Caribbean Luxury Group

Caribbean Luxury Group

w w w. C a r i b b e a n l u x u r y g r o u p. c o m

Volume Volume III, III, Number Number 11

Homes and Estates From Around the Caribbean

Cover Property

Maison Veldkamp St. Thomas, U. S. Virgin Islands

Straddling the ridge which forms Skyline Drive, MAISON VELDKAMP offers charming, stylish and serene luxury. This three-bedroom villa provides delightful terraces, a large pool with an incredible view of Charlotte Amalie Harbour, native stonework and other architectural delights. Amazing 360-degree views over the town and harbour: south to the island of St.Croix; east - down island to the British Virgin Islands; north over world famous Magens Bay and the Atlantic; and west to outer islands and Puerto Rico. This electronically gated aerie has a “bird’s-eye view” from the best vantage point St. Thomas has to offer. There is also a one-bedroom apartment accommodation for guest privacy with view looking to the Atlantic. FIVE STAR! MLS#101554 Offered at $1,300,000.

John Foster Real Estate 6111 Estate Nazareth St. Thomas, U.S. Virgin Islands 00802 P.340-776-5000 • F. 340-775-3301 www.usvi-realestate.com

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A First Look at a

Second Home

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n the current economy, home prices have dropped and mortgage interest rates have been lingering in record-low territory since midway through the second quarter. These conditions have presented opportunities for many who have been hesitant to purchase a vacation home or investment property in the past, when costs were much higher. For those who are able to pay the additional mortgage, taxes, insurance, repairs and maintenance on an additional property over the long term, there are many benefits to be gained, financial and otherwise.

residence for two of the last five consecutive years. This exclusion applies to one sale every two years.

Also, while home prices have dropped, rental costs have remained relatively stable in many areas. While those who purchased property in 2005 or 2006 may have trouble using rental income to cover the ongoing expenses of owning a second home, recent buyers may find the extra money from renting their vacation home when they’re not using it can pay for a larger proportion of their costs. However, this takes planning, patience and effort to make it work.

In addition to the profits obtained from selling the home in the future, vacation homes are a lure for family and friends. Hosting family gatherings at your beachfront property or a ski trip with friends at your mountain retreat will create memories for you and your loved ones that will never depreciate in value.

In fact, before making a purchase decision on a vacation home or investment property, there are many considerations you should be aware of. It’s imperative you fully understand the homeownership costs that come with owning a second home.

A large number of buyers also purchase a vacation home with the intent to use it as their personal residence in the future. The appeal of retiring to a beloved vacation spot is obvious.

However, it can also save on taxes when the house is sold. To qualify for the exclusion of up to $500,000 of gain on the sale of a principal residence, the home must be used as a primary

How Much Home Can You Afford?

If you don’t have enough to pay off your second home with cash, you’ll need a mortgage. Your Loan Officer can help you determine the type of financing for which you qualify. You can usually prequalify by visiting your Loan Officer’s website, giving you a good idea of what you can afford.

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It’s not necessarily the best idea to go with the most expensive property you can manage, and it’s important to factor in additional costs, such as maintenance, utilities, taxes, furniture and other expenses. Your homeowner’s insurance may cost more than you’re used to, depending on the area in which the property is located.

You should also make sure you have cash reserves set aside for extra expenses, many of them unexpected, especially if you plan on renting out your home. When you’re a landlord, you don’t have the luxury of making repairs “whenever you get around to it.”

Be prepared to cover your mortgage payments for periods in which your property is not rented.

Many vacation spots have off seasons, and renting out a vacation home is a lot of work.

Even if you’re able to cover the home loan costs with your rent income, you should be prepared to pay the full mortgage if the property is vacant.

Before You Buy Be aware that requirements for mortgages on a second home are higher than those for your first mortgage. Depending on the loan programs for which you qualify, banks may require anywhere between 10 and 50 percent of the total home cost for a down payment.

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home, and income are reported on Schedule E. Losses are subject to the passive loss rules and may be limited.

It is best to consult with a tax professional to learn exactly what deductions can be claimed before you purchase your second home.

Interest rates also tend to be higher on a second mortgage.

