The housing market in South Florida is soaring, with single-family homes sales increasing by over 24% and median sales prices growing by nearly 18% compared to one year ago. New residents and business relocations from high-tax urban areas like New York are driving the demand for real estate in South Florida.
Will home prices drop in South Florida?
South Florida home prices have settled at last. Median sales prices of single-family homes in Miami-Dade dropped by 3% between April and May, from $515,000 to $500,000, despite a surge in the number of transactions. Condo prices remained steady, with a median price of $325,000.
How to sell the house to your own child?
A solid option is to sell your house at its full fair market value (FMV) to your child. This is a great choice if your child is well-settled and wants to earn the house in an affordable way. Instead of demanding the full price of the house at the time of sale, consider making an installment sale for the full price. It works like this:
How to finance your child’s purchase of a house?
Finance your child’s purchase of the house. Sell the house to your child at a discount. Sell the house to your child but continue to live there. Let your child assume the mortgage. Use a personal trust.
Can a stranger sell your house for less than its FMV?
If you sell your house to a perfect stranger for less than its FMV, then you can take a loss. It was a bad sale, but the IRS doesn’t care because it’s an arms-length deal. But if you try to sell your house to a relative, aka your child, for less than its FMV, the IRS considers this a gift, and won’t simply let you take a loss on the sale.
What happens when you pass your house to your child?
This means, when you die, you can pass your house on to your child if you wish to, as expressed through a valid will. When you transfer property after death, however, the government levies an estate tax, and your child will only receive the house after those taxes have been taken out of your estate.
