Capital Gains

 There are Capital Gains tax consequences for selling your personal residence before you have owned it for two years. Everyone should consult thier tax advisor before proceeding into any financial situation that could incur a tax but here are a few links with some information that may be helpful to anyone wondering what to consider before selling.

 There are short and long term investments and here is a short article to explain the difference:

http://www.googlerealestate.com/short-term-vs-long-term-capital-gains/

 If you should hold your primary residence for two years or over it is a different story. The next link will explain our current capital gains real estate tax laws. When I say current – We never know what our law makers might be up to!

http://taxes.about.com/od/taxplanning/qt/home_sale_tax.htm

The real estate market in Irvine and southern Orange County is improving. If you are considering placing your home on the market and would like to know what it is worth in today’s market,  just visit my web site IrvineVillages.com and complete a short home value  form with details about your home. I am also easy to reach via phone or text at 949-275-6544.  Looking forward to hearing from you.

Location No-Timing Yes!

This was posted in 2008 but is still relevant today!

Consumers who watch the real estate market like investors watch the stock market -can buy and sell homes like a shrewd day trader. But as day traders know, it’s not quite as easy at it sounds. It takes time, practice and patience. You won’t make a killing over night, but over time you will enjoy the security of a roof over your head which can double as an investment with hefty returns. Track the Market: Every month, follow the five key indicators. Start logging them. Use a spreadsheet to chart them. One or two months doesn’t make a trend. Trends develop over the long term.. At this point you might want to look backwards! So what are those five key indicators? One indicator alone does not make a trend or a decision to buy or sell. The key indicators to watch are: · Interest Rates. Rising interest rates have a depressing effect on real estate prices. Falling rates help generate demand. That helps prices go up. · Building Permits. When demand is strong, builders pull more building permits so they can build and sell homes. Builders reduce the number of permits when demand drops. · Home Sales. Simple principles of supply and demand affect home sales. When buyers buy prices rise. When buyers retreat so do prices. · Loan Defaults. Defaulting home owners are having job or money troubles or both. That signals a weakening economy. · Foreclosure Sales. Foreclosures signal even deeper consumer money troubles and a worsening economy. It also signals dropping home prices. It might be of interest to note that in some communities inventory is dropping rapidly. Somewhat usual for the holiday season but if the trend continues along with lower interest rates could be an indicator of change to come. Unforeseen and unexpected events can suddenly throw any market into shooting star or falling star status — earthquakes, war, terrorism, floods, hurricanes, insurance industry pull back, a real estate bubble? Should I add bad loans, bank failures, and wall street greed? No matter what’s going on in the nation or the world, usually a real estate market that changes over night is rare. Our current crisis has been building over a couple of years with little intervention to curb or prevent our current dilemna. It comes down to these vital signs -take into account imbalances between supply and demand. What is moving the market. When the demand for housing drops we see existing home prices falling, building permits decreasing and delinquencies start rising and foreclosures will be the last domino to fall. I think we are there! Watch our indicators for signs of change. Currently inventory is decreasing due to sellers unwillingness to sell in this “buyers market” , banks willingness to modify loans to help homeowners stay in their home, less foreclosures and available bank sales ( largely due right now to moratoriums)and interest rates decreasing and predicted to continue to decrease. The most important thing to watch closely is where it is taking prices! It doesn’t matter what is happening. What matters is what direction it’s taking prices.

The real estate market is currently experiencing the lowest inventory we have seen in several years.  Currently we have just over 4 months worth of inventory.

Rear View Mirror

Rear View Mirrow

We all know hindsight is so much better than foresight.

A few years ago I wrote this paragraph:

Many potential home buyers, whether looking to purchase a home to live in or invest for the future, are already active in todays hard hit market. Others are still on the fence waiting to the market to bottom out!  Still, now is the best time to buy for the long term because there is a considerable inventory of homes to choose from at great prices. Much of our market is now priced at 2004 prices! Once the market is on the upward swing, there are very few desirable homes on the market that would be for sale at bargain prices! The market can change very quickly and most will not notice the change until it is well underway.

