Friday, February 29, 2008

Is your real estate agent lying to you?

Getting the correct information from your real estate agent is of paramount importance as you are entrusting him/her with one of the largest financial decisions you will ever complete. So, how do you know if your real estate agent is actually telling you the truth? Here is an example of a conversation that was over heard and then we can discuss how you can find out what the real truth is:

Client: Is offering on a short sale a good idea?

Agent: Well you know when you make an offer on a short sale, you have to wait a long time and they always counter back at more. Did you really want to wait that long and still not get a great discount?

Client: Oh, I didn't realize that, I guess I won't offer on a short sale.

Unfortunately in this conversation the client was not given enough information to make an informed decision. Is it possible to receive a counter offer back that is more than you offered; yes. Does it always happen? Absolutely not! This agent didn't have enough experience on short sales to tell the client that sometimes the offer is accepted at what you offer!

So, how do you find out the truth in this situation?

Ask the agent additional questions. Ask them how many short sales they have completed so you can find out what basis their information is coming from. Ask them what parameters the bank is making their decision on. Ask them if they have helped both sellers and buyers complete short sales.

Getting as much information as possible, especially when it relates to relatively new procedures is essential to understanding what the pros and cons really are.

Monday, February 25, 2008

What is available on Naples Island?

So just where is Naples Island in Long Beach, CA? Well if you are ever visiting and you want to see a unique are than Naples in Long Beach has to be a stop for you. It is located just west of Second st as head toward Orange County. This small community is home to large homes on generally small lots. Some homes exist right on the water or even on the canal that runs through the community.

Currently there are only 23 homes available in this exclusive community and the average price of a home currently available for sale is 1.8 million. While the prices may exclude some the desireability to be there always will exist for it's location and beauty.

There are currently several homes below 1 million dollars and while they may not have the gourmet kitchens yet you can certainly add your own when you become a new owner in the area.

Sunday, February 24, 2008

Still Few Choices in Belmont Heights

We tend to hear from the media that the real estate market is falling apart and there choices for homes abound. Now of course there are areas of this fine city, Long Beach, that have more inventory choices than others. Downtown Long Beach and North Long beach represent over 50% of the available inventory in Long Beach but no where near 50% of the purchases that occur in the city. Let's take a look at what is going on in Belmont Heights.

Belmont Heights Real Estate Update
  • 61 single family homes are available for sale
  • Average price for a home is $983,000
  • Only 25 homes that are $775,000 or under
  • 12 properties are currently in escrow

The city is average about a 10% purchase rate of homes meaning about 10% of the available home inventory is sold every month. In Belmont Heights it is almost 20% or twice the average of the rest of the city. Real estate is local even within the same city and you have to know what is going on in your particular part of the city. While the general press reports that every area is having problems it is not true and it would be wise to look at what is available and what properties are selling for prior to listing or making a purchase. Real estate is a long term investment and the future of real estate continues to look bright especially in beautiful Belmont Heights.

Friday, February 22, 2008

6 Items You Never Thought Would Cause a Buyer to Panic

In today's market, and really any market, there are things that every seller should do for their home prior to listing it for sale. Now before you stop reading believing that this is one of those lists that have been seen every where keep reading as I am going to cover some things that maybe you hadn't thought of. These items are more important then you think and may make the difference between a home completing its escrow or a buyer cancelling and moving on to another home.

  1. Strap your water heater appropriately - Water heaters must be strapped by code in order to pass a home inspection performed by a buyers home inspector. A seller would be wise to make sure a licensed contractor comes out to make sure that the water heater is strapped and the exhaust for the water heater is appropriate.
  2. Your electrical box is up to code - electricity scares buyers as they believe it is very expensive to fix electrical boxes. Now it can be but often times it is as simple as a new breaker or a new cover for your box. Avoid this item being called out in an inspection and make sure that an electrician takes a look at your electrical box prior to listing it for sale or at least prior to the buyers inspection.
  3. Make sure the vents that block access to your foundation are repaired - in a raised foundation home there are vents (sometimes) that allow access to the home. Make sure they all look presentable and repaired.
  4. Fix all broken glass - this may sound obvious but sometimes their is a small window in a closet (especially in old craftsman homes) that has a cracked pane of glass that you hadn't got around to fixing. Make sure that you get it fixed prior to any showings.
  5. Leaking faucets - This may seem small but when a buyer can be picky they often will and you want to make sure the least amount of items show up on a physical inspection report as possible and this is one that is easy to spot.
  6. Make sure you have replaced all outlet covers if missing - this is another one that scares buyers that is quite small. Make sure that you have all outlets covered and new ones if possible. It is a small detail that is very much appreciated.

