Record number of houses for sale

Realestate_2The Virgin Islands Multiple Listing Service, a few days ago, was showing 143 residential properties for sale. Prices range from $185,000 to $32 million.

A review our postings about real estate over the past year shows little change in either average asking or median listing prices, even though we read about sharp drops  in the real estate market on the mainland.

This chart shows that a year ago, the average asking price of a home on the MLS was $2.2 million.  It’s now $2.183 million. However, if you eliminate the two houses at the top of the list, priced at $32 million and $12 million, the average asking price drops to $1.9 million (This is what the chart show.)  That’s off almost four percent; still far less than the national averages.

The median house price, the midpoint of the listings, also has not budged.  A year ago it was $1.5 million; this year it’s $1.5 million.

Why the stability?  Brokers tell me St. John has many strengths, not the least of which is that many home owners are in no rush, don’t need to sell.

Merry Nash at Islandia Real Estate is one of them. "These are mostly not primary residences and most (owners) are not desperate to sell," she said. "People originally bought because they love it here and waiting seems not to be too great a burden.  There are always a few who are desperate to sell and these are where the good deals can be found right now."

A real estate broker in Maine, also working in a tourism market, would agree that the pricing of some properties there also may not reflect what they call 'motivated buyers,' and therefore sales are few.

Jim Cosgrove blogged, “Many of those that are out there have been on a long time and represent Sellers who have not made the mental shift to the new market reality. In other words they are priced for 2007 not 2009. By and large, those properties that have come on the market in the last 6 months have been realistically priced and a greater percentage of them have sold.”

50 thoughts on “Record number of houses for sale”

  1. HOO-RAY!! Finally!!! An optimist, William Rini, who thinks the number will drop.
    (Of course it could just be someone pulling their home off the market, but we have to assume that kind of in/out action’s been ongoing anyway.)
    But Rini thinks the number will go down.

  2. I keep hearing from realtors in higher end markets around the country the same reasoning that sellers are “not desperate to sell” so they are going to “wait it out”. Does this reasoning make sense to anyone given the current situation? I’d especially like to hear from realtors. Question: If you keep your price up, wait out a downturn for two or three years while the real estate market slowly recovers (show me a “V” shaped recovery in a real estate market any time / where in U.S. history), what is your investment worth at the end of those two or three years? Answer: Same thing that it was worth two or three years earlier. This makes sense if there are not other investments that are at once-in-a-lifetime lows to invest in. But let’s say that at the same time you are waiting for the real estate recovery, the stock market has just suffered the lowest percentage drop any of us have seen in our lifetimes. Does it not make since to undercut housing market prices by 15%, sell your property (even if at a small loss), and reinvest in the faster cycling market? Where would you then be at the end of the same two or three years? Likely answer: 50% to 150% up. One step back is sometimes worth the giant leap forward. I sold my St John villa back in December, and I will be upgrading to a new villa in 2011… Does anybody want to bet that St John villa prices will be anywhere from 0% – 5% down at that time from where they are now and that the same people who are currently not “desperate to sell” will still own them? My new villa plans just keep getting bigger.

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