Kim Lucas

Hurricane season is here, and I just took a listing on a townhome in a complex which is self-insured, so thought a few words regarding hurricane insurance would be timely.

Our property taxes are pretty low (about .004 X purchase price) but we make up for it in the cost of windstorm insurance. If you are getting a mortgage on a single family home, you can expect to pay 2 - 3% of the mortgage in windstorm insurance. Even then, you will be underinsured and likely have huge deductibles, and possibly penalties, should you incur damage. To be fully insured, calculate 2 - 3% of the replacement value.

Now, if you are purchasing a condo, some of the complexes have commercial windstorm insurance. These will likely have higher monthly fees (our condo fees here range from $250 - $1200 a month). Smaller complexes can't afford commercial policies (the monthly condo fees would be prohibitively expensive) so they "self-insure." That means that a portion of the monthly condo fees goes into a "pot" or reserve fund to take care of any damages that might be incurred due to a hurricane.

If there is not at least a million dollars in the reserve fund, then most likely, the banks will not lend on these units. In the past, they would lend, but they would require the buyer to buy their own commercial insurance policy (again - at 2 - 3% of the mortgage). So, on top of the monthly condo fees, you would have had hurricane insurance payments.

In today's stricter lending climate, many are just not lending on self-insured properties. If you can pay cash for a condo or home, you can avoid this issue altogether. If I were buying a home or condo today, I'd do my best to be a cash buyer and I'd make sure I had at least $10,000 in "reserve" for my own hurricane fund, and skip the commercial insurance. Not so easy for most of us, I know.

A few years ago I purchased a self-insured condo here. I took out a home equity loan to do so, and avoided the insurance issue. I'm probably paying a bit more interest than I would with a mortgage loan, but I can pay it down as I'm able.

If you're considering purchasing a home or condo here, be sure you speak with a lender or realtor to get an idea of all the expenses you can expect to incur. Be creative and ask the seller to be creative - it is a Buyer's Market. Just don't expect to come here with no job and get a mortgage on a home.

We have always had a strict lending climate here (which is why we don't have many foreclosures), and it's much more difficult now to get a loan than ever before. Our lenders don't charge to talk with you and pre-qualify you - and believe me - you can save yourself a lot of pain and suffering by doing this BEFORE you start looking for a home or condo!

Contact me for names and numbers of good lenders here. I will help you try and purchase, and work with sellers to find creative - legal - ways for you to buy a home. St Croix is still the best value in the Caribbean and will only be more expensive in the future. Let's work together on making your dream of living in the Caribbean come true!

Kim Lucas, Realtor
Coldwell Banker Land-de Wilde Realty
kim@coldwellbankervi.com
340-626-3758
www.retireinthevi.com
www.kimlucasvi.com

A word about getting pre-qualified before 'shopping' for homes, land, condos in VI:

With all the new federal guidelines impacting the mortgage industry, it is getting more and more difficult to secure financing for the purchase of property in the VI. Only a few banks here will lend on land, and many of the condo complexes are self-insured and the banks are no longer lending on them.

Plus - if you're one of those brave souls who plans to sell everything and come down to paradise to live - if you need a mortgage - you may not be able to get one until you've worked here for a few years.

So, to save yourself some big disappointments - Please take a few minutes out of your busy day to contact a lender here on the island (your bank will NOT lend
on property here....trust me).

I will be happy to give you a list of names - just email and ask. Once you have that coveted pre-qualification letter - then believe me - sellers will pay MUCH more attention to your offer and seriously consider it.

Sadly, I've seen offers that are not even countered because the buyers were not pre-qualified! Had they been, my feeling is that the deal could be negotiated to everyone's satisfaction.

Contact me for names of reputable, experience St Croix lenders.

Kim Lucas, Realtor
340-626-3758
kim@coldwellbankervi.com
www.kimlucasvi.com
www.retireinthevi.com

Perhaps the most common question I get about St Croix is "Can I afford it?" I have known people who could live on $200 a month - and I have known people who needed $200 a day to be happy/comfortable. So it is really difficult to answer that question.

What I can tell you is what housing costs, and give you an idea of food costs, utility costs, etc. Also - it's pretty easy to move here hassle-free. Most things are sold or rented fully furnished - so all you need to bring is a toothbrush and clothes! And you don't need many clothes. It's a very casual place and the weather is consistent - so shorts and a couple of T-shirts - good pair of flip flops - and you're good to go!

Housing costs:

You can get a condo here for as little as $65,000 (there's a great one bedroom - 2nd floor - sea view - for $65,000 at Long Reef - great deal!). The monthly condo fees will range from $250 - $1200 a month. Most times, that fee does cover your insurance - but not always. If you're going for financing, I suggest you avoid condos that are "self-insured" because the bank will require you to get hurricane insurance, and that will be on top of hefty condo fees. Some banks have even decided to not finance those purchases.

