Blogs - Miami City Lifestyle

Foreign buyers still continue to fuel the South Florida Market

Villa in South Florida Foreign buyers still continue to fuel the South Florida Market. Miami was the second highest visited market on the web in February – this was according to the National Association of Realtors.

Fort Lauderdale was the fifth most searched market and our nearby nearly Orlando scored out in fourth place. All in all the data places Florida at the top of the most desired location in the US by overseas buyers.

Home buyers can still find down payment assistance

gsappp-blueglasscast-120213TALLAHASSEE, Fla. – April 25, 2014 – Home buyers still have access to down payment assistance grants, interest-free second mortgages and other special home loan programs, provided they have decent credit and documented income in Florida

However, many borrowers don’t realize that home buying aid isn’t reserved for just low-income individuals, and money available through state and local housing agencies often goes unused.

Some down payment assistance programs “are for working people who make a decent income but don’t have enough to save for a down payment,” says loan specialist Deborah Holloway of Melbourne, Fla.-based Shelter Mortgage Co.

Some buyers qualify for down payment assistance even though they earn upwards of 120 percent to 140 percent of the median area income. Buyers should check the websites of the housing authority in their state for a list of programs and participating lenders.

Meanwhile, some lenders – like TD Bank Group – have created their own loan initiatives for first-time buyers with low down payments, and buyers also have access to Fannie Mae’s HomePath program, which requires only 5 percent down. A first step for Floridians checking to see if help is out there: The Florida Housing Finance Corporation. It’s the state window for funneling money from federal and state programs into the hands of prospective homeowners.

Source: Bankrate.com (04/22/14) da Costa, Polyana © Copyright 2014 INFORMATION, INC. Bethesda, MD (301) 215-4688

Marinas & Boating in Miami

marina and Boat revitalization Marinas and boating amenities across South Florida have been experiencing major improvement and beautification projects; as home buyers with a love for boating flock to our communities. According to a recent article in the Real Deal the Dania Beach Marina has gotten a $7.5 Million face lift;  “revitalization and redevelopment”  project which will be completed by June this year as announced by the mayor. This same article quotes the Sun Sentinal as stating that several docks are already open for business and 2/3 of the 120 new docks are done.  These improvements are sure to benefit the area in property values, amenities offered to residents and those that are visiting South Florida.

What is a 1031 Exchange?

1031 exchange

Simply put a 1031 exchange / transaction is when a seller sells an investment property and buys a “like kind” property after the sale.  This tactic is used in order to reinvest the sales proceeds and defer paying capital gains

1031 exchangetaxes.  Keep in mind that at the time when an investor sells an investment property he may be liable for capital gains taxes; this may be due even if the property is sold for a loss.1031 exchanges offer an excellent opportunity to defer the capital gains tax and re-invest and possibly grow your investment after the sale of an investment.Often I have clients come to me as their tax accountant or real estate broker in order to question how it could be possible that they have a tax liability when the investment was sold for less than what they paid.  Well, the answer to this question lies in the previous year’s tax returns in reference to this investment.  We often forget that investment properties are eligible to take a depreciation loss throughout the life of the investment. For example a residential income property would take depreciation over 27.5 years (other types of properties have different time depreciation life); with that said the cost of the acquisition plus any related services for the acquisition and any improvements to the property would be added up and divided by 27.5 years thereby producing the annual depreciation which an investor may take as a deduction along with any other deductions for maintaining the property in order to offset income from the rental activity. Therefore since depreciation is taken or able to be taken the taxable income is in turn lowered. However, the other side of the equation is that the basis or cost of the property is also diminishing proportionately. Ultimately at the time of the sale you would have a lower basis (original cost) in the investment to reduce your sale price by and could therefore produce a profit even if the sale is technically for less than the purchase price.

Investors should consult their real estate broker and tax accountant in order to determine the best course of action in their particular case.

Ismael Gonzalez III

Licensed Real Estate Broker

Enrolled Agent, admitted to practice before the IRS

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Easier Home Loan to assist housing recovery 2012

Easier Home Loan to assist housing recovery 2012, Capital Economics recently reported the possibility to the end of the US housing crises, late this year. This much awaited housing recovery may in part be due to the banking industry loosening up credit requirements to borrowers. We should not expect to go back the boom days when anyone with even a moderate credit score could get a loan. Buyers can expect to carry a credit score of 700 or greater to qualify according to the analytic firm.

In addition, to credit score; buyers will need to prove income (the days of the stated income loans are far gone); however, the good news is that it is expected that qualified buyers will be able to borrow roughly 3.5 times their annual income, this up from 3.2 from the crises; according to the report.
Furthermore, banks are expected to increase the LTV (Loan to Value Ratio) to 82% up from 74%.
As brokers we have personally seen many cash buyers and agree that the opening up of available credit to qualified buyers would most certainly assist in the housing recovery. Buyers requiring financing would be able to come off of the fence and begin to reduce the inventory levels. Capital Economics recently reported the possibility to the end of the US housing crises, late this year. This much awaited housing recovery may in part be due to the banking industry loosening up credit requirements to borrowers. We should not expect to go back the boom days when anyone with even a moderate credit score could get a loan. Buyers can expect to carry a credit score of 700 or greater to qualify according to the analytic firm.

In addition, to credit score; buyers will need to prove income (the days of the stated income loans are far gone); however, the good news is that it is expected that qualified buyers will be able to borrow roughly 3.5 times their annual income, this up from 3.2 from the crises; according to the report.

Furthermore, banks are expected to increase the LTV (Loan to Value Ratio) to 82% up from 74%.

As brokers we have personally seen many cash buyers and agree that the opening up of available credit to qualified buyers would most certainly assist in the housing recovery. Buyers requiring financing would be able to come off of the fence and begin to reduce the inventory levels.

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