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Property Values?

isl3985
August 25, 2016 07:39AM

Registered: 6 years ago
Posts: 68

Lemme get this straight:

Bought a condo in 2010 that appraised for $105,000.

US home prices have slowly increased since 2010.

Put 25-30k into upgrades new tile floor, new kitchen, new bathroom, walk-in closet, A/C, etc etc.

Go to sell condo in 2016 and appraises for $98,000 almost 7% lower than 2010 without upgrades

I guess that's what I get for investing in a failed economy welfare state. Lesson learned.



Edited 1 time(s). Last edit at 08/25/2016 07:40AM by isl3985.

Re: Property Values?

SausageInTheCan
August 25, 2016 08:02AM

Registered: 4 years ago
Posts: 396

Lemme get this straight:

You bought a condo on and island with an unstable economy two years after the housing bubble burst and you're.........

I'm confident if you asked on this forum, several would have advised against it.



Edited 1 time(s). Last edit at 08/25/2016 08:03AM by SausageInTheCan.

Re: Property Values?

ms411
August 25, 2016 08:05AM

Registered: 8 years ago
Posts: 3,521

A friend bought a condo in NC, and it has also lost value. Housing depends on local economy. If you want an almost guaranteed return on a property, buy in Silicon Valley or NYC.

Re: Property Values?

OldTart
August 25, 2016 08:24AM

Registered: 6 years ago
Posts: 6,524

It's clear that you didn't like living in the islands and are quite bitter about the time you spent here but there's any number of reasons why a current appraisal is lower than when you purchased. It can happen anywhere. As "SausageInTheCan" mentioned, had you sought opinions before investing in real estate so soon after your arrival, you may have received good cautionary advice - the same as has been given on this forum many, many times.

Hopefully despite the lowered appraisal you'll be successful in selling the unit for the price you're asking. Good luck.

Re: Property Values?

IslandHops
August 25, 2016 08:41AM

Registered: 9 years ago
Posts: 929

And when did Hovensa shut down?

After you bought, and before your reappraisal.

I'm assuming you're on STX.

Re: Property Values?

isl3985
August 25, 2016 08:46AM

Registered: 6 years ago
Posts: 68

Quote
OldTart
It's clear that you didn't like living in the islands and are quite bitter about the time you spent here .

Oh no, I loved it! Especially never receiving my $1400 2014 tax return but still having to pay taxes & property tax or the last 2 years.

And I was there 2 years before I bought. On STT btw.



Edited 1 time(s). Last edit at 08/25/2016 08:48AM by isl3985.

Re: Property Values?

LoveUSVI
August 25, 2016 09:15AM

Registered: 3 years ago
Posts: 29

I look at any investment, including real estate, as a very long term investment (10+ years). Otherwise I consider it a speculation, in which you can make lots of money if you are lucky, but are more likely to loose lots of money. In my view this applies whether you are starting a business, buying in the stock market, or buying a real estate property. The additional characteristic of a business or real estate investment versus public stock investment is that it may take long time to get your money out whether at at profit or not.

Improvements to the property are very unlikely to return 100% of their cost. They may be nice to do for your personal comfort, but you will recover their full cost only as the value of the overall property increases. For selling, the only improvement that are worth it, it is to clean the property thoroughly (spotless), make sure the property smells good, clean the trash outside, make sure that main things work (doors, toilets, faucets, etc.), add a coat of paint if needed, remove clutter in closets and rooms, and remove items (like pictures) that personalize the property too much.

I would be cautious about thinking that some markets continuously produce gains. I have lived in NYC and Silicon Valley and have seen the prices go down considerably in both locations. In my experience, prices go up and down everywhere despite what people will tell you when the prices are up ("prices cannot go down, because NYC is an island and there is no more land" or "prices cannot go down since two thirds of the island is a national park," etc.).