It is interesting to see where we are today! The market has been evolving over time but it is a slow process that most people will not notice. We are now at a time of very low inventory! Almost gone (at least for now!) are all the foreclosures and short sales that so permeated the market just a short time ago! Prices and interest rates are still good and will most likely stay that way through this year according to predictions. But there is so much less to choose from and competition has already begun to push prices up. Inflation follows recession!

 Don’t get caught looking in the rear view mirror! Many people were surprised by the recession and many will be surprised when the market passes them by again! If you have been waiting to purchase-now is the time.

If you are looking for purchase this spring it is a good time to get started!   Contact Mary or visit my web site to view available listings. I am here to help and look forward to hearing from you! Call direct or text 949-275-6544

Buy in the Spring!

Home buying and selling activity is typically hottest during the spring and summer months. Spring is right around the corner so here are a few great reasons why you should take advantage of the spring season to find your home and and make the move by summer.

1. More people choose to buy or sell during the spring and move by summer. You are more likely to find a home that suits your lifestyle and budget.

2. Easier on the kids Moving during the spring/summer season gives everyone more time to get adjusted to the new environment. The variety of summer programs available makes it easier for your children to meet future schoolmates. Kids are also playing outside more, which gives them lots of opportunities to make friends in their new neighborhood. Not to mention they’ll be able to start school in September and avoid the obvious new-kid syndrome.

3. More daylight This is a plus if you are buying or selling. It’s more appealing to show your house in the daylight- it will appear brighter and larger than at night. If you’re buying, you may have more flexibility to explore a home and schedule a professional inspection.

4.Flowers are in bloom Your curb appeal will be maximized by the lush and fragrant summer-blooming flowers. This also gives buyers a good idea of the amount of yard maintenance to expect to keep it looking beautiful.

Whether you’re buying your first home, or selling your current home and buying another, the spring is an ideal time to make YOUR move.

Supply Versus Demand

Supply versus demand -What does that mean to you? 

Many areas in Orange County are experiencing the lowest inventory rates we have seen in over 5 years! This does not apply to every neighborhood but in general:

  • Active available listings are trending the lowest in over 5 years 
  • New Listings are trending the lowest we have seen in over 5 years
  • Pending Sales hit the HIGHEST point in over 5 years
  • Current available inventory is  around  2-3 months supply!

We could be facing a very hot summer real estate market this year! 

If you are looking for purchase this spring it is a good time to get started! Lending has been very tight but we are seeing signs of improvement. Loans are key so make this your first step.  Contact Mary or visit my web site to view available listings. I am here to help and look forward to hearing from you! Call direct or text 949-275-6544

Reasons to Buy

No matter what the economy some of the same reasons apply to buy that exist any time. Right or wrong many people count on thier homes for a long term asset that can be leveraged for retirement or future financial needs. Here are some of those reason. 

Reasons Why You Should Stop Renting
1. Rents continue to rise
2. Having no economic security, not knowing how much your rent may go up in the next two to three years.
3. No tax benefits
4. No long term wealth accumulation

I have broken the homebuying process down to four steps.

  • Step One: Determine how much home you can afford. Speaking to a mortgage loan specialist to be pre-qualifed for your home loan is the most important ste! The price range of the homes you look at will depend on this.
  • Step Two:Getting Pre-Approved for a loan to purchase a home.After getting pre-qualified, the most important thing you can do is to go ahead with the loan process and get fully pre-approved before you decide or extend an offer on a home. This will give you advantages when you are in the negotiating process.
  • Step Three: Find your new Home! My Unique Buyers Service will assure you will see all the homes for sale that match what you are looking for and not just a few. With my Unique Buyers Profile Service you will receive (via e-mail) all available homes for sale by all companies. You can look at the pictures and details, drive by the neighborhood to see if you like it and then call me to schedule an appointment to view the homes. There is never any pressure to buy!
  • Step Four: Working with a your Professional Real Estate Broker Specialized Knowledge-After you find the home you want you will need someone who is knowledgeable on the purchase contract including buyer and seller obligations, time lines and who will prepare and present the offer to the seller -negotiating the terms and conditions in your best interest.

