Tuesday, December 23, 2014

Tips for making your home ready for sale

If you have to put your home up for sale, prepare your home as you would like to find a home when you are house hunting. For potential buyers, it just takes seconds to decide whether the house feels up to their standards or not. No one is going to give second thoughts to your home if they feel that they will have to make additional expenses towards renovation, unless, of course, you are giving away your property at throw-away prices.

5 Tips to Make Your Home Sale Ready

Tips to Make Home Ready for Sale
Here are some tips that will immediately enhance the look of your property, and help buyers make up their mind about making it their home.
  • Spruce up the Door:

A door is the first thing that people will look at. A brightly painted door immediately attracts attention and sets the tone of the house. So, get your front door painted nicely. If you are lousy at DIY, don’t do it at all – nobody likes to be welcomed with a door that has dried dripping paint on the edges.
  • Lighting is Important:

Good lighting can completely transform a dull area into a warm, comforting space. If the entry to your house is via a garden, make the pathway to the front door inviting by installing lights concealed in trees or shrubs.
  • Clean the Windows:

Dirty windows are easily spotted from a distance and they can mar the look of a house from the outside like nothing else. If you have casement windows, clean the edges of the sashes well. Rotten window frames are a big turn off; it is advisable that you replace them with good quality ones. You can check out products from Fenesta which is one of the best door and window manufacturers in India.
  • Add Some Green:

Even if you have limited space, adding some greenery can bring life to your house. Creepers trailing up houses or main entrances are a beautiful sight to behold, and all you need is a little piece of ground to grow them. Alternatively, get some window boxes and plant ivy or a flowering creeper that will drape your house.
  • Brighten up the Fa├žade:

Re-paint your dull walls and repair damaged brickwork. Peeling plaster will scare buyers away even before they enter the house. Choose a subtle paint color for the exteriors, reserve the bright ones only for the door.

There’s something called the “curb appeal”. It’s a term that refers to the overall impression your house makes when one looks at it from outside.  Apart from the building, the impression will also be made by the surroundings around your home that also includes your neighbor’s home. So, instead of whining about their garbage cans lying helter skelter around the premise, clean them up as you would do to your own. Make sure that your lawns or gardens are not littered with leaves or covered with over-grown grass. Because when they say the first impression is the last impression, they are probably right.

Buying or Selling?  Please go to my website; http://www.joebunch.com; for powerful search tools and more real estate information.

Friday, December 19, 2014

The Three Most Important Responsibilities Buyers Have

The American dream of owning a home is something everyone should have if they want it. You should be able to live where you want and enjoy the features of your environment that help you relax, entertain, play, and do more of the things you enjoy without the restrictions imposed by a landlord.
You can own a pet, build a treehouse, paint the walls your favorite color, and play music and videos as loud as you like without disturbing your neighbors. That's the essence of the dream -- independence.


For most first-time buyers, it's better to accept that for dreams to come true, you have to do the groundwork. Yes, you will be far more independent than you would as a renter, but you will still have some very real responsibilities to make homeownership work. Here are the top three responsibilities you'll have as a homeowner.

Financial responsibilities

You owe your lender timely payments. Paying on time helps you build your credit. With great credit, you can take on more projects such as remodeling, or you'll be able to buy furniture, cars or other things you want with lower interest on your payments.

Your debts should never be more than 40 percent of your income. If you get overextended, you'll have problems meeting the minimum payments. Instead, limit the amount of credit you actively use and pay off balances every month. Don't add new charges until you've paid off your balances.

You should also be in a position to save money, which you can do several ways. You can put money in your 401K, you can pay extra on your principal every month, or you can buy bonds or invest in the stock market, according to your tolerance for risk. You can put money in a safety deposit box or under the mattress as long as you are saving rather than overspending.

Common wisdom is to build six months of cash so you can continue to make your house payments if you lose your job or become ill. You need savings for emergencies, large expenses such as student debt, and retirement.

Neighborhood responsibilities

When you buy a home, your household becomes part of the neighborhood. You can influence whether or not the neighborhood prospers or declines simply by the way you treat your neighbors and your home. It's up to you to uphold or to set a higher standard for the neighborhood by keeping your lawn and trees trimmed, your home freshly painted, and toys and trash picked up from the entry.
This is the way you can protect your investment and those of your neighbors. It's one of the reasons many neighborhoods have homeowners associations -- to protect values by standardizing safety and maintenance for the community.

To get the benefits the HOA provides such as higher and consistent home values, you have to pay your dues and obey the covenants. You can volunteer to help or you'll have to abide by the decisions others make. Before you buy a home in a HOA-managed community, read the covenants so you'll know what you're getting into. If not being able to use certain exterior paint colors bothers you, then don't buy the home. Find something else.

