Do you know about an exemption that can save you money when you sell?

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TAX TIP: The 121 Exemption When Selling Your Home

The reason to do a 1031 exchange is to avoid capital gains taxes on investment property. Almost once a week I get asked about the sale of a primary residence. When you sell your home, you have an exemption from most capital gains taxes. A great resource to get more details about that is an IRS Publication, updated annually, called Selling Your Home (Pub 245). You could go to IRS.gov to download that.

In short, there is a 121 Exemption for capital gains taxes up to $250K per individual or $500K per married couple filing jointly. You do have to have lived in the property as your primary residence for 2 out of the last 5 years, and you can only take this exemption, once every 2 years.

This has been used in a long term strategy to avoid paying capital gains on rentals by converting the property from investment to primary residence. The IRS got wise to this strategy and put some constraints on this.

It could still be part of a plan, but reach out to your tax advisor with questions and see if this is an option for you

You just bought a $300,000 house so how much interest do you pay?

Saving MortgageSaving MortgageSaving Mortgage

You have finally closed on your new home and with great rates and a beautiful home you can now relax all the hard work is over right? Not exactly. So get settled in and get use to a mortgage payment then, after a few months take a look on how you can get that mortgage down a bit faster.

Either right away, or in the future, there is a better way to pay that 30 year mortgage down quicker and build your equity faster.  Here is a current payment schedule based on a approximate 4 1/8% rate. As you can see the first few years you are paying an astronomic amount in interest. Just think of what just one extra payment a year could do for you.

Here is a link to a great site I give to my buyers and sellers. While I am not a mortgage broker (I work with some great ones) I do believe all of us Realtors should provide better tools  to our clients and be informed. After all, a home buyer, or seller, who understands the process is more comfortable with their home and their purchase.

Not only does this site have mortgage calculators. Check it out  there is every kind of financial calculator you can think of. It actually is a bit addicting so have fun with it!

Payment schedule

Year

Total
Payments
Principal
Paid
Interest
Paid
Ending
Principal
Balance
$300,000.00
1 $17,395.20 $5,192.05 $12,203.15 $294,807.95
2 $17,395.20 $5,408.99 $11,986.21 $289,398.96
3 $17,395.20 $5,634.96 $11,760.24 $283,764.00
4 $17,395.20 $5,870.37 $11,524.83 $277,893.63
5 $17,395.20 $6,115.61 $11,279.59 $271,778.02
6 $17,395.20 $6,371.14 $11,024.06 $265,406.88
7 $17,395.20 $6,637.34 $10,757.86 $258,769.54
8 $17,395.20 $6,914.62 $10,480.58 $251,854.92
9 $17,395.20 $7,203.53 $10,191.67 $244,651.39
10 $17,395.20 $7,504.47 $9,890.73 $237,146.92
11 $17,395.20 $7,818.00 $9,577.20 $229,328.92
12 $17,395.20 $8,144.63 $9,250.57 $221,184.29
13 $17,395.20 $8,484.91 $8,910.29 $212,699.38
14 $17,395.20 $8,839.40 $8,555.80 $203,859.98
15 $17,395.20 $9,208.70 $8,186.50 $194,651.28
16 $17,395.20 $9,593.44 $7,801.76 $185,057.84
17 $17,395.20 $9,994.27 $7,400.93 $175,063.57
18 $17,395.20 $10,411.80 $6,983.40 $164,651.77
19 $17,395.20 $10,846.79 $6,548.41 $153,804.98
20 $17,395.20 $11,299.97 $6,095.23 $142,505.01
21 $17,395.20 $11,772.08 $5,623.12 $130,732.93
22 $17,395.20 $12,263.90 $5,131.30 $118,469.03
23 $17,395.20 $12,776.27 $4,618.93 $105,692.76
24 $17,395.20 $13,310.07 $4,085.13 $92,382.69
25 $17,395.20 $13,866.14 $3,529.06 $78,516.55
26 $17,395.20 $14,445.46 $2,949.74 $64,071.09
27 $17,395.20 $15,049.00 $2,346.20 $49,022.09
28 $17,395.20 $15,677.73 $1,717.47 $33,344.36
29 $17,395.20 $16,332.74 $1,062.46 $17,011.62
30 $17,391.71 $17,011.62 $380.09

