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How to close a real estate deal using Bitcoin

Wednesday, January 31, 2018

Tags:  How to close a real estate deal using Bitcoin



As of Tuesday, 1 Bitcoin was worth about $10,000. The cryptocurrency peaked in December at $19,500 and fell to about $9,000 in early January.

For Bitcoin investors, the residential real estate market offers some stability from the whiplash highs and lows. A property’s price gets locked in based on its value in dollars. Someone paying for the property in Bitcoin or other cryptocurrency would pay the amount at a precise date and time.

Bitcoin operates through a series of blocks of code known as blockchain that creates a record of every transaction and every access point. Keyholders, who each have a unique access code, can access a blockchain from virtually anywhere and can share important data with all parties in a transaction. But the system is also vulnerable to hacking, as seen most recently when the Japanese exchange Coincheck reported losing $530 million in cryptocurrency.

In the residential real estate world, though many brokers are excited about its potential, cryptocurrency has yet to enter the mainstream. In South Florida, cash remains king.

In all of Florida, there has been only one known Bitcoin-to-Bitcoin deal, which closed in late December. That was for a $275,000 Miami condo purchased by a Bitcoin entrepreneur.

William Kakon, who launched the international cryptocurrency real estate listing company Blockchain RE with his brother, Nathan, has been involved in three cryptocurrency deals in Florida. None of them was fully completed with cryptocurrency. He has worked on fully cryptocurrency deals abroad, however, using both Bitcoin and Ethereum, which is currently valued at more than $1,000.

To avoid engaging in shady deals, Blockchain RE uses “Anti-Money Laundering” and “Know Your Customer” software, both designed to determine the source of funds that are paying for a property.

“It’s a very, very simple process. A lot of people don’t really understand how it works,” he added.

But for every digital currency evangelist there is a skeptic.

Diego Arnaud, founder and CEO of DA Luxury Realty, said his clients, most of them with a net worth of more than $20 million, aren’t interested in the digital currency world. Volatility isn’t their biggest concern. “There’s a negative perception in cryptocurrency that [buyers] can’t be traced,” he said.

There are also statewide limitations. All three of the Florida deals that Kakon did involving digital coins were ultimately reflected in dollars, out of necessity.

While blockchain contracts are accepted as legal tender in states like New York and Arizona, that’s not yet the case for the Sunshine State. But a bill introduced in the Florida House of Representatives earlier this month could legalize blockchain data and smart contracts. It would validate signatures registered through a blockchain as part of the electronic record, according to the proposed legislation.

But just as difficult as negotiating state law can be getting real estate investors as comfortable with digital currency as they are with the dollar. Digital currency proponents maintain Bitcoin and similar exchanges are simple, fast and effective methods of payment.

The problem is, most consumers don’t know how they work.

Educating the public has been part of the job for Michel Triana, founder and CEO of Intelerit, a Fort Lauderdale-based predictive real estate analytics platform for U.S. investors. The vast majority of sellers still want payment in dollars, he said. For some portions of a deal, that may not change soon, Triana acknowledged.

That includes the title and escrow process, said Marlen Rodriguez, president of the HomePartners Title Services, an affiliate of the Keyes Company real estate firm. Major insurance underwriters only accept dollars, she said.

As long as buyers convert their Bitcoin or Ethereum to cash for the title and escrow process, there would be no problem.

Once the seller converts the digital currency to dollars to pay the title company, “there’s nothing unique about that transaction moving forward,” said Andrew Hinkes, a partner at the law firm Berger Singerman.

In very rare cases, a buyer and seller will agree to skip the title process. That’s what happened when Ivan “Paychecks” Pacheco, digital currency proponent who co-founded Bits to Freedom, paid nearly 18 Bitcoin for the Miami condo late last year. At the time it was the equivalent to about $275,000.

But for de la Vega of One Sotheby’s, those kinds of transactions only reinforce his feeling that now isn’t the right time for cryptocurrency in the real estate world.

