Tag: Investment Real Estate

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Buying Commercial Real Estate Selling

Why Amendment 2 Matters To YOU!

Amendment 2 Is For Everybody photo credit: Brian Sharpe- Sharpe Properties
Amendment 2 Is For Everybody photo credit: Brian Sharpe- Sharpe Properties

Although this year’s elections aren’t until November and every one is pretty tired of politics, I have to take this opportunity before all of the other campaigning starts to talk about Amendment 2 and why it matters to you.

Amendment 2 is not a tax cut, it would make a current 10% cap on non-homesteaded property tax increases permanent.  If Amendment 2 does not pass in November, the current cap will expire and property owners may see their taxes increase significantly.  If you own commercial or non-homesteaded residential property, such as an investment property or second home, I think you can see how this would affect you.  Even if you don’t own any property, significant tax increases on property will affect you.  How?  Your rent and the costs of goods and services may go up significantly.

First approved by voters in 2008 as part of the Save Our Homes portability constitutional amendment, the 10% cap on non-homesteaded properties was a non-partisan issue in the Florida Legislature last year.  In order to get Amendment 2 got on 2018’s ballot, the Florida Senate passed it unanimously and the House passed it with 97% voting for it.  As the Amendment tag line states:  “Amendment 2 is for Everybody”.

Now that you know why Amendment 2 matters to you, please help get the word out to your neighbors, tenants, friends, business associates, and every Florida resident you know.  Need more information or material to share?  Check out www.EverybodyIsFor2.com

 

 

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Commercial Real Estate Investment Real Estate

Signing New Commercial Leases in 2018? Remember To Drop The Sales Tax To 5.8%

Publix on Miami Beach FL
Publix on Miami Beach FL

If you are a landlord signing new leases in 2018, remember that the state sales tax on commercial leases has dropped from 6% to 5.8%.  As a result, the sales tax rate in Miami-Dade County will drop to 6.8% and in Broward it will drop to 5.8%.  Although the drop in rate may not sound like much, it amounts to an estimated $60 million a year savings to businesses.

Florida is the only state in the nation that charges a sales tax on all commercial leases and Florida Realtors, Florida Chamber, International Council of Shopping Centers, Florida Ports Council, and many others have been working diligently to get the tax reduced in order to keep Florida competitive with other states.  The sales tax is levied on all businesses leases, large and small, regardless of profitability and therefore disproportionally affects small businesses and start ups.  Florida Realtors will continue to work with legislators to get the tax on leases reduced further.

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Brickell/Downtown Miami Commercial Real Estate Investment Real Estate Neighborhood News Selling

Self-Contained Amenities and Neighborhood Key in The Conrad Brickell Hotel Sale

The Brickell Arch - photo credit Rusty Diaz Photography
The Brickell Arch – photo credit Rusty Diaz Photography

Though the pace of commercial real estate transactions in South Florida has slowed down a bit, Miami continues to rack up big sales with the recent purchase of The Conrad Brickell Hotel for $72 million by Mast Capital and Angelo, Gordon and Company.  The 203-room hotel will be managed by HEI Hotels & Resorts, it’s first property in Miami.  At a time when the number of hotel rooms has outpaced demand, this purchase shows that experienced investors believe in the long term viability of Miami as an investment.  Both Mast Capital and Angelo, Gordon, and Company like to purchase value-add properties and it will be interesting to see if they hold onto it or sell it once the planned renovation is completed.

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Buying Selling

What Do The Election Results Mean For Real Estate?

 

langer-front

The long election  is finally over and the question I am getting asked a lot is, “What does it all mean for the real estate market?”  A recent video put out by the National Association of Realtors sums up the election as follows:

  • In Congress, not much has changed.  Republicans controlled the House and the Senate before the election and they control the House and the Senate after the election.  This will help NAR moving forward on flood insurance, tax reform, and the re-invention of Fannie Mae and Freddie Mac, since Realtors® had been working on these issues with the previous Congress, thereby providing continuity.
  • Flood Insurance:  The National Flood Insurance Program is $24 Billion in debt, which needs to be addressed.  States vary on the importance they give this program and how flood insurance should be covered.  Nevada has a different view than New Orleans and Florida and NAR is active in trying to negotiate a solution so that insurance is available and real estate transactions can continue taking place.
  • Tax Reform:  The mortgage interest deduction, property tax deduction, capital gains exemption and 1031 Like Kind Exchanges are all under consideration for reform.  No bills have been filed yet, but there are different proposals that have been floated by a variety of legislators.
  • Fannie Mae and Freddie Mac:  Their future is totally up in the air and NAR will keep an eye on any new proposals that are put forth.
  • Dodd Frank and the Consumer Protection Bureau:  These will be revisited.  Under Dodd Frank, regulations that affect smaller banks will probably be relaxed.  Since approximately half of current mortgage lending is being done by non-bank banks (on-line lenders), regulations may start addressing them.  Overall, the view is that federal regulations will be loosened and state and local regulations will increase.

Another topic that will be looked at is refinancing student loans, which would help get young people with a lot of student debt into mortgages and homeownership.  This is obviously a national overview.  I will go into more detail as to what the elections mean for us locally and for commercial real estate in future blogs.  Stay tuned!

