Investors

Are big investors really buying up all the homes today?

If you’re trying to find a house to buy, this may be something you’re wondering about. Maybe you’ve read about it or seen reels on social media saying investors buying all the homes is making it even harder to find what the average buyer is looking for. But spoiler alert – there’s a lot of misinformation out there. To clear things up, here's the scoop on what's really happening. A lot of the big investor activity is actually in the rearview mirror already.

The Wall Street Journal (WSJ) explains:

“Investors of all sizes spent billions of dollars buying homes during the pandemic. At the 2022 peak, they bought more than one in ev...

The Internal Revenue Service has issued final rules on the 20 percent business income deduction (Sec. 199A of the Tax Code) that was enacted in late 2017 as part of the Tax Cuts and Jobs Act.

Eligibility of Rental Income 
If you generate rental property income, that income can also qualify for the new deduction, as long as you can show that your rental operation is part of a trade or business. The IRS has released proposed guidelines that include a bright-line test, or safe harbor, for showing that your rental income rises to the level of a trade or business. Under that safe harbor, you can claim the deduction if your rental activities—which include maintaining and repairing property, c...

Greg Rand, CEO of Ownamerica and a real estate analyst for Fox Business News, has picked Charleston, SC as one of his two top cities to INVEST in real estate right now!

Contact Us Today if you are interested in learning more about investing in residential real estate in the Charleston SC Metro Area.

FHA Extends Anti-Flipping Rule Exception 

"With certain exceptions, FHA regulations prohibit insuring a mortgage on a home owned by the seller for less than 90 days. Early last year, FHA temporarily waived this regulation through January 31, 2011. FHA this week posted a notice extending this waiver through the remainder of 2011. This action will permit buyers to continue to use FHA-insured financing to purchase HUD-owned properties, bank-owned properties, or properties resold throughprivate sales. It will allow homes to resell as quickly as possible,

Although most analysts are crowing about the increase in sales and the early signals that the real estate market is turning around, there are a few items that may complicate matters and/or destabilize the market down the road (i.e. during the spring buying season):

• The Federal Reserve is expected to wind up a $1.25 trillion buyback program that has kept mortgage rates low. This "lack of demand" for mortgage-backed securities may trigger steep increases in mortgage interest rates.
• The FHA (Federal Housing Administration) has tightened underwriting standards and plans to further tighten these standards at the end of the first quarter. This could reduce demand by making it more difficult...

Comparing Residential Real Estate Investments Across Markets

New Investment Assessment Tool Rolling Out

I just read about this new company, SMARTZIP.com, who is now in beta testing but intends to go national next year.  They have come up with a system to rate residential property investments across different markets, just like any investor would rate a stock, bond or mutual fund.

I think this is a great tool! We'll be able to see each property's investment ranking for future capital appreciation, as well as for cash flow. For residential property investors, they will be able to compare an investment in Charleston, SC, with an investment in Wilmington, NC.

A word of caution: Nothing su...

One of the difficulties of executing a Forward 1031 Exchange is that there is limited time to identify suitable properties and an investor may miss the window to qualify for the 1031 "tax-free" exchange. Many of the current buying opportunities are either short sales or lender-owned properties. The timing uncertainties these generate make a Forward 1031 Exchange risky to execute well.

A Reverse 1031 Exchange allows investors to take advantage of current market opportunities by purchasing the replacement property FIRST, and then identifying the relinquished property within a designated time frame (most times investors KNOW which property they want to get rid of in advance).

As an investo...