Household responsibilities
You owe yourself and the other members of your household the best life you can possibly provide. Buying a new home is a great time to step up your lifestyle and enjoy what your new home and the community has to offer.

Your home should help you be who you want to be. That's the purpose of shaping your environment. You have control over whether you entertain like Martha Stewart, paint in your studio like the next Picasso, or grow a lawn as sleek as the Augusta fairways.

Choose a home that meets as many needs as you can within your means. Separate bedrooms for the kids may be doable, but you may have to compromise on a Jack and Jill shared bath. This is an excellent opportunity to teach your older children about prioritizing, delayed gratification, give and take and winning and losing gracefully.

Make sure the area you select offers amenities that your building doesn't have. If you don't have a yard for the kids and the dog, make sure there's a park and playground nearby.
Think about how far and how long it will take you to get to shopping, work, and other friends and family. Think about how a long commute will affect your family. Would you rather be sitting in traffic or attending your son's ball game?

You and your spouse may want the prestige of living in a certain area, but if your house-payment is too high, you'll introduce problems into the relationship you don't need. It's about making choices that make sense. Better to buy a smaller home in a great neighborhood and keep the arguing down.
Buy the best home you can that's within your means and it will see you through years of comfort.

Interested in Buying or Selling a Home??  Go to my website, http://www.joebunch.com, for more information about Real Estate.

Friday, December 12, 2014

Selling Your Home? 5 Things You Should Never Do

When you prepare to put your home on the market, you hope that everything will go the way you imagine and that is your home will sell for over listing price the very first day it goes on the market.
The reality isn't so rosy. The market may slow down. Your home may get few showings or no offers.

You may have to lower your list price. Or, your home may not sell at all because you made a big mistake.

So if you're thinking of doing any of the following five no-no's, stop yourself right now.


Don't hire the first REALTOR® you meet. Selling your home is one of the largest transactions you'll ever have, so why wouldn't you interview several applicants to help you? You can ask friends and family for referrals, but there are several questions you should ask. Make sure the agents you interview are experienced selling homes in your neighborhood and the type of home you want to sell. To get the listing, potential agents may employ a number of strategies, including suggesting or agreeing with you to list a high price for your home. Don't fall for it. Choose the agent who is straight with you, about the market and about your home.

Don't ignore the market. Every market is different and those differences can impact the sales price of your home, the number of days your home spends on the market, and whether your home sells or not. You have to face the reality of market conditions to influence the success of your home's sale. If home prices are going up, you'll do well, but it will be more expensive to purchase your next home, unless you move to a less expensive market or home.

And if prices are going down, you may not net what you were hoping for, but your next purchase may be a bargain, if you stay in the same area.


Don't hide problems the home may have. If you've had a major water leak or had your foundation fixed, you need to disclose that in a formal seller's disclosure form for all potential buyers to see. While it may be tempting to check the I-don't-know box, remember that any lie can come undone. You don't want to face legal problems because you tried to hide the truth. And if your buyer wants to know more, you can show the receipts for what you did to fix the problem.

Don't overprice the home. When your home is overpriced, it's underdressed for the party. Everyone notices that it doesn't quite fit in. Buyers who can afford your home quickly notice that your home doesn't quite measure up to others in the same price range. Buyers who could afford your home if it were priced correctly are unlikely to make offers because they'll be searching in a different price range.

Don't ignore your agent's advice. A real estate agent is a professional. When she or he tells you that you'll get a better offer more quickly if you'll declutter, stage your home, make certain updates or repairs, it's a proven truth. Buyers are more negative when they see homes that need work, and tend to make offers or withhold offers based on their feelings.
If your agent showed you a comparable market analysis, he or she may have suggested a listing range to price your home. If you go over that, you're risking a negative response from the marketplace, long days on the market, and probable price reductions.

Do things right from the beginning and you'll have a smoother, easier, and more profitable transaction.

Interested in Buying or Selling a Home??  Go to my website, http://www.joebunch.com, for more information about Real Estate.

Wednesday, December 10, 2014

Landlords should think like Sellers, Not Landlords

Those who make a living buying and selling real estate know some upgrades are more expensive than they are worth, but others deliver a significant return on investment. If you know, for example, that your $5,000 refurbishment budget won't boost the sale price, you would be foolish to spend it. On the other hand, if you know that same capital can be invested in a way that will bring an additional $20,000 to the property, you would be foolish not to carry through. Here are just a few improvements to consider for your property:

Perceived Value


Landlords and real estate agents have a huge factor in common: their success comes from the perceived value of the property up for sale or rent. This means it doesn't matter what you think the home is worth as much as it matters what the potential buyer or renter thinks it's worth.
The good news is owners and agents can take action to increase the perceived value. The trick is to keep the ROI as high as possible. So, don't over-invest in things that won't deliver a suitable return.

