“Inventar”: last episode, we were introduced to this phrase by our guests, Josue Romero and Juan Nunez. The hardships faced in Cuba as young men and as immigrants to Florida instilled in them an invaluable determination to thrive and to make the best out of any situation given – to invent success out of nothing through hard work. This episode, we learn how Juan and Josue applied these principles to Florida real estate as we trace their success stories from their introduction into the real estate industry to where they are today.
Josue was introduced to the financial side of real estate in 2009, at the peak of the financial crisis that crippled Florida’s real estate markets. We learn how he was able to find success as a mortgage broker despite the dire state of real estate financing. Juan, with Josue as his mentor, entered the investment side in 2011 and quickly found success in the single-family residential markets fixing and flipping. Together, Juan and Josue formed a dynamic, cooperative relationship founded on principles of hard work and perseverance and are now leaders in Florida’s single-family markets. Josue is the owner of MyLendingHub.com, a mortgage calculator website and Juan is owner of Zenun Enterprises, a real estate investment firm. This episode, they discuss their approach to lending and investing as well as the current state of Floridaand Hillsborough’s real estate markets.
Focused on Single-Family Markets
Majority fix-and-flip deals
Emerging in development and construction
Hot Hillsborough SFR Markets
Town ‘n’ Country
Appreciations not really a problem for next couple years, but investor pool diminishing
Lending markets moving from FHA to conventional institutions (Fannie Mae, Freddie Mac)
3% down for qualified investors and lower premiums than FHA
Tips for Investors
Focus on single market and expand only after well-established
Large portfolios are difficult to manage alone
Have a team; network with agents and brokers
Due diligence is key
Stay in budget
For lending inquiries or solutions, contact Josue by phone – (813) 802-6970 or visit www.mylendinghub.com
For any investment inquiries or potential investment opportunities, contact Juan by phone – (813) 766-2959
Its tax time again. Although filing taxes can be a tedious and frustrating time for many Americans, real estate investors fall into particularly complex categories. Knowing the structure of your property business can save time and money when it comes time to file.
Kevin Walsh, CPA is an expert on all things real estate when it comes to tax structures and filing. A founding member of Atrox Partners accounting services, Kevin has over 15 years experience specializing in real estate, providing consultant services for investment and brokerage firms. This episode, Kevin discusses the importance of structuring your property business to maximize your tax returns. Kevin also discusses big changes coming to foreign investing in U.S. real estate.
Real Estate Filing Structures:
Business of Real Estate
Realtors; Brokers; Industry Servicers
Most favorable tax structure
Applicable to small and large-scale investors
Subject to loss-limitations ($3000 max)
Capital Gains/Losses advantages and disadvantages
Fix-and-Flip deals; high frequency of deals
Gains taxed as ordinary gains; not offered Capital Gains/Losses filing structure
Tax Tips for Investors
Knowledge is Power – Planning for your taxes is imperative. It is best to consult an expert to ensure the proper tax structure
Documentation – Filers need to verify they are filing within the appropriate structure; provide proof of your property business
Preparation – Prepare for taxes early…know your filing structure…certain filing limitations begin at close of each tax year
Protecting Americans for Taxes Act, 2015 (PAFT)
Revisions to previous FIRPTA, outlining terms and stipulations for foreign real estate investors
2 Provisions: 10% sur-tax on foreign investors abolished; 5% allotment for foreign investors now increased to 10%
Poised to bring influx of foreign capital into U.S. markets
Winter is coming… And so are national interest rate increases.
The Federal Reserve has recently announced a new national interest rate hike, the first since 2006. Real estate investors are very anxious about the announced rate hike. Many investors are wary that the rate hike may be instituted prematurely in an economy that is not capable of facilitating the effects on real estate markets.
Mark Fleming, Ph. D. serves as the Chief Economist for First American Financial Corporation. With over 20 years’ experience in mortgage and property information, Mark analyzes and forecasts national mortgage and real estate markets. This episode, Mark lends his expertise to our discussion on the new rate hike‘s effect on current real estate markets at a national level, and tells us why investors shouldn’t be so worried.
Federal Reserve Rate Hikes
First rate hike in 9 yrs
2006 – +5% increase
2007 -’08 to Present – 0%
End of Year (2015) – .25% increase
2016 – +1% increase
Instituted to correlate with expected income/wage growth
Long-term, fixed-rate loans not affected
Good for housing markets
House-price appreciation seeing “asset inflation”, especially in Florida
5-6% nationally, higher in FL markets (South Florida)
Out-pacing current wage growth, causing increase in housing rates
Rate hike should slow appreciation growth rate
2016 and Beyond
Rate hike est. 5% increase
House-appreciation (Nationally) projected to slow to 3-4%
Income growth est. 3-4% increase
Commercial real estate to benefit from economic growth
Multi-family to benefit from strong millennial rental market
As a real estate investor, especially in Florida, it is important to remember one thing: there is no single real estate market. The Florida real estate markets are diverse and dynamic and are comprised of many different asset classes; from single and multi-family to commercial investment markets. Naples, on microcosmic scale, is a good representation of a diverse market. Although, with low supply of available property and a near-exclusive cash-buyer’s market leading to high real estate values, it can be difficult to find a footing in investing in Naples real estate.
June Fletcher can be considered an expert on real estate markets. She has been involved in business and real estate reporting for nearly 30 years and currently works as a Business and Real Estate reporter for the Naples Daily News. As local resident of Naples, she has the inside scoop on the current state of the Naples real estate markets.
Naples is one of highest Cash Markets in US
Represent 7/10 buyers
Collier County very diverse demographically
Marco Island + City of Naples, largely wealthy
Immokalee + other outlying areas, lower-income
Higher-price market averages compared with FL
Naples – $432k for single-family, $285k for townhomes/condos
FL – $200k for single-family, $159k for townhomes/condos
Higher net-worth value than state and national markets
City of Naples – $752k
State of FL – $395k
US – $496k
Decrease in Institutional Investor transactions (buys 10 or more units in calendar year)
Not affordable for local residents
Average income – $55k per year
Not many multi-family developments or affordable living projects
Ave Maria – planned community 20 mi. from City of Naples
If you are looking to visit Naples for investment opportunities or just to enjoy its natural splendor, June recommends stopping by The Bayhouse Restaurant for some great local flavor and grub or to catch a live Celtic band!
If you wish to contact June for more information on Naples real estate, email her at: firstname.lastname@example.org