$0.00

#snohomishcountyrealestate  #mortgagecalculators


Information and interactive calculators are made available to you as self-help tools for your independent use and are not intended to provide investment advice. We cannot and do not guarantee their applicability or accuracy in regards to your individual circumstances. All examples are hypothetical and are for illustrative purposes. We encourage you to seek personalized advice from qualified professionals regarding all personal finance issues.

National Real Estate News

Posted: 24 Jul 2014 09:31 AM PDT

The new home sales report for June – combined with the downward revisions for previous months – was very weak.

The Census Bureau reported that new home sales this year, through June, were 225,000, Not seasonally adjusted (NSA). That is down 4.3% from 235,000 during the first half of 2013 (NSA).

Maybe sales will move sideways for a little longer, but remember early 2013 was a difficult comparison period. Annual sales in 2013 were up 16.3% from 2012, but sales in the first four months of 2013 were up 26% from the same period in 2012!

New Home Sales 2013 2014

Click on graph for larger image.

This graph shows new home sales for 2013 and 2014 by month (Seasonally Adjusted Annual Rate).

The comparisons to last year will be a little easier in Q3, and I still expect to see year-over-year growth later this year.

And here is another update to the “distressing gap” graph that I first started posting several years ago to show the emerging gap caused by distressed sales.  Now I’m looking for the gap to close over the next few years.

Distressing Gap

The “distressing gap” graph shows existing home sales (left axis) and new home sales (right axis) through June 2014. This graph starts in 1994, but the relationship has been fairly steady back to the ’60s.

Following the housing bubble and bust, the “distressing gap” appeared mostly because of distressed sales.

I expect existing home sales to decline or move sideways (distressed sales will slowly decline and be partially offset by more conventional / equity sales).  And I expect this gap to slowly close, mostly from an increase in new home sales.

Note: Existing home sales are counted when transactions are closed, and new home sales are counted when contracts are signed. So the timing of sales is different.

 
New Home Sales decrease to 406,000 Annual Rate in June

Posted: 24 Jul 2014 07:13 AM PDT

The Census Bureau reports New Home Sales in June were at a seasonally adjusted annual rate (SAAR) of 406 thousand.

May sales were revised down from 504 thousand to 442 thousand, and April sales were revised down from 425 thousand to 408 thousand.

Sales of new single-family houses in June 2014 were at a seasonally adjusted annual rate of 406,000, according to estimates released jointly today by the U.S. Census Bureau and the Department of Housing and Urban Development. This is 8.1 percent below the revised May rate of 442,000 and is 11.5 percent below the June 2013 estimate of 459,000.

New Home Sales

Click on graph for larger image.

The first graph shows New Home Sales vs. recessions since 1963. The dashed line is the current sales rate.

Even with the increase in sales over the previous two years, new home sales are still close to the bottom for previous recessions.

The second graph shows New Home Months of Supply.

New Home Sales, Months of Supply

The months of supply increased in June to 5.8 months from 5.2 months in May.

The all time record was 12.1 months of supply in January 2009.

This is now in the normal range (less than 6 months supply is normal).

“The seasonally adjusted estimate of new houses for sale at the end of June was 197,000. This represents a supply of 5.8 months at the current sales rate.”

New Home Sales, Inventory

On inventory, according to the Census Bureau:

“A house is considered for sale when a permit to build has been issued in permit-issuing places or work has begun on the footings or foundation in nonpermit areas and a sales contract has not been signed nor a deposit accepted.”

Starting in 1973 the Census Bureau broke this down into three categories: Not Started, Under Construction, and Completed.