The price at a given time is very driven by the local economy AND in some unique places by the desirability of the location to outsiders. Clearly, if the economy in the USVI does better, people living here may want to upgrade where they live and usually this drives prices up. In addition, we are fortunate that the USVI can be very attractive for outsiders to move to or buy and rent because of its weather and natural beauty. Government policies can make a place more desirable (or less).

Frankly, this forum is a component of making the USVI desirable to people with means who want to invest here. To attract them, the more we emphasize the positive aspects of the USVI, the better... do not worry, they are sophisticated enough to understand the negatives (that exist everywhere).



Edited 1 time(s). Last edit at 08/25/2016 09:25AM by LoveUSVI.

Re: Property Values?

IslandHops
August 25, 2016 11:30AM

Registered: 9 years ago
Posts: 929

You know, if you think about it, this thread is encouraging others to consider moving here. Real estate right now is a bargain in comparison to just a few years ago!

But I think the downward trend is over, from what I'm seeing. Pre-Hovensa the housing stock listings on STX were around 280 properties (houses - not land, condos, business). After the shutdown this increased up to over 330+. Now the market stock is around 260, and from what I hear the frequency of sales has increased.

(Edit)
It's also a reminder that your investment in upgrades to any property should be considered wisely. Just do what is necessary to enjoy living here - don't overbuild, or overspend.



Edited 1 time(s). Last edit at 08/25/2016 11:32AM by IslandHops.

Re: Property Values?

LiquidFluoride
August 25, 2016 12:10PM

Registered: 5 years ago
Posts: 1,940

Quote
IslandHops
Now the market stock is around 260, and from what I hear the frequency of sales has increased.

Houses hit the market and sell by the next day in the 150-250,000 range... I don't think prices will stay low..

when I purchased in 2013 I low balled by $100,000 my offer was accepted on a house in that range; I doubt you could do that now.

But IMO, it's still worth buying.. you won't find houses this cheap again for a while now that the shock of Hovensa leaving is mostly absorbed.

Re: Property Values?

Pammerjo
August 25, 2016 12:41PM

Registered: 2 years ago
Posts: 146

I have no regrets. I don't expect to see 100% return on our investment or the improvements we plan to make, but then, barring some catastrophic event, I don't plan on selling it, either. At least not until I'm really old.

OP, are you trying to sell? Are you in a place financially where you can use your property as a rental property if you are looking to move elsewhere? Depending on the location of your unit, it's a seriously good gig. We purchased in February, and as of this month have covered our mortgage, HOA fees and operating costs for the entire year. The guests we have booked from now until March '17 are gravy!

Re: Property Values?

SausageInTheCan
August 25, 2016 03:16PM

Registered: 4 years ago
Posts: 396

Quote
isl3985
Quote
OldTart
It's clear that you didn't like living in the islands and are quite bitter about the time you spent here .

Oh no, I loved it! Especially never receiving my $1400 2014 tax return but still having to pay taxes & property tax or the last 2 years.

And I was there 2 years before I bought. On STT btw.

Yet another topic which has been discussed numerous times on this forum. Something else warned about over and over about living in th VI.

Re: Property Values?

mtdoramike
August 25, 2016 08:02PM

Registered: 6 years ago
Posts: 929

Never treat a home like a piggy bank that is what the last 16 years should have taught folks. I bought my home because I liked it and wanted to live there. Now if I sold it and lost money it is what it is. But if you buy for an investment, never, never up grade the property by more than what the value of the home is at that time. But if it's a home you intend on spending the rest of your life in, who cares what the value is.

Also, condo's are not a good investment unless you intend to either live in it or rent it out because the prices fluctuate so drastically it's not a good investment, especially if you have condo fees that rival the monthly payment of a luxury car. If you are going to invest, buy a home and improve on it gradually and keep checking home values in that area to make sure you are not over improving for the area.


mike

Re: Property Values?