“It’s about the gray area,” he said. “I don’t know how these people have gotten Bitcoin, how it has been exchanged.”

Closing a real estate deal using digital currency can be a complicated process. Here are some important points to keep in mind along the way:

Get comfortable

Surround yourself with real estate pros who are also fluent in cryptocurrency, particularly attorneys, said Ragnar Lifthrasir, founder of the blockchain real estate startup Velox.RE. Ask those same people if they own any digital coins.

“Anyone in real estate needs to get skin in the game. They need to own the coin themselves,” Lifthrasir said. “Until they’re comfortable using it themselves, they don’t know what they’re talking about.”

Agree on a price

The biggest step in the digital currency process is to agree on a price, then lock in a closing date and time. That’s when the dollar price will be agreed on in cryptocurrency. The purchase and sale agreement should include language about the risk involving cryptocurrency, said Hinkes of Berger Singerman.

Pay the necessary parties in dollars

Some attorneys, real estate agents, title and escrow agents will require you pay them in dollars. For that, you would need to convert your Bitcoin to dollars. Services like Bitpay or Changelly can convert the digital currency to cash.

What about title?

The seller may have liens on the property or an unpaid mortgage. If a seller has $500,000 left on his or her mortgage, they would convert that portion of cryptocurrency into dollars and pay the mortgage. “The title work is exactly the same,” Kakon said. But, he added, “you need somebody who really understands cryptocurrency.” Because most title and escrow companies aren’t set up to accept Bitcoin, “They just might not be sure,” added Lifthrasir.

Recording the deed

In the future, cryptocurrency supporters hope that recording deeds will be done with blockchain. The startup Propy recently launched a pilot program in Vermont to use blockchain technology to record real estate deals. Velox.RE created a similar program in Chicago’s Cook County.

By Katherine Kallergis



 

PROCESS TO PURCHASE A REAL ESTATE PROPERTY IN THE UNITED STATES

Tuesday, January 30, 2018

Tags:  PROCESS TO PURCHASE A REAL ESTATE PROPERTY IN THE UNITED STATES



How should a foreign national invest in the United States?

The best form for a foreign national to purchase a property in US is in the name of a limited liability company (LLC)
It will receive a taxpayer identification number to be used to pay taxes.

What documents will you need to purchase a property in U.S.?

To make a purchase you will only need your documents of your respective country ( Ex: passport); Any foreign investor can invest in real estate in the United States.

What forms of financing are available for foreigners?

There are a variety of financing options for foreigners. Each person qualifies according to their financial situation. You must show your income statements from your country and provide letters from your accountant or your employer. (English forms will be provided by American banks.)
There are banks that will lend you up to 70% of property value. The investors will have to pay the 30% at the time of the purchase, but you can also buy in cash which is much easier.

Are there any additional costs to buy a real estate property?

Yes, there are additional cost. They are called closing costs and is a percentage of the purchase price of the real estate property. This cost covers title insurance, legal fees, and registration. This varies depending if the property is purchased with cash or financing .

What are the annual Taxes and extra payments on the property?

The property taxes cost about 1.5% to 2% of the property's assessed value. A property of around $100.000 USD pays around $1,500 to $2,000 dollars per year. If the property price goes up, your taxes will also increase. Another expense is the monthly administration fee that varies depending on the luxury of the property and services included.



 

Miami Luxury Home, Condo Sales End 2017 on High Note

Monday, January 29, 2018

Tags:  Miami Luxury Home, Condo Sales End 2017 on High Note




According to the Miami Association of Realtors, luxury home sales in Miami posted double-digit gains while existing condominium transactions surged year-over-year in December 2017.

Luxury ($1 million-and-above) existing Miami condo sales jumped 47.6 percent year-over-year, from 42 to 62. Luxury Miami single-family home sales rose 16.7 percent, from 60 to 70. Existing Miami condo sales increased 6.5 percent year-over-year in December, while single-family transactions stayed effectively even (down 0.7 percent).

