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Re: Advice for buying in USVI
[Re: patcakes]
#28834
09/09/2014 02:56 PM
09/09/2014 02:56 PM
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Joined: Feb 2006
Posts: 928
Fletch
Traveler
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Traveler
Joined: Feb 2006
Posts: 928
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First, go to www.vimovingcenter.com - lots of useful information there - so much so it will take weeks to read everything. There's also a very active forum there that has tens of thousands of threads that will answer all your questions plus hundreds more you haven't even though of yet. Now, to answer your specific question: Yes, you can purchase a rental property in the USVI's and yes, you'd be wise to buy one with on-site management or you'll need to hire a local property manager. Now, most property owners will tell you that you probably won't be able to rent out your unit for the majority of the year unless you find a long term (say 1 year or longer) renter which then precludes you from using the property yourself. The really is more like 15 to 20 weeks rentals each year. Almost everyone I know who rents out their island homes just break even or lose a little on the rentals rather than make very much money. The income helps off-set carrying costs not fully cover them. Best to talk with your Tax advisor or CPA for more information how owning a vacation rental will affect your taxes. One other thing to consider, if you buy a vacation home now and rent it out for the next 20 years what you'll have when you retire? You'll have a 20+ year old dwelling, that has had lots of wear & tear in a harsh tropical environment. Renters are notorious for abusing property that is not theirs. The sit on furniture with wet bathing suits, they run the a/c 24/7 even when they are "out", the sun & salt air play havoc with fabrics, appliances, paints and finishes. Expect to replace furniture, carpeting, appliances, upholstery, etc 2 to 3 times more often that you do "back home'. Be careful before venturing into this type set up - do your research first hand, do not rely on promises of others or solely upon what you read on the internet. You might be much better off, saving your hard earned money and doing some conservative "normal investments" to build your nest egg so you can purchase a newer or even brand new home when you are ready to retire. Good luck following your dream.
Last edited by Fletch; 09/09/2014 04:19 PM.
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Re: Advice for buying in USVI
[Re: patcakes]
#28835
09/09/2014 03:37 PM
09/09/2014 03:37 PM
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Joined: Nov 2008
Posts: 402 St Thomas, USVI
Kimber
Traveler
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Traveler
Joined: Nov 2008
Posts: 402
St Thomas, USVI
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I think it will be challenging to break even, not counting any tax benefits you may receive. You might look at VRBO to get an idea of the market. In my mind when I hear the term "investment property" it sounds like someone expects to make an income. Then when it goes to vacation property you are into another field. Yes there are investment properties that make money here but they are typically multi-family dwellings with 3 or more tenants. Those properties are in places where I wouldn't wish to vacation, inland and rough neighborhoods. The Movingcenter suggestion is a good idea. Speaking with your accountant is sound advice as well. We had some friends try to use VRBO for their beautiful condo but they gave up after a year. Cleaning and maintenance fees ended up costing more than just shuddering it when they were gone. Good luck to you.
Just recalled they got a $1500 utility bill when somebody rented their condo for 3 weeks apparently trying to make ice with the air conditioning. Vacationers can empty a cistern pretty fast too. They don't understand that there isn't an endless supply attached to the faucet.
Last edited by Kimber; 09/09/2014 03:41 PM.
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Re: Advice for buying in USVI
[Re: patcakes]
#28836
09/09/2014 04:59 PM
09/09/2014 04:59 PM
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Joined: Sep 2001
Posts: 5,884 St. Thomas, USVI
Nutmeg
Traveler
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Traveler
Joined: Sep 2001
Posts: 5,884
St. Thomas, USVI
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I agree with investigating vimovingcenter.com. There are also condominium associations that have on-site property management and they control access. I know vrbo is very popular, but I feel there are huge problems with it.
[color:"red"]NUTMEG[/color] Today is the tomorrow you talked about yesterday.
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Re: Advice for buying in USVI
[Re: Carol_Hill]
#28838
09/09/2014 08:55 PM
09/09/2014 08:55 PM
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Joined: Sep 2001
Posts: 5,884 St. Thomas, USVI
Nutmeg
Traveler
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Traveler
Joined: Sep 2001
Posts: 5,884
St. Thomas, USVI
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As an condo owner, I want to know who the people are around me. With vrbo, there can be multiple cleaning people and "agents" on the property. Even the guests- what if their behavior is inappropriate (too loud, too drunk, etc.)? Who goes over to ask them to simmer down? I prefer a bit more oversight on security. <img src="http://www.traveltalkonline.com/forums/images/graemlins/Wink.gif" alt="" />
[color:"red"]NUTMEG[/color] Today is the tomorrow you talked about yesterday.
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Re: Advice for buying in USVI
[Re: Nutmeg]
#28840
09/10/2014 06:35 AM
09/10/2014 06:35 AM
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Anonymous
Unregistered
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Anonymous
Unregistered
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VRBO is a rental agency, it is not a management agency. It brings renters and owners (or their managers) together. The property owners and their managers are responsible for turnaround, maintepainence and so forth. They are also responsible for guest screening, check in and check out and complaints. Don't blame VRBO, they are a great tool and provide clients for referral and commission fees far lower than full time, so called professional, vacation rental agents with physical brick and mortar offices on island.
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Re: Advice for buying in USVI
#28841
09/10/2014 07:45 AM
09/10/2014 07:45 AM
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Joined: Sep 2001
Posts: 5,884 St. Thomas, USVI
Nutmeg
Traveler
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Traveler
Joined: Sep 2001
Posts: 5,884
St. Thomas, USVI
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unreg: Yes, all that is true. But if I live in a condominium community, I don't want all those random people on the property. A management company run by the association gives me a bit more protection. It is all a matter of perspective. What is good for an individual owner who is on island 1 week a year is different from someone who is a resident. <img src="http://www.traveltalkonline.com/forums/images/graemlins/handshake.gif" alt="" />
Actually, what is good for the resident IS good for the off-island owner, they just may not see it the same way. <img src="http://www.traveltalkonline.com/forums/images/graemlins/Wink.gif" alt="" />
Last edited by Nutmeg; 09/10/2014 07:48 AM.
[color:"red"]NUTMEG[/color] Today is the tomorrow you talked about yesterday.
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Re: Advice for buying in USVI
[Re: Nutmeg]
#28842
09/10/2014 01:41 PM
09/10/2014 01:41 PM
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Anonymous
Unregistered
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Anonymous
Unregistered
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I have owned a codo on one of the nicest beaches in the Caribbean for nearly 30 years. I have never even come close to breaking even or making money.
Rentals take a lot of time and effort and are like a second job
Electric bills can easily exceed $1000/month. Water bills are in the $300/month range unless a toilet is running or a faucet leaking and if that happens it is more like $1000. Assesments of $10,000 are not at all rare and that is on top of monthly dues of $1400/month.
Be sure you can afford that and sustain a negative cash flow.
Yet if I had to do it over again I would still buy when I did. The place is very special for me and my family and we have gotten a great deal of pleasure from owning it.
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