Scenes from the street…..

Scenes from the street….. By: Brian Brosen,

NY State MLS Blog Post Contributor

As a Broker who covers a wide area, and one that runs across a fair amount of people on a weekly basis, I am personally seeing more and more cases of homeowners in trouble these days than I have at any other time. It’s a bit ironic, because the pundits tell us everyday lately that the economy is getting better, that growth is starting to slowly happen, and things are looking up, depending on your perspective I guess.

In the Capital District we are very protected from the swings, the storms so to speak of the real estate world over the last 5 or 6 years – no major wild swings ( yes, we had some good appreciation, some even bordered on speculation “ can you say Saratoga” ) – but nothing so extreme that the bubble burst like it did all over the rest of the nation. Nothing highlights this fact more than stats I just saw in the Business Review – from 2005 until 2010, the national avg sales price dropped across the nation about 32% - meanwhile, here in the Capital District, our avg sales price rose nearly 2% - that is a HUGE statement in regards to our market.

We have been bombarded with stories of people losing everything, foreclosure nightmares across the nation for the last 2 yrs – and while that was going on I was out there daily, meeting people, and not really hearing that story too often locally – but like all other trends, we tend to lag behind. I am not speaking, nor could I ever speak, for all the other agents and brokers out there – but I know, I am running across more and more people who are behind, who are close to losing it all, who are barely holding on, who are tapped out in their homes…and they need to sell, some want to, some don’t, and some just don’t seem to care……again, I am only one guy, one broker out there amongst thousands…..but, am I the only one seeing it more this year, already? Is it just my “luck” so to speak to run across a larger portion of these situations than truly exist? Or is there something brewing out there in the hills of Columbia County, in the alleys of Albany, in the suddenly more desperate suburbs of Delmar and the martini hot spots of Saratoga, and everywhere in between that no one is paying attention to?

Just throwing it out there…..i guess the next 8 months will answer those questions.

Don't Drive By The Short Sales

Don't Drive By The Short Sales: By: Vanessa Saunders,

NY State MLS Blog Post Contributor

I'm finding that a lot of Realtors are turning their buyer clients away from Short Sales. We all know that historically they have been difficult to negotiate. We've gone from seeing multiple offers and the selling agents having no clue as to handle them, attorneys that have no clue as to handle a short sale correctly, followed by months of frustration for all concerned. Now it appears that short sales are seeing minimal traffic or worse, no offers at all. Which ultimately leads to expired listings and even worse for the sellers, foreclosure.

Buyer agent's are clearly fed up with months of angst of dealing with frustrated buyers that finally decide it's not worth the wait and move on to another property, and sometimes, ( blaming you for the debacle,) another Realtor. Why bother?

Well for starters, many more Realtors are becoming either educated or certified in how to handle short sales successfully. For those that care about their clients and their business there are a lot of options out there from state and board education, to the nationally recognized Certified Distressed Property Expert (CDPE) course and many more. I became a member of the CDPE institute 3 years ago, and have found the in depth knowledge I gained to be of invaluable assistance in understanding how to list, market and sell short sales successfully. As a member of the institute we are continuously updated of changes to rules, regulations, and the many evolving issues that this ever changing market brings.

Lenders are facing facts and are now assisting in expediting short sales more often than not. Many have initiated "fast track" programs for short sales, and some attorney's understanding the market changes have put negotiating teams in place to assist with both sellers facing foreclosure and buyers attempting to purchase a short sale. I work with a crack team that honestly makes selling short sales a pleasure from my point of view. My clients both buyers and sellers also reap the benefits of sage counseling from a pro and his team. Seller’s relief is palpable when the full picture of what they are facing becomes clear, and the knowledge that someone "has their back", paints a path to a much brighter future. Buyers are counseled before going into a short sale scenario and come away with an understanding of exactly what's necessary to negotiate a successful deal. Thus I can do my job is exactly the way it should be. Finding the right property for buyers and weeding out those that don't stand a chance of closing.

If more Realtors were to become educated in both the sales side and the buyers side of handling short sales, many more sales could be achieved. A good thing for all and country.

To that end....Here is my latest short sale. Fully marketed, no skimping and pre-cleared by the bank for a speedy sale should we find well qualified buyers.

And please, don't drive by the short sales in your market; make the calls needed to find out if it could be right for your clients. If you don't know the right questions to ask....educated yourself fast or miss out on a part of the market that's not going away anytime soon.

What is one of the best points of owning your own home vs renting?

By: Vanessa Saunders

NY State MLS Blog Post Contributor

What is one of the best points of owning your own home vs renting?

Tax Deductions!

Homeowners are able to deduct 100% of their mortgage interest and property taxes from their income tax returns.

That means that if you're in a 28% tax bracket, the Government effectively subsidizes about one third of your borrowing costs or more, making your home more affordable or allowing you to buy a larger home than you could have otherwise. Also, big chunks of your closing costs are tax deductible, and hundreds of thousands of dollars of any profit (or capital gains) that you realize when you sell your home are exempt from income taxes. Something that is about to change in the near future when a 3.8% levy will be taken from your capital gains for Health Care Reform.

It is critical to know what you're entitled to at tax time so you can claim it back. So, here are five essential need-to-knows about home-related income tax tips to help you get the most tax-reducing bang out of your home-owning buck – and to avoid hefty home ownership-related tax traps.

