Archive for February, 2010
Mortgage Market Trends for week ending February 19, 2010
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Last week the Federal Reserve took center stage by raising its discount rate: the rate at which banks can borrow money directly from the Federal Reserve. While this move has very little immediate impact, the increase was widely viewed as a symbolic first step in beginning to remove the emergency measures put into place during this deep recession. The Fed’s meeting minutes also provided some more insight into future Fed moves. In addition to letting certain programs expire as planned, the Fed will create some new tools that will enable it to “mop up” excess cash in the market. These 
new tools, in conjunction with its primary method of adjusting the Fed Funds rate, will be targeted at keeping inflationary pressure under control.
This week, and coming weeks, could begin to see mortgage rates become more volatile as the market digests everything coming out of the Fed. We’ll also get new and existing home sales data this week. With housing and employment as the weakest link, any positive news could push rates upward.
Graph Courtesy from NY Times in an article by Bob Tedeschi February 17, 2010. Data provided by Jeff Carpenter, Director of Finance, GFI Mortgage Bankers, Inc.
Ownership Tip For Foreign Buyers of Manhattan Condos and Townhouses
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Foreign purchasers of Manhattan real estate often take title to the property through a legal entity rather than in their capacity as individuals. Some of the reasons they opt for this can be privacy issues, income tax deferral issues, gift/estate tax concerns, the need or desire to shield the foreign investor’s own assets from liabilities arising from the ownership of U.S. real estate, and whether it is expected that additional investors will acquire equity interests in the property.
It is imperative that prior to signing the contract of sale the foreign purchaser receives competent legal and international tax advice as to the proper structure to use in order to accommodate the investment.
Foreign purchasers should be cognizant of the fact that certain types of entities in which they want to take title may not be available to persons that are NOT citizens or permanent residents of the United States, such as an “S Corporation”. In using this particular entity the investor would soon discover for one, that it may not be available to them and that the income generated by the U.S. real estate would likely be subject to double taxation.
This post was taken from a tip written by Filippo Cinotti, Esq.and published in PDE Title’s Spring Newsletter. PDE Title is a sister company of Prudential Douglas Elliman Real Estate.
Which Spot In Central Park Was Voted Most Romantic?
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As the snow falls heavily in Manhattan, I received an update from the Central Park Conservancy. Reminding me of Valentines Day (note to self: Send flowers to Les), I did wonder which was the most romantic spot in Central Park.
The answer? Bow Bridge. Check this and