You can be assured you are in good hands with my years of experience and knowledge as a real estate professional. Vist my web site  for more articles and advice to help you along your home purchasing adventure!

Now is the Time to BUY!!

Fall and Winter  is the Time to BUY!!

As the holidays draw near (or to a close) and the cold sets in we tend to become more dormant, much like the real estate market in many regions of the country, making it a great time to get out and buy before conditions likely thaw out by spring. There is still time to get a great deal!

The real estate market typically softens this time of the year. Kids are settled into the school year, the holidays are here, and many put off  buying a home until spring, or at least until the new year.

But the savvy home buyer will take advantage of the current conditions, which, coupled with historically low  interest rates , make it an excellent time to buy.

Homes will typically sit on the market a little longer in the winter which often presents buyers with a good opportunity to negotiate their best deal.

If you have been thinking about buying next year, or plan on buying in the near future, you may want to reconsider your plans to time the market  It could end up saving you a considerable amount of money.

Not only will you risk the probability that prices will rise, but who knows what interest rates will be like next year. Today’s low rates are  incentive enough to think about buying now.  

The chill of winter is setting in (well maybe not so much here in California!) and as the holiday season draws to a close (Happy New Year!) ,  sellers have been realizing they must be more competitive in the marketplace to affect a sale, “Many listings are now beginning to show reductions in price, and sellers are becoming more aware of how they need to  set their homes apart from all the others on the market.”

So if you do start looking in the weeks ahead, be sure to keep an open mind. Always think about the future potential. You can always change the carpet that would clash with your furnishings, paint the walls, replace outdated appliances, or add the back yard patio area that is missing. Remember, if the sellers are anxious to sell or the house has been on the market a considerable length of time, you’ll likely have the advantage in the negotiation process.

Finally, if you do manage to buy and close escrow by the end of the year (too late if you aren’t in escrow already!) you’ll have the added benefit of being able to deduct your closing costs, mortgage interest, and property taxes on your 2012 tax return!

Plan on Buying a Home Next Year?

Then Keep Holiday Spending to a Minimum

If you’re pconsidering purchasing a home in the coming year, then you’ll want to keep an especially close eye on your holiday spending -as not to hamper your chances of getting a loan You will want to refrain from opening any credit accounts for major appliance or electronic purchases , avoid  running your existing credit cards to their limits, resist overspending by using your credit to finance your holiday gift spending  or dipping  into the money you’ve set aside for a down payment on your new home.

Why? When you apply for a mortgage, the lender will request a credit score with the credit report. A credit score is a computer-generated number that indicates your ability and willingness to repay a debt based on your credit record. This is an important factor the lender used to determine whether you will be approved for a loan and to determine the mortgage interest rate.

Your credit history is very important in obtaining a loan If you show a pattern of managing your credit wisely, keeping credit card balances low and paying your bills on time consistently, your credit score will be positively affected.

Remember, besides the initial down payment you plan to put down on your home purchase, you’ll also need to have some cash available for closing costs, which will usually run between 2 and 7 percent of the property’s value. Closing costs cover taxes, recording fees, inspections, prepaid loan interest, title insurance, financing costs, and points – the dollar amount paid to a lender for obtaining a lower interest rate on a loan.

In addition to the down payment and the closing costs, you’ll need to have some cash to move, for homeowners insurance, property taxes, maintenance and repairs. And don’t forget furnishings and other household items once you move in.

So, with that in mind, the best thing to do as you tackle your holiday shopping is to plan ahead and do your homework.