"Strong pent-up demand for Miami luxury single-family and condominiums fueled December's strong home sales," said George Jalil, a Miami broker and the 2018 MIAMI chairman of the board. "Luxury sellers are becoming more realistic with their asking prices, and buyers are coming off the sidelines. Federal tax reform is also starting to have an impact as more Northeastern buyers are opting to purchase in Miami to escape the higher taxes they could face in states like New York and New Jersey."

Federal tax reform, which was signed into law Dec. 22, 2017, sets a deductions cap for income, sales and property taxes at $10,000. The new cap could lead more residents of states with high property values and state income tax to purchase properties in states such as Florida, which has no state income tax and a pro-business tax structure.

Total Miami Home Sales, Dollar Volume Increase in December

Total existing Miami-Dade County residential sales -- which posted a record year in 2013 and near record years in 2014 and 2015 -- increased 2.9 percent year-over-year from 2,156 to 2,219.

Miami existing condo sales -- which are competing with one of the most robust new construction markets in the country -- increased 6.5 percent year-over-year, from 1,084 to 1,154. Single-family home sales decreased 0.7 percent, from 1,072 to 1,065.

Lack of access to mortgage loans continues to inhibit further growth of the existing condominium market. Of the 9,307 condominium buildings in Miami-Dade and Broward counties, only 12 are approved for Federal Housing Administration loans, down from 29 last year, according to Florida Department of Business and Professional Regulation and FHA.

Total sales volume for all properties accounted for $983.5 million last month, up 23.2% from $797.9 million a year ago. Sales don't include Miami's multi-billion dollar new construction condo market.

More than Six Consecutive Years of Price Appreciation in Miami

Miami-Dade County single-family home prices increased 9.1 percent in December 2017, increasing from $305,000 to $332,850. Miami single-family home prices have risen for 73 consecutive months, a streak spanning more than six years. Existing condo prices rose 11.9 percent, from $210,000 to $235,000 in December. Condo prices have increased in 76 of the last 79 months.

According to Freddie Mac, the average commitment rate for a 30-year, conventional, fixed-rate mortgage inched higher for the third straight month to 3.95 percent in December from 3.92 percent in November. The average commitment rate for all of 2017 was 3.99 percent.

Miami Distressed Sales Continue to Drop

Only 8.9 percent of all closed residential sales in Miami were distressed last month, including REO (bank-owned properties) and short sales, compared to 14 percent in December 2016. In 2009, distressed sales comprised 70 percent of Miami sales.

Total Miami distressed sales declined 34.4 percent year-over-year, from 302 to 198 last month.

Short sales and REOs accounted for 2.2 and 6.8 percent, respectively, of total Miami sales in December 2017. Short sale transactions dropped 26.2 percent year-over-year while REOs fell 36.7 percent.

Nationally, distressed sales accounted for 5 percent of sales, down from 7 percent a year ago.

Miami Real Estate Selling Close to List Price

The median number of days between listing and contract dates for Miami single-family home sales was 43 days, a 14 percent decrease from 50 days last year. The median number of days between the listing date and closing date for single-family properties was 97 days, an 8.5 percent decrease from 106 days.

The median time to contract for condos rose 16 percent to 87 days from 75 days. The median number of days between listing date and closing date increased 3.3 percent to 127 days.

The median percent of original list price received for single-family homes was 95.6 percent. The median percent of original list price received for existing condominiums was 93.5 percent.

National and State Statistics

Nationally, total existing-home sales slipped 3.6 percent to a seasonally adjusted annual rate of 5.57 million from a downwardly revised 5.78 million in November. After last month's decline, sales are still 1.1 percent above a year ago.

Statewide closed sales of existing single-family homes totaled 22,903 last month, up 2.6 percent compared to December 2016, according to Florida Realtors. Statewide closed condo sales totaled 9,193 last month, up 6 percent compared to December 2016.

