by starfish on December 29, 2007
Jeremy Siegel, a professor of finance at Wharton and author of The Future for Investors, was recently asked to analyze the Fed’s decision to cut short-term interest rates by a quarter percent or 25 basis points. The Fed cut its main short-term rate target to 4.25% and the “discount rate” charged on direct Fed loans to commercial banks to 4.75%.and its impact on the markets.
Siegel says “ If I were there, I would have tried to have gotten 50, but I’m not at all surprised at 25. What surprised me a bit was the retention of the balanced directive. And what that means is that the Fed still sees inflation as a potential problem and did not wish to elevate the slowing economy to a primary position in its policy making. That was a surprise.”
“Many felt that with GDP growth slowing down this quarter virtually to zero, that the Fed would have put more emphasis on the slowing growth. So, the stock market’s reaction, which is a great disappointment, is not surprising. There is a feeling now that the Fed may be what we term ‘behind the curve,’ which means they are not being preemptive in trying to prevent a recession or a slow down, but they are only being reactive — and being reactive might be too slow.”
For more of his comments please click here:
by starfish on December 29, 2007
Foreign investment in real estate – particularly in Florida and top destinations like Vero Beach – is likely to pick up. So says Mark Vitner, chief economist for Charlotte, N.C.-based Wachovia Corp. “The dollar is on sale”, said Susan Wachter, a professor of real estate at the Wharton School at the University of Pennsylvania. She points to the declining value of the dollar against the euro – the currency of 13 European countries: Belgium, Germany, Greece, Spain, France, Ireland, Italy, Luxembourg, the Netherlands, Austria, Portugal, Slovenia and Finland. Today, a foreign buyer would need only 34,100 euros to make a $50,000 downpayment on a house, compared to 37,920 euros to make the same downpayment at the beginning of the year.
by starfish on December 26, 2007
Early this summer, lawmakers passed landmark legislation to create the largest tax cut in Florida’s history. What passed was a two part process that put the people in control:
- Step one was a law that required local governments to roll-back taxes this year, and then to grow at a responsible rate in the future.
- Step two is in the hands of the People of Florida.
- On January 29, the people will have the power to cut their taxes in a historic way by passing the constitutional amendment.
- Floridians have the power and choice to lower their tax bill. They can decide what is best for their pocketbook on January 29, 2008.
Floridians need property tax relief
With the passage of Amendment 1, citizens will gain the freedom to purchase a new home without huge tax penalties, and rental home owners, second home owners and businesses will benefit by limited future tax increases.
The amendment contains two provisions that Governor Crist has long advocated: doubling the homestead exemption and portability of the Save Our Homes tax benefit.
- Double the homestead exemption for almost all homeowners, providing an average savings of about $240 annually. The new exemption applies fully to homesteads valued over $75,000 and partially for homesteads valued over $50,000. This new exemption does not apply to school taxes.
- Allow portability: The Governor has heard from many constituents that they feel trapped in their homes. Portability will allow homeowners to transfer their Save Our Homes tax benefits from their old home to a newly purchased home. Portability applies to homes purchased in 2007 and later, and the benefit is capped at $500,000.If you upsize, you will be able to apply the dollar value of your Save Our Homes tax benefit to your new home.
For example:
a: Homesteader owns home valued at $300,000 and buys a new home valued at $400,000If you downsize, you will be able to apply the percentage of the Save Our Homes benefit to your new home.
For example:
a: Homesteader owns home valued at $300,000 and buys a new home valued at $150,000
- Provide an assessment cap of 10% for all properties, not previously capped: While homestead properties are already capped at 3%, now all other properties, including rental properties, second homes, and business properties, will be protected from huge increases in valuation. This new exemption does not apply to school taxes.
- Create a new $25,000 exemption for business property, including office furniture, computers, machinery and equipment.Estimates provided by the Legislature show that Florida homeowners and businesses will save over $12 billion in property taxes over the next five years.
What’s your opinion on the proposed legislation, and it’s impact on Vero Beach Real Estate? Click here for more on ‘Yes on 1′