The third graph shows the three categories of inventory starting in 1973.

The inventory of completed homes for sale is still low, and the combined total of completed and under construction is also low.

New Home Sales, NSA

The last graph shows sales NSA (monthly sales, not seasonally adjusted annual rate).

In June 2014 (red column), 38 thousand new homes were sold (NSA). Last year 43 thousand homes were also sold in June. The high for June was 115 thousand in 2005, and the low for June was 28 thousand in 2010 and 2011.

This was well below expectations of 475,000 sales in June, and sales were down 11.5% year-over-year.

#nationalrealestatenews  #snohomishcountyhomesrealestate
Information obtained from http://www.calculatedriskblog.com

 

 

 
 

WEEKLY DOSE OF Real Estate Awesomness

MORTGAGE & FINANCE news

7 steps to help you navigate the mortgage process

5 tips for unmarried couples buying a house together

 5 tips to help you win a bidding war for your new home

REAL ESTATE news

 Seattle-Bellevue-Everett Metro area 3rd fastest-moving housing market in U.S.

 Home Tips

So you boldly painted a wall a vibrant red. Now what?

 5 ways to turn that drab deck into a relaxing summer oasis

 Tips for cutting down waste while entertaining this summer

 Water conservation tips for Seattle and all Puget Sound homeowners

Just for fun! Take a look at this Everett Home listed for Sale.

What a view of the Cascades and the entire Snohomish Valley!  Can you imagine waking up each morning and having coffee on the deck to this? Its one of the very many scenic views our community offers and is the reason I call this area home.

 View6

 #snohomishcountyrealestate

#snohomishcountyhomesforsale

Tuesday Tid Bit Real Estate News

Whew! A bit late I guess Tuesday evening for the news but its end of the School Year fun and with two boys all these events are making for one tired mom who is up working late.

So if your up as late as me here is your Tuesday Tidbit Real Estate News.

From Fannie Mae: Spring-Summer Buying and Selling Season Sputters Despite Drop in Mortgage Rates

“Consumers’ lukewarm income expectations and reticence about the economy seem to be holding back housing demand,” said Doug Duncan, senior vice president and chief economist at Fannie Mae. “This year’s spring and summer home buying season has gotten off to a slow start, even as mortgage rates have trended lower over the past two months. Our National Housing Survey data show that economic conditions continue to be the top concern among consumers who think it’s a bad time to buy or sell a home. While recent housing activity suggests that the worst of the housing slump may be behind us, this caution among consumers supports our expectation that the rebound in home sales will likely be too modest to pull sales for all of 2014 ahead of last year.”
As a reminder: a decline in existing home sales this year is not “bad news”. With fewer distressed sales and less investor buying, it is no surprise that existing home sales are down. I expect housing starts and new home sales (the key for GDP and employment growth) to increase this year and also in 2015.

Other  news included the research data that demand for purchase mortgages in the last three months gained a cumulative 9%. On the pricing front, a national listing site said prices are beginning to stabilize. Their chief economist explained: “…home price changes are looking more balanced, sustainable and widespread than at any point since the price recovery began.” With home prices still rising, but in a more controlled fashion, there are now more than 43 million homes with equity. This should encourage more people to put their properties on the market, improving the inventory situation. 

I know buyers will like to hear this.  I just secured a home for a buyer of mine that had 5 offers! Since it was the only Rambler in that zip code for sale you can imagine how happy they are.

Top Housing Predictions for 2014

The market is heating up and even though I don’t always agree with Zillows “Zestimates” I do believe they are very accurate about the predictions for 2014 Housing Market. Rates are going up! My advice to those that are waiting to buy a home? If you are seriously thinking this year as they year~ start looking sooner than later. If you also take a look here in the Puget Sound Region we are #2 for the hottest market areas. All over its HOT and especially in Snohomish County. In the last week I have put in a total of 6 offers for clients and all were multiple offer situations. Knowing the tricks to secure the home you want over all the other offers take an experienced agent that will due their due diligence. If you need help please feel free to contact me! 