1. Itemize Your Return to Claim Your Deductions

During a recent debate on Capitol Hill about whether the mortgage interest deduction should be eliminated, it came out that nearly 40% of homeowners lose out on their major tax advantages every year when they fail to itemize their income taxes. If you own a home and otherwise have a fairly simple return, it might be tempting just to take the standard deduction – and if your mortgage, property taxes and income are low enough, the standard deduction might outweigh your homeowners' deductions. But you'll never know if you're losing out on the tax advantages of itemizing unless you try. Pick up the forms from your mortgage company and answer the questions on tax software like TurboTax, which will automatically do the math on whether itemizing or taking the standard deduction will result in the lowest tax bill – or the highest tax refund – for you.

2. Be Strategic When Taking a Home Office Deduction – Plan Ahead

According to the Small Business Administration, the average home office deduction is $3,686 – multiply that by your tax bracket – 15%, 20%, 30% or whatever it is, and that's what you'll save on your taxes by writing off your home office. Know, though, that the space you designate as your home office cannot be exempted from capital gains tax when you sell your home later. The $250,000 (single)/ $500,000 (married filing jointly) income tax exemption for capital gains is only good on your personal residence, after all – not including any space in your home you've claimed as your tax-advantaged office. If you foresee selling your home for much more than you bought it in the future, near or far, discuss this with your tax preparer to see if the few hundred bucks you save is worth the capital gains complication later.

3. Tax Relief for Loan Modifications, Short Sales and Foreclosures Will Stop in 2012

While the long-term housing outlook is beginning to look up, 2011 is projected to be the peak year for foreclosures during this market cycle. Distressed homeowners who are on the brink of a short sale, loan modification or foreclosure should be aware that normally, any mortgage balance that is wiped out by one of these outcomes is taxed as what the IRS calls Cancellation of Debt Income, or CODI.

Under the Mortgage Debt Forgiveness Relief Act of 2007, the IRS is currently not charging income taxes on CODI incurred through a loan mod, short sale or foreclosure on most primary residences through 2012. But right now, banks are taking many months, or even years, to work out mortgages in all of these ways; the average foreclosure in New York state right now occurs only after 22 months of missed mortgage payments. If you foresee any of these outcomes in your future, don't put things off. Do what you can to get to closure on your distressed home and loan, ASAP, while you won't have income taxes to add as the insult on top of your significant housing injury. AS a CDPE (Certified Distressed Property Expert) I can show you the many opportunities currently available to you to avoid the devastating consequences of foreclosure, contact me direct for a confidential chat.

4. Project the Income Tax Consequences of a Refinance or Property Tax Appeal

Homeowners everywhere are working on applying for a lower property tax bill on the basis of the last few years' decline in their home's value. Those who have equity have flocked en masse to refinance their 7% home loans into the 4% to 5% rates of the last few months. These strategies offer some of the heftiest household savings out there for the corresponding investment in time and money they take. But here's a caveat for savvy homeowners who slash these costs: remember that property taxes and mortgage interest, the very costs you're minimizing, are also the basis for the major tax benefits of being a homeowner. So plan ahead for your income tax deductions to go down along with your taxes and interest.

5. Don't Forget Those Closing Costs

If you bought or refinanced your home in 2010, you may be so focused on your mortgage interest and property tax deductions that you forget all about your closing costs. Any origination fees or discount points that were paid to your mortgage lender at closing are tax deductible on your 2010 return, get this – even if the seller paid your closing costs. If you can't figure out exactly what you paid, look for your HUD-1 settlement statement, that legal sized paper full of line item credits and debits that you should have received from your escrow provider or title attorney at, or just after, closing. Can't find it? Drop your Realtor, attorney or mortgage broker an email; they can usually get a copy to you quickly

To Catch a Falling Star...

By: Vanessa Saunders

NY State MLS Blog Post Contributor

I keep getting inquiries regarding whether or not the BASIC STAR in New York is on its way out, and the answer is NO, but the requirements have been changed to qualify for this tax exemption.

But before we start, do you know what STAR is?

The New York State School Tax Relief Program (STAR) provides New York homeowners with partial exemptions from school property taxes. If you earn less than $500,000 and own and live in your home, you are probably eligible for the STAR exemption.

There are two parts to the 2011 STAR property tax exemption:

• Basic STAR is available for owner-occupied, primary residences where the owners' total income is less than $500,000. Basic STAR works by exempting the first $30,000 of the full value of a home from school taxes.
• Enhanced STAR provides an increased benefit for the primary residences of senior citizens (age 65 and older) with incomes that don’t exceed $79,050. For qualifying seniors, Enhanced STAR exempts the first $60,100 of the full value of their home from school taxes.

This year’s new legislation requires that taxpayers over the $500,000 income will no longer be eligible. Those declaring income over the threshold will be notified by the assessor. If you agree that you're ineligible, you don't need to do anything. However, if your income drops below the limit in the future, you will need to re-apply for the exemption.

If your household income is below $500,000 or you fall into the Enhanced Star bracket and you believe that you're eligible for the exemption, contact your assessor. If you need further clarification, I will do my best to assist, Email me and make sure you catch your STAR!

Click on this STAR for some

fun for the kids in your home!

The NY State MLS Blog To Add Member Contributor Posts

The NY State MLS plans to expand this blog to include posts from our member/blog post contributors.

The new blog posts will include information on the market for our Real Estate Agent and Broker Members from across the state. Contributor Blog posts will begin in April 2011.

To sign up to be a contributor to the NY State MLS, you must be a NY State MLS member or affiliate/partner. Blog posts should contain pertinent information on your local market conditions, legal considerations, title or closing issues or other pertinent information regarding the sale of property and business. If you would like to be a contributor, please send requests to blogposts@nystatemls.com or go to www.nystatemls.com and use the "contact us" form.

NY State MLS

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