April 2010 Entries
Different real estate investing strategies have radically different impacts on tax returns.
Those who buy and hold property for over one year benefit from qualifying the income from rentals as passive income. Depreciation and many maintenance expenses qualify as deductions against any rental income. When property held for a year or more is sold, the gains are taxed as long term capital gains at a tax rate of 15% (at least for now). Consult your tax advisor for current law and expected change
The Case-Schiller Home Prices Index showed another positive jump for the eight straight month in January. The seasonally adjusted prices increased by .4% for the 10 city index and .3% on the 20 city index. Both showed a decline on the unadjusted indexes due in part to the bad weather in many parts of the country.
Florida, like other judicial foreclosure states, is experiencing a serious backlog of cases and needs additional funds in order to clear the log-jammed court dockets. The Florida Courts Administration has asked the legislature for an extra $9.6 million in order to hire more case managers and judges in order to clear the current glut of lis pendens and final judgment cases in foreclosures.
First American CoreLogic has estimated that even in the healthier markets that are now beginning to heal from the steep price drops of the last three years, homeowners currently with underwater mortgages will continue to have mortgages that exceed value until late 2015.