Luxury Real Estate Buyers To Be Tracked

By
Real Estate Agent SL3287291

An article in the New York Times on Jan. 13, 2016 stated,"U.S. Will Track Secret Buyers of Luxury Real Estate".

 

It seems that the U.S. government has started a pilot program in an attempt to find the names of buyers of Luxury Real Estate who are trying to remain anonymous.

 

The focus of the pilot program is Miami-Dade County and New York City. If the program accomplishes its purpose it is expected to go nationwide.

In Miami-Dade County, the focus will be on all cash sales that are more than $1 million. The New York City rule will apply to sales $3 million or higher.

 

What is the reason for this scrutiny?

 

It is all about tracking "dirty money". It is believed that criminals are putting their money into real estate.

This effort is a function of the Treasury Department, who is now looking at Shell Companies that buy upscale real estate.

 

Shell Companies are legal, but they are layering the companies to hide identities. The new rule will require any individual who owns 25% or more to sent their name to the Department.

The rule will require Title Insurance Companies to discover the identities of the buyers and send those names to the Department.

This new ruling will have an affect on Billions of dollars of real estate transactions.

The Times research found that almost half of homes, nationwide, worth at least $5 million are obtained through the use of Shell Companies.

 

Here is a link to the article for more information:

U.S. Will Track Secret Buyers of Luxury Real Estate

 

This will be interesting to follow, especially those Real Estate Agents and Title Insurance Companies that handle Luxury Real Estate.

What impact will this have on the Luxury Market?

It will for sure be interesting to follow.

 

 

Comments (12)

Patricia Kennedy
RLAH Real Estate - Washington, DC
Home in the Capital

John, this is inspired by a New York times investigation, and after reading it, the Treasury Department efforts sound like they are not a bad idea.  Of course, if you are an agent who lists and sells these properties, it could sound a little scary.

Jan 14, 2016 12:23 AM
John Wiley
Fort Myers, FL
Lee County, FL, ECO Broker, GRI, SRES,GREEN,PSA

Patricia, I agree that the reasoning is good for this rule. It may have an impact on agents and Title Insurance Companies that have a heavy focus on the Luxury market.

Thanks for commenting.

Jan 14, 2016 12:37 AM
Joe Petrowsky
Mortgage Consultant, Right Trac Financial Group, Inc. NMLS # 2709 - Manchester, CT
Your Mortgage Consultant for Life

I am not one bit surprised, my continuing education was loaded with sections about money fraud and laundering.  John, it was just a matter of time that this was going to be done.

Jan 14, 2016 05:59 AM
John Wiley
Fort Myers, FL
Lee County, FL, ECO Broker, GRI, SRES,GREEN,PSA

Thanks Joe, we know the dirty money is out there and now it will not be so easy to launder that money.

I appreciate your added comments.

Jan 14, 2016 06:02 AM
Joan Cox
House to Home, Inc. - Denver Real Estate - 720-231-6373 - Denver, CO
Denver Real Estate - Selling One Home at a Time

John, this is interesting, but would imagine this would be a great place to put dirty money to hide it. 

Jan 14, 2016 09:19 PM
John Wiley
Fort Myers, FL
Lee County, FL, ECO Broker, GRI, SRES,GREEN,PSA

Joan, I would expect a lot of dirty money is involved in the Luxury real estate market.

Thanks for the comment.

Jan 15, 2016 12:27 AM
Sharon Tara
Sharon Tara Transformations - Portsmouth, NH
New Hampshire Home Stager

Sounds like a great idea to me. But then I'm not going to be buying a home for cash any time soon. LOL

Jan 15, 2016 04:29 AM
John Wiley
Fort Myers, FL
Lee County, FL, ECO Broker, GRI, SRES,GREEN,PSA

Sharon Tara     you just don't look like a crook who would have dirty money.

I hope you have a great year and can pay cash for your dream home.

Jan 15, 2016 05:19 AM
Sharon Tara

Thank you....you are right, I'm not a crook. LOL

Jan 16, 2016 12:42 AM
Debbie Reynolds, C21 Platinum Properties
Platinum Properties- (931)771-9070 - Clarksville, TN
The Dedicated Clarksville TN Realtor-(931)320-6730

Our luxury properties don't come close to the price of other luxury properties. Thanks for sharing this news.

Jan 17, 2016 11:14 AM
John Wiley
Fort Myers, FL
Lee County, FL, ECO Broker, GRI, SRES,GREEN,PSA

Debbie Reynolds I don't expect this to have a big impact on most agents who are not in a high end market, but it is at least interesting to see another twist to real estate.

Thanks for commenting.

Jan 17, 2016 11:28 AM
Sally K. & David L. Hanson
EXP Realty 414-525-0563 - Brookfield, WI
WI Real Estate Agents - Luxury - Divorce

Big Brother will be watching the BIG buyers John Wiley !

Jan 29, 2016 09:53 PM
John Wiley
Fort Myers, FL
Lee County, FL, ECO Broker, GRI, SRES,GREEN,PSA

Sally K. & David L. Hanson you are right about Big Brother watching.  I expect they will catch some and Title companies will have added work.

Thanks for commenting.

Jan 30, 2016 05:01 AM