Property Ownership in the US Virgin Islands
Ownership is under the US flag and is fee simple, allowing the owner to enjoy the property and freely sell, transfer, or will the property to others, as desired.
US Virgin Islands Property Transfer Tax
Transfer tax is usually paid by the seller at the following rates :-
2% for any property valued up to US$350,000
2.5% for property valued from US$350,000 up to $1,000,000
3% for property valued from US$1,000,000 up to $5,000,000
3.5% for all property valued above US$5,000,000
Buyers Closing Costs
In addition to paying the transfer tax, the buyer may wish to take out title insurance and will also need to pay for any survey of the property and lawyers fees etc.
Sellers Closing Costs
Real estate agents fees and lawyers fees.
US Virgin Islands Property Tax
Property taxes in the US Virgin Islands are lower than most US mainland states and are levied at 1.25% of 60% of the assessed value.
Most of the banks in the US Virgin Islands are willing to offer mortgages to qualified clients.
If a property is purchased using a loan, the lender will in most cases require that the property be insured. Taking our such insurance makes good sense even when not required by a lending institution, and typically costs between 2 and 3 % of the property value per year. The insurance should cover all risks and include the specific risks of hurricane and earthquake damage to the property.
Building costs in the US Virgin Islands range from US$275 per square foot and upwards for buildings constructed from masonry, with the actual cost depending on the standard of the finishes required and the quality of the materials used. To withstand earthquakes and hurricanes, buildings typically include reinforced concrete floors, ring beams and reinforced concrete blockwork walls, with roof joists secured using hurricane clips.
Newly constructed properties in the US Virgin Islands are required to be designed to withstand not less than one standing mile of wind travelling at 110 mph. Buildings must also meet all requirements to withstand Zone 4 earthquakes. To meet these requirements, a locally licensed USVI architect or engineer must approve the buildings structural design and stamp the new construction plans.
Building permits typically take 3 months or more for approval.
Electricity : Mains electricity of 220 and 110 volt 60 hertz 3 phase and single phase is supplied in most areas by the US Virgin Islands Water and Power Authority (WAPA). Unfortunately the supply is not dependable and most home owners will choose to install a standby generator with an automatic changeover switch. Any specialist or highly sensitive equipment that cannot be turned off, should be placed on a separate circuit direct from an inverter and battery bank, with a charger connected to the domestic supply.
The monthly rates for electricity from WAPA are :-
First 10 kWh cost $10.68 per kWh;
Next 90 kWh cost $9.45 per kWh;
Next 100 kWh cost $6.25 per kWh;
Over 200 kWh cost $5.75 per kWh.
Water : Local building codes in the US Virgin Islands require that buildings be constructed with rainwater harvesting from the roof collected in storage cisterns. Typically the requirements are that 10 gallons of cistern storage is provided for every square foot of roof area on a single-storey home and 15 gallons of cistern storage per square foot of roof area on a two-storey home. The Water and Power Authority produces desalinated water that is sold exclusively to the USVI Department of Public Works for distribution at a cost of about $14 per 1,000 gallons. The St. Croix public water supply is supplemented by about 30 percent from well fields. Properties running out of water, can also arrange for water to be delivered for approximately US$150-$200 for 3,000 gallons.
Gas : Bottled propane gas is a preferred and dependable method for cooking (a reserve bottle should always be kept on hand) and is readily available from private suppliers.
US Virgin Islands Property Rental Income
The rental market differs between the islands and from property to property. There are numerous rental management companies that will look after and rent property, with the owners typically receiving 45% to 60% of the gross rental income after management expenses and commissions.