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10 Tips for Finding Your Perfect Home

Wednesday, July 10, 2013 posted by Tommi Crow

10 Tips for Finding the Perfect Home

Buying a home can be stressful and exciting all at the same time. It’s quite the adventure! We recently purchased our second home and I found a few tips very helpful while searching for the perfect home for my family.

1. Figure out what your ‘perfect home’ looks like. Write down on a piece of paper all of the things you must have in your new home, things that would be nice to have and things that don’t really matter.

2. Purchase a home that stays in budget. Make sure to get pre-approved for a loan before going out to look at houses. It will make the buying process much easier and you will know which houses to look at.

3. Bigger isn’t always better. While we all dream of having a huge mansion, it’s good to think about what will be best for your family. Figure out how many rooms you need to fit your family comfortably and look in that range.

4. Think about remodeling. Many homes you will look at may not be in the best condition, but think about the potential of the house. Would painting and new wood floors turn it into your dream house? How about a kitchen or bathroom remodel? There are many easy fix-ups such as adding new light fixtures and painting that can turn your house into the perfect home.

5. Location is important. Check the surrounding area of the home. Drive around the 2 mile radius to see what is around your home. Make sure it is in an area you feel comfortable with. Find out what school district you’ll be in. Even if you don’t have kids, you may want to think about the school district you live in for resale. You may also want to take the commute to your work and see how long it will take you.

6. Do your research. Research property values in the area. Stalk your neighborhood and find out what it’s like at all times of the day. Is it a family friendly neighborhood? You could even knock on the neighbors’ doors before buying.

7. Do a home inspection. The home inspector will look at everything in a home and give you a non-biased opinion. They will also tell you the true value of the home you are looking at. It’s better to spend a couple hundred dollars doing a home inspection than finding out the house had several problems.

8. Picture your family living in the house. When you walk into the home, can you picture your family living there? Does it have a good feeling? Picture your family living in each room and see you how feel.

9. Leave room to grow. Make sure your ‘perfect home’ has extra storage and gives you room to grow.

10. Don’t put your expectations to high. Realize that most houses aren’t perfect to begin with. Even if you are building your dream home, there are always things that could have been different. Be flexible. Once you move in and add your own style it will soon become your dream home.

InfoTube.net has thousands of Homes for Sale.  Please search our site for listings seen no where else on the web.  Thank you for reading our Blog and if you Love Real Estate…LIKE InfoTube for Real Estate on Facebook.  We post really cool things every day.

6 Reasons 2013 is a Home Sellers Market

Wednesday, January 23, 2013 posted by Tommi Crow

Prices for existing homes rose another 7.7% in the month of December.  For our customers who have been patiently waiting for the market to favor sellers, instead of buyers…the tables have finally turned. 

Why is the housing inventory so low in 2013?

The Wall Street Journal writes a good article on this, pointing to six reasons:

1. Many homeowners are underwater, and thus can’t sell.
2. Homeowners with equity in their home don’t have enough of it to “trade up” to buy a bigger and more expensive  home.
3. Everyone wants to buy at the bottom, but few want to sell when they feel their home will be worth more next year.
4. Investors – from mom and pop and corporate investors have come out and become landlords, taking property that normally would be on the market into the rental realm.
5. With the foreclosure fiasco, banks have been slower at foreclosing homes.
6. There’s been a lot less construction of new homes by home builders.

What does this mean for home sellers?

1.   Advertising your property on the MLS and Realtor.com has never been more crucial to reach qualified home buyers.  Realtors and homebuyers are searching for new listings, daily, because there is nothing on the market that fits their needs.  If your home does not appear in these real estate search engines, chances are that no one will ever know your home is for sale and you will miss your window of opportunity.

2.   Holding an Open House on the weekend is a great way to get people who see your listing online  into your home for an actual showing.

3.  Place a FREE listing on InfoTube.net.  InfoTube is visited by thousands of people daily who are looking for “by owner” property.

4.  The homes that are flying off the market are the properties in the best condition, location and they are priced right, ready to sell.  Homebuyers will not look at a house that is overpriced, hoping to negotiate back and forth.  They are buying homes that are reasonable to purchase and are ready to move into.

5.  Keep your InfoTubes and InfoBoxes full of flyers.  We receive calls from buyers everyday who want more information, but the container is empty.  Be sure to keep a back stock of brochures on hand in time of high traffic.

