Short sales skyrocket in days before tax breaks expire according to Kathleen Howley of 
Bloomberg Business. A short sale is the sale of a home for less than the homeowner owes with foregivness from the bank for the difference. The tax breaks have prevented the homeowner from being taxed for the difference.
According to Howley, "The transactions, known as short sales, increased by 35 percent in the third quarter from a year earlier, while sales of bank-owned homes dropped 20 percent, according to a report today by mortgage data seller Renwood RealtyTrac LLC. Together, they accounted for 41.5 percent of home purchases in the quarter."
Truthfully if they cannot afford to make their mortgage payment they probably cannot afford an extra $25-50 m.illion in taxable income liability. Less short sales will mean more foreclosures which is going to have a slowing impact on the housing recovery.
Why is the government not doing something?
What impact will this have on your real estate investing? If you've been focused on short sales will you change your focus? Join me for a look at another way. Click here.
Let's actively discuss and brainstorm the impact of this slip of the fiscal cliff.
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