Sunday, March 4, 2007
Saturday, February 17, 2007
Capitol Gains Tax
You can avoid capital gains taxes on the sale of your home if it was your primary residence for at least two of the five years prior to its sale. Individuals may qualify for a $250K tax exemption, and married couples up to $500K.
If you've moved into your "forever home," and suddenly get laid off from your job, or need to move unexpectedly, you will not completely lose your exemption even though you couldn't remain in your home for two years.
Even the IRS understands unforeseen circumstances. Under Internal Revenue Code 121, you can get a partial credit for the time you've lived in your home.
Your exemption is based on the number of months that you remained in your principal residence. If you have to sell after 18 months, you will qualify for 18-24ths, or 75% of the total exemption.
The rules may seem complicated, but with the assistance of your tax adviser and a real estate professional, you can maximize your savings and locate your next home with a minimum of aggravation.
If you've moved into your "forever home," and suddenly get laid off from your job, or need to move unexpectedly, you will not completely lose your exemption even though you couldn't remain in your home for two years.
Even the IRS understands unforeseen circumstances. Under Internal Revenue Code 121, you can get a partial credit for the time you've lived in your home.
Your exemption is based on the number of months that you remained in your principal residence. If you have to sell after 18 months, you will qualify for 18-24ths, or 75% of the total exemption.
The rules may seem complicated, but with the assistance of your tax adviser and a real estate professional, you can maximize your savings and locate your next home with a minimum of aggravation.
Sunday, January 28, 2007
Renting to Purchasing
Today's real estate market provides an excellent opportunity for renters to turn their monthly payments into equity. Interest rates are still lower than in the past ten to twenty years. Home prices in many areas are adjusting back down to reflect reasonable levels of appreciation.
Money paid for rent goes into the pocket of the landlord, but money paid for a mortgage goes toward equity in the home. You keep the money you pay for your home, as its investment value increases with every payment.
If you could put $10,000 down on a $210,000 home today and pay $1,100 per month, your equity would total $138,521 over a ten-year period. This calculation assumes a 30-year fixed rate loan at 6.5% and an annual appreciation of 4.5%. Of course your income and credit rating determine whether or not you qualify for a loan.
So do the math, and then contact a local real estate agent or a lender to discuss your eligibility for home ownership. It’s never too late to start building your future!
For more information about living in central Virginia please visit my website at
www.MadisonVARealEstate.com
Money paid for rent goes into the pocket of the landlord, but money paid for a mortgage goes toward equity in the home. You keep the money you pay for your home, as its investment value increases with every payment.
If you could put $10,000 down on a $210,000 home today and pay $1,100 per month, your equity would total $138,521 over a ten-year period. This calculation assumes a 30-year fixed rate loan at 6.5% and an annual appreciation of 4.5%. Of course your income and credit rating determine whether or not you qualify for a loan.
So do the math, and then contact a local real estate agent or a lender to discuss your eligibility for home ownership. It’s never too late to start building your future!
For more information about living in central Virginia please visit my website at
www.MadisonVARealEstate.com
Thursday, January 25, 2007
Sellers/Buyers Market
Are we currently in a “buyers market” or a “sellers market”?
The basic concept behind a "buyers market" is that there are more residential properties for sale in an area than there are qualified buyers. This creates increased competition among the sellers for those fewer buyers, putting the buyers in the “driver’s seat” when it comes to negotiation.
A "sellers market" occurs when there are more prospective buyers than there are homes for sale. Buyers then compete against each other for available properties, often to the benefit of the seller.
Many areas across the country have enjoyed a sellers market for the last few years. Mostly because interest rates have been so low that many more buyers qualified for financing. We are currently experiencing more of a “buyers” market, since interest rates are slowly creeping up and there are more houses for sale.
Regardless of which hat you’re wearing, consult a professional for advice on getting the most out of your real estate experience.
The basic concept behind a "buyers market" is that there are more residential properties for sale in an area than there are qualified buyers. This creates increased competition among the sellers for those fewer buyers, putting the buyers in the “driver’s seat” when it comes to negotiation.
A "sellers market" occurs when there are more prospective buyers than there are homes for sale. Buyers then compete against each other for available properties, often to the benefit of the seller.
Many areas across the country have enjoyed a sellers market for the last few years. Mostly because interest rates have been so low that many more buyers qualified for financing. We are currently experiencing more of a “buyers” market, since interest rates are slowly creeping up and there are more houses for sale.
Regardless of which hat you’re wearing, consult a professional for advice on getting the most out of your real estate experience.
Monday, January 22, 2007
Sunday, January 21, 2007
Pricing Your Home
As most markets experience an "adjustment" period, buyers are fewer and farther between. Sellers usually ask their listing agent for a Comparative Market Analysis (CMA) to properly gauge their asking price in these dynamic conditions.
But as a buyer, how can you be sure that your offer is a reasonable one? Some sellers simply ignore current market conditions, expecting to fetch the same prices as a year ago. You may need some assurance. Particularly, you need to know how many homes are on the market now vs. a year ago, and how the average sales times compare. Ask a real estate pro to provide you with the very same CMA that the sellers request!
Once you've located a home you're excited about, a CMA report will compare it with similar properties, and give you a very good indication of whether the asking price truly reflects its value. Such a report costs you nothing, yet gives you the peace of mind that your offer is a solid one, and you're not risking one penny more than you should!
But as a buyer, how can you be sure that your offer is a reasonable one? Some sellers simply ignore current market conditions, expecting to fetch the same prices as a year ago. You may need some assurance. Particularly, you need to know how many homes are on the market now vs. a year ago, and how the average sales times compare. Ask a real estate pro to provide you with the very same CMA that the sellers request!
Once you've located a home you're excited about, a CMA report will compare it with similar properties, and give you a very good indication of whether the asking price truly reflects its value. Such a report costs you nothing, yet gives you the peace of mind that your offer is a solid one, and you're not risking one penny more than you should!
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