Justified Pricing

Anyone who rents property should develop friendships with local real estate brokers because techniques that work well in one area, may not pan out well in another. Just as a fisherman needs to talk with others to discover the best fishing holes, landlords should talk with those who are actively engaged in the real estate market.

There are no one-size-fits-all silver bullets for justifying higher rental prices. However, some of the most-recommended ideas can be helpful. Consider these, for instance:
  • Landscape improvements are almost always a good idea. Your property doesn't have to look like a mansion, but it definitely should look like someone cares. According to the HomeGain 2012 National Home Improvement Survey, landscaping investments return an average 215 percent ROI. Think about curb appeal. Little things like fresh mulch, a lack of weeds and a healthy lawn can go a long way towards justifying the rental price.

  • Make sure all lighting features work and deliver ample light. Let in natural light by being selective with window treatments and making sure window glass is clean. Attractive shades and drapery also look great from the outside and can provide a cozier and warmer feeling inside.
  • Green upgrades in heating and cooling can be expensive, but may also be high ROI ventures. Not only is it easy to show prospective renters that they will have lower utility bills but there also are green incentive programs that offer rebates or tax credits for property improvements. This Old House cites a Seattle broker who told them buyers are very concerned about utility bills.
Highest ROI Investments
If you are looking for some of the quickest, easiest and most beneficial property improvements, here are the top three improvements according to HomeGain, listed by ROI percentage:
  • Cleanliness and reduced clutter: 403 percent
  • Lightened and brightened property: 299 percent
  • Electrical and plumbing upgrades: 293 percent
Improvements are often justifiable because they boost both the perceived and actual value of the property. However, it is important to study your local market, assess your own situation and invest wisely.

Interested in Buying or Selling a Home??  Go to my website, http://www.joebunch.com, for more information about Real Estate.

Tuesday, December 9, 2014

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How Important is Square Footage??

MLSs use it. Insurers use it. Appraisers use it. Tax Assessors use it. When it comes to real estate, there's no avoiding square footage as a measure of any home's value.
But how much is square footage worth to you as a homebuyer? Knowing the square footage can be helpful, but it shouldn't be the main tool to determine your offer price.


Square footage measurements aren't exact, nor are they taken the same way by every person. For example, your local tax assessor or appraiser may determine square footage by measuring the outside of the house. A real estate professional, on the other hand, typically counts only indoor living space to determine square footage.

Real estate listings for single-family homes do not include square footage for covered "outdoor" spaces, including porches, verandas, balconies and porte-cocheres. Yet, in high-rise buildings, square footage quotes often include balconies.

Further, some elements such as stairways and closet spaces are also open to interpretation. If you're buying a home with a two-story foyer, is that foyer space also counted on the second floor?
Another measure that's subjective is the price per square foot, which is determined by the number of square feet divided into the price of the home.

High-end homes with expensive materials such as granite countertops and finishes such as hardwood floors tend to have a much higher price per square foot than more affordable homes. But what if those high-end features are 20 years old, and you're comparing them to other similar homes in the area that are brand new?
Hallways, landings and stairs can add hundreds of square feet to any home, but is that space really livable? An open floor plan may have smaller square footage, but be much more pleasant to live than a larger home with too much space allocated to getting from one room to another.

All this means that valuations based on square footage are and should be somewhat subjective.
If you're confused about what you are paying per square foot for your next home, ask your real estate professional how the home was measured for the listing and compare it to local tax roll data you can find. If there is a bank appraisal, you can ask the appraiser how the square footage was determined.

Wednesday, December 3, 2014

I own my home. How long should I keep my records??

The question is always raised: how long must I keep my records? As taxpayers, we are legally required to keep accurate books and records in the event the Internal Revenue Service ever knocks on our door seeking justification or documentation of our tax returns.


No one wants or likes to keep unnecessary papers. Taxpayers should go through their files at least once a year, keeping what you think is important, but discarding a lot of unnecessary documentation. Often, the document we knew was so important last year is now considered totally useless. Clearly, those documents which are not used for tax purposes can be thrown out on a yearly basis -- such as department store statements.

Unfortunately, neither the Internal Revenue Service nor the Internal Revenue Code gives us any clear guidelines as to what records must be kept and what can be destroyed. The IRS merely states that records should be kept "for as long as they are important (or material) for any Federal tax law."
In general terms, this means that while the taxpayer's return is subject to audit by the Internal Revenue Service, the taxpayer is required to keep his or her books and records.

