Register Real Estate Advisors

The Internal Revenue Service has some important information to share with individuals who have sold or are about to sell their home.  If you have a gain from the sale of your main home, you may qualify to exclude all or part of that gain from your income.  Here are ten tips from the IRS to keep in mind when selling your home.

1.  In general, you are eligible to exclude the gain
from income if you have owned and used your home as your main home for two
years out of the five years prior to the date of its sale.
2.  You are not eligible for the exclusion if you
excluded the gain from the sale of another home during the two-year period
prior to the sale of your home.

3.  If you can exclude all of the gain, you do not
need to report the sale on your tax return.

4.  If you have a gain that cannot be excluded, it is taxable.  You must report it on Form
1040, Schedule D, Capital Gains and Losses.

5.  You cannot deduct a loss from the sale of your main home.

6.  Worksheets are included in Publication 523,
Selling Your Home, to help you figure the adjusted basis of the home you sold,
the gain (or loss) on the sale, and the gain that you can exclude.

7.  If you have more than one home, you can exclude
a gain only from the sale of your main home.
You must pay tax on the gain from selling any other home.  If you have two homes and live in both of them,
your main home is ordinarily the one you live in most of the time.

8.  If you received the first-time homebuyer credit
and within 36 months of the date of purchase, the property is no longer used as
your principal residence, you are required to repay the credit.  Repayment of the full credit is due with the
income tax return for the year the home ceased to be your principal residence,
using Form 5405, First-Time Homebuyer Credit and Repayment of the Credit.  The full amount of the credit is reflected as
additional tax on that year’s tax return.

9.  When you move, be sure to update your address with the IRS and the U.S. Postal
Service to ensure you receive refunds or correspondence from the IRS.  Use Form 8822, Change of Address, to notify
the IRS of your address change.

** For more information about selling your home, see IRS Publication 523, Selling Your Home.  This
publication is available at www.irs.gov or by calling 800-TAX-FORM (800-829-3676).

 This information was reprinted from the September 2011 edition of the Houston Realtor Magazine (HAR) to help consumers with home selling tax information.  Realtors cannot tax or legal advice.  This is information to help consumers.

Do you have a real estate question you would like our agents to answer on the blog?  If so, please email your real estate questions to info@rrea.com and our agents or myself will respond on the blog.  We are always looking for great ideas to write about that will help consumers with their real estate decisions.  So if you have an idea for our blog or a real estate question, please don’t hesitate to email info@rrea.com!

An article by Ginger Wilcox appeared online on Trulia.  She is the Head of Training at Trulia and I think this was on her blog.  She has sold real estate in California and Arizona.  Below is most of the article.  I do recommend to all of my buying clients that they google property address and sellers names.  I have them sign something acknowledging this.  All of my RREA agents are doing this as a precaution to home buyers as a form of disclosure.  I think we’ll start reminding sellers to do this, too!

The amount of information available on the web is staggering. Google indexes billions and billions of webpages.  With virtually any type of information imaginable, it makes sense for homeowners to do regular internet searches for their home’s address and be aware of what type of information is available about their property and their neighborhood on the web.

Prospective buyers and tenants are googling homes of interest to them- to find comparable properties, past sales, crime reports, neighborhood information, and much more. If your homeowners are thinking of selling or renting their property,  they should google and be prepared for what prospects might see about the home or property.

The most common results will be other homes for sale or recently sold, a google map to the property, crime reports and foreclosure reports for the area.  All of these items could influence a prospective buyer or tenant.  Additionally, there may be personal information about the homeowner that could influence how a prospective buyer negotiates an offer.  Savvy buyers and sellers are searching for any information that might give them a leg up on negotiations.

More unusual finds could include historic information about the neighborhood, unknown or unusual property history and more.  In addition to just searching their specific address, homeowners should search their own name, their street name and the subdivision or neighborhood they live in.

For example, in the search below, results showed home listings, tax assessment information and even a blog post speculating about the property.

The National Association of the Remodeling Industry (NARI) conducted an exclusive poll of top builders and developers and found that while most people are not starting major renovation projects due to the economy, homeowners feel now is the time to take care of the smaller jobs around the home. Additionally, consumers are indicating that the most important goal in home renovation this year is to incorporate trends with staying power, not ones that will become dated as soon as construction ends.

So, what remodeling projects are on top of the 2011 list?

