Bella Vista - Cedar Park

This is a new project that I am working on for my blog, I will be visiting the neighborhoods of Cedar Park on a regular basis.  The video will be a drive through of the neighborhood along with MLS (Multiple Listing Statistics.  Enjoy.

Preliminary MLS Data - March 2012

Units for Sale: (compared to March 2011)
New listings are down 7.90%.
Pendings are up 19.39%.
Solds increased by 16.46%

As for Average Prices:
The "New Listings" average list price is up 3.66% to $342,713.  In March 2011 the average list price was $330,627.

Sold average sales prices increased 6.14% to $258,863.  For March 2011 it was $243,878.

What does this mean?  We are seeing a steady number of buyers coming to the market, but listings are not coming on the market at the same pace as last year.  The homes that are ready to sell and price right are selling quick.

Home Buying Tips: Negotiating House Price

Making an of Offer on a House Without a Buyer's Agent.

Thinking about making an offer on a house without a real estate agent? Nervous about negotiating the best house price in this crazy economy? We don't blame you. When it comes to buying a home, negotiation can mean the difference between a few thousand dollars and tens of thousands of dollars. It's stressful and scary, especially if you're doing it without an experienced real estate agent. Negotiating a home selling contract in this current real estate market is also financially tricky. This is where an experienced agent who has sold in times of real estate booms and past real estate slumps can save you more than the commission you pay them.

For those brave enough to consider making an offer without a buyer's agent, here are a few tips on negotiating house price:

Negotiating House Price Tip #1: Arm Yourself with Information

The most important information is a Comparable Market Analysis (CMA), which is a neighborhood survey of the similar and recently sold homes in your neighborhood of choice. There are several places you can get partial information about sold houses online these days, but it is important to choose the right homes and get full information. This is another way a professional real estate agent can help you save money. Agents have access to the most up-to-date real estate data and are experts at figuring out which houses truly belong in a CMA. More importantly for today's economy, a real estate agent can tell you how short sales and foreclosures in the neighborhood can affect negotiating an offer. House pricing is very tricky in this economy.

Once you have access to a detailed CMA, check out the houses as much as possible. A real estate agent might be able to get inside some of the houses that were just recently sold or have a current offer. You can check to see if the house you're looking at is up to par or if it falls frighteningly below the homes listed in the CMA. This is a great way to tell if your house is near the proper price point or if there is leeway in negotiating an offer. House pricing is much more complicated these days than it used to be. Rather than comparing features like which houses have pools and which don't, buyers are weighing short sales against foreclosures and traditional home sales.

Negotiating House Price Tip #2: Figure Out the Seller's Motivation

Information is key in negotiating house price. But, finding out how your dream house price compares to the market is only part of the process. The second is figuring out the seller's motivation. It's the fun part of play detective and look inside the home seller's mind for a minute. Do they have to sell their house or do they want to sell? Motivation isn't always revealed and the seller's agent doesn't necessarily have to give you this information. However, if you have a good real estate agent, he or she often can get the information from the seller's agent.

Have too reasons:

• They are relocating for a job.
• They just got laid off and can't afford the mortgage.
• The house is close to foreclosure and they don't want to ruin their credit history.
• They just had an addition to their family and truly don't have enough space.

Want too reasons:

• They are testing the market to see if they could sell their house.
• They want to buy a different house while housing prices are down.
• They want to buy a new house while mortgage rates are low.

You can see what scenarios give you bargaining power. When the seller has to move, you have more bargaining power. Right now, most people aren't selling to try and test the market. They're selling because they have to. Knowing the timing of a move or how long before the house may foreclose is very important when negotiating house price.

Negotiating House Price Tip #3: Don't Waste Time

Buying a home can be super stressful. You don't have time to waste with sellers who won't budge and you shouldn't waste the seller's time with a low-ball offer.

How do you know if sellers are wasting your time? If they won't discuss asking price in relation to similar homes in the neighborhood, they probably are not serious about selling the home. Sellers will do this when they're unsure about moving or to figure out how much they can get for their property.

Just as they shouldn't waste your time, don't waste theirs. Don't give them a low-ball offer just to see if they bite. It makes you seem like you're not ready to buy or that you want to scam them. If you are truly interested in the house, this is not a good negotiating tactic.

Negotiation is an art, not an exact science. Experienced real estate agents have practiced different techniques and know what works when negotiating house price and what doesn't. Once again, in today's economy, negotiating house price can be much easier if you have an experienced agent on your side. Negotiating a home selling contract is a tricky proposition if done on your own.

Sellers Leaving Money on the Table

For sellers to achieve top dollar on their home many miss an important element that is costing them money.  Staging.   Lets do the math.  If the seller spends a median of $250 on staging and the selling price of a staged home is typically 1.7% higher, then for a $200,000 home, staging can result in a $3,150 return on investment at closing!  Since only one and three sellers stage their home, there are sellers leaving money on the table.