  • Develop a budget. Determine who you’re buying for and how much you plan on spending.
  • Look for other ways to pay for holiday gifts. Can you put in some overtime to earn extra money? Do you have time to work an extra job during the holidays? Can you adjust your household budget – perhaps exclude your monthly or weekly dinner and movie out?
  • Try to avoid shopping at the last minute. The stress will lead you to buy whatever’s easiest, not most economical.
  • Look for deals and sales. Scour the weekly ads. Look for deals and coupons on the Internet.
  • Keep track of how much you spend. Once your shopping is done, don’t spend any more on the holidays.
  • Pay off any debt in full in January. Try to limit credit card use during the holidays, but pay it off once you receive your first-of-the-year statement.

Small sacrifices when your consider the reward to spending next Christmas in your new home!

Inflation and Mortgage Rates

Could Inflation affect mortgage rates soon? Most people do not think about inflation but it is already here. Just consider how much prices have gone up in the last year. You will see an increase in almost everything you buy!

 Contrary to what the Fed has said about it moderating, year-over-year inflation is on the rise. Producer Price Index (PPI) rose by 0.8% in the month of September, elevating year-over-year wholesale prices by  6.9%. Meanwhile, the Consumer Price Index (CPI) for September rose by 0.3%, and while this was inline with estimates it pushed the year-over-year number to 3.9%. This is significant because the year-over-year figure was just 1.6% in January.

Remember, inflation is the arch enemy of Bonds and home loan rates. The concept is very simple: If inflation rises, investors in Bonds demand a higher yield to offset the lost buying power inflation imposes on a fixed payment. And as home loan rates are tied to Mortgage Bonds, this would mean home loan rates move higher.

It’s still important to remember that now remains a great time to purchase  a home, as home loan rates  are still near historic lows. .

If you need help in purchasing or selling a home in Orange County Ca just Contact Mary or text /call 949-275-6544

Determining the Listing Price

 Pricing  your  home  is  an  art  — not a science.

 Achieving the optimal price  is  the result of both objective research into similar properties and  instinct in  determining how much a buyer will be willing to pay for  your  home.  The  right  price  will  attract  showings,  which  will generate offers.

The  unfortunate  fact  is  that  price is  the  number  one  factor that most  homebuyers use to determine which homes they want to view. It’s also important to remember that although you and your Realtor set the asking price, the selling price is determined by the buyer.

The Correct Price Will:

  •  Expose the property to more buyers
  • Result in a quicker sale, with less inconvenience to the seller
  • Increase Realtor response
  •  Generate more ad calls
  •  Prevent your listing from getting “stale” or “shop worn”

 Typically  homes  that sell more quickly, sell closer to or sometimes over asking price.

 Some Common Reasons for Overpricing

  • Over-improved property
  •  Original purchase price too high
  • Desire for “negotiating room”

 Overpricing Pitfalls

  •  Most  of  the  activity on  your  home will occur in the first few weeks.
  • Pricing ahome properly creates immediate urgency in the minds of buyers and agents.
  •  There  is  a  pool  of  buyers  who  have  seen  most  available homes  in  theirprice  range and are now only waiting for new listings  or  price  reductions.  Abuyer  that has been waiting, may fail to see your home if it is priced too high.
  • Sometimes, a price  reduction  may  be too late, as interest by both buyers and Realtors, may have waned.

 Buyers and  their  agents are very aware of the length of time on  the  market, the most  common  question  continues to be: “How  long  has  it  been  on  the  market?”  Often buyers are reluctant  to  make  an  offer  on  a home that has beenon the market  for  “awhile”  thinking  that there is something wrong with the home.Unfortunately,  overpriced  listings  frequently help you to sell your  neighbor’ reasonably  priced  home,  making  it appear that their home is priced very well.

 The Role of a Real estate Agent in Pricing

 Provide  you  with  a  comparative  market  analysis,  which  is a comparison  of recent  homes  with  similar  amenities  that  are available, in escrow and sold. There  is  no  “exact price”; your home is worth what a buyer is willing to pay. The  market  determines  value;  together  you  and  your agent determine asking price.

  Realtors  have no control over the market, only the marketing plan. The  seller  determines  the  asking  price.   Never  select  an  agent based on price. 

If you’re serious about selling and not just listing your property, call me today. I will give you an honest evaluation of what it is going to take to get your property sold.

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