1. Bathrooms Rule: When homeowners see the old tile getting a little grungy, they want a fresh look. It appears that 2011 is the year for a bathroom update. Bathrooms are the hottest project right now; possibly because baths cost less than a kitchen or an addition. Plus, people desire the luxury of a spa in the comfort of their own homes.
2. Must-Do Projects: Rather than going through major renovations, this year people will continue to complete the projects that need to be done, like repairs to siding or roof leaks. “Have-to” projects instead of “want-to” projects are a trend that is remaining near the top of the list.
3. Warm & Cozy: Warmer colors on all surfaces are coming back. People tend to be moving away from minimalist, white designs or bright colors in favor of cozier, earth tones. The trend, however, is not rustic. Instead, it is a blend of earthiness and modern design. Along with warmer tones in homes are warmer tones in metallic features—oil rubbed bronze, aged bronze, or distressed hardware is big in 2011. Homeowners want rooms that are more contemporary and calming, but are “still not totally contemporary.”
4. Living Outside: It appears that in 201 people want to sit outside again and are staying at home more frequently. This means that outdoor living spaces are making a big splash. Many pools are being built and homeowners are looking to bring the inside out.
5. Roomy Rooms: Open floor plans are in, so removing interior walls and opening up the spaces in older houses to modernize them is a big trend among homeowners with older houses. Open floor plans help families be more flexible with the square footage they already have.
6. Work Space Flair: Exposed beams will remain popular, but stainless steel cable and industrial products are on the rise. With so many people working from home, office spaces will take on more of a business or commercial look.
7. Tech-Savvy Homes: In a world ruled by technology, many homeowners are making changes that will improve the workability of their home electronics. Equipment is improving and consumers want every possible gadget they can get their hands on. Ease of use and ways to make all those ugly cords, as well as the T.V. (called the black hole by many female clients) less obvious is a design trend that is coming on strong.
8. Growing Green: Bamboo floors, energy-efficient appliances, and energy-efficient glass doors and windows will continue to be a big trend in 2011. Though consumers have not bought into the green movement hook-line-and-sinker, it is projected that this market will keep growing in popularity.
9. Planning Ahead: More and more people are turning to universal design and performing expansions to prepare for the future. Many homeowners want to age in place, so their homes need to be accessible when they do grow older. This does not mean installing ramps or elevators, but rather making smaller adjustments like widening hallways and doorways, adding step-in showers and installing extra lighting. This design concept is extremely popular, and it will stick around for a long time.
10. Hiring the Qualified: Consumer diligence is on the rise. People are finally getting the message that it is important to look more closely at companies they are considering for their remodel project. They are asking the questions we have been telling them to ask for years and checking out qualifications.

With all this information, what do we do next? It is important to recognize that some of these trends will be around for awhile. Therefore, in order to stay competitive, those of us in the industry must be experts within our fields. Designations and product knowledge are a must. Consumers know what they want and they are becoming much more discerning when it comes to selecting a remodeler. As well, now is the time to establish great relationships with your clients, because even though the jobs may be smaller this year, those larger jobs will come back around and you want to be the one they call.

About the Authors: Allen Griffin is founder and president of Gryphon Builders and Gryphon Property Services. He is a Certified Graduate Remodeler, Graduate Master Builder, Certified Aging-in-Place Specialist, and a Certified Green Professional with 20 years of experience in the building industry. Allen was named 2009 Remodeler of Year and 2007 National Association of Home Builders Certified Graduate Remodeler of the Year. Allen currently serves as the Membership Committee chair for the GHBA Custom Builders Council. He serves on the Education Committee, the Membership Committee and has been on the Remodelors Council board of directors for several years, serving as RMC president in 2009.

This article was first printed in the May 2011 Houston Builder Magazine and was written by Allen Griffin and Larissa Michael.
Larissa Michael is a graduate of the University of Texas with a degree in Communication and has been working in the building and design industry for nearly 15 years. She recently started a new business, Volume Control, and now handles the advertising, marketing, and public relations for several companies within the industry. As a member of the GHBA Remodelors Council, Larissa earned her Certified Graduate Associate designation, served as the 2010 Membership Chair, and currently serves as special committees—Marketing Coordinator. As well, Larissa received the 2010 Texas Association of Builders Star Award and the 2010 GHBA Houston’s Best Award for Best Print Ad—Remodeler.

Are homebuyers any different today than they were five years ago?  Here’s a comparison of some findings from the Profile of Texas Homebuyers and Sellers.