 

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Commercial Real Estate Investment Real Estate Restaurants

Top 3 Retail ‘Buy’ Markets Are In South Florida

ceviche-105

Ten-X’s U.S. Retail Market Outlook listed the top five markets for investors to consider buying retail real estate.  Three out of those five were Miami, Fort Lauderdale, and West Palm Beach.  Robust employment and increasing population in all three cities are pushing the demand for retail space in all of their respective counties.

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Buying Investment Real Estate Selling

7 Of Forbes’ Top 20 Cities to Invest In Are In Florida

Forbes Ft Laud map pic

Forbes’ 2016 top cities to invest in is out and seven of the best investment cities are in Florida.  Two, West Palm Beach and Fort Lauderdale, are in South Florida.  The Fort Lauderdale Metropolitan Statistical Area and Divisions (MSAD), which includes Fort Lauderdale, Pompano Beach and Deerfield Beach, has a three-year home price growth forecast of 20%.  West Palm Beach’s MSAD, encompassing West Palm Beach, Boca Raton and Boynton Beach, has a  three-year home price growth projection of 23%.

Based on Florida’s employment recovery and the overall improvement in the national economy, Florida dominates the housing investment list for 2016.  Those are the “scientific” reasons given.  In my opinion the weather, water,  cultural diversity and favorable tax climate are also contribute to Florida being a great place to live and invest!

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Buying Commercial Real Estate Luxury Real Estate Selling

New FIRPTA Rules Take Effect February 17, 2016

 

1450 BrickellTwo changes made to the  U.S. Foreign Investment in Real Property Tax Act of 1980 (FIRPTA) will go into effect February 17.  While one affects foreign investment in publicly-traded real estate investment trusts (REITs) and should make commercial property in the U.S. more attractive to foreign buyers, the second one affects foreign buyers of residential properties.

The change relating to ownership of U.S.  REITs is the doubling of the maximum amount of stock a foreign investor may have in REITs from 5% to 10% and allowing foreign pension funds to invest in REITs withoug having FIRPTA apply.  Ralph W. Holmen, associate general counsel for the National Association of Realtors® (NAR) states that these changes “… are conservatively estimated to boost foreign investment in U.S. commercial real estate by $20-$30 billion per year'”.

In order to cover the costs associated with the two commercial provisions, the withholding amount for residential properties will increase from 10% up to 15% on properties that are over $1 million, whether it is used as a primary residence or not.  For properties $300,000 or less or $300,000 to $1 million, the rules don’t change.  Under $300,000, no FIRPTA tax is paid if it is to be used as a primary residence.  From $300,000 – $1 million, the current 10% FIRPTA tax will not change as long as the property is used as a primary residence.

Buyers need to know that although most settlement agents do withhold the FIRPTA tax, if they do not, the buyer is the one that is legally responsible for the tax owed if it is not withheld.

 

 

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Buying Commercial Real Estate Investment Real Estate Renting in Miami

Majority of Millennials Cite Cost of Living as a Concern

Downtown Chicago - Chicago IL #24 of Forbes 25 top cities for Millennials

 

Downtown Chicago - Chicago IL #24 of Forbes 25 top cities for Millennials
Downtown Chicago – Chicago IL #24 of Forbes 25 top cities for Millennials

Bank of America/USA Today Better Money Habits® Millennial Report, provides great insight into the financial concerns of the millennial generation.  As the mother of three millennials, ages 21-25, and a Realtor I am always interested in what reports say drive this group of young adults.

Of great interest is the correlation between jobs and housing in areas where millennials like to live, which tend to be cities with plenty of cultural and social activities, strong public transportation, high percentage of others in their age group (18-34) and ethnic diversity.

According to the B of A study, “No matter where they live, the cost of living is a concern for a majority of millennials. More than half are also concerned about their ability to save based on where they live.”  This is also one of my concerns for my children.  My youngest is already thinking about where she is going to move once she graduates.  Although she realizes it will depend where she finds a job in film editing, she is looking at cities that have both a large film/television production industry and a lower cost of living than some of the big cities, such as Los Angeles and New York.

Given the top Forbes’ Best Cities for Millennials in 2015, it is not surprising that cost of living is such a large concern.  Eleven of the top 25 cities have rents at or close to $1300 per month.  If you go by the rule of thumb that no more than 30% of your annual income should go to rent, then millennials in these cities would have to make a minimum of $52,000 per year.  Miami rents have gone up significantly as well and though we didn’t make Forbes’ cut as top 25 cities, I think that is changing with the emergence of a strong tech entrepreneurial center.

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Buying

Florida Home Prices Projected to Increase 9.3% in 2016

CoreLogic, is projecting overall U.S. housing prices to rise 5.2% next year.  Florida is projected to increase by 9.3%, which is the second highest increase in the nation, just behind California at 10.8%.

Prices-KCM

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Buying Investment Real Estate Selling

Multifamily Properties Are Still The Commercial Properties In Highest Demand

Lofts at Mayfair Bulk Sale - Listed by Levine Realty
Lofts at Mayfair Bulk Sale – Listed by Levine Realty

With South Florida rentals in high demand, increasing rents, and available rentals low, investors are searching for multifamily properties. According to LoopNet, 9 out of the Top 10 Most Popular South Florida Properties were multifamily.

Here are some multifamily properties for sale in Miami areas with high rent demand.