There is a three year statute of limitations for the IRS to assess a tax and impose a penalty on the taxpayer. Once this three year period has elapsed and the IRS is no longer permitted to examine your returns for a particular year, you can toss out your records. You should note that the three years begins when the tax return is due; if you filed early, the due date is still the target date. Keep in mind, however, that if you obtained an extension of the April 15 deadline, the statute of limitations begins to run from the date you filed your return.

If you filed your return but did not pay your tax until a later date, the statute does not run until two years from the date the tax was actually paid.

However, as in many areas of the law, there are exceptions to the rule. The IRS has the right to go beyond three years if, for example, income has been substantially under-reported by the taxpayer. Under these circumstances, the IRS can go back six years. Furthermore, there is no statute of limitations where a taxpayer files a false or a fraudulent return -- or does not file any return at all. The tax for those years can be audited -- and assessed -- at any time.

Most records, however, must be kept by the taxpayer for only three years after the tax return is filed.
That is the general law on recordkeeping. There are documents, especially in the real estate area, which you should keep your records forever.
When you buy real estate, whether it be your principal residence or an investment property, clearly you have to keep your records for at least four years from the date you sell that property. Profit and loss can only be determined once you sell your property, and in order to determine whether you have made any gain, you have to subtract the purchase price from the selling price.

Additionally, there are certain adjustments that can be made -- both on the buying and the selling side -- such as closing costs, real estate commissions, and recordation and transfer taxes. All of these items will be found on your settlement sheets, and clearly these sheets must be maintained in safekeeping.

More importantly, under the Taxpayer Relief Act of 1997, taxpayers can exempt the first $250,000 of profit ($500,000 for married taxpayers filing a joint return). The only way that you can determine the amount of your profit is to determine the basis (adjusted purchase price) when your principal residence is ultimately sold. This means that you may have to go back to the day when your very first property was purchased, to determine all of the legitimate items that can be added to basis.

Also, it is important that you keep careful and accurate records of all of your improvements. For every dollar you can demonstrate was spent for home improvements, you will ultimately save 20 cents that does not have to go to Uncle Sam. And that is only at the Federal level; you also have to consider any local or State tax.

Example: You purchased investment property for $100,000, and made a major addition in the amount of $50,000. Your basis in the property is $150,000. When you sell the property at a later date for $200,000, and do not take advantage of any of the tax saving devices, your profit is only $50,000 ($200,000 minus $150,000). For purposes of this example, I am ignoring depreciation.

However, the taxpayer has the burden to prove that he/she actually made the improvement and paid $50,000. It is not sufficient merely to tell the IRS auditor that you think you put $50,000 worth of improvements in the house sometime in the late 1990's. You will be required to provide proof of the cost of these improvements. If you do not have this proof, and cannot substantiate the improvements, there is a possibility that the IRS agent will reject your claim of improvements, or reduce the amount you are claiming. You will then have to take the matter to the Tax Court, in an effort to overturn the IRS decision.

If you plan to take advantage of the $250,000/500,000 exemptions for your principal residence, it is important to document what costs you incurred above and beyond the purchase price of your home.
Many long-time homeowners -- despite the mortgage meltdown where property values often significantly decreased, have found their profit is above these limitations. Thus, every dollar that you add to basis creates a significant savings for you, and puts additional money in your pocket for retirement purposes, rather than have to pay it by way of capital gains tax.

Items such as recording and transfer taxes, settlement and escrow costs, title insurance and legal fees, and real estate commissions are all legitimate items to be included in your computation of net gain. The best evidence of these expenses can be found in the settlement sheet -- called a HUD-1 -- when you bought your house.

I strongly recommend that anyone who buys a house keep a permanent record of all settlement sheets. When the last house is sold, and the applicable statute of limitations has expired, then -- and only then -- should you destroy those vital documents
.
The question is always raised as to whether tax returns should be kept beyond the statute of limitations. Once again, I recommend they be kept forever. They do not take up a lot of room in storage, and periodically you may want to refer to them for reasons that go beyond an IRS audit. Often, a mortgage lender or other potential creditor may want to review your tax returns for the past few years.

If you do not have a copy of your tax return, you can obtain it by sending for IRS Form 4506, entitled "Request for Copy of Tax Form." You can also get additional detailed information from IRS Publication 552, entitled "Recordkeeping for Individuals." To obtain both documents, you can pick these up at your local IRS office, or download them from www.irs.gov.

Thus, even in our information super highway, paper documents must be preserved so long as the IRS has the legal right to audit your tax returns

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