Scubadoo
August 25, 2016 09:20PM

Registered: 4 years ago
Posts: 2,092

Quote
mtdoramike
Never treat a home like a piggy bank that is what the last 16 years should have taught folks. I bought my home because I liked it and wanted to live there. Now if I sold it and lost money it is what it is. But if you buy for an investment, never, never up grade the property by more than what the value of the home is at that time. But if it's a home you intend on spending the rest of your life in, who cares what the value is.

Also, condo's are not a good investment unless you intend to either live in it or rent it out because the prices fluctuate so drastically it's not a good investment, especially if you have condo fees that rival the monthly payment of a luxury car. If you are going to invest, buy a home and improve on it gradually and keep checking home values in that area to make sure you are not over improving for the area.


mike
thumbs up

Bought my current STX condo in 2015 for 67% what the previous buyers paid in 2007 and that was after it was on the market for several months with a few price drops. I don't know what the condition was in 2007 but other than some wear in tear it was in good shape.

There are currently 99 condos for sale on the STX MLS, was around 150 I think in 2013. Prices in areas in my complex have certainly been creeping up in that time frame. There are certainly still plenty of condo opportunities out there for reasonable prices compared to pre-crash but for how long? Anyone have a crystal ball?

Re: Property Values?

FLLisa
August 26, 2016 09:21AM

Registered: 4 years ago
Posts: 125

Do any of you have condos in St C or Cruzan or Coral Princess? If so, could you pm me? I have some questions that I really can't find answers for with the search feature......Thanks.

Re: Property Values?

stjohnjulie
August 27, 2016 07:00AM

Registered: 10 years ago
Posts: 779

Quote
isl3985
Lemme get this straight:

Bought a condo in 2010 that appraised for $105,000.

....

Go to sell condo in 2016 and appraises for $98,000 almost 7% lower than 2010 without upgrades

Too bad it wasn't on STJ. It would have appraised for eleventy billion dollars, or something close to that, by the property assessors anyhow.
But seriously, stinks to lose money.

Re: Property Values?

islandnewbie
August 27, 2016 08:44AM

Registered: 3 years ago
Posts: 66

Do you also realize you will have to pay a 2-1/2% stamp tax on the sales price of the home at closing? This is in addition to the realtor commission and all the other closing costs. You can also expect it to take at least 90 days to close unless you get a cash sale. A cash sale will usually help you avoid an appraisal and allow you to close in 30-45 days. Good luck!

Re: Property Values?

Alana33
August 27, 2016 09:49AM

Registered: 6 years ago
Posts: 12,041

People paying cash for a property often order an appraisal.
Cash closing can take place in less than 30 days if all goes smoothly.


The following is a break down of stamp taxes in the U.S. Virgin Islands:

2 percent for properties valued up to $350,000
2 ½ percent for properties valued from $350,001 to 1 million
3 percent for properties valued from $1,000,001 to $5 million
3 ½ percent for properties valued over $5,000,001[3]

Re: Property Values?

SkysTheLimit
August 27, 2016 02:15PM

Registered: 11 years ago
Posts: 1,899

If you have the time and skills to do upgrades yourself you can certainly make money on houses here. Condos I'm not so sure due to the carrying costs of condo fees.

Bought our house in 2004. An incomplete house. Finished it off with mid range finishes and I'm confident I could sell for nearly double what I have in it. In fact, we just purchased another fixer. I'm confident it will be worth more than double what we'll have in it.

It takes the right property and location, the right attitude and skill set, a bit of money to "gamble with", but can be done in almost any market. You just need to watch for the right "deal".

Re: Property Values?

caribbecowboy
August 27, 2016 02:48PM

Registered: 2 years ago
Posts: 21

Want to make a million dollars in the Caribbean? bring two.

Re: Property Values?
avatar

Exit Zero
August 27, 2016 03:06PM

Registered: 10 years ago
Posts: 2,254

Quote
caribbecowboy
Want to make a million dollars in the Caribbean? bring two.

Not a bad return on your money 50%

"If you want to Leave the VI with a Million $$ bring 2 Million" was always the way I heard it.

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