The national median existing-home price for all housing types in December was $246,800, up 5.8 percent from December 2016 ($233,300). December's price increase marks the 70th straight month of year-over-year gains.

The statewide median sales price for single-family existing homes last month was $244,185, up 8 percent from the previous year, according to Florida Realtors. The statewide median price for townhouse-condo properties in December was $180,000, up 7.8 percent over the year-ago figure.

Miami's Cash Buyers Represent about Double the National Figure

Miami cash transactions comprised 39.3 percent of December total closed sales, compared to 42.4 percent last year. Miami cash transactions are about double the national figure (20 percent).

Miami's high percentage of cash sales reflects South Florida's ability to attract a diverse number of international home buyers, who tend to purchase properties in all cash. Miami has a higher percent of cash sales for condos due to lack of financing approvals for buildings.

Condominiums comprise a large portion of Miami's cash purchases as 53 percent of condo closings were made in cash in December compared to 24.5 percent of single-family home sales.

Seller's Market for Single-Family Homes, Supply Declines in December 2017

Inventory of single-family homes decreased 4.0 percent in December from 6,218 active listings last year to 5,969 last month. Condominium inventory increased 3.8 percent to 14,436 from 14,984 listings during the same period in 2016.

Monthly supply of inventory for single-family homes decreased 1.8 percent to 5.6 months, which indicates a seller's market. Existing condominiums have a 13.7-month supply, which indicates a buyer's market. A balanced market between buyers and sellers offers between six and nine months supply of inventory.

Total active listings at the end of December increased 1.4 percent year-over-year, from 20,654 to 20,953. Active listings remain about 60 percent below 2008 levels when sales bottomed.

New listings of Miami single-family homes increased 7.9 percent to 1,271 from 1,178. New listings of condominiums increased 3.8 percent, from 14,436 to 14,984.

Nationally, total housing inventory at the end of December dropped 11.4 percent to 1.48 million existing homes available for sale, and is now 10.3 percent lower than a year ago (1.65 million) and has fallen year-over-year for 31 consecutive months. Unsold inventory is at a 3.2-month supply at the current sales pace, which is down from 3.6 months a year ago and is the lowest level since NAR began tracking in 1999.

By



 

Miami condo price reductions in sales just 1.1% from list

Tuesday, January 23, 2018

Tags:  Miami condo price reductions in sales just 1.1% from list



Miami has seen a recent boom in not only condominium construction and sales but also resales.

While many buildings are still in the pre-construction or construction stages, there is always a demand for units in existing buildings, observers say. Of the 50 most expensive, prices range from $13.9 million for a 6,120-square-foot unit on Fisher Island to $55 million for a penthouse at Faena at 3315 Collins Ave. on Miami Beach. The five-bedroom, five-bath unit features 8,273 square feet of living space.

Though sellers of single-family homes priced at more than $1.5 million have had to drop their prices an average of 3.8%, condo prices were reduced by only 1.1%, according to the Multiple Listing Service.

“The top of the market is stable,” said Alicia Cervera, managing partner and principal of Cervera Real Estate. “It’s not a raging market – which everybody prefers – but it’s not in freefall, either.”

There’s no shortage of buyers, but different factors motivate them to buy, she said. “The reality is, you’re selling to a very small pond, maybe 5% of the population. People at this level have the cash; it just depends on when they want to pull the trigger.”

Cervera Real Estate advertises both locally and in targeted luxury publications. “The big shift is that you don’t market geographically, but to other demographic factors: where they go, what luxury items they consume. What appeals to them? Is it the boat show, is it Art Basel, is it the Miami 500 races? We advertise in our own backyard, too, because we know wealthy people from around the world come here.”

In Miami, luxury condo buyers want to be on the water, near upscale restaurants and luxury shopping, Ms. Cervera said. Edgewater, where Cervera Real Estate is marketing Elysee Miami and Biscayne Beach, is near the Design District, as is Aria on the Bay; Aston Martin Residences is downtown, close to Zuma and DB Moderne restaurants, she added.

