Archive for July, 2012

FOREIGN REAL ESTATE BUYERS

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Here in Silicon Valley were hearing a great deal about the Asian Buyers who are fueling the crazy boom market now in full force.
Every new listing is selling with multiple offers within day of hitting the MLS, and often not even getting to the MLS.
Buyers with less than 20% down payment have very little chance of even getting their offers considered, much less accepted.
While this is true it’s not accurate to suggest that any one ethnic group is driving this situation.
If we just consider the 2 States where most outside money is driving the market we find some interesting statistics:
o. 26% of all sales involving out of the country Buyers are happening in Florida.
o. 11% are in California.
o. In both cases 24% of such sales are coming from Canada.
o. 11% are from China.

FORECLOSURE/SHORT SALE TAX HELP

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In 2007. the Mortgage Forgiveness Debt Relief Act of 2007 was passed, helping many underwater homeowners avoid taxes on the amount of debt that their lender forgives. Even though the homeowner doesn’t see any of the money from the short sale, the lender’s loss is considered the homeowner’s gain and the lender issues a 1099 reporting that amount as income.

That “income” would ordinarily be taxable, but the 2007 Act wiped out tax liability for many homeowners who short sale their homes between 2007 and 2012.

It is possible that Congress could move to extend the tax protection. However, those who are considering short sales may wish to be cautious and begin negotiating the process now. Listing the home, finding a buyer and negotiating with the short sale can take months.