Low Interest Rate:
*Interest rates
have remained low for the past 5 years with 11 tax
cuts in 2001 alone. Refinancing an existing
mortgage, taking out the cash and re-investing in a
second home (condo) could make good sense for you.
There are some
excellent rates out there right now. Contact your
banker, loan officer, or lender about some of the
excellent programs they can provide. It is also a
good idea to check with a local lender in the area
where you plan to purchase for any unique loans in
that area. (Examples are flood planes, special
insurance requirements, 2nd home occupancy rates,
interest rates for investment properties, etc.)
Low Household Size and
High Household Income:
*The latest U.S.
Census reports that household size is at an all-time
low while household income is at an all-time high.
Why not invest in a second income generating
property? Check with your tax accountant about some
of your tax deductions.
Tax Law Changes (since
1997)
*In 1997, a new tax
law gave the second-home market a boost. Most
married couples no longer have to pay capital gains
tax on the sale of their primary residence and the
purchase of another property as long as the
difference is under $500,000.00. Again, contact your
tax accountant about specific advantages or uses of
1031 tax exchange. (Exchanging investment properties
for investment properties without paying capital
gains taxes.) Also inquire about deductions for
repairs, upkeep, depreciation, and management costs
as well.
Aging Baby Boomers:
Older baby boomers
are now close to retirement, and the fastest rising
age group is this group between the ages of 55 and
64. If one in ten of these baby boomers own a second
property, the numbering entering the second home
market will add between 100,000 and 150,000 housing
starts each year through 2010. Planning ahead for
investment purposes makes sense. Call your
Condominium Real Estate Authority for information
about inventory, prices, locations, and advantages.
Call your tax accountant concerning tax benefits and
call your lender and ask about all the interest
rates available to you.
Telecommuters:
The Bureau of Labor
and Statistics projects that 2008, approximately 2.5
million people will be self employed. No matter
where these people are, they have access to internet
connections and cell phones and business can be
conducted as usual and location is not an issue.
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