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3297 Pomerado Dr Quick Tour
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High Interest Rates Make New Home Construction Less Feasible
The city of San Jose just released a report titled "Residential Feasibility Analysis" that compares expected construction costs with the value of the construction. The report says the total estimated development costs have increased by approximately 12-13% over the last 18 months. Construction mortgage rates have doubled over the last 12 months and hover above 8.0%. The report analyzed the expected total construction costs of building multi-unit housing and compared it to the expected value of the completed project for housing built to be rented and housing built to be sold. For market-rate homes, the expected residual value per unit ranged from -$322,000 to -$614,000. The residual value is the expected sales price minus the total of the hard costs, soft costs, sales costs, and profit. With these strong negative residual values, a builder would not want to build.Looking at the San Jose real estate market shows that weak sales…
Short Term Rental Taxes: Airbnb, Vacation, etc.
You do not have to be a real estate professional to move short-term rental income out of the passive income category. This allows many families to deduct their short-term rental losses from other income, reducing their taxes. These tax savings and the higher per-day rent received for short-term rentals make these rentals an attractive investment/business opportunity. Learn more at "Airbnb & Short Term Rental Properties" on julianalee.com.
1031 Exchange, Cash Boot Is Taxed
If your replacement property has a lower purchase price than the sales price of the property you sold, the difference will be refunded to you by your 1031 exchange intermediary at the end of the 180 day period defined for purchasing your replacement property. Since you will be receiving the cash, the IRS will not defer the taxes owed on this portion of your sale. Typically it will be taxed as a capital gain. This cash received is referred to as a cash boot. View more 1031 exchange rules.