REAL ESTATE

by John-Mark Mitchell

Welcome again to the most unusual real estate market we have ever experienced on the East Coast! As the outdoor temperatures are rising, so are the temperaments of our buyers and sellers while being in the midst of the hottest and most complex, but exciting, markets on record. The new normal is anything but normal… And it appears that we’re just getting started.

We can all agree that due to the limited quantity of luxury properties and prospective buyers, the listing and sale of luxury real estate may present some challenges. However, with the right marketing mix, the right Broker, and a little creativity, you can connect your luxury listings with qualified and interested buyers. Thinking outside the box may transform a multi-million dollar home on acreage into a winery or a convention retreat center. Finally, connecting with the international community will help increase the pool of prospective buyers for any luxury property.

So your question may be… how can we win the war in this competitive real estate market? First and

foremost, find the most knowledgeable

and reputable company in the area

that you were wishing to purchase. Do

your own homework and ask people

that you respect that currently live in

that area who they may recommend.

It is a fact that having more than just

local knowledge can make your buy-

ing and selling experience much more

rewarding and profitable in your real

estate decisions.

Here is a great idea if you are a buyer in this crazy market: If the property you seek is in “coming soon” status, make an aggressive offer to the sellers, with a lower due diligence until you have seen the property. Your offer will possibly be the first offer the seller has received and will be presented at a much more relaxed pace than when the house is open for showings and they have 18 offers in one day. In my firm, we have done this several times and have had tremendously successful results for our buyers and sellers. We have found that a lot of the sellers we represent are excited about not having 20 showings in one day and having to decide between so many different offers. Also, some of the best buyers do not wish to compete and will pay a premium to have their offer considered before the competition. At the end of the day, helping our buyers and sellers get the results they want is what makes our job relevant and successful. Having a broker with knowledge of how to be creative in negotiations is what will make the difference in how satisfied you are as a buyer or seller of luxury real estate.

According to the latest profile of home buyers and sellers, this is the first year that we are seeing that 5% of first time home buyers have a net income of over $200,000. This is not investors, but the first home that young people out of college are purchasing. You may conclude that this is one of the factors that is forcing the luxury market to rise quicker than predicted.

Statistics worth repeating are that home sales for the remainder of 2022 are predicted to rise 6.6% year over year, reaching a 16 year high across the East Coast. And although we will have increased inventory due to the warmer seasons, we will still face fierce competition, record high listing prices, and fast paced sales for the remainder of the year. Hang on tight and let’s enjoy the ride together.

In conclusion, I always inform my sellers and buyers when I meet them to hire me… Not because we are friends, which a lot of times we are… But select me because I am the absolute best person to get you the highest price and best deal in today’s market. We make this the reason for anyone to select any of the brokers in our firm, or any company that places outstanding service as their highest priority. If you have any suggestions for future reports or any questions, please feel free to reach out to me by email; johnmark@gomitch. com or follow me on Instagram; johnmarkmitchell.realestate.

As always, thank you for letting me be a part of your story.

Cheers!

By John Mathews

On account of complicated rules, fears of the internalized revenue service, generalized knowledge of most certified public accountants (CPAs), many businesses and individuals just follow a standard tax plan. This standard tax plan is the taxpayer’s taxable income by a set amount determined by the government. In the end, most people overpay because they don’t know how to leverage the complicated U.S. tax code.

However, a customized plan can help increase tax savings, and as a managing director with Redwood Tax specialist, this is something I do daily. Tax planning is the number one service requested by my clients. This type of planning requires a tremendous number of resources to do accurately, keeping this service out of reach for traditional CPA firms.

The key to a customized plan is a service provider that can provide multiple strategies to any given client and that can implement tax plans more like a project manager opposed to a CPA. These plans shouldn’t be designed to substitute an existing relationship between a client and their accountants; rather, they can be utilized by CPAs in addition to.

For optimal tax plan implementations, I recommend multiple strategies developed simultaneously. This level of detailed forethought should occur long before your tax statements are ever due. This requires the necessary time and investments in strategic tax-reduction services - and knowing 100 percent of the tax laws and following them 100 percent of the time. As an example, a past client corporate executive had income of $4,000,000. The executive had zero deductions available due to various phase-outs and limitations and was paying over $1,500,000 each year to the government. We worked through his priorities and identified that current debt payoff was the largest goal opposed to long term savings and retirement strategies. Based on the client’s preferences, cash flow needs, and budget, we designed their custom tax plan with a $160,000 real estate investment opportunity, that when properly administered generates large annual deductions to offset wage income and is not limited by passive real estate investment rules.

As a result, a tax deduction of $730,000 from the real estate investment reduced the executive’s tax liability by $262,000, delivering a refund of over $252,000. Conclusively, my suggestion is finding a team that is highly competent and can provide implementation.

John Matthews C.P.A. is a Managing Director at Redwood Tax Specialists where he helps clients with over $1 million of income legally reduce their taxes through proactive tax planning. John has 23 years of experience as a C.P.A. John lives in Charlotte, NC with his wife and 2 kids and is a terrible golfer. john@matthewscpa.com