Monday, November 26, 2012
Real Estate Players Race to Close Deals Before Year's End
The final weeks of the year are always a busy time for real estate folks. Investors are busy trying to close out deals and wind down business before 2012 is no more.
But this year the rush is even more intense, thanks to the high-stakes monkey business going on in our nation’s capital.
With most federal tax rates scheduled to change with the start of the new year, some real estate players are in a hurry to get their deals wrapped up before the ball drops in Times Square. Regardless of whether the gang in Washington can avoid the fiscal cliff, these investors are saying that it’s better to get their business done at current tax rates.
“The likelihood of an increase in capital gains taxes has people flying,” said Dallas property broker Jeff Swaney. “There is a real sense of urgency, and the title companies are going to be full of year-end deals.”
Title company execs confirm that their in-baskets are full of business that has to be done in the next five weeks.
“Yes, we are seeing an increase in year-end closings,” said Ted Darby, senior vice president in Chicago Title Insurance’s Dallas office. “With the uncertainly of what is going to happen Jan. 1, many have pushed up their closing dates to ensure they close this year.
“This is across the board in all product types,” Darby said. “We are seeing similar activity in many other states as well as Texas.”
Of course, it’s great if you can fast-track a real estate closing to be done by the end of December. But these days getting any real estate transaction closed takes a lot of time, even with the fiscal cliff overshadowing the market.
It’s easier for corporations; some are moving up their dividend payments to the final hours of 2012 so that shareholders won’t have to fret about paying higher taxes on their gains.
Commercial broker Pat Patman doesn’t doubt that a few deals will be hurried to completion before the current tax rates expire. But he thinks the notion of a rush is overstated. “People are just using that to get sellers moving,” Patman said. “I wish someone would buy some of the property I have, so I wouldn’t be paying higher long-term capital gains taxes.”
Real Estate Editor
Dallas Morning News