REAL ESTATE NEWS...U.S. TO START TRACKING "SECRET" LUXURY BUYERS

U.S. TO START TRACKING "SECRET" LUXURY BUYERS
The Treasury Department announced last week that it will begin tracking all "secret buyers" of luxury properties as concerns mount about money laundering in high-end real estate. The initiative requires shell companies that make all-cash real estate purchases to expose the buyers' identities. The Treasury is asking title insurance companies to discover and report the identities of these buyers.

The government said it would allocate more resources into investigating luxury real estate sales that involve shell companies, such as limited liability companies, partnerships, and other entities. The government will begin its new program in New York's Manhattan as well as Miami-Dade County in Florida. In Manhattan, buyers who purchase property at a sale price of more than $3 million must be reported, and in Miami-Dade County, more than $1 million.

A New York Times series last year revealed that real estate professionals in the luxury market often don't know much about their buyers as the use of shell companies rose with foreign investment in U.S. real estate. In fact, the Times found that nearly half of homes nationwide worth at least $5 million were purchased using shell companies.