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AMAZING property! 4.62 ACRE New Home in beautiful Gated Community of Machias

17331 59thFull Gallery of Pictures Click Here

Contact info:
Jenifer Murrweiss | RE/MAX Town Center Mill Creek | 425-422-7243

AMAZING property! 4.62 ACRE New Home in beautiful Gated Community of Machias

17331 56th St NE, Snohomish, WA 98290

$529,000

KEY FEATURES
Year Built: 2013
Sq Footage: 3477 sqft.
Bedrooms: 4 Beds
Bathrooms: 3 Baths
Floors: 2
Parking: 4+ Garage | Guest parking
Lot Size: 4.62 Acres
Property Type: Single Family House

DESCRIPTION


AMAZING property, 4.62 ACRE lot in beautiful Machias!! Gated Community of Pilchuck Highlands; Home features 4 bedrooms, main floor den/office, (could easily be 5th main floor bedroom) 2 3/4 bath, entertainment sized kitchen with granite counters, SS appliances, formal dining room, bonus and laundry room upstairs. ~ you will LOVE this builder’s attention to detail! 2-10 Warranty Included. You will not be disappointed and will fall in love immediately!

PROPERTY FEATURES


  • Living room
  • Dining room
  • Walk-in closet
  • Master bath
  • Family room
  • Storage space
  • Stove / Oven
  • Dishwasher
  • Microwave
  • Garbage disposal
  • Stainless steel appliances
  • Balcony, Deck, or Patio
  • Yard
  • Lawn
  • Central heat
  • Central A/C
  • Ceiling fans
  • Double pane windows
  • Cable-ready
  • High-speed internet
  • Wired
  • Hardwood floor
  • Tile floor
  • Granite countertop
  • Fireplace
  • High / Vaulted ceiling

COMMUNITY FEATURES


  • New property
  • Secured entry
  • Gated property
  • Guest parking
  • Off-street parking
  • Covered parking
  • Garage – Attached
  • RV parking

ADDITIONAL LINKS



Contact info:
Jenifer Murrweiss
RE/MAX Town Center Mill Creek
425-422-7243

Posted: Jan 29, 2014, 10:26pm EST

Competition among home buyers Fierce!

News from NW Multiple Listing Service

FOR IMMEDIATE RELEASE: June 5, 2013

Competition among home buyers “still fierce;” rising interest rates adding to fury

NWMLS, Kirkland, WA, June 5, 2013 – Well-priced homes continue to draw multiple offers and sell at a brisk pace around Western Washington as buyers react to increases in interest rates and asking prices.

Northwest Multiple Listing Service reported double-digit gains in several key indicators it tracks for the 21 counties in its service area. Compared to a year ago, the number of new listings climbed 16 percent, pending sales increased about 10 percent, closed sales jumped nearly 22 percent, and prices rose more than 13 percent. Despite gains in listing activity, inventory remains tight.

Commenting on the latest report, brokers said the fast pace is frustrating some buyers — and surprising sellers with unrealistic expectations. One broker cautioned against an overheated market. “We do not want a market that escalates too fast and topples again,” commented Frank Wilson, Kitsap district manager at John L. Scott Real Estate and branch managing broker for its Poulsbo/Kingston office.

“Overly aggressive sellers find themselves disappointed when no or low offers are presented,” remarked Northwest MLS director Kathy Estey, the managing broker at John L. Scott in downtown Bellevue.

With inventory apparently improving, some would-be buyers are staying on the sidelines. The increased inventory is “cooling some buyers,” reported George Moorhead, managing broker at Bentley Properties in Mill Creek and a member of the MLS board of directors. “We also have buyers who are stepping back as they are frustrated with current inventory and multiple offers going well above asking price,” he added.