Home sellers should act quickly to take advantage of the present market conditions because they will not last.   Home inventory levels will increase as home builders react and start more new homes.  Banks will quickly work there way through millions of foreclosures that are still sitting in limbo.    And, home buyers are snapping up houses right now to lock in low interest rates and low home prices.   If you want to sell your home for the most money, in the least amount of time, you should act aggressively.  Time is of the essence.

Thank you for visiting InfoTube.net.   Post a free property listing on our website.  Search for thousands of homes for sale seen no where else.  Buy an InfoTube or InfoBox to market your property..nothing beats providing a brochure about your home, instantly to a prospective buyer.   Put your property information in front of millions of internet home shoppers and real estate agents with our low cost MLS and Realtor.com listing packages.   Whatever you need to sell your home….we have you covered since 1988.

2013 Marks Rebound in Housing Market

Monday, January 14, 2013 posted by Tommi Crow

    InfoTube is bullish on housing in 2013 and here are a few reasons why.

Home prices rose 7.5% last year, largest increase in six years.  Total number of  homes sold increased 6% last year, to 4.2 million, marking the first increase since 2005.  The same forces that helped propel prices last year will be in play this year, including improved housing demand fueled by good affordability, fewer foreclosed homes for sale and a low inventory of unsold homes.

Trends that will Boost Home Prices Again in 2013

  • The Fed feeds housing rebound in 2013.  Interest rates for mortgages are at historical lows, making monthly payments affordable than renting for millions of families. 
  • The rate of new foreclosures has fallen to normal, pre-bust levels. 
  • Banks have cleared a lot of bad debt off the books and rising home prices will loosen up their purse strings.  Expect loans to be easier to come by in 2013.
  • Stronger job growth will drive more housing demand as people living with friends and relatives move into their own homes.
  • Increasing rents and lack of desireable rental inventory will push many tenants out the door and into a home of their own.
  • Investors are snapping up distressed property, rehabbing and flipping it.  This means higher average home sales prices and fewer homes vacant or in disrepair.
  • Rising home prices will increase borrower equity in their homes.  This means that few people will be interested in walking away…or requesting a short sale.
  • The Fiscal Cliff settlement left housing tax benefits in tact.  Mortgage interest deduction, property taxes deductions, depreciation schedules and one time tax free home sales were left in tact, making real estate one of the few remaining tax havens for the average working American.
  • Rising home prices will allow more sellers to list their homes and sell near the asking price.
  • The supply of homes for sale fell to 4.8 months in November, the National Association of Realtors says.  That’s the lowest level in more than seven years.  Realtors consider a six-month supply to be a balanced market between buyers and sellers.
  • Market researcher, Corelogic, calculates that home prices will increase 6 percent in 2013.
  • According to a December survey of 105 real estate experts and economists by real estate company Zillow, home prices will rise 3.1% in 2013. 

All the evidence stacks up to make a good year for real estate in 2013, whether buying or selling.  If you have been waiting for the market to improve to sell your home, the time is now.  If you have always wanted to own a home of your own…the odds are stacked in your favor, too.  

Thank you for visiting InfoTube.net.  Place a Free Property listing, advertise your home on the MLS or Realtor.com, follow InfoTubes very popular Facebook page for up to the minute news and home improvement idea’s that you won’t see anywhere else.

Buyer Beware! DEA List of Known Meth Houses

Tuesday, October 2, 2012 posted by Tommi Crow

 

Meth House Nightmares —  Buyer BEWARE!!!

This post will hopefully educate you on some of the risks involved when purchasing a property that may have been used as a meth lab.   Single family homes are frequently used as a place where methamphetamine is manufactured.  

The dangers that go along with meth houses include exposure to cancer causing chemicals that can saturate walls, carpets and other building materials as well as all contents. Lead and mercury are common byproducts. Chemicals, such as solvents, may be disposed of in plumbing or simple poured on the ground. If not removed properly these can cause various health problems.

Meth Labs ~ Tell tale signs to look for…

• Yellow discoloration on walls, drains, sinks and showers

• Blue discoloration on valves of propane tanks and fire extinguishers

• Fire detectors that are removed or taped off

• Experiencing physical symptoms while inside the house, such as burning in your eyes or throat, itching, a metallic taste in your mouth and breathing problems

• Unusual strong odors that smell like materials from a garage, such as solvent and paint thinner, cat urine or ammonia

• The use of security cameras and surveillance equipment

When you enter a property take a deep breath.  A cat urine smell is often associated with meth. Other odors to be aware of are ammonia, vanilla, solvents or metallic smells.  These are warning signs.