Your debt-to-income ratio (DTI) will also be taken into account. Your DTI is determined by adding all debts, including your projected future monthly payment for your second home, and comparing it to your monthly pre-tax income. As a general rule, lenders are looking for a DTI of 36 percent or less. However, your lender can help you determine what DTI works best for you, and if you are planning on renting out your second home, the possible income from that may be taken into account.

Your lender may also require a higher credit score than they did for your principal residence.

A score below 660 could make it difficult to obtain a loan for a second home.

Vacation Home vs. Investment Property There may not seem to be much difference between a vacation home and an investment property, but the IRS has rules as to the income and deductions that are available for both. If you own a vacation home and it is leased out for less than 14 days a year, you may deduct the mortgage interest expense (subject to mortgage indebtedness limits) and taxes as an itemized deduction. Any rental income does not need to be reported.

If your vacation home is used by you for more than 14 days as well as rented out, the income from rental is reported on Schedule E and the portion of interest and taxes allocable to the rental use is deducted on Schedule E against the income. The personal use portion is deducted as an itemized deduction. Direct and other rental expenses can be deducted against income, but these expenses cannot create a net loss.

If you use the home for personal use for less than 14 days a year and receive rental income, the home is considered a rental property and all expenses, including depreciation of the

Renting Out Your Second Home While renting out your second home as a means to have your vacation property pay for itself is difficult, you can at least offset the costs with the income. It is best to rent it out as often as possible, as vacation rentals can take a high weekly rent, especially if located in a prime area. Consider a vacation home in a popular vacation area with low home prices to increase your potential for profit, even if it’s not your home state.

Once you’ve bought your home, the next step is to find renters. Paid websites such as www.Rentalo.com, www.VacationRentals.com, www.VRBO.com (Vacation Rental By Owner) and www.CyberRentals.com are vacation booking companies that are searchable by a number of features and are a good way to advertise to prospective renters. www.HomeAway.com is an owner community that lists paid listings on several websites, including some of those above. Homeowners pay $329 a year to list on www.HomeAway.com, while www.VRBO.com costs $279 a year.

To be competitive in the rental market, distinctive features are necessary. When purchasing your home, aim for an area with amenities available in the community, such as neighborhood pools, public beaches, ski resorts and golf courses.

Make the property attractive to families by adding features like pool tables, board games and TVs. Keep the house stocked with toys so that children will be occupied.

Some rental owners spring for the VIP treatment, offering weekly maid service, limousine transport and private chefs. If it’s in your budget, your home could be that much more attractive to renters with elegant tastes.

Don’t be afraid to accept less for a last-minute deal. Offering a stay-for-four-nights, get-thefifth-free special would lure previously hesitant renters, and you’ll still be getting more than you would have if the home had been empty for a full week. It is also a good way to occupy the home during the off season.

Comply with Rules, Regulations and Laws Before you start renting out your property, make sure you research the many rules for renting out properties. Fines for noncompliance can be steep. These rules vary by region, and a good place to start is the U.S. Department of Housing and Urban Development’s website, www.hud.gov.

You might also consult with an attorney to be sure you are fully aware of the local laws and have all the proper forms required.

You will also want to have a rental agreement signed by both you and the tenant, identifying both parties, the property, the terms of the rental and the amount to be paid. You may also consider hiring a property management company to handle the care of the day-today operations and tenant needs. You may make less profit, but you will have less handson responsibility.

Your Home Away From Home Regardless of whether you choose to use the home as an investment property or solely as a vacation home, the benefits of having a retreat for you and your family are many. And if you can use rental income to pay for all or some of the costs related to purchase, the rewards become financial in addition to sentimental.

Experts say there is a short window of opportunity for people to purchase the best property possible before home prices and mortgage rates increase. The economy will recover, and as it does, your chance to make the most out of less will slowly disappear.

This article was submitted by Cornerstone Mortgage Company, a full-service mortgage banker operating more than 75 offices in Texas, Georgia, Minnesota, Oklahoma, Louisiana, Arizona, Colorado, California, Mississippi, Nevada, North Carolina, Utah and Washington.

Corporate Office/Houston, 713.621.4663, 1177 West Loop South, Suite 200, Houston, Texas 77027.

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Villa Indochine St. Thomas, U. S. Virgin Islands An oasis of tranquility awaits at this three-acre estate. Decorated with Oriental antiques and modern teak pieces set on mahogany floors, this home is unlike any other on St. Thomas.