Inventory showed signs of improving with the addition of 11,445 new listings during May, the highest number since April 2010. May’s total outgained the year-ago figure of 9,861 new listings for a 16 percent gain.

“It has been refreshing to see more listings coming on the market, but with overall inventory remaining low the competition among buyers is still fierce for homes that are priced properly,” commented Estey.

At month end, there were 21,943 total active listings in the Northwest MLS database, a drop of 4,248 from the same time a year ago for a decline of more than 16 percent.

Buyers looking for condominiums will find slim pickings. Condos currently account for only about 10 percent of the available inventory. The area-wide selection, which numbers 2,253 listings, is down more than 26 percent from a year ago.

Brokers reported nearly as many pending sales system-wide (10,045) as new listings (11,445). Nine counties reported year-over-year gains in pending sales that exceeded 30 percent (Clallam, Cowlitz, Ferry, Grant, Grays Harbor, Island, Kitsap, Lewis, and Okanogan).

Most metro area counties had more modest gains in pending sales: King (up 6 percent) Snohomish (down 5.8 percent) and Pierce (up 10.6 percent).

Closed sales continue to track well ahead of a year ago. During May, members tallied 7,349 completed transactions, outpacing the year ago total of 6,027 by nearly 22 percent.

Prices jumped 13.4 percent from twelve months ago, rising from an area-wide median selling price of $242,500 to last month’s price of $275,000. The median price for homes and condos that sold in both King County and San Juan County was $375,000 ($100,000 higher than the area-wide figure). In King County, that represented a gain of 15.4 percent, while for San Juan County prices edged up only about 1.8 percent compared to a year ago.

“We’re seeing the trajectory of home prices beginning to soften and the number of days on the market decline,” observed Mike Grady, president and COO of Coldwell Banker Bain, adding, “The trends suggest inventory levels are slightly more sustainable, but we’re still clearly in a seller’s market. For the foreseeable future, buyers will continue to pay more the longer they wait to purchase a home.”

Frank Wilson, who is also a board member for Northwest MLS, said recent market activity is affecting home values. In Kitsap County, where his office is located, brokers added 575 new listings to inventory during May, improving on the year-ago total of 515. During the same period, MLS members reported 567 pending sales to soar past the year ago figure of 414 sales for an increase of nearly 40 percent. Median selling prices in Kitsap County rose 5.3 percent, from the year-ago figure of $228,000 to $240,000.

“Slow and steady is the key here,” Wilson cautioned, while also raising concern about low appraisals, which he described as the “inchworm effect” of the market. “As prices begin to appreciate we will continue to see challenges with low appraisals,” he predicted.

Moorhead said increased activity is very noticeable, with mixed outcomes. “We are seeing multiple offers at 5-to-12 percent over list price in highly sought-after areas,” he reported, but also noted “there are other homes on the market that are not selling with no real reason why.”

Some brokers also commented on rising interest rates.

Wilson said the biggest effect of the upswing in the real estate market has been the erosion of a buyer’s buying power. In May alone, interest rates jumped almost 0.75 percent, he noted, which reduces a buyer’s ability to purchase a $350,000 home by almost $31,000. Coupled with an increase in price, he said it “creates a compounding affect, which will frustrate buyers in today’s market.”

Estey said interest rate increases are “adding fury to the already frenzied buyers who must finance their purchase.”  A one-half percentage point increase in interest rates reduces buying power by 5 percent, she explained, adding, “so as prices increase about a percentage a month, the feeling of urgency mounts too.”

Commenting on the challenges buyers are encountering, Estey said, “The joy of buying a home in today’s market is in the long-term result of settling in, but the competitive process is sometimes not so joyful! Hiring the right broker who can add some fun elements and insights while wisely guiding buyers through the decision process can make a huge difference,” she suggests.

Federal officials are downplaying rising interest rates. In a recent interview, Frank Nothaft, Freddie Mac’s chief economist, commented on the latest rise that marked three consecutive weeks of increases. “While this may slow some of the refinance momentum, rates are nonetheless low and home-buyer affordability high, which should further aid home sales and construction in coming weeks,” he remarked, adding, “The rates are also lower today than they were a year ago at this time.”