Meth users sometimes become obsessive about objects.  They may dismantle things like remote controls, watches or electronic devices.  The objects can sometimes be found in a pile dismantled down to the smallest part.

Large amounts of household products are a tip off.  Common products are used to manufacture meth that can found in an average home, except in a meth lab large quantities of common items may be in odd places.  If you see multiple packages of lye, Heet, Coleman fuel, peroxide, pseudo-ephedrine or coffee filters in odd places, like stored in a bathroom, closet or kitchen, this is an indication that it may be wise to forget any involvement in the property.  The occupant may be a warehouse club shopper with no sense of organization, but he/she may not be.

Propane bottles, or fire extinguishers, that have been altered, or have a blue stain on the connector, may indicate that anhydrous ammonia has been stored in the container. Anhydrous ammonia can be explosive in the right circumstances. It reacts with the metal leaving the connector corroded.

Iodine may be used in meth manufacturing.  Iodine is a substance that goes from solid to gas state without becoming liquid. It sticks to everything and spreads on contact. Iodine stains walls and everything else. The stain may be red or yellow. It may be very noticeable if a photo, or other wall hanging is moved, revealing the contrast between stained and unstained.

Meth labs may be hidden behind false walls or other building alterations.  Alterations that make no sense should be suspect, such as: exhaust fans mounted where they have no logical use; bootlegged power supply; rooms that are unexplainably small.

Another thing all home buyers and Realtors should do before writing a contract on a home to purchase…is to check out the DEA Meth Laboratory Registry to see if the home has ever been used to manufacture drugs in the past.  The DEA link is http://www.justice.gov/dea/clan-lab/clan-lab.shtml .  Click on the state and scroll to the county where the property is located BEFORE you buy.

Thank you for visiting InfoTube.net.  Remember that you can’t always spot a meth house.  They are often nice homes located in nice area’s.  Check before you buy to avoid a nightmare that you may never recover from.

4 Tips to Become a Successful Landlord

Monday, September 24, 2012 posted by Tommi Crow

   Owning a piece or real estate with the objective of earning regular cash flow is probably the best known and most common form of real estate investing.   The rental property is the way a lot of people in the “middle class” have found a real opportunity to make a fortune, if they know what they need to be successful.

Thousands of distressed and vacant properties, historical low interest rates and rapidly increasing rental rates have converged and created a great opportunity.  If you are considering becoming a landlord, focus on 4 basic fundamentals to insure profits and success.

1.  Paying Tenants-  This may sound obvious, but the first fundamental you need to be a successful landlord is a good quality tenant who can pay the rent.

One of the biggest challenges for a landlord is keeping good paying tenants and avoiding vacancies.  If a property is vacant, it usually results in the loss of at least one month’s rent while the place is being freshened up and a new tenant is found.   We highly recommend that all prospective tenants be screened, including a background and criminal record check.   Landlord screening services are available to assist you or your property manager.

One of the best way to keep your rental occupied at all times is to invest in a location that attracts a lot of renters.  Neighborhoods near colleges and universities are filled with students who rent while they attend school…and for the most part, parents insure the rent will be paid.   Homes near education facilities are also in high demand and landlords can usually charge a rent premium for these properties.  Any area with a lot of employment opportunities will also have very good rental demand.  In many markets, larger, 4 or more bedroom homes are scarce.   Find a niche in your market that provides a stream of ready tenants. 

2.  Keep Expenses Low – Contolling costs are one of the basic fundamentals of successful real estate investing.  Some costs of property ownership are known, such as taxes and insurance…but, others are often beyond an investors ability to control. 

Property taxes and insurance are expenses that are determined by third parties.  Combined, they can easily cost at least one months rent each, or more.  On average, budget about one months rent to cover your insurance premium.  Property taxes are another matter and they can vary greatly.  High property taxes helped trigger the housing collapse in Florida, when landlords couldn’t earn any cash flow on rental property.  When searching for an investment property, make sure you verify the taxes because tax rates can easily cost as much as two or three monts rent.

3. Property Maintenance – Keeping your property in good working condition is a big part of managing a successful investment.  Again, screening tenants is key in keeping costs down.  A good tenant will certainly have normal wear and tear and your property, but they won’t do much damage.  However, a bad tenant can cause thousands of dollars in property repairs in a very short period of time.

