Real Estate Investing involves the purchase, ownership, management, rental and/or sale of any form of real estate for profit. Improvement of any real estate property as part of a real estate investment strategy is generally considered to be a sub specialty of real estate investing called real estate development. Real estate is an asset form with limited liquidity relative to other investments such as stocks or bonds that openly trade on financial markets. Real estate investments are also capital intensive although capital may be gained through mortgage leverage and is highly cash flow dependent. If these factors are well understood and managed by the investor, the real estate becomes a very sound investment.
Real Estate assets are typically very expensive in comparison to other widely available investment instruments such as stocks or bonds. Only rarely will real estate investors pay the entire amount of the purchase price in cash. Usually a large portion of the purchase price will be financed using some sort of instrument or debt such as a mortgage loan which is collateralized by the property itself. The amount of purchase price financed by debt is referred to as leverage. The amount of financed by the investors own capital, through cash or other asset transfers is referred to as equity.
The ratio of leverage to total appraised value (often referred to as LTV or Loan to Value for a conventional mortgage) is one of the mathematical measurements of the risk an investor is taking by using leverage to purchase the property. Investors usually seek to decrease their equity requirements and increase their leverage so that their return on investment (ROI) is maximized. Lenders and other financial institutions usually have limited equity requirement for real estate investments that are being asked to
finance typically on the order of 20% of appraised value. Investors seeking low equity requirements may explore alternate financing arrangements as part of the purchase of a property for instance private equity sources or institutional lending.
"Real estate cannot be lost or stolen, nor can it be carried away. Purchased with common sense, paid for in full, and managed with reasonable care, it is about the safest investment in the world." -Franklin D. Roosevelt
MULTI-FAMILY
Florida Property Development focuses on multi-family development with mixed-use urban infill and garden style products.
Florida Property Development's success is in the direct result of the company's vision, developing products with an emphasis on creative solutions and design, quality construction and materials, and its partnership with award-winning architects, interior designers, and construction companies. Florida Property
Development has a traditional approach to its business, trust, and respect. This approach has resulted in productive long-term relationships with its partners, lenders, contractors, consultants, and Florida agencies. This perspective extends to all our actions and interactions, looking to generate value in every deal for every participant.
LUXURY HOMES
Luxury homes are a great option if you are looking for a long-term investment with a larger investment amount. We focus on homes that sell for under $10 million because they have a wider range of buyers. Since Florida continues to be a prime location for luxury homes, these projects have the potential to yield great profits.
The process of building a luxury home starts with finding a suitable land to build on. This may be an open lot or an existing home, which we would tear down in order to build a luxury home to sell. Our team is highly selective and skilled in scouting prime locations, focusing on areas such as Miami, Naples, Tampa Bay and Palm Beaches.
Before initiating a purchase, we analyze the location, area market price, zoning code, lot size and buildable square footage. Our experts estimate the costs to build in comparison to the anticipated sale price, to ensure a profitable end result.
OPPORTNINITY ZONES
The opportunity zones incentive is a new community tool established by Congress in the tax cuts and jobs act of 2017 to encourage long-term investments in low-income urban and rural communities nationwide. Opportunity zones provide a tax incentive for investors to re-invest their unrealized capital gains into dedicated opportunity funds.
Any corporation or individual with capital gains can qualify. The program provides three tax benefits for investing unrealized capital gains in opportunity zones: Temporary deferral of taxes on previously earned capital gains. Investors can place existing assets with accumulated capital gains into opportunity funds.
An opportunity zone is an economically-distressed community where private investments, under certain conditions, may be eligible for capital gain tax incentives.
