Posts Tagged ‘investment’
Wayback Wednesday… Don’t be Dumb Like a Bank
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A couple of years ago I wrote a post about a particular property. It was a foreclosure, and the bank acted stupidly. And I’m not saying that lightly. Had they accepted my client’s offer, they would have sold the property a year earlier and for $40k more than they eventually got.
Now I see a lot of people making the same mistake from the other side of the fence…
I see buyers trying to deliver one last beating to the bank… often during the inspection phase… and losing a great deal over things that are trivial. I understand it. That doesn’t make it any better…
I had one client that was angry that the bank accepted his offer. He thought they would counter. I had warned him that they might accept of reject, but not counter. Some of the banks have a number. If you offer $1 over the number, they accept. If you offer $1 below, they reject. During the inspection period, this client made a LOT of demands. The bank rejected. No counter… no discussion.
Don’t make the same mistake the banks were making.
View CommentsThere IS a New Real Estate Transfer Tax in the ObamaCare Law
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One of the forums in which I participate has had stories on both sides of this issue for a couple of months… with the more conservative members saying that there is a 3.8% sales tax on the sale of homes, and those that are more supportive of the President and his policies saying that there isn’t.
Neither side was real specific about their information source… talk radio for some, blogs for others… nobody seemed to be going to the source… the 20,000+ page law signed by the President. In all fairness, there is a LOT of room in 20,000 pages to hide a lot of little Easter Eggs like this. And being fair to the other side, if there isn’t a tax, the bill isn’t going to say “there is not a tax” anywhere…
I have an answer…
There is indeed a tax on the sale of real estate. It doesn’t apply to many people, but it WILL apply to some people that have profit from the sale of their homes. Starting in 2013, those with incomes over $200,000 will have to pay a 3.8% tax on profit from the sale of their primary residence or investment properties. The exact amount will be based on a formula that includes the profit from the property and the income above $200,000. The tax is not an income tax, but rather it is a “payroll tax”… officially it is a Medicare Tax.
It does not just apply to real estate, but also applies to investment income and dividends.
The bottom line is that both groups are right… and both are wrong.
But…
It will drive another nail into the luxury real estate market. It has been in the doldrums for a while. Adding new taxes will not get it going again. And if you are thinking that this only affects ‘the wealthy’, think again. Those homes are not built by ‘the wealthy’. Those homes are not renovated by ‘the wealthy’. Those consumers are more likely to hire contractors to do improvements. And they are more likely to update more often… They are a driver in the housing sector. This added tax is NOT putting gas in the tank…
View CommentsWayback Wednesday… Add on or Get out?
Two years ago I wrote a post about whether a (would-be) seller would be better adding on or moving if their current home wasn’t meeting their needs.
View CommentsWayback Wednesday… Staging…
A couple of years ago I talked a little about staging. Angel Walker is a Stager that I know, and she had stopped by during an Agent/Broker Caravan I was hosting around that time.
View CommentsWayback Wednesday… Incrementalism…
Two years ago I wrote a blog post called “Incrementalism“… It is actually a favorite term among a small group of my friends. We coined the term in regards to Jeep modifications. Instead of doing the work over and over, but just a little at a time, causing a tremendous amount of laber of spending WAY more money, just go full in the first time.
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I have just struck a deal with The Video Connector to provide video content for my sites. Look for lots of cool videos from Tara and TJ from Reel Productions. They have been the providers of my video tours for a couple of years now, and really have a handle on the real estate market. Enjoy.
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