Other properties the group represents are The Grove at Grand Bay and The Markers in Coconut Grove and The Bond and Smart Brickell in Brickell.

Demand for the buildings is driven by high occupancy overall (97%) and “rents going through the roof,” Ms. Cervera said. “It takes two or three years for a building to deliver, so it’s good that we have all of these units coming on the market. Otherwise, it would have stifled the city.”

It’s also fortunate that the buildings are proceeding at different schedules, to accommodate those who want to move in right away, as well as those who can wait, she added.

“It’s good to have some that are close to finishing; Aria on the Bay will be finished in January. We sold it out, and people want to move in. Biscayne Beach is finished. Life changes quickly, and it’s hard to know where you’ll be in four years.”

A major change in this building boom is that more people will occupy their units, even if on a part-time basis, she said. “Someone has to call it home, even if it’s one week or one month a year, so it’s not idle. In Miami, that hasn’t been an issue. In fact, we have buildings being occupied very quickly.”

“It’s the definition of luxury,” said Chad Carroll of Douglas Elliman, describing the $39 million penthouse on which the company has an exclusive listing in the Regalia in Sunny Isles Beach. With nearly 17,000 square feet, it is the second most expensive condominium unit for sale in Miami-Dade County.

The two-story penthouse at Regalia comprises 10,700 square feet (at $3,600 per square foot) with a 7,000-square-foot rooftop terrace and private pool reached by glass elevator, dual master bedrooms, a great room, movie theater, game and family rooms, private spa, wine cellar and guest room with its own living space.

Finishes include Nikzad wood and Blanco Sevilla stone flooring, Kreon designer lighting, custom speakers and millwork, Falma Italian closets, and programmable controls for lighting, shades, temperature and music. “No expense was spared,” Mr. Carroll said.

Designed by Arquitectonica’s Bernardo Fort-Brescia, the building itself offers only 39 units, he said, with unit prices starting from $8 million. They have 360-degree wrap-around terraces that offer unobstructed views of the Atlantic Ocean, Golden Beach, the Intracoastal Waterway and the skylines of Miami, Miami Beach and Fort Lauderdale.

Another listing in the Regalia is a six-bedroom, six-bath “beach house” comprising 10,515 square feet, with a private pool, sauna, steam room and spa. It is listed for $29 million, he said.

“We have had interest from hedge fund managers, European families, Brazilians. It’s a very diverse group,” Mr. Carroll said. “The ultra-wealthy just love the building because it makes them feel at home. We’ve been very active.”

Written by on November 7, 2017



 

Orlando, Florida: La ciudad #1 Para Invertir en Propiedades de Renta en Los Estados Unidos

Tuesday, January 9, 2018

Tags:  Orlando, Florida: La ciudad #1 Para Invertir en Propiedades de Renta en Los Estados Unidos



Los mejores lugares para comprar propiedades de alquiler para flujo de efectivo y crecimiento
de capital a menudo tienen tres cosas en común: el crecimiento del empleo, el crecimiento de
la población y la asequibilidad. Cuando encuentre un mercado que tenga estos tres factores,
probablemente podrá encontrar buenas oportunidades de inversión.
Hay varias ciudades en los Estados Unidos donde existen estos factores hoy en día, lugares
donde puede comprar propiedades de alquiler con alto flujo de efectivo y ver crecer su capital.
Las razones que exponemos a continuación, llevaron a BelHouse Real Estate a poner sus
ojos en Orlando, Florida buscando oportunidades de inversión para nuestros clientes.
Recuerde de la importancia de contar con una compañía de servicios integrales para que su
inversión sea segura.

