St. Thomas Real Estate Trends

Anyone owning or wishing to own property on St. Thomas, St. John or St. Croix can breathe a sigh of relief! We have been going through a property re-valuation and with the increase of property prices over the last few years we all expected to see huge property tax bills in our mail boxes.

The current way to calculate property taxes: take 60% of "fair market value" and then multiply by 1.25%

In a recent article in the daily news:

"The original bill, which deJongh presented to the Senate, was replaced in its entirety by an amendment Thursday. That amendment - co-sponsored by Malone, Richards and White - is nearly identical to both deJongh's proposal and the bill defeated by the Senate two weeks ago. The bill states that different kinds of property would be taxed at different rates. Unimproved noncommercial property would be taxed at 0.49 percent of its value. Residential property would be taxed at 0.38 percent of its value. Commercial property would be taxed at a rate of 0.71 percent of its value, and timeshares would be taxed at 1.4 percent of their values.

To mitigate the impact of the bill, it contains several exemptions that the Senate made more generous through amendments. People who live in their homes can receive an annual homestead exemption of $400. Veterans are eligible for a $650 exemption - increased from $450 by an amendment proposed by Sen. Juan Figueroa-Serville. Senior citizens who have individual incomes of less than $30,000 or household incomes of less than $50,000 - income caps increased through the Malone, Richards and White amendment - are eligible for $500 tax credits. Residents with disabilities and individual incomes of less than $30,000 or household incomes of less than $50,000 receive a $500 tax credit, also increased through the majority members' amendment.

Disabled veterans would be exempt from property taxes. An amendment sponsored by Hill allows residents with homestead exemptions to have a second exemption.

In cases of an increase in residential taxes of more than 125 percent, people who live in that residence and have a household income of less than $135,000 - a cap increased through the majority's amendment - would receive a tax credit for 40 percent of that increase, up to $5,000. Ottley sponsored an amendment that extends that credit to unimproved noncommercial property with large increases.

Amendments sponsored by Hill chip further away at a resident's tax burden. One provision of Hill's amendments cap the taxable increase in values of residents' homes at 3 percent every five years. Hill said the cap will protect an average resident from being affected by burgeoning home prices and new developments. "

While property tax bills will be higher but not as high as expected. Good news for our islands and property owners.