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The IRS is offering some much needed tax help in 2009.  The Tax Relief Programs, which address real estate matters are outlined below.

1. 1.  First Time Homebuyer Tax Credit:  People who recently bought a home or those who are considering buying one should pay close attention.  The program, which could be worth $7500 to those qualified, defines “first time buyer” as anyone who has not owned a primary residence in the past three years.   If this is you, check out the IRS program details.
2. Offers in Compromise on Home Values:  An Offer in Compromise (OIC) is an agreement between a taxpayer and the IRS.  An OIC is a viable option for taxpayers experiencing money difficulties, as the agreement settles a tax debt for less than the full amount owed.  Under IOC guidelines, the IRS realizes that real estate valuations may not be accurate.  In instances of financial hardship, where the accuracy of local real estate values are in question, the IRS will give a new review of the information before determining their final offer.
3. Real Estate Tax Deduction:  Taxpayers can claim an additional standard deduction, based on state and local real estate taxes paid in 2008.  The maximum deduction is $500 per person or $1000 for joint filers.
4. Workouts and Foreclosures:  For most homeowners, debt forgivenness is now tax free.  Homeowners can exclude forgiven debt on their principal residence if their loan was for owe less than $2,000,000.  The limit is $1 million for individuals and married couples filing separately.

Thank you for visiting InfoTube.net homes for sale or rent website. If you are interested in more information, consult your tax planner or visit www.irs.gov.

The unfolding mortgage crisis ushered in some good news for home sellers and renters, alike.  Fannie Mae will allow paying tenants to stay in their rental homes, after a defaulting borrower’s property is foreclosed on.

The new policy brings some much needed relief to tenants, who find that they are often innocent victims of the foreclosure crisis.  Landlord’s often use tenants as a revenue stream, long after they quit making mortgage payments.  As a result, thousands of renters, who were unaware that their landlord was in foreclosure, have been evicted through no fault of their own. 

The new policy is historic because lender’s want to get foreclosed property ready for a new buyer, as soon as possible.  Typically, renters make this difficult to do.  But, in this environment, thousands of homes sit vacant and fall into disrepair, because the tenant is gone and no one is buying. 

This policy is a win-win for lenders and neighboring homeowners, as well.  Vacant properties pull down prices and the appeal of any neighborhood, even the good ones.  By leaving the paying tenant in place, the lender’s home’s are occupied and maintained, while they collect rent. Homeseller’s benefit from a stable neighborhood, and they don’t have to compete against the vacant foreclosure’s, as they try to sell their owner occupied homes.

Fannie Mae and Freddie Mac have a moratorium on foreclosures and evictions through January 9, 2009.  The hold on holiday evictions has allowed 10,000 families to stay in their homes, and the new policy means that thousands of renters may escape eviction after the first of the year. 

Thank you for visiting InfoTube and Happy Holidays to all.

It looks like we may all be home for Christmas after all.  

Freddie Mac and Fannie Mae, the mortgage-finance companies seized by the U.S. government, will suspend foreclosures and evictions over the holidays.

The six-week pause will begin Nov. 26, a day before the U.S. Thanksgiving holiday, and last through Jan. 9, the companies said in separate statements today.  The much needed reprieve is designed to give servicer’s more time to implement a streamlined loan modification program for struggling borrowers.

Happy Holidays and thanks for visiting InfoTube.net homes for sale website.

The new, US economy brings with it, a whole new set of rules for investing in real estate.   In the past, real estate has been a tried and proven method for quickly building wealth, but the current rules for successful investing have changed.

Making money in real estate is still a possibility, but investor’s must pay very close attention to the changes that this ecomonic cycle brings.  Today’s investors need to reexamine their criteria for buying, selling or holding property.  They also need a lot of patience and flexibility, along with complete and detailed research, before they jump in and take advantage of some of the best bargains seen in years.

NEW RULES FOR INVESTING IN TODAY’S REAL ESTATE MARKET

NEW RULE #1:  LOCATION, LOCATION, LOCATION.   For the baby boom generation, the suburbs were “the” location for profit and life style.  Fuel was cheap, commutes were short and the ‘burbs’ offered the big house, with picket fenced yards and the image of the Leave It to Beaver lifestyle.   Not so much, today.  Today, it is the urban scene that is making a comeback.   While homes in downtown area’s are generally more expensive on a price per square foot basis, buyer’s today are willing to pay a bit more money for less square footage.   Urban center living eliminates long commutes, urban sprawl, expensive fuel bills and provides nearby ammenities without the need to drive.

NEW RULE #2:  STAY PUT AND DO NOT REMODEL WHEN THE MARKET IS SLOW.   In the past, many homeowners gained equity by renovating their old home while the market was slow.   The improvements added value to their real estate, while they waited for more favorable market conditions.  In the 2008 housing market, any major renovations should be analyzed purely from a return on investment perspective.   According to Remodeling Magazine, which just published its Cost vs Value Report, homeowners should be warned that they will not recover as much of their costs for remodeling as they did in the past.   The best investment today’s homeowner can make in terms of renovating fall in the category of paint, landscape and green, energy saving features. 

NEW RULE #3:  Technology and Networking are the Key to Locating Great Properties.   Home listings, valuations and other crucial information for real estate investment used to be available only through a real estate agent.  Now, the genie is out of the bottle and the best sources for real estate information can be accessed with nothing more than the click of a mouse.   More technology has also made it possible for home seller’s to list their property on the powerful, national MLS, without listing with a agent.  Companies like Why 6 Percent.com, and its national network of broker’s, list property for seller’s, investors and builders who want the exposure the MLS provides, but do not want to pay 6 percent of their sales price for the priviledge.   Technology has changed the way buyer’s and seller’s connect, and the way that property is advertised.   Smart investor’s should take advantage of this new alternative, as it offer’s accuracy, speed and control unmatched by the traditional route of buying and selling through agent’s only.

New Rule #4:  BIGGER IS NOT ALWAYS BETTER.  In the past, agent’s and home builder’s advised buyer’s to purchase as large of a home as they could possibly afford.  As a result, home size in the 1970’s averaged about 1700 square feet, with 3.1 people in the average family.  In 2004, the average size of a home was around 2400 square feet with only 2.6 occupants on average.   Today’s lending and energy crisis has changed our thinking and bigger is not necessarily the best investment.  Buyer’s are looking for a home that meets their needs without paying for space they don’t need.   Today’s investor needs to adapt their thinking and focus on useable living space, energy saving ammenities, security and conveniences instead of targeting the over blown McMansion.  Another demographic also backs up the theory that smaller may be better.  For the next two decades, retiring baby boomers will be scaling out of their McMansions, now that their families have left the nest.  The boomer’s will favor smaller homes with more ammenities, located in convenient neighborhoods that are clean and safe.

New Rule #5:  FLIPPING IS OUT. BUY AND HOLD IS IN.   Today’s falling prices and the huge inventory of unsold property means that potential bargains are plentiful.  Smart Investor’s will take advantage of the current market and lock themselves into a good deal now, and hold the property until stability returns.  Prospective investors should be warned that the crash we are experiencing will not turn around anytime soon.  Prices will continue to fall, though not as dramatically as we have seen in the recent past.  As prices firm and inventory is sold, the patient investor will see gains, but they should plan on waiting five years to ring the register.

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