Endlessly comfortable living areas are Zenlike in their elegant simplicity. Outside, a pool, meditation pavilion and hiking trail enjoy spectacular ocean views. MLS# 07-1735 Offered at $3,450,000.

Estate Bakkeroe St. Thomas, U. S. Virgin Islands Sited on a beautiful, flat 1.5 acre lot in prestigious Bakkeroe Estates, this remarkable property has five bedrooms and three and one half baths plus a den, home office with private entrance and half bath, a separate studio apartment and 3-car garage all on one level. Outside, a large pool and tennis court make this the perfect family home or vacation retreat. MLS# 10-1017 Offered at $1,945,000.

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John Foster Real Estate 6111 Estate Nazareth St. Thomas, U.S. Virgin Islands 00802 P.340-776-5000 • F. 340-775-3301 www.usvi-realestate.com

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Own a Piece of Paradise!

St. Thomas, U. S. Virgin Islands Extensive waterfront lots. The property is zoned R-1, low density residential and located approximately 5 miles west of Charlotte Amalie and is accessible via a paved public highway. The topography is moderately steep and there are public utilities leading to the property. MLS# 10-677 (209 Acres) Offered at $6,500,000 and MLS# 10-678 (76 Acres) Offered at $3,500,000.

Shipwreck Point Water Island, U. S. Virgin Islands Shipwreck Point is an extraordinary 2.28-acre waterfront property located on Water Island. Over 1,000 feet of waterfront provides seclusion for house, cottage, and separate cistern and pad for another house. Professionally landscaped. Just a few steps to the beach and tie your boat up at your private dock. Make this your family compound. MLS# 09-2227 Offered at $2,500,000.

John Foster Real Estate 6111 Estate Nazareth St. Thomas, U.S. Virgin Islands 00802 P.340-776-5000 • F. 340-775-3301 www.usvi-realestate.com

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Pelican Heaven St. Thomas, U. S. Virgin Islands Situated above a private cove, with breathtaking down island views, hear the sound of the waves, see the humpback whales migrating and enjoy the year-round breeze from within this gated entry one-acre waterfront villa.

Enjoy three separate living areas, top-of-the-line appliances, granite tops, incredible furnishing package, home entertainment system, pool, large decks, Jacuzzi tub. MLS# 09-967 Offered at $3,900,000.

The Villa at Banana Bay Water Island, U. S. Virgin Islands Fully furnished and equipped for immediate turn-key occupancy. The main house includes three bedrooms and six baths with oversized great room, large kitchen, 55-foot pool with Jacuzzi, and equipped pool bar. The separate three-bedroom guesthouse is situated just steps above the beach. The property is equipped with a two-car garage (with cars), diesel generator, updated electronics, integrated phone systems, satellite TV-internet.

MLS# 07-1804 Offered at $3,000,000.

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John Foster Real Estate 6111 Estate Nazareth St. Thomas, U.S. Virgin Islands 00802 P.340-776-5000 • F. 340-775-3301 www.usvi-realestate.com

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Blue Moon St. Thomas, U. S. Virgin Islands The Blue Moon estate is situated on the far eastern tip of Cabrita Point. Built in 1988, the home features 3,771 interior square feet, an outdoor patio deck with pool, and unobstructed views of St. John and the Caribbean waters to the south. The fivebedroom, five and one half-bath estate is located on one of the most highly desirable waterfront lots on Cabrita Point. MLS# 10-1300 Offered at $2,450,000.

Paradise Living at Its Best St. Thomas, U. S. Virgin Islands Walk into this beautiful villa down a few steps and you’re on your own private sandy beach located on one of the most beautiful beaches in the world, Magens Bay. This stunning sixbedroom, five and one half-bath home was completely renovated in 2008. MLS# 10-1695 Offered at $2,850,000.

John Foster Real Estate 6111 Estate Nazareth St. Thomas, U.S. Virgin Islands 00802 P.340-776-5000 • F. 340-775-3301 www.usvi-realestate.com

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Botany Bay St. Thomas, U. S. Virgin Islands A large flat knoll atop this homesite offers the perfect vantage to keep watch on all seafaring expeditions. The gentle building plane atop the property affords a grand entrance and parking capability. Ideal for entertaining as your guests will enjoy this regal Up Island view replete with sunset.