Sellers who enhanced their curb appeal received their first offer 6 days faster and sold 7 days faster for 1.23% points their in the list to sell percent.

The takeaway, sellers who choose not to stage and add curb appeal to their home is leaving money on the table.

How to Avoid Capital Gains Tax after Selling a Home

Benjamin Franklin stated that the only two certainties in life are death and taxes. While there's little you can do to cheat death when it comes, there are many tax breaks available to homeowners. This article will explain how to avoid capital gains taxes after selling a home.

There are many tax breaks available to homeowners. The Department of the Treasury, Internal Revenue Service Publication 523 explains how to avoid capital gains tax after selling your home. In 2010, you may be able to avoid capital gains tax on the sale of a home up to a profit of $250,000, or $500,000 if you are filing a joint return. If you can exclude all of the capital gains on the sale of your home, you do not need to report the sale on your tax return. Any capital gains that cannot be excluded are taxable and must be reported on Schedule D (Form 1040).

The IRS defines your main home as the one in which you live most of the time. To avoid paying capital gains tax after selling your home, you must have owned and lived in the property for at least two years during the five-year period ending on the date of the sale. These two-year periods of ownership and use do not have to be continuous nor do they have to occur at the same time. In order to avoid capital gains tax after selling a home, the two-year periods of ownership and use only have to both occur within the five-year period before the selling of your home.

In addition to ownership and time lived in the home, the IRS considers other factors in determining whether or not a home is your main home. To determine whether or not you will be able to avoid capital gains tax after selling your home, go to IRS Publication 523 for further description of what is considered your main home.

If you sell the land that your home sits on, but don't sell the home, you cannot avoid capital gains tax on the sale of the land. Department of the Treasury, Internal Revenue Service Publication 523 also explains the criteria for avoiding capital gains tax on the sale of vacant land.

Some taxpayers can avoid capital gains tax after selling a home when additional conditions exist. Exceptions to the ownership and use tests exist under the following conditions. There is an exception to the use test in the five years prior to selling a home for individuals with a disability. If a person who has owned or lived in a primary home for a total of at least one year becomes physically or mentally disabled and cannot care for him/herself, the time that he/she lives in a facility licensed to care for people with that disability can count as time lived in the primary home. In order to avoid capital gains tax after selling a home, the disabled person must still meet the two-out-of-five-year ownership test.

If your previous home was destroyed or condemned you can avoid capital gains tax when selling your replacement home if the ownership and use of the combined homes meet the two-out-of-five-year exclusion.

If you are a member of the uniformed services or Foreign Service, employee of the intelligence community, or employee or volunteer of the Peace Corps you may be able to avoid capital gains tax after selling a home by having the two-year period of use suspended during qualified official tours of duty of either you or your spouse. By suspending the period of time you were on extended duty you may be able to qualify for the two-year use test even if you did not live in your house during the five-year period prior to the sale of the home.

For more information on how to avoid capital gains tax after selling a home, be sure to check the Department of the Treasury, Internal Revenue Service Publication 523 for further details.

Renewed trust for tough times

Does it feel like trust is one of the major casualties of the economic meltdown of 2008 – followed by the “Great Recession,” the “Jobless Recovery” and now the threat of a “Double Dip Recession?”

Weren’t we assured that home values were destined to go up and up and up?
There have been lots of promises that help is on the way—and lots of warnings of scams and schemes that have only served to confuse the matter. So where’s a homeowner who’s underwater or overleveraged to turn?

Here’s the bottom line: the choices that homeowners make when they feel they are at the end of their rope will have ramifications for years to come on their ability to qualify for credit, their job prospects, their security clearance and their overall finances. When a family’s financial trajectory is rapidly heading in a negative direction, there’s no substitute for the helping hand of a knowledgeable expert who has the integrity, the experience and the training to reverse the course—someone who is tapped into regulatory initiatives and can separate fact from fiction.

It is my mission to serve as a credible source of information and perspective to homeowners who have found themselves in a tough situation and need help sorting through their options. That’s why I sought out the Certified Distressed Property (CDPE) designation—the most renowned and recognized credential in the distressed property field, and it’s why I continue to stay on top of regulatory and industry developments that impact options available to homeowners who are struggling with their current financial situations.

My message to homeowners who do not know where to turn: there is hope. Foreclosure is not inevitable and neither the government nor your bank wants to see that happen. No one expected to find themselves on the brink of foreclosure, but I have worked with countless clients who have managed to turn their financial trajectory around and get on a path of financial recovery.

It CAN be done! And it would be my privilege to help.

Prelisting Prep Works to Maximize Your ROI

Repeat buyers, especially move-up buyers, tend to want their next home to be in great condition. Usually, when homes are located in a neighborhood that attracts those buyers, homes need to be pristine to stand out from the rest. This can be achieved in part by getting the home preinspected. Research shows that 8% of sellers have a prelisting inspection before putting their home on the market.