A house will cost more. Generally $200,000 is about the least you can expect to pay and at that you will have some fixing up to do. There are a few exceptions - and that's why you need a Realtor! We know the good deals - different areas - and I for one will be completely honest with you.

If you choose to rent - you can expect to pay at least $800 a month - and that won't get you much. I'd say $1500 is about the least you can expect to pay for a nice home or condo. Again -there are always some exceptions out there. You can peruse the inventory of rentals at www.stcroixvacationhomes.com. One of our big employers just laid off 300 people - so rent may be coming DOWN as a result. That's a big hit in our economy and community.

Food costs:

Food costs are higher here than in the states (maybe 25% more?) - and eating out costs more too. Good news is that you can get what you want (not always the case in the Caribbean) - and there are great restaurants!

Living Costs:

Your electricity is going to cost a lot more here -so it's important to get a home that has good breezes and ventilation so you don't have to use AC.

We collect rain water on our roofs so no water fees (except in some condos).

Other things - like phone, internet - are comparable to the states.

Our gas is cheaper here than in the states - I think about $2.21 a gallon now.

If you have specific needs or questions - please feel free to ask. And if you can give me an idea of what "affordable" means to you - perhaps I can give you a better answer.

Helping you Live Your Dream,

Kim Lucas, Realtor
340-626-3758
kim@coldwellbankervi.com
www.retireinthevi.com
www.kimlucasvi.com

If you are a first-time home buyer this year, you may be eligible to take a tax credit of $8,000, making it easier to afford to make the financial leap.

Under the federal stimulus package passed earlier this year, first-time home buyers can deduct 10 percent of the cost of a home purchased as your primary residence -- up to $80,000, for a maximum of $8,000 -- from their income tax. It is a refundable tax credit, so if you owe less than your credit, you can get the difference in your income-tax refund. This year's federal stimulus package explicitly offers the tax credit to state residents, but is silent on the territories.

"There has been some concern that because language in the stimulus legislation states that those eligible for the credit include the 50 states and the District of Colombia that the territories are not eligible," Delegate Donna M. Christensen said in a statement from her office. "However, for the Virgin Islands and Guam, the mirror tax makes changes to the�U.S.code applicable to our territories."

If you already purchased a home you can still use the deduction, so long as the purchase was after Jan. 1. If you are considering buying a home, the tax credit is another factor to consider as you budget and determine what you can afford.

There are so many opportunities for buying in St Croix right now - it's almost unbelievable what prices are being offered for oceanfront or oceanview homes. Contact me for some ideas.

Kim Lucas, Realtor
340-626-3758
www.kimlucasvi.com
kim@coldwellbankervi.com

The U.S. Virgin Islands and the Virgin Islands Economic Development Authority (VIEDA) were featured on Delta Airlines' In-flight Video during the month of April 2009. That video is now online for you to see at the USVIEDA web site.

The video focuses on the quality of life offered residents of the Virgin Islands, and the generous tax incentives for businesses. Showing the beautiful beaches and blue water, and the historic quaint towns, it makes a strong case for using the US tax benefits while enjoying a Caribbean Island culture. "This video is a great opportunity to create greater global exposure about the Virgin Islands EDC Program," says Mr. D. Jerry Garcia, the Director of Marketing and Public Relations for the VIEDA.

Governor John P DeJongh Jr. is very supportive of business in the Virgin Islands. In his Message from the Governor on the USVIEDA site, he explains,

"My Administration is firmly committed to supporting economic development in the United States Virgin Islands. We boast a strong and rapidly growing economy that is evident with an unprecedented influx of business development to our islands on a daily basis...

"Tax benefits and various incentives are only a part of the reason that one should engage in business initiatives on our beautiful shores. We also offer an educated, multi-skilled work force with a unique and superior quality of life. For service businesses and light, non-polluting manufacturers, our people, lifestyle, natural beauty and our pro-growth policies make the U.S.V.I. a wonderful business location."

While helping many folks research relocation to St Croix, most ask about working or starting their own businesses. If you watch the video, I think you will agree the business climate here is very friendly. Two recent developments - the new rum distillery and approval for Robin's Bay - will bring jobs and economic stimulus. Contact me for a free copy of Relocation to the Virgin Islands, and/or Retiring in the Virgin Islands. Also, you'll find loads of information on my web sites.

Hope to see you here soon -

Kim Lucas, Realtor
www.kimlucasvi.com
www.retireinthevi.com
kim@coldwellbankervi.com
340-626-3758