With six and one half acres and a long expanse of its very own Caribbean waterfront. MLS# 10-1036 Offered at $1,600,000.

Waterfront Lifestyle St. Thomas, U. S. Virgin Islands St. Thomas’ premier gated beach/waterfront community. Large deed restricted lots and wonderful beaches offer a luxe lifestyle. MLS # 10-1137 Offered at $725,000, MLS# 08-926 Offered at $675,000, MLS# 10-1472 Offered at $650,000.

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John Foster Real Estate 6111 Estate Nazareth St. Thomas, U.S. Virgin Islands 00802 P.340-776-5000 • F. 340-775-3301 www.usvi-realestate.com

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Waterfront Site St. Thomas, U. S. Virgin Islands This waterfront site is distinguished by gradual changes in elevation. Among all of the homesites, this property offers abundant locations for a residential compound that will nestle into the fall of the hillsides that converge at the cliffside edge of the property. The siting on the cove is captivating. MLS# 07-324 Offered at $1,350,000.

Botany Bay Waterfront St. Thomas, U. S. Virgin Islands Botany Bay waterfront - this property resides at the end of a very private drive that wraps the south end of The Preserve, and includes a gentle building site at the crest of the property. The tropical breeze is soothing and siting opportunities are numerous for that perfect design. MLS# 10-1035 Offered at $1,500,000.

John Foster Real Estate 6111 Estate Nazareth St. Thomas, U.S. Virgin Islands 00802 P.340-776-5000 • F. 340-775-3301 www.usvi-realestate.com

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Harmony St. Thomas, U. S. Virgin Islands A Caribbean OASIS.....Experience the tranquility of this finely-crafted Old World stone Villa plus Gatehouse situated in a secluded cove embracing the Caribbean Sea. As you pass through the stately arches of the Beach House, you are welcomed by tropical breezes and picturesque views of the turquoise waters......just a few steps glide you into the clear waters of Secret Cove for snorkeling pristine reefs and leisurely swims. Enjoy the casual elegance of the open-view great room including sunken living room and expansive kitchen enhanced by Italian travertine and rich cabinetry. The two queen bedrooms with en suite bathrooms are extremely appealing with intricate stone and shell showers, coral stone walls and flooring. There are multiple shaded terraces and viewpoints for relaxing, recharging, meditating or just enjoying the sailboat races while being mesmerized by water music. Commanding a hilltop presence is the Harmony Gatehouse, graced with panoramic views and tropical breezes.

This bi-level cottage is nestled in a hillside garden filled with bougainvillea and palms. The Gatehouse overlooks Secret Harbor Cove and the Caribbean Sea. The ambiance of the Gatehouse is warm and inviting with a palette of eye-pleasing colors and textures. The upper level consists of an airy living room with open cafe-like kitchen adjoining the balcony with overflowing sky and water views. A very comfortable bedroom has multiple closets and a separate bathroom. The lower level welcomes you with a cozy sitting room, charming bedroom and bathroom with artistic appointments. HARMONY is one with nature, and perhaps, the most memorable architectural features are the many artisan-crafted walls and steps of native stone, antique brick, coral and shells. MLS# 10-1719 Offered at $1,980,000.

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John Foster Real Estate 6111 Estate Nazareth St. Thomas, U.S. Virgin Islands 00802 P.340-776-5000 • F. 340-775-3301 www.usvi-realestate.com

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Cabrita Point St. Thomas, U. S. Virgin Islands Cabrita Point, St. Thomas is an exceptional location set in one of the most picturesque destinations, located adjacent to the four-diamond rated Ritz-Carlton with its sugar white sandy beaches. View the mountainous peaks of St. John, crystal blue waters of Great Bay, or the yacht mecca of Red-Hook—every home will have a breathtaking vista. This exclusive peninsula will provide future owners a sense of exclusivity and privacy rarely experienced in the Caribbean. Opportunity awaits thirty five (35) fortunate lot purchasers. All parcels are oceanfront or water view. R-1 zoning code will allow each lot owner to build detached single or two family homes. The land is subject to the CZM approval process, however single and two family residences require a “minor” CZM permit, which is typically a 60-day process. New waterfront and water view homes are typically priced from $500 to $1,000/interior square foot, ranging in price from $1.8 to $5 million. This is a unique and historic opportunity to own and experience a rare lifestyle/investment in the US Virgin Islands. Prices upon request.