49% of buyers end up purchasing a home in excellent condition while 40% purchase a home in good condition.

In the current market, it is fundamental for sellers to make essential repairs to their homes before listing, and curb appeal is particularly important. This is often a first step to getting buyers in the door. Sellers who choose to make enhancements to their front yards tend to have good-to-excellent results in comparison to the 68% who don't. By boosting curb appeal, sellers tend to receive their first offer six days faster and sell seven days sooner than sellers who choose not to focus on first impressions.

47% of sellers enhance their curb appeal by making changes up to five weeks in advance of listing the home. Sellers tend to spend between $150 and $1,000 when improving their curb appeal.

Short Sale vs. Foreclosure?

You make the call!

I get the question from people all the time: short sale or foreclosure, which is the better option? My knee-jerk reaction is always “Are you kidding? Short sale, of course!” This has been mostly because I was always under the impression that a short sale, although still a ding on your credit, was gentler on the score than a foreclosure.

But according to a recent blog post by FICO Banking Analytics, there is no real difference in the affect a short sale or a foreclosure has on your credit score. Both the impact in points and the time to fully recover is about the same for both events.

This put me in a precarious situation. All this time I had lauded the short sale as vastly superior to foreclosure, largely because of its less adverse affects on credit. So I was forced to do further research into which was the better option. In doing so I learned about benefits of a short sale I wasn’t even aware of, and found that the FICO blog was way off.

Each borrower’s credit situation is different, and the way that a creditor reports a short sale to bureaus is different. The reality is that hundreds of thousands of distressed homeowners who have chosen a short sale have experienced a lesser impact on their credit than those who have chosen foreclosure.

In a short sale, a distressed homeowner may be able to obtain another mortgage sooner than someone who has a foreclosure on his or her record. Also, more and more employers pull credit before hiring a potential employee, and a foreclosure can keep you from getting a job. Some employers pull credit reports on existing employees, and a foreclosure may not bode well in certain industries.

These benefits stacked against the negatives of foreclosure, including the embarrassment of public announcement and literally being kicked out of your home, make, in my opinion, short sale the reigning champion.

Now you make the call!

For more information about short sales, click here.

82nd Texas Legislature eliminates most private transfer fees on real estate transactions

Here’s the issue: Most private transfer fees increase costs to buyers and sellers, can be difficult to discover, and offer no benefit to property owners. Private transfer fees can also affect a property’s marketability and cloud its title.

What this means for you: The new law prohibits most future private transfer fees on real property and provides clarity and disclosure requirements to properties with existing private transfer fees. These measures mean fewer surprises for buyers and sellers and one less thing to derail a transaction.

To find out more about homes in the Austin area, click here.

How Rising Interest Rates Will Impact Affordability

Buyers need to measure their decision choosing to wait until prices come down more. It is improbable that interest rates will remain this historically low, last time this low, President Eisenhower was in office. The following blog post has a chart showing what happens to your purchasing power if interest rates change by 1%.

How Rising Interest Rates Will Impact Affordability

Cost to Value Report on Remodel Projects

Recent article on Realtor.org looks at the cost and investment return on remodeling.

On average, the return on investment recoups approximately 63.8% of cost. Upgrading the kitchen and bath are still a smart bet but forego the super expensive, deluxe projects. Instead, take a look at what is selling in your neighborhood at top dollar and use similar costs in your upgrades.

Worth mentioning, the greatest rate of return at a whopping 128% is upgrading the front door. Its one of the least expensive projects and immediately changes the first impression of your home!

To read the entire article: www.realtor.org

Unhappy Seller Sues Condo Auction Buyers

I wrote a post on July 13th about an Auction I attended. In a strange turn of events, the seller is sueing the buyers! Apparently he doesn't agree with the terms of the sale price. This is an article I will continue to follow. Click the following link for the entire Austin Stateman's article.

Unhappy seller sues condo auction buyers

Federal Sales Tax on Home Sales

Recently researching claims that the new Healthcare Law enacted a sales tax on all home sales. Doing abit more digging I found a website that clarified the issue for me.

First of all, only those with incomes over $200,000 a year ($250,000 for married couples filing jointly) will be subject to it. The tax still won’t apply to the first $250,000 on profits from the sale of a personal residence — or to the first $500,000 in the case of a married couple selling their home.

And the fact is, the first $250,000 in profit on the sale of a primary residence (or $500,000 in the case of a married couple) is excluded from taxable income already. (That exclusion doesn’t apply to vacation homes or rental properties.)

http://www.factcheck.org/2010/04/a-38-percent-sales-tax-on-your-home/

October 2009: Austin Market Stat's

The number of sold listings jumped almost 28% from this time last year which is good news for the Austin market. We are also seeing a reduction of Days on Market (DOM) which is also good for sellers. Time will tell on the impact of the extension & expansion of the Home-Buyers Tax Credit.