As far as controlling expenses  is concerned…it is cheaper in the long run to address maintenance issues as they arise.   For example, a roof leak can cost a few hundred dollars to fix, but the price can quickly escalate to thousands of dollars and lost tenants, if ignored.   Although no one likes to pay maintenance expenses, being a slum lord is a costly proposition.  Deferred maintenance brings down the value of the entire property, increases ownership costs in the long term, decreases the amount of monthly rental income that can be charged and atracts renters with less than stellar references or ability to pay.

4.  Reduce Mortgage Costs – Refinance and lock in historical low interest rates.  Current quotes for investor loans for residential property are under 4%.  If you can reduce the amount of interest you pay for your money, it immediately increases your bottom line.  It is also a good idea to appeal tax assessments.  Contact your local taxing authority to see the procedure required.  Most people who go to the tax office armed with recent comps and educate themselves, can get some tax relief.

If renting is so great..why does your landlord own? For all the challenges of owning investment real estate, earning income while owning an asset that someone else pays for is still one of the best ways to create wealth.   If you get really good at it, you can make a good money, decrease the amount of taxes you pay and increase your networth multi-fold.   Lucky you.  Timing has never been better.

Thank you for visiting InfoTube.net.  Visit our site to search for homes, place a free listing, purchase an MLS or Realtor.com listing or buy marketing tools to assist you with sales or rentals.  Like InfoTube on Facebook for up to the minute news, marketing tips, design and staging idea’s.  You will LOVE it!      

Proof the Real Estate Market Has Turned Around

Wednesday, September 12, 2012 posted by Tommi Crow

The cover story for the September 10th weekly magazine Barron’s is on the recent surge in real estate and how the rise in property prices is no fluke.  We agree with the many experts and professionals that believe the recovery is real…and that is will continue in the foreseeable future. 

First take a look at the chart below.  You can see that housing starts (crucial to rebuilding our economy) bottomed in 2009 and have been trading in a healthy base pattern for 2 years.  In February of 2011, we finally started moving up off the bottom and the trend is continuing.

We all know that real estate can not thrive in an environment where lenders will not lend money.  Tracking real estate loans is a good indicator for the future direction of housing.  As you can see in the chart below, there has been a dramatic increase in lending, which has pushed the housing market higher over the past year.  We believe this trend will continue and will improve as lenders work there way past non-performing assets and bad loans liablities.

Finally, we show a chart of home prices since 1991.  The chart shows that home prices are certainly on a sustainable upward trend, since the 2006 crash.

 

In conclusion, we believe conclusive evidence shows that there is immediate long-term opportunities for homebuyers and investors in the housing market.  InfoTube is BULLISH on housing and the stocks of home builders, some REIT’s and home improvement giants like Home Depot and Lowes Hardware.

Thank you for visiting InfoTube.net.  We are Made in the USA manufacturers of the InfoTube and InfoBox real estate marketing tools.  If you have a home to sell…you need this product.  Exposure is everything in this market!!!  Show and Sell! 

Thanks to Barrons and Seeking Alpha for giving us facts and charts for this story.

New Rules for Comparable Sales and Apprasial Info

Wednesday, August 29, 2012 posted by Tommi Crow

The real estate meltdown has changed many things about the way we think about real estate and property values.  

Recently, we watched 3 home sales close in the same neighborhood.  Typically, the price per square foot and price range for all 3 homes would be similar…given that the ranch style homes were of similar age, size and were located in the same small neighoborhood.    What we learned today was that the 3 homes sold in a range from $200,000-$400,000…or from $100-$200 a square foot.  

The vast difference in the prices tells us a story about why comps (or comparable sales data) is not the indicator of true value that is has been in the past.   Today, we have essentially 3 housing markets, thus 3 price ranges in every neighborhood. 

    First, we have the bank owned home that sold for $200,000.   This is the home that no one cares about.  The lawn is 2 foot tall…the air conditioner has been pilfered through for copper and spare parts, the appliances have been stolen and the home has been abandoned.     This property was purchased by a rehab company, who will put a lot of money into its restoration, then resell it for a profit, at an estimated $400,000.

   Second, is the home that sold for $300,000, but, far short of the loan balance owed against it.  This house was always lived in and had never been vandalized, but all maintenance had been deferred and no updating had taken place in years.  The seller knew they were losing the home and had no money available to properly maintain the residence.    This home was sold to a young couple who didn’t mind doing some cosmetic work in order to save money. 