John Foster Real Estate 6111 Estate Nazareth St. Thomas, U.S. Virgin Islands 00802 P.340-776-5000 • F. 340-775-3301 www.usvi-realestate.com

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Villa Banana St. Thomas, U. S. Virgin Islands BANANA showcases both primitive and modern styles boasting ethnic design and furnishings influenced by international travels of the owners. The “cool” concrete floors are reminiscent of a home they visited in Lamu, Kenya; the dramatic location of the home was selected for its similarity to a residence visited by the owners in Mustique in the Grenadines. The blending of styles also hints of a Mediterranean ambience; all of which are enjoyed here in the Caribbean. BANANA is truly a unique architectural experience. Casual elegance at its best! MLS# 09-2094 Offered at $3,950,000.

Villa La Creole St. Thomas, U. S. Virgin Islands Villa La Creole, steps from the ocean and Lime Tree Beach; this brand new expansive, 6,000 square foot, four-bedroom masonry home awaits final finish. Marble floors and cathedral ceilings echo elegance, all on the walk-in level from the covered portico. Expansive, serene covered gallery; sprawling pool deck with giant pool awaits finish. Spacious flat yard, unlimited parking. Three-bedroom apartment below. Best value under $2,000,000. MLS# 092253 Offered at $1,600,000.

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John Foster Real Estate 6111 Estate Nazareth St. Thomas, U.S. Virgin Islands 00802 P.340-776-5000 • F. 340-775-3301 www.usvi-realestate.com

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Coral Isle Water Island, U. S. Virgin Islands For the discriminating buyer looking for a quiet and secluded retreat away from the bustling pace on the main island. Access to this exclusive property used by dignitaries and celebrities is a quick five-minute trip from Crown Bay Marina via your private boat or public ferry.

There is a ‘’Supplement’’ for the full information on this unique property. MLS# 10-1371 Offered at $1,850,000.

Maison Veldkamp

John Foster Real Estate 6111 Estate Nazareth St. Thomas, U.S. Virgin Islands 00802 P.340-776-5000 • F. 340-775-3301 www.usvi-realestate.com

St. Thomas, U. S. Virgin Islands Straddling the ridge which forms Skyline Drive, MAISON VELDKAMP offers charming, stylish and serene luxury. This three-bedroom villa provides delightful terraces, a large pool with an incredible view of Charlotte Amalie Harbour, native stonework and other architectural delights. Amazing 360-degree views over the town and harbour: south to the island of St.Croix; east - down island to the British Virgin Islands; north over world famous Magens Bay and the Atlantic; and west to outer islands and Puerto Rico. This electronically gated aerie has a “bird’s-eye view” from the best vantage point St. Thomas has to offer. There is also a one-bedroom apartment accommodation for guest privacy with view looking to the Atlantic.

FIVE STAR! MLS#10-1554 Offered at $1,300,000.

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Southwind St. Thomas, U. S. Virgin Islands SOUTHWIND currently serves as a vacation home situated in the established gated community of Mafolie Estates in St. Thomas, Virgin Islands. This home is nestled in a mahogany forest overlooking Charlotte Amalie Harbour among other upscale homes 850 feet above sea level. Southwind contains 3,500 square feet of interior space and 3,000 square feet of exterior living. Four air-conditioned bedrooms and four baths can easily accommodate 8 to 10 people quite comfortably. A large openair, covered terrace furnished for relaxed lounging and dining enjoys the ever-changing harbour scene by day or night. By day, the beautiful cruise ships, the sailboats and the seaplanes provide continuous activity in the azure Caribbean below. By night, the sparkling lights of the city dance in the darkness lending themselves to flights of fancy. We invite you to make Southwind your home in the Virgin Islands. Price upon request.

John Foster Real Estate 6111 Estate Nazareth St. Thomas, U.S. Virgin Islands 00802 P.340-776-5000 • F. 340-775-3301 www.usvi-realestate.com