It's not just villas sitting empty. Just today I had to slash rents on my newly renovated condo hoping to attract some renters. The thing is people will still want a discount and I'm about as low as I can go and cover expenses. As to the question about people that booked at higher prices; if the renter brought the issue up to me I'd probably reduce their rent. I don't think it's right though. If the airline has a sale after you've purchased your ticket--too bad for you.

It's going to be a tough season sapphire08... Oh and about the issue of week mins or sat/sun to sat/sun... I am not a big rental outfit and I will do 1 nights upon request... I think restrictions like that are greed.

If the airfare goes down you can get a voucher for the difference to use on a future flight or, if it dips significantly, it could be worth it to re-book and pay any change fee.

I guess I think of the villa rental more as building a relationship with an owner or manager, looking to return to their property (or properties) in the future and certainly to recommend them to other travelers. If I felt taken advantage of monetarily or if the property was not as represented or if there were problems during our stay that were not corrected then I wouldn't return or recommend them but, other than that, I would be very inclined to repeat at a property or through a management company.

It's a tough call about offering discounts - I don't envy the owners and managers having to deal with this loopy economy.

STT,

Hi.
The reason I mentioned the gas prices was not in re: islanders. I mentioned it in response to the question about economic impact on villa rental and travel.

If airline prices are still as high as they were when fuel was $4.20 gal, but fuel has dropped to $2.50 gal, then statesiders may decide that it is cheaper to load 4-6 family members into an SUV and drive to Florida, as opposed to flying them to the Caribbean at $700 pp.

Gas prices have reverted where they were 3 years ago. Airline prices are where they were during the summer, when fuel was at its height.

As Lip said, some airlines are still offering deals. My old standby, USAir, is not one of them.

As such, if I fly down, I will likely pay more than usual for airfare, and look to recover some of that expense though a good deal on accomodations and on-island spending.

I just experienced something new - my Amex card lowered my credit limit on Black Friday. Great credit score - nothing bad has happened. But, they sent me a note that they did a
review" across the board and decided to take it down by a couple thousand. I suspect this is related to people now defaulting on credit cards. This is just more pathology.

From the hotel point of view, I have to give a shout out to the Department of Tourism. They are doing a good job of advertising and subsidizing special offers. We were in the states for Thanksgiving and heard several ads for the USVI on satellite radio.

I think is a combination of expensive airfare and lack of willingness to commit what disposible income consumers have.

My husband and I bought our villa in STT almost 2 years ago in hopes that the Wyndham would finally renovate the former Grand Renesaince Hotel. When we finished renovating last summer we decided to go with longterm tenants and rent for a fair price because it doesn't look like anything will be happening very soon, especially with the state of the economy. We split our condo into 4 seperate studio units and it has been renting fairly well. At one time we had all four units rented but now we are down to three. Our we dissappointed that we bought our place, yes and no. Yes we were hoping for the hotel to open up and generate a lucrative vacation rental for us, and no we are glad that we took that money out of the stock market. We are currently down 40% on our investment savings still in the market but our condo that we purchased at a good price is holding it's own.

On the flip side, although our home building business stateside has slowed down considerably, my husband and I have decided to take advantage of some of the great deals that our out there. We just returned yesterday from Italy, we found a package deal on Kayak for $699 per person that included our flight into Rome, with 2 nights stay, a ticket on the Eurorail up to Florence for another 2 nights, another Eurorail ticket to Venice for an additional 2 nights accommodations, the flight back to Rome and then on to Chicago. Our package included all hotel taxes and free breakfast as well. On a side note, we were in Venice for the record flooding. I did feel bad for all of the store owners, but the tourists all trapped in the hotels hung around the 2nd floor pubs all day and had a great time sipping cocktails and sharing stories.

I am 40 and my husband 50 so we have some time to watch the market rebound. Taking a few excursions like this may mean delaying retirement a little bit on the tail end, but with business slow and still being healthy, we thought, why not?

We will be traveling back to STT in January and plan on having a great time and visiting old and new friends and supporting local businesses that need our tourist dollars spent at their establishments. Anna, we'll see you at the Toad and Tart for your prime rib January 16th or 17th, only 4 of us traveling this time.

Molly

The reason long term rentals don't appeal to me is simply, I will have no where to stay?

Hi,

I just stumbled across your post while searching for inexpensive accommodations on St. John. I am guessing your villa isn't inexpensive, but if you just want to pay some bills we are looking for a place to stay between the 13th and 19th of this month. Please let me know if you're interested because we are.

Thanks

I'm happy to report that since lowering my advertised rates, inquiries have greatly increased. Now, if I can just get them to sign on the dotted line.

That's great... I'm doing the same as of today.... stay tuned

I know the only reason I went last month was because I'd made a financial commitment and it made more sense to go than to lose the money I'd spend before the economy got so bad.

