Condos....

[jasondcrawford]

I'm not quite sure where this thread belongs, but I thought this would be a good place to start.

I'm interested in buying a condo in a scuba-friendly place and wanted to pick everyone's brain. Has anyone looked into those places where you buy the condo, and can stay in it as much or as little as you'd like, and the management rents it out while you're not there? That seems like the ideal setup, as I'm not sure I'd be able to spend a bunch of time there, but I like the idea of buying an investment property and such. As for location, I'm sure there are people here who have looked into it more than I, but I was really looking at Thailand and it seemed pretty doable.

Has anyone had experience with this, or thought of doing something similar? I'm really interested in it, just have no clue where to start. I hope this post makes sense!

 

[ronbeau]

I'm not quite sure where this thread belongs, but I thought this would be a good place to start.

I'm interested in buying a condo in a scuba-friendly place and wanted to pick everyone's brain. Has anyone looked into those places where you buy the condo, and can stay in it as much or as little as you'd like, and the management rents it out while you're not there? That seems like the ideal setup, as I'm not sure I'd be able to spend a bunch of time there, but I like the idea of buying an investment property and such. As for location, I'm sure there are people here who have looked into it more than I, but I was really looking at Thailand and it seemed pretty doable.

Has anyone had experience with this, or thought of doing something similar? I'm really interested in it, just have no clue where to start. I hope this post makes sense!

The first question that comes to mind is

Is the island you are considering inside or outside of the hurricane belt?

For example the ABC islands (Aruba, Bonaire and Curacao) are outside of the hurricane belt while the U. S. Virgin Islands, Puerto Rico, Cayman Islands etc. are within the hurricane belt.

What are the local laws regarding ownership of property? For example, in Bermuda I believe you have to be a Bermudian national to own property.

First narrow down where you think you might want to purchase a condo then check into the other questions I mentioned to get started.

You also need to check into local tax laws and contact people who live in the country where you wish to buy the condo. If it looks promising find a trustworthy attorney in that country to advise you.

I am not an attorney and don't currently own any property outside of the USA.

 

[tvictory]

The old Cayman Diving Lodge, in East End GC, which was destroyed in Hurricane Ivan in 2004, is being rebuilt and will include 10 or 12 investor-financed condos with a rental pool arrangement. I looked at the deal earlier this year and it had some attractions but it didn't pencil out for me. I think you'd have to review the package and then evaluate whether it meets your parameters as an investment. There is no doubt it qualifies as a scuba-friendly place.

 

[BTravlin]

In addition to those concerns already mentioned, financing is a major concern. Mortgage loans outside of the U.S. are generally at much higher rates than found here and U.S. mortgage companies generally won't finance properties in other countries. The availability of title insurance is another area to check thoroughly before buying. Also, many countries impose a stamp tax or transfer tax that can be anywhere from 1% up to 16% of the purchase price. Visit websites for real estate agents in the country you are interested in and they will generally have a link that explains the specifics of foreigners buying property. It is highly advisable to secure the services of a reputable real estate attorney in that country to check all contracts for you and to represent you at closing.

By the way, how does someone 24 years old and fresh out of college afford buying a condo?

 

[jasondcrawford]

I guess part of my inquiry was because I have not narrowed it down to one location -- mostly because of the problems mentioned by many of you folks. Before spending hours looking into the dozens of possible options, I was hoping that someone had at one point developed a similar interest and could point me towards the more feasible options. If, for example, you have to be a Bermuda national to own property there, I could save a few hours by knowing that right off the bat.

tvictory, thanks for the suggestion, I'll check with them and see if they can give me more information.

Btravlin -- My wife and I bought a small townhouse while in college and built up some equity before we sold it. It's by no means enough to justify having a vacation condo (or even a large house!), but I could finance a large portion of it if it would result in a semi-reliable income stream. I'm trying to figure out how much of the annual mortgage could be offset by renting it out throughout the year.

 

[BTravlin]

I don't think that most condos are great investments as far as generating a reliable income stream goes. Most condo developers will over promise on the return on investment. There are many deductions from your rental income starting with a property manager, monthly maintenance charges, utilities, homeowner's insurance, and local income taxes in some cases. Also, vacation area rental income rises and falls with the condition of the economy. How much you use it during the year will determine if your expenses are deductible here in the U.S.

Good to see that you're actively managing your money already. HINT: Start a retirement plan now even if you can only put $20 a month away. Increase your monthly contribution as able and faithfully make that contribution every month. You'll retire comfortably and be able to do pretty much whatever you like.

 

[Damselfish]

The old Cayman Diving Lodge, in East End GC, which was destroyed in Hurricane Ivan in 2004, is being rebuilt and will include 10 or 12 investor-financed condos with a rental pool arrangement. I looked at the deal earlier this year and it had some attractions but it didn't pencil out for me. I think you'd have to review the package and then evaluate whether it meets your parameters as an investment. There is no doubt it qualifies as a scuba-friendly place.

Divetech on Grand Cayman is developing a small set of condos at their new location. I think they start a good bit higher than what Cayman Diving lodge has though, no idea which would work out better overall. I think CDL is all 1 BRs though, I sort of wished they were doing 2BRs.

 

[divergirl50]

Yes I have been thinking of this myself! I have looked some in Cozmel. I really love the island and the people. I believe they have changed the laws now in Mexico and you can buy a place now and not just leave for 100 years. A good realtor would have all the information that you need. danadevin@hotmail.com is a great one in Cozumel. Give her an email and tell her Diane Darcy sent ya....she was really nice and I know her dive instructor boyfriend. Any island you chose, you should talk to a realtor first because they can give you the ins and outs of island owning laws.