Many people when they sell a car make sure to get it all cleaned up and even take it for a tune up. This is exactly what you want to do for your home. You want to make sure that all the details are done and it is in its best condition possible. You don't need to go overboard with upgrading items but make sure that you and your real estate professional go through your home and take time to look at what things might scare buyers and do your best to address those prior to it coming up in any report.

Thursday, February 21, 2008

Top New Tax Breaks You Should Know About

If you're starting to prepare you 2007 taxes then you'll need to make sure that you look at every possible tax break possible. The more money you save for yourself and don't give to the government (legally of course) the better. Today I'm going to go over a few new tax breaks for 2007 and a couple that aren't used very often. Take a few minutes to get an overall view of these three tax tips and make sure you haven't overlooked anything.

Private Mortgage Insurance Deduction

If you bought a new residence and paid under 20% of its value as a down payment, your lender probably required that you purchase PMI or Private Mortgage Insurance. If you acquired a loan in 2007 and were required to purchase PMI you could be eligible for a tax deduction based on your PMI payments. Of course there are a few things you'll need to check:

- PMI is insurance taken out on the balance of your mortgage and doesn't cover hazards for your house. Make sure you don't mistake PMI as normal home insurance, they are two different things.

- Typically the PMI deduction is only available to those with incomes less than $100,000 and $50,000 as married and filing separately. This break is only good for your primary residence, so don't get excited and think yippee...I get a break on my vacation home in Big Bear.

- If PMI was taken out on a home equity line, then the deduction is only good for the portion of the loan you're using to improve your home.

Deduction On The Home Office

If you are a small business owner and run your business out of a spare bedroom in your home that's used exclusively for business you might be eligible for a home office deduction. With a home office deduction you can write off that portion of your home used for business purposes AND the percentage of your mortgage payments and utility bills that represent that portion of your home.

You'll need to determine the percentage of the square footage used for business when calculating the eligible amount. For example, if your home is 3000 square feet and your home office is 300 square feet you can write 10% of your mortgage payment, utilities, etc, as a business expense.

If your home office is eligible for this deduction you can reduce your tax bill drastically. Remember to only use space actually used for business purposes.

Debt Forgiveness On Your Home Mortgage

Over the past six months the home mortgage crisis has been in the news almost everyday. Foreclosures and loan defaults are increasing at amazing rates. Because of this the banks are more willing to work with financially distressed home owners that have borrowed money by restructuring the terms of their existing loan or writing off a portion of the principal. That being said, keep in mind that the amount forgiven by the bank might be an amount that you're liable to pay taxes on.

There's some good news though! The Mortgage Debt Forgiveness Act of 2007 is a law for homeowners that received debt forgiveness on their primary residence. Under this new law homeowners won't owe taxes on the forgiven amount if they meet certain requirements:

- The amount forgiven does not exceed $2,000,000 or $1,000,000 if married and filing separately.

- The amount forgiven was discharged in 2007.

You might save an enormous amount of money if you qualify for the Debt Forgiveness Act of 2007, so make sure you check it out if you think you might fall into this category.

In Closing

Make sure you check with your tax professional before filing and do your best to keep your tax bill as low as possible by investigating deductions like the ones we mentioned today.

Wednesday, February 13, 2008

Long Beach Real Estate "Deals" Still Selling

The well priced Long Beach real estate is still moving quickly. Sounds very different than the main stream media but it certainly is happening in real life. Now, this is not to say that there aren't properties that are sitting on the market for 80,90, or 100+ days, because they certainly are, but the properties that are in great condition and priced lower than their competition are receiving multiple offers and staying on the market less than 14 days.

So what does this mean to you?

As you are looking for properties using the Long Beach MLS or your local real estate agent be aware of the properties that are the"deals". The deals in any market certainly don't last long and with interest rates at still record lows buyers are hungry for the best deals possible. Searching through the inventory will help you to understand what is possible so you can identify the deal along with your agent.

Sounds good, but is it really happening?

If I didn't look through 100's of properties every day online every day I might be skeptical of this post, so let me provide a couple of examples.

  • Signal Hill Condo on 20th St - This property is over 1,500 sq ft and was listed as a foreclosure for $299,000. It stayed on the market less than 11 days before it went into escrow.

  • Belmont Heights 3 Bedroom Home - This home was just 2.5 blocks from Ocean blvd and priced at $650,000. Within it's first 14 days on the market it received 2 offers and went into escrow.

Whatever area within Long Beach you are focusing on, make sure to understand the inventory that is available. Have your Long Beach real estate agent set you up to view the listings so you can determine what is available and then you can see when that "deal" pops up. Remember don't hesitate too long as the deals certainly are flying off the shelves.