However, I did everything I wanted to do on that trip and bought what I wanted, just in case I don't get back for a while. I have no plans to visit in 2009. I'm just hoping I can hold on to my job and I'm pocketing every spare penny just in case I don't.

I am seeing that rentals are coming in late. People are not planning ahead. They want to see what is coming down the road. We are reducing our rates to get more people to come. But these are real tough times. I expect that tourism will drop somewhere around 20-30%. Another factor is Obama's stance on Cuba. If Cuba opens up to the the US traveler then expect tourism to drop about 50% as it will be the new hot spot. It will take a few years but it will happen.

For now I expect prices to drop around the board. Gas is now 151 in NJ. Stores are failing. Small business are failing. Housing is in the dump. The real unemployment rate is NOT 6.8% but is around 10%.

So hang on. Do your best. We will come out of this. But it will take about 3-5 years,

billd

During our visit to STX last month we noticed that Elizabeth's restaurant had a great dinner special. One Appetizer, two entrees and a dessert for a flat fee. Very nice when you are on a budget.

Just an FYI

Jen

I was out looking to buy a condo in STT about 5 months ago. Made offers on 3 within 10% of asking price in Cowpet Bay. Owners turned offers down with barely a counter-offer and demanding that buyer pay stamp tax. I foresaw this decline coming to STT as it had already hit NJ about 2 years before. The owners on STT thought they had "Gold." I was buying due to a 1031 exchange, so was not overly concerned with slightly overpaying. I did not buy based on the unreasonable expectations of the condo owners. So I just paid the capital gains tax on my exchange. Fast forward 5 months and now I see the same condos still on the market, prices dropped - to below what I had offered. Amazing how short sighted some of the condo owners were - thinking this recession would never hit STT. Welcome to the real world. I am incredibly fortunate that my offers were rejected given the current financial situation in STT - and this is just the tip of the iceberg. Wait until tourism hits its full decline, gas prices go back up and WAPA wacks STT again, then you will see prices drop to about 50% of their peak, which is where they should be realistically anyway. My money will stay in fixed income, once Cuba opens I can buy a condo for about 150k, or go to Costa Rica and buy new on the beach for 250k.

oceanman: fortunate for you that you had the foresight. Several friends saw the writing on the wall over a year ago and acted accordingly before they floundered. I saw it coming some time ago but when I broached the subject I was berated as being a "doomsayer" and many people said, "Oh it's just a little glitch and will be over before we know it!" In the meantime, the economy on the mainland and throughout the world was slithering downwards ...

I do think realism is finally sinking in and that owners are beginning to accept the fact that prices are going to drop quite substantially. There will still be buyers who will prefer to purchase on US soil rather than chancing the instability and lack of US protection on foreign soil but the road ahead is going to be very rough for a couple of years. Good luck with your future plans. Cheers!

I'm not sure of the "condo" market, but I personally bought my Villa in what I consider to be close to the highs of the market in "05" and was recently offered more than double what I paid for it. That being said it was a total rehab and that , plus furnishings cost me $150,000ish. I could turn a handsome profit of but also I realize That I am priced out of the market and would not be able to buy a villa like this in the area I want to be in.

Is the same happening on St. John? Are the home owners seeing a decline in there rental homes? Is it best to go straight to the home owner or through the rental management? Still trying to get to St. John this spring but cant seem to afford a rental yet. Income has gone down and lost almost all our 401 k. But god willing I will get to St. John some things in life are a must and visiting St. John is one of them. I love that island.

imcnell125: Of course it's happening on STJ. too. Owners should be well aware of the downward trend and those who have resident agents will hopefully rely upon the fact that the resident agents who act on their behalf know what's going on both locally and globally and advise their clients accordingly.

Where any rental is concerned you work through either the agent or the owner but don't try to mix and muddle them.

Cheers!

The reason I was asking is because I was looking at all the rental agencies websites for St. John and havent come across 1 yet that is running rental specials except for last minute specials. So I wasnt sure if St. John is having the same problem as St. Thomas filling rentals. Dont they advertise specials instead of letting them sit with no income? Or do we have to call and ask for a special rate if they are offering one? I assume so as I havent seen any lower rates offered on there websites. Which is no biggie I will call and ask if they have specials for maybe this spring instead of last minute specials.

Imcneil Most villa owners do not need to rent them (i'm not one of them) I would suggest you deal w/ owners directly on sites such as VRBO.com or HomeAway.com and deal w/ on island owners or those w/ on island property managers. It is very important to have a "go to" person if there are any problems that will be accountable. The last thing you want to do while on vacation is try to locate AC repair people , have a small appliance repaired or get propane or water... My manger is as hands on or off as a renter requires after her initial greeting (offered at the airport too) at the villa to go over AC system, Satellite TV, or WIFI... It's just my opinion (and experience) dealing w/ big management firms are expensive for owners to deal w/ and that expense is passed onto the renter.