The third home located right around the corner from the other two closed for $400,000.  This home was meticulously maintained.  The interior and exterior had been upgraded with high end finishes and colors.   The home was move in ready.     The only thing this move up buyer had to do was unpack their personal belongings and enjoy themselves. 

As these 3 properties illustrate, we have 3 different real estate markets developing across the USA.    Typically, homes in the same neighborhood were very similiar to one another, so sales data was easy to compare.  Today, there may be 3 distinct markets in every neighborhood, so beaware that price ranges can vary greatly.  

If you are attempting to value property today, you must look at the category your home is in…ranging from bank owned/abandoned to high end/move in condition to determine the average price per square foot in your neighborhood.   Eventually, all this upheavel will work itself out… and houses in a neighborhood will once again be more similiar than different…but until then, make sure that you compare apples to apples when buying or selling

Thank you for visiting InfoTube.net.  Visit our website to place a FREE home listing, view great deals on all types of property, place an MLS listing or feature your property on Realtor.com.

Is Your Property the Pinball Listing??

Thursday, August 23, 2012 posted by Tommi Crow

   What is a Pinball Listing?

A pinball listing is a house that is listed for an unrealistic asking price.  It pulls in a lot of showings by agents and home shoppers, but receives no offers.  Real estate agents, including the listing agent for the home, use the overpriced house as a negative example to sell similar homes that are listed for lower prices.

Any pinball listing is basically a set up.  Listing agents show clients these homes to make realistically price homes look like fantastic deals, which is why the traffic for pinballs is high…but no sale will ever take place until the price is drastically reduced. 

What Happens to the Pinball Listed Home?   Unless it is being used by Realtors as a set up…they stop showing it until the seller agrees to reprice it at a realistic number.

Is it Ethical for a Broker to Accept a Pinball Listing?   NO!  It is not ethical to list a property at a price that an agents knows it will not sell.  If they do, they are intentionally misleading the seller.  Do agents list unrealistically priced houses to use as a set up, anyway?  YES, all day long.

How to Protect Yourself?  Interview several real estate agents before signing any listing agreement.  Get as much information as you can about CLOSED sales prices of comparable homes in your neighborhood.   If you are inclined, you can always push a little on the listing price, but if you get greedy, or try to go overboard…you may unknowingly become the set up, pinball, out of touch with the competition listing…that everyone loves to visit, but no one will buy.

Thank you for visiting InfoTube.net.  Visit our site to place a FREE property listing, search for great deals, MLS and Realtor.com flat fee listing packages, InfoTubes, InfoBoxes and More.

How to Speed Up a Home Closing

Tuesday, May 8, 2012 posted by Tommi Crow

Some home-sale transactions close quickly, while others can take months. Two significant factors that affect most home sales are inspections of the property and financing the purchase.

Inspections should be done within the first couple of weeks after the offer is ratified, i.e., accepted by both buyer and seller. Usually, the day after ratification is day one of the contingency and closing time periods. This may vary from one location to the next.

When transactions fall apart soon after ratification, the cause is usually something discovered during the buyer’s inspections. It’s a good idea for sellers to get presale inspection reports so that the buyers have as much information about the property as possible before they make an offer.

Most home inspection reports make recommendations to consult other specialists such as a roofer, furnace contractor, drainage specialist or engineer. Few sellers have these additional inspections done. Even if they do, the buyers might want a second opinion.

Inspections are also somewhat subjective. One inspector might say a roof needs to be replaced; another might say it has a few years of life left as long as it is properly maintained. Transactions fall apart because the buyer and seller can’t come to an agreement on inspections, which means the sale doesn’t close, the house goes back on the market and the buyers renew their home search.

If the inspection issues are worked out satisfactorily, the next major hurdle that could delay your sale, or crater it, is the loan contingency. Cash buyers bypass this rigorous process; however, they do need to provide the sellers with evidence that they have sufficient liquid funds to close the sale.

All-cash deals can close whenever the buyers and sellers agree, after all inspection issues are resolved. Closing can occur in a week or two. Some all-cash buyers include an appraisal contingency in their contract to confirm that they’re not paying over market value.

In this case, it would take longer to close because an appraiser would need to visit the property and work up an appraisal report. If the property didn’t appraise for the purchase price, the buyer might be able to back out and have the deposit returned.

Both buyer and seller would start all over again. However, if they negotiated a resolution, the sale could close quickly and would take far less time than it does to close a sale involving a mortgage.

HOUSE HUNTING TIP: Purchase contracts include contingencies and time periods for them to be met. To avoid having to ask for extensions, make sure that the time periods you request are reasonable. An extension might not be granted if the seller has a backup offer for a higher price.