This information was first published in the April 2011 Issue of Texas Realtor® Magazine

2010    2005

Percentage of buyers with 100% financing
15%    34%

Median purchase price per square foot
$83     $74

Information sources used in home search

Internet
90%    78%

Real estate agent
89%    87%

Yard sign
54%    71%

Where buyers found the homes they purchased

Internet
37%    25%

Real estate agent
31%    32%

Yard sign
11%    17%

How buyer found real estate agent

Referred by friend,
neighbor, or relative
46%    41%

Web site
12%      6%

What buyers want most from real estate professionals

Help finding the right home
48%    45%

Help with negotiations
14%    14%

Help determining how
much buyer can afford

3%     12%

Help finding financing

3%       9%

HOUSTON (Colliers International) – Houston’s office market posted 81,091 sf
of positive net absorption during second quarter 2011 with the majority taking
place in the suburban sector, according to the latest report from Colliers
International.

Year-over-year vacancy rates decreased from 16.5 percent to 15.9 percent
citywide.

Rental rates continued to decrease during the second quarter, with the
citywide average rate dropping to $22.70 from $23.81 per sf in the first
quarter.

Vacancy in CBD Class-A properties continued to soften, reaching 12.5 percent
compared with 9 percent a year ago. In contrast, Class-A suburban vacancy
decreased to 16.2 percent from 19.6 percent a year earlier.

Leasing activity decreased between quarters, consisting mostly of renewals
and/or expansions, suggesting tenants took advantage of more favorable lease
terms.

DALLAS (Dallas Morning News)
– Dallas added more construction jobs than any other city in the country from
May 2010 to May 2011 according to Contractors of America.

Construction jobs increased by 5,600 during that period — about a 5
percent increase.

Apartments and large public sector projects provided a large portion of the
gains, with single-family housing remaining low in job creation.

Eighteen other Texas metro areas had construction job increases as
well, including Houston, which had the fourth largest increase.

Are you vacationing this 4th of July weekend?  Or having a “Staycation in your own backyard space?”  Below is an article written by Sam Hickey, Owner of Creekstone Outdoors.  It was published in the June 2011 Issue of Texas Builder Magazine.  What do you think?  Do you prefer a real vacation this holiday weekend or a “Staycation?”

In today’s world, we find ourselves increasingly attached to
our laptops, PDAs, cell phones, smart phones, internet, etc., and it is
increasingly more difficult to “get away from it all.”  The stresses of our everyday lives paired
with a struggling economy have made outdoor living areas a primary choice as
people decide where to spend their construction dollars.  The popularity of “staycations” has increased
as well, contributing to people’s desires to have resort-style backyards they
can regularly enjoy.

“Outdoor Living” is an extension of the living area into the
backyard.  At one time, a swimming pool
was by and large the only element homeowners considered for their
backyards.  However, today’s backyards
regularly include fireplaces, fire pits, pizza ovens, pergolas, built-in bench
seating, outdoor kitchens, stand-alone patio covers, bathrooms, water features,
and more.

An outdoor fireplace or fire pit is becoming increasingly
popular as people design their entertaining areas.  The ambiance of a lit fire as you cook and
entertain can set the mood whether you are trying to entertain or just
relax.  The fireplace is more commonly
built in conjunction with a patio cover or pergola to help create the
full-service living room outside.  The
fire pits are a great addition to an open air seating area in a backyard and
are instrumental in helping stir the conversation and storytelling.

Today’s patio covers are much more than a shade area to
protect us from the sun, rain and heat.
Entertaining outdoors wouldn’t be complete without a full array of music
and television.  RF, radio frequency,
remotes are a practical alternative to leaving high-dollar electronic equipment
outside.  By back feeding the low voltage
connections from an indoor location, a homeowner simply needs only the remote
and an outdoor television to watch the big game or listen to their iPod
outside!  This eliminates the challenge
of finding a good location for stereo receivers and cable boxes while also
helping to minimize equipment replacement due to being exposed to the elements.

Stain grade v-groove or bead board ceilings are a fantastic
look and help create a warm feeling when used to dress up a patio cover.  Available in many different wood species,
such as pine, cedar, or cypress, a stained ceiling can help create the ultimate
look!

