeen luxurious residences at Cabes Point.
St. John which is celebrated as the “City of love” with its unique scenery is now showing the fastest market recovery due to the growing number of luxury house seeking visitors. The isle has the most expensive rental houses and profuse villas. Despite of the fact that there are a limited number of newly constructed villas, St. John is attractive to tourists because of the beautiful beaches, the rich underwater world and the interesting coral ledges.
In St. Croix, the process of recovery is rather modest compared to the other two attractive isles. An average home is sold at the approximate price of US$ 379,024 and the condominium prices amount to US$ 210,361. Although it is not as developed and as notable as the other two Virgin Islands because of the flatter terrain, St. Croix is the largest of them. It is also known as the twin city because of the two main towns Christiansted and Frederiksted that gather most of its visitors.
The forecast:
As the tourism in the US Virgin Islands is the main industry that attracts over 2 million visitors every year and accounts around 80% of GDP, the expectations of the market analysts are very good. The outlook for the present year will remain positive. The more tourists are coming, the more the interest in buying or renting property will keep high values.
The Virgin Islands Housing Authority is taking measures for financing, building and maintaining public housing developments, mostly on St. Thomas and St. Croix, where around 15% of USVI’s total housing stock is concentrated. The price politics will continue to be income-based.