Buyers should get preapproved for the financing they need to close a home sale before their offer is accepted. This way, they are assured of what they can afford to pay. Preapproval can cut a few days off the loan approval process.

Loan approval can go relatively quickly if you present all required documentation promptly and your financial situation is not complicated. It can be more time consuming for buyers who are self-employed or are using other than W-2 income to qualify.

Part of loan approval involves an appraisal on the property by a licensed appraiser. This can slow the process down depending on the lender, how backlogged they are and the loan amount. A large loan amount can prompt the need for two appraisals, which adds more time to the approval process.

THE CLOSING: If you’re buying in an area where homes are selling quickly, it may take 35 to 45 days from contract acceptance for final loan approval and closing.

Dian Hymer, a real estate broker with more than 30 years’ experience, is a nationally syndicated real estate columnist and author of “House Hunting: The Take-Along Workbook for Home Buyers” and “Starting Out, The Complete Home Buyer’s Guide.”

ALL HomeBuyers HATE Popcorn Ceilings

Wednesday, April 18, 2012 posted by Tommi Crow

   When trying to come up with a list of items that all homebuyers HATE..the first thing that came to my mind is Popcorn ceilings.   They scream dated.  They collect cobwebs, dust and dirt.  They are impossible to clean or paint.  And, if your home was built before the 1980’s, the popcorn may contain cancer causing asbestos.  (Asbestos was outlawed in 1977, but old supplies were used for years.) 

If you are selling your home, get rid of it….even though that is easier said than done.  If your home was built before 1980, you should first have the ceiling tested by a professional to see if it contains asbestos.  (Read the handout “Asbestos in Your Home“).   If asbestos is found, call a professional asbestos removal company to spray paint over it ($2-$6 a square foot), if it is in good shape.  Or, better, have the pro’s remove and properly dispose of it ($54-$64 a square foot).  Do not attempt to remove asbestos yourself!   There is a lethal reason it is a banned substance.                        

Whether the popcorn contains asbestos or doesn’t…removing popcorn ceilings is a messy, difficult and possibly expensive project.   Do it yourself with the proper gear, or expect to pay a painter about $2.50 a square foot to get rid of it, patch holes and repaint your ceiling.  

There are a few alternatives to sealing or removing popcorn ceilings.  You can opt to cover it up.   Depending on the architectural style of your home…you can consider installing beaded board or press tin ceiling tiles to hide the popcorn….forever.

If you are selling a home…get rid of the popcorn!!!  No one in the world likes popcorn ceilings…if you have them, you hate them, too.   Today’s buyers have so many choices, they won’t even consider a home with popcorn.  

Thank you for visiting InfoTube.net.  Please get rid of those dated, dirty, ugly and possibly dangerous ceilings today!!!    Popcorn is blowing your sale!

Click Here to Read What Buyers Hate Most…Second to Popcorn Ceilings

Rising Rents Push Homebuyers Into the Market

Tuesday, April 10, 2012 posted by Tommi Crow

Sharply rising rents are pushing buyers into the real estate market this spring. 

Rising Rents Push Fence Sitting Homebuyers

Take a minute to watch this short video from the Wall Street Journal.   From now on…fence sitting will cost you!!

Thank you for visiting InfoTube.net.  Please LIKE us on Facebook!!

Big Tax Breaks for Real Estate Investors

Monday, March 26, 2012 posted by Tommi Crow

  With reduced home prices and interest rates near historic lows, affordability levels in early 2012 reached their highest point in 42 years according to the National Association of Realtors.

Not only are homes at record affordability levels, real estate ownership also opens the door to a wide variety of tax benefits and additional savings.

“A recent poll shows that 75 percent of likely voters think real estate tax deductions are appropriate and reasonable,” said Steve DiUbaldo, president of Atlantic & Pacific Real Estate, a full-service real estate brokerage with offices in 22 states. “People understand the value of owning a home and the role played by tax benefits. Combine today’s affordability levels with tax advantages and now is a very good time to consider both residential and investment real estate.”

So what are the biggest real estate tax breaks? For most owners and investors the list of major tax write-offs looks like this:

1. Property Taxes. Real estate owners can write off the cost of state and local property taxes. For many borrowers this deduction can reduce taxable income by thousands of dollars.

2. Mortgage Interest. The IRS defines a home mortgage as “any loan that is secured by your main home or second home. It includes first and second mortgages, home equity loans, and refinanced mortgages.”