Northwest Multiple Listing Service, owned by its member real estate firms, is the largest full-service MLS in the Northwest. Its membership includes more than 21,000 real estate brokers. The organization, based in Kirkland, Wash., currently serves 21 counties in Washington state.

###

Statistical summary and sources quoted follow.

Statistical Summary by Counties: Market Activity Summary – May 2013

Single
Family
Homes
+ Condos
LISTINGS PENDING
SALES
CLOSED SALES MONTHS
SUPPLY
New
Listings
Total
Active
# Pending
Sales
#
Closings
Avg.
Price
Median
Price
King

4,352

4,832

4,041

3,122

$457,903

$375,000

1.20

Snohomish

1,564

1,777

1,487

1,131

$309,112

$285,000

1.20

Pierce

1,576

3,025

1,648

1,116

$234,875

$210,000

1.84

Kitsap

575

1,426

567

345

$286,870

$240,000

2.51

Mason

206

759

94

71

$178,045

$149,900

8.07

Skagit

245

785

226

149

$238,902

$220,020

3.47

Grays Hrbor

165

807

114

68

$143,411

$139,000

7.08

Lewis

187

700

90

74

$150,977

$134,500

7.78

Cowlitz

164

455

134

83

$174,330

$169,000

3.40

Grant

145

547

92

76

$169,412

$157,840

5.95

Thurston

506

1,121

482

332

$241,093

$225,500

2.33

San Juan

67

415

25

19

$519,047

$375,000

16.60

Island

279

834

199

117

$281,624

$240,000

4.19

Kittitas

150

447

66

60

$285,393

$217,995

6.77

Jefferson

123

466

53

40

$308,200

$298,750

8.79

Okanogan

114

447

48

28

$193,686

$147,950

9.31

Whatcom

552

1,448

398

279

$290,196

$250,000

3.64

Clark

83

149

69

54

$255,812

$229,000

2.16

Pacific

91

436

36

27

$136,736

$121,000

12.11

Ferry

11

76

4

5

$139,600

$151,000

19.00

Clallam

104

415

68

62

$191,923

$181,000

6.10

Others

186

576

104

91

$217,902

$179,900

5.54

MLS TOTAL

11,445

21,943

10,045

7,349

$343,639

$275,000

2.18

4-County Puget Sound Region Pending Sales (SFH + Condo combined)
(Totals include King, Snohomish, Pierce & Kitsap counties)

Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec
2000 3706 4778 5903 5116 5490 5079 4928 5432 4569 4675 4126 3166
2001 4334 5056 5722 5399 5631 5568 5434 5544 4040 4387 4155 3430
2002 4293 4735 5569 5436 6131 5212 5525 6215 5394 5777 4966 4153
2003 4746 5290 6889 6837 7148 7202 7673 7135 6698 6552 4904 4454
2004 4521 6284 8073 7910 7888 8186 7583 7464 6984 6761 6228 5195

2005

5426 6833 8801 8420 8610 8896 8207 8784 7561 7157 6188 4837

2006

5275 6032 8174 7651 8411 8094 7121 7692 6216 6403 5292 4346

2007

4869 6239 7192 6974 7311 6876 6371 5580 4153 4447 3896 2975
2008 3291 4167 4520 4624 4526 4765 4580 4584 4445 3346 2841 2432
2009 3250 3407 4262 5372 5498 5963 5551 5764 5825 5702 3829 3440
2010 4381 5211 6821 7368 4058 4239 4306 4520 4350 4376 3938 3474
2011 4272 4767 6049 5732 5963 5868 5657 5944 5299 5384 4814 4197
2012 4921 6069 7386 7015 7295 6733 6489 6341 5871 6453 5188 4181
2013 5548 6095 7400 7462 7743

__________
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