Outdoor kitchens’ recent popularity has spurred an increase
in the availability of component options.
Previously, an outdoor kitchen was typically referencing a built-in
grill.  Today, an outdoor kitchen
commonly consists of a built-in grill, side burners, power burner, sink,
built-in ice chest and refrigerator.
Other items that are beginning to make their way into people’s backyards
are warming drawers, ice makers and ovens.
In addition to basic appliances, other conveniences such as enclosed
door and drawer units, trash can pull outs, paper towel storage and cutting
boards are commonly incorporated to make the outdoor kitchen full service.  A chef’s kitchen can easily be constructed
outside with the availability of appliances on the market.

Pizza ovens have started to gain traction here in Texas as
well.  A masonry constructed pizza oven
is a timeless conversation piece and a great backyard focal point.  Besides, who doesn’t want the ability to cook
pizzas in three minutes?  Typically, a
pizza oven is built along with an outdoor kitchen, bar area and/or seating
areas.

The ability to use their outdoor living area all year long
is the main reason to install outdoor cooling and/or outdoor heating
systems.  An outdoor cooling system can
be as simple as ceiling fans or a misting system, or as extensive as a
dedicated air conditioning system.  A
mini-split system is typically a great choice, since they are typically small,
highly efficient, and can offer heating as well.  A free standing gas or propane patio heater
is also a popular choice.

A bathroom in the backyard is another great addition to help
ensure the homeowner doesn’t have to leave their backyard.  Whether it’s free standing or built off a
patio cover or the house, it is one of the main conveniences that a homeowner will
need to create the ultimate outdoor living area.  Although usually a half bath, consisting of a
sink and toilet, an exterior rinse-off shower is a great addition for backyards
with a pool.

Previously, a pergola, shade arbor or trellis was used as a
small shade structure or backyard accent.
Many times, they can be the primary outdoor living area.  Whether they are attached to another
structure, such as the house, or freestanding, there are endless options and
designs for this type of cover.
Different wood species such as treated yellow pine, western red cedar,
or cypress can help achieve different looks along with painting or
staining.  Another component that has
increased pergolas’ popularity is the use of polycarbonate roofing sheets to
create a fully roofed shade arbor.
Polycarbonate roofing is available in a variety of thicknesses and
colors, one of which is bronze, which is similar to a tinted window and
provides some UV protection as well.  Due
to its low profile and the ability to use on a low-slope application, it’s the
perfect combination with a pergola.

Being outside reminds us of simpler days, campfires,
barbecues and family.  Without the walls
that typically confine an interior living area, your client can entertain their
family, their co-workers, or their whole neighborhood without feeling
cramped.  They may even go home thinking
they’re a good cook, since we all know everything tastes better cooked
outside!  The one thing that is for sure
is that they will be the envy of the neighborhood with resort-style living in
their backyard!

After graduating from Texas A&M University, Sam Hickey spent seven years in
production and custom home building in Houston, Texas.  After holding positions from construction
superintendent to project management to division manager, Hickey decided to
start Creekstone Outdoors, a full-service residential general contracting firm
specializing in outdoor living environments.

Will Buyers pay more to live in Country Club Estates than River Crossings?  A study from The University of Georgia says that they will.  Researchers analyzed MLS Sales Data in Baton Rouge, LA between 1984 and 2005 and found that buyers were willing to pay a premium of 4.2% for a property with “country” in the name and an additional 5.1% for the phrase “country club.”  Surprised?  I thought this article in the Texas Realtor Magazine was very interesting and since I graduated from UGA, had to add it to my blog.  It was first published in the June 2011 edition of the magazine.

SANTA ANA, Calif. (CoreLogic) – Texas had 335,446 negative equity home loans
(10.1 percent of all mortgages) and 177,410 near-negative equity loans (5.4
percent) at the end of first quarter 2011, according to
CoreLogic data compiled by Real Estate Center Research Economist Dr. Jim
Gaines.

Texas ranked 33rd out of 44 states for which the data were reported,
which Gaines said is good news.

Negative equity, often referred to as “underwater” or “upside down,” means
that borrowers owe more on their mortgages than their homes are worth.

Nationally, 10.9 million (22.7 percent) of residential properties with
a mortgage were in negative equity, according to CoreLogic data. That’s down
slightly from 11.1 million, or 23.1 percent, in fourth quarter 2010.

An additional 2.4 million borrowers had less than 5 percent equity, referred
to as near-negative equity, in the first quarter.

Together, negative equity and near-negative equity mortgages accounted for
27.7 percent of all residential properties with a mortgage nationwide. In
fourth quarter 2010, these two categories stood at 27.9 percent.