I was looking at a web site the other day that referenced the Gulf Opportunity Zone Act of 2005. According to the IRS web site, the Act “amends the Internal Revenue Code by adding Section 1400N(a) which authorizes the issuance of qualified private activity bonds to finance the construction and rehabilitation of residential and nonresidential property located in the Gulf Opportunity Zone. Gulf Opportunity Zone Bonds must be issued after the date of enactment and before January 2, 2011.” These “Zone Bonds” can be issued by the states of Alabama, Louisiana, or Mississippi.
The Hanover Companies LLC web site states that the tax benefits are part of the effort to revitalize areas impacted by hurricanes Katrina, Wilma, and Rita. The company goes on to list the following 5 reasons to consider investing in properties in the eligible communities:
- 50% Bonus Depreciation in the first year of ownership for qualifying real estate investment buyers. This depreciation bonus can be carried back up to 5 years as well!
- Demand for housing in the Go Zone will vastly exceed supply for the next 3 – 5 years. The Go Zone lost 65,000 homes and 11,000 short-term rental options in one day!
- Gulfport-Biloxi is currently the No. 2 gaming center in the country with 11 casinos and 8 more anticipated to open by the end of 2009.
- Housing Predictors gave Biloxi the number one spot on it’s “10 Most Promising Housing Markets”
- Hanover Companies exclusive “Total Leasing Program” that offers you the option of leasing your newly purchased single family home to a corporate tenant for up to 24 months! The rent you receive as part of the T.L.P. generally covers your mortgage, taxes, and HOA fees for the full term of the lease. This means you could very well be cash-flow positive from day 1.
I do not know anything about Hanover Companies, LLC so be sure to do your due diligence if this is something that you want to explore further.