Mortgage interest can generally be written off, but not always. The limitation for mortgage interest on a primary and secondary residence is a total of $1,000,000 for acquisition indebtedness and $100,000 for home equity indebtedness. There are lower limits for individuals and those who are married but filing separately.

3. The Standard Deduction. “Everyone is entitled to a standard deduction,” said DiUbaldo. “However, write-offs for mortgage interest, property taxes, mortgage insurance premiums and other costs generally allow real estate owners to justify itemizing expenses and thus larger write-offs.”

4. Mortgage Insurance Premiums. Mortgage insurance allows purchasers to buy with less than 20 percent down. Qualified borrowers can get FHA financing with 3.5 percent down, conventional loans can require as little as 5 percent down and VA purchasers can borrow with zero down. Closing costs are extra.

“In general,” says the IRS, “if you itemize deductions, you may deduct premiums paid for mortgage insurance provided by the Department of Veterans Affairs (VA), the Federal Housing Administration (FHA), the Rural Housing Service (Rural Housing), or private mortgage insurers in connection with a mortgage for the purchase of your main home.”

5. Points. A “point” is a fee to the lender equal to 1 percent of the mortgage amount. Borrowers often have the option of paying points at closing rather than a higher interest rate over the life of the loan. Whether it’s better to pay points or accept a higher interest rate depends on such issues as the interest rate, the number of points and how long the property will likely be held.

In general, a point paid at closing for acquisition financing is fully deductible in the year paid. If a point is paid to refinance a home, the point is deductible over the term of the mortgage, typically 1/30th per year.

6. Investors can claim Depreciation. Depreciation allows investors to take an additional tax deduction because a real estate “improvement” is believed to wear out over time and will need to be replaced.

“Depreciation is an accounting concept,” said Atlantic & Pacific Real Estate’s president. “The investor is not actually spending the cash represented by the ‘cost’ of depreciation and one result is that it’s possible to have an investment property which produces a positive cash flow that is partially or wholly not taxable currently. In certain instances, subject to individual taxpayer limitations, it is even possible to show a loss for tax purposes.”

7. Sale Profits. When a prime residence has been occupied for two of the past five years it’s probable that much or all of the profit will be sheltered from capital gains. With a joint return up to $500,000 can be protected, $250,000 for an individual owner. Example: You bought a home in 1990 for $100,000 and sell it in 2012 for $300,000. There’s a $200,000 long-term profit, none of which is taxed.

If you’re an investor, sale profits are taxed as long-term capital gains if the property has been owned for at least a year. That means long-term capital gains in 2012 are generally taxed at 15 percent.

8. Tax-deferred exchanges: The National Association of Realtors says investors purchased 23 percent of all existing home in January. One reason for such interest is that it’s possible to have tax-deferred real estate exchanges with investment property.

“You can swap one investment house for another, but you can also trade a rental house for a commercial property or a property with four units,” said DiUbaldo. “An exchange can allow an owner to defer capital gains taxes for years if not decades, and swaps are one of the reasons investors come to our website ( www.apreus.com ).”

The Bottom Line: Whether purchasing as an owner-occupant or as an investor, tax rules can powerfully impact the value of your real estate. For the latest information, details and deductions be sure to check with a local tax professional.

As always, we urge you to consult with your own independent Certified Public Accountant as to the appropriateness of any tax deductions for your specific circumstances.   Article by Market Watch.

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If you are one of the millions of Americans who would love to take advantage of record low home prices and record high levels of foreclosures, but your cash on hand is coming up  little short… consider using a portion of your IRA funds to buy a piece of rental property.

Millions of Americans have billions of dollars tied up in IRA’s that nay be paying little to no interest or gains to investors.  Maybe it’s time you considered diversifing from stocks or mutual funds… and add some tempting real estate bargains into the mix.

Here are the basic rules:

  • The funds used to buy the property must be held in a self directed IRA.  You can not use 401K funds or Roth IRA’s to buy real estate, but you can roll over those funds into an IRA before you buy.
  •  The property you buy must be an investment property.   You can not buy a second home or primary residence with IRA funds without paying a penalty.
  • You must pay cash for the investment property.  You can not borrow or take out a mortgage against your IRA investments.  
  • Monthly rental income must be placed back into the IRA account.
  • When the property is Sold…the sale proceeds must be deposited back into the IRA.
  • No taxes are due on rental income or capital gains held in the IRA, until the money is withdrawn at retirement age, so earnings grow tax free.
  • The IRA can pay all expenses associated managing and maintaining the property.
  • You can use a property manager or manage it yourself.

