Land ain’t selling
Scotia Bank executives made the rounds at the real estate offices this month, promoting a new, really unprecedented loan program it clearly hopes will jump-start dead land sales on St. John. There’s a record 291 pieces of land for sale on St. John right now, and only nine land sales so far this year. Compared to 49 sales in 2006. The last boom year for land sales was 2003.
Here’s Scotia Bank’s deal, good through Aug 31, unless the bank decides to extend it. Buy a piece of land with 5 percent down. The 20 year note carries a rate of 7.99 percent up to $550K. (For reference, when we bought in Chocolate Hole in 2002, the un-negotiable terms were 30 percent down, 10 years, 8.25 percent.)
Just for fun, here’s the math. Say you find the perfect lot for $400,000. Cough up a $20,000 down payment (versus $120,000 at 30 percent down), and it will cost you $3,176.11 per month. The cost of admission is a whole lot cheaper, but that’s still a lot of Red Stripes.
June 19th, 2007 07:40
Almost nice offset to the fact that construction costs have skyrocketed… the house we were told would cost us $900K – $1M to build in 2006 is now estimated to cost $1.7M… Just buy a place at Grande Bay! – I bet a bunch of those should be coming up for re-sale… Only $3,000+ per month for cable tv and a place to cool your wine!
June 19th, 2007 08:13
Tom
Did you read the tradewinds today? You can only live in the Grande Bay condos 90 days per year! And NO wine coolers!Buy something already built.
June 19th, 2007 09:28
Scotia must need to put loans on the books. Compared to terms offered in my area, 5% with 20 year amortization is a liberal deal.
June 19th, 2007 10:29
Let me look on my desk to see if I can afford that deal…
Plastic triceratops
Sticky notes
$3.47 in change.
I’m almost there! St John here I come!
June 19th, 2007 14:53
You can only live in the Grande Bay condos for 90 days per year. Why? because all your neighbors are mad as hell with you for blocking their view!
June 19th, 2007 18:15
I also read that your reserved parking space is only reserved while you are there and you’ll need to valet your car as they’re going to use the “stacker” to put two cars in one spot… I can only imagine how that technological wonder will last in STJ!
June 20th, 2007 12:34
Just avoid FirstBank at all costs – as previously documented in Bongo Bongo Blog
Had yet another issue with them this week – their internal processes are non-existant.
June 22nd, 2007 21:55
Well there is a thirteen year plus supply of lots on St. John when considering current annualized sales and 290+ lots for sale. This is mostly a result of purchases made in 2000-2002 in anticipation of EDC (Economic Development Commission)IRS tax breaks, which have since been mostly rescinded. Those buyers expected to immediately “flip” their purchases for double the money – guess what, didn’t happen and won’t happen in the next three to five years and of course if Castro dies then it will never happen!
Unfortunately, like musical chairs – when the music stopped someone was left without a seat and they were the land purchasers of that era. I would say now is the time to get in there and make a purchase because they have been holding lots for five years or more and likely paying high interest rates and hurting with no prospect of a sale and lost opportunity costs of their investment for the past five years. In most cases no purchase offers have been made. Low ball offers will likely now get strong consideration – so don’t look at the asking price, look at what they paid five to seven years ago give them some skinny profit and BUY! This may very well be the last chance to buy St. John land at a somewhat reasonable cost. To me, this is a GREAT OPPORTUNITY and I will take a “bag” of cash next month and see who is really ready to sell! I’ll give you feedback through Jeff on what was asked, what I paid and what happened. But I can guarantee you right now I will be a buyer on one or more lots and this is coming from someone that currently owns land on St. John and is building another house there!