¿Entonces, porqué Orlando?
Orlando es uno de los mejores lugares para comprar propiedades de alquiler en el estado de
Florida en 2018. Ubicada en la región del &quot;cinturón de sol&quot; de Florida, la zona es conocida por
su clima cálido, hermosas playas, parques de atracciones de fama mundial, entretenimiento y
diversión.
Con una población combinada de 3,3 millones de residentes, el mercado inmobiliario de
Orlando está alimentado por solicitantes de empleo, jubilados baby boomer y estudiantes que
desean vivir en un área &quot;barata y alegre&quot; que ofrece una alta calidad de vida a un costo
razonable.

Datos Breves del Mercado de Orlando
 El área central de Orlando es la cuarta área metropolitana más grande en el país, y también
es el 16º de más rápido crecimiento en la nación.
 Forbes informa que 60 millones de personas visitaron el área de Orlando en 2015, por lo que
es el destino turístico más visitado del país.
 La población en Orlando ha crecido un 41% desde el año 2000. Hasta la fecha, Metro Orlando
alberga a más de 2,3 millones de residentes.
 Los alquileres crecieron un 3,4% en los últimos 12 meses, que es más alto que los niveles
nacional y estatal.
 Las leyes de ejecución hipotecaria han ayudado a mantener los precios de las viviendas
significativamente por debajo de su último pico, pero las tasas están aumentando.

Conclusión: las 3 principales razones para invertir en Orlando en 2018
Como se mencionó, la mayoría de los mejores mercados de inversión inmobiliaria tienen tres
factores en común: crecimiento del empleo, crecimiento de la población y asequibilidad.
Orlando no es una excepción.
1. Crecimiento laboral: el crecimiento laboral trae nuevos residentes y busqueda de
propiedaes para la renta.
2. Crecimiento de la población: El crecimiento de la población trae consigo un aumento
en la demanda de vivienda, esto trae consigo un aumento considerable en el valor de
las propiedades.

3. Flujo de capital: con una renta estable por días o meses, los millones de turistas y
nuevos residentes hacen de Orlando un lugar ideal para tener una propiedad de renta.
Además que puede ser para usted y su familia lugar de descanso vacacional que le
producirá ganancia en dólares.



 

MIAMI HOUSING FORECAST INTO 2018

Wednesday, January 3, 2018

Tags:  MIAMI HOUSING FORECAST INTO 2018



Condo prices will continue to drop.

Deals done by Bold Buyers

The best deals will be done with ‘bold buyers’ willing to come in and make offers (up to 30%)

below asking. With so many sellers and properties priced above market value, bold buyers

might get lucky. Many owners need to sell their properties very fast and will take a cash offer

that will cover their costs or mortgage.

In this market (mostly on the Beach) we see a lot of overpriced condos that are lifting their

prices because of neighboring ultra-luxury projects. Although high-end condos might lift the

prices in a certain area, it wont justify hefty over-market asking prices for condos that are

not up to par. Sellers of such units will soon enough notice that today’s buyers are more

price conscious and won’t pay above market unless the property justifies the price.

Single family will remain stable, but very high end homes will still be slow

The single-family market behaves in a completely different way than the condo market. We have seen steady increases over the last few years and the necessary corrections have taken place already for the most part. It is just in the ultra-luxury market that we see less demand, yet more demanding buyers. In our 2017 Miami real estate report we showed that even in very healthy markets, the highest prices per SF saw a decline. This means that buyers are not paying top-dollar anymore for properties that are not finished perfectly or otherwise justify the high Dollar amount per SF.- David Siddons Group.

Miami, Florida Housing Market Forecast: A Dip in Home Values?

According to the real estate information website Zillow, the median home value in Miami rose to $300,500 as of July 2017. That was a slight increase over the previous year’s median. According to the company’s analysts, prices in Miami rose by 2.2% during the 12-month period from July 2016 to July 2017.

Looking forward, however, their economists’ forecasts call for a slight decline in Miami home values. In July, the company issued a prediction that prices would actually dip by -0.4% over the next year. This forecast was issued in July 2017, so it extends into the summer of 2018. -By Brandon Cornett



 

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BELHOUSE INTERNATIONAL
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Miami, una de las ciudades más deseadas para invertir
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