Real Estate IRA

Here is a simple example of how the investment could grow and fund your retirement.

  • You buy a $100,000 rental property with IRA funds.
  • You collect $10,000 a year in rent that is paid directly back into the IRA. 
  • After 10 years, the entire $100,000 you invested in the home has been paid back into the IRA.  Bonus, you still own the property and you can sell it anytime you chose and put the proceeds into your account, too.
  • You pay NO TAXES on income or capital gains until you withdraw money from the IRA.

Tax deferred gains

Buying a foreclosure with IRA money can be a great way to diversify your retirement portfolio and take advantage of historically cheap real estate prices and highly motivated sellers.  As with any tax related investment…ALWAYS consult your tax expert before investing.

Thank you for visiting InfoTube.net.  The spring home selling season is underway and it looks to be the best one in several years.  If you are in the market for home, this is a great time to be shopping.   Check out some of the great deals on our site…or place your property listing on our site for FREE.

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Home Buyers Move Back to Basics

Thursday, February 23, 2012 posted by Tommi Crow

                                                    Home Sellers take note:

When it comes down to chosing a home, buyers are going back to the basics.  Today’s buyers consider new or updated kitchens and bathrooms, and a flexible, open floor plan as the most important features they are looking for in a home.

A recent survey of hundreds of real estate agents reveal what features appeal to the broadest cross sections of buyers in the marketplace.

  • 33% of those surveyed said that a new or updated kitchen is the most important feature they are looking for.
  • 14% of purchasers said that an open floorplan is a must have. 
  • 12% are looking for homes with new or updated bathrooms.
  • Only 1% of buyers feel that entertainment rooms or finished basements are important home features.

Thank you for visiting InfoTube.net.  When you advertise, photograph and show your home, don’t forget to emphasize the “hot buttons” area’s that buyers are telling you they are looking for.

    When it comes to successful real estate investing, I’ve learned the my purchase price has nothing to do with making money.  Good tenants are the key to making money.  If you are seeking a reliable stream of steady income, with few to no hassles…buy a property that will attract “A” quality tenants who will renew their leases year after year. 

As a novice investor, I often wasted a lot of time and money searching for “a deal” on a house.    I worried about who I would rent it to, later.  After years of losing money and sleep, I learned that seasoned investors use a strategy completely opposite from what I had been doing.  They pictured the most desirable and profitable tenant in the market…then, concentrated on locating a piece of property that would attract that type of tenant. 

If you are searching for a piece investment property that will bring in income, picture who your ideal tenant will be, then buy a piece of property that will draw them in!!   “A” quality tenants look for common ammenities in a rental home… 

  1. Search for properties that are located near strong, vibrant downtown or commercial corridors.  If the area is thriving, you should be in good shape.  If the business district is run down or boarded up, think twice about investing in that location..
  2. Quality tenants live in clean areas of town with parks and recreation options, good schools, medical facilities and reliable police and fire protection. 
  3. Buy property that has easy access to convenient transportation, interstates or major thoroughfares.
  4. Look for neighborhoods that are filled with owner occupied homes, not other rental properties.  You want the area you invest in to be filled with homeowners, not other renters.
  5. The Best Tenants are Long Term Tenants.   If you find a foreclosure or a distressed property, chances are it will be in need of repairs and updating.  Plan to  spend money after closing to make the place nice and fix anything that is broken.  You want your property to be a place that your renter is proud to call their home.
  6. As a general rule, families make the best long term tenants.  On average, families stay in one rental house for 4+ years.  To attract “A” quality families to your property, look for single family homes with a minimum of 3 bedrooms and 2 baths.  The best homes also have 2 car garages, 2 living and eating area’s and a good size yard.
  7. Size Matters to a family. My most profitable properties have not been the cheapest homes, they’ve been the largest.  Large 4 bedroom homes in good neighborhoods, with good schools have been proven winners time after time.   Why?  Most rentals on the market tend to be smaller, starter type homes.  The lack of competition for a large house makes finding and keeping good tenants much easier.
  8. Seek out locations with large employment bases.  Tenants look first at homes located within a 15 minute drive from their workplace.  

In conclusion, it is not “deal” or a cheap sales price that will make you money on rental property.   Properties in “A” condition and “A” locations attract “A” quality tenants that create the positive returns you are seeking. 

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