Hike forecast in
real estate prices
PHILIPSBURG--Potential buyers should budget for a ten to fifteen per cent increase in the 2006 house prices, if they seriously want to delve into real estate. The average cost for a two-bedroom house was about US $227,882 last year.
According to the island government’s Economic Outlook booklet, the real estate market has been on “a steady rise for the past five years” in the commercial and residential sectors.
The outlook was prepared by the Department of Economic Policy and Research, based on data gathered from real estate agents.
It states that after Hurricane Luis in 1995, the prices for real estate dropped as demand decreased. However, since then the island’s real estate market has made “tremendous recoveries.”
Last year, the market favoured sellers, as limited land continued to be a main factor in pricing and availability.
Based on the outlook, some real estate agents were of the opinion that it was both a seller’s and a buyers’ market, because the market had stabilized throughout the year.
As limited land continues to determine market trends, property prices are expected to get higher. In 2002, a two-bedroom house/condo cost about US $113, 269 compared to US $227,882 last year. A year earlier, the price stood at US $189,660.
For a three-bedroom house/condo, buyers paid US $326,245 last year, a US $45,640 increase from 2005.
Properties with more than three rooms cost US $439,078 in 2006, compared to US $362,558 a year earlier.
If a small property is preferred, one bedroom unit sold for approximately US $131,917 last year, an increase of US $21,522 from the 2005 prices.
Real estate in Simpson Bay/Pelican was the most expensive, based on last year’s figures. A two-bedroom house/condo in the district cost about US $395,500, while three-bedroom cost about US $550,000.
This district was also the priciest in 2005, with a two-bedroom costing about US $313,590 and a three-bedroom US $408,250.
The cheapest district to find real estate last year was Cay Bay, with prices for two-bedrooms averaging US $128,750 and three bedroom US $191,667.
A year earlier, the cheapest districts to find a two-bedroom house/condo were Arch Road/Sucker Garden, Dutch Quarter/Mount William Hill and Middle Region. The average cost was US $107,250.
Pricey places for a two-bedroom unit in 2006 were Airport/Lowlands (US $376,667), Philipsburg (US $350,000), Defiance/Oyster Pond/Guana Bay/Hope Estate (US $297,500), Belair (US $247,000), Pointe Blanche (US $237,500), Betty’s Estate/Saunders (US $234,500), Cole Bay (US $225,000) and Fort Willem/Little Bay (US $221,875).
Two-bedroom units were less expensive in Ebenezer (US $194,500), Madame Estate (US $183,333), St. Peters (US $172,500), Cul de Sac (US $170,833), Dutch Quarter/Mount William Hill (US $146,875) and Middle Region/Sucker Garden/Arch Road (US $145,833).
The outlook suggests that it is a sellers market for residential homes below half a million dollars and a buyers market for homes above US $1 million.
Commercial properties are becoming more difficult to acquire, as less flat land is available.
A recent development in the area of real estate on St. Maarten is pre-construction purchasing. According to the outlook, high demand for homes, condominiums and other commercial buildings has led to these developments being sold before the actual construction takes place.
“Buyers speculate that the value of the properties will rise in the short-term. After construction, these buildings are usually resold at a higher price or rented out to residents, visitors and medical students here on the island.”
Further, neighbourhoods that were traditionally considered to be middle income due to moderate pricing, such as Saunders and Belair, are today experiencing high-end market prices, as well as a shift in clientele.
