Buyers are looking online to find property

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Making that move into your dream home

There are quite a few people who’s situation has changed and their current life style does not match the home they are living in. It’s either to small, too big, the yard is to small or too big, to name just a few.

YardRight now there is not a lot of inventory in the wine country. Homes sell fast and quite often with multiple offers, sellers have a choice when offers come in.

So how about moving into your dream home?  Option 1:  Selling and moving into a rental means you have to move twice. Not so desirable.

Option 2: Making an offer contingent upon the sale of a home. This might not get your offer accepted. Why would a seller choose a more difficult transaction when there is the option of a sale without this contingency.

Option 3: A better option is this market is to sell your home contingent upon you finding a new home. This means that you might have to go with a little lower asking price to make sure that you have found a committed buyer who is willing to wait.  Then, when you find your dream home, finalize the sale of your current home and rent back for a week or 2. The money received from the sale of your home can be used to purchase your new home.

There are many options to consider when buying and selling real estate, your local Realtor will be able to help you sell your home and  move into your dream home, taking the local market conditions into account.

Mirjam

 

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Staging a home works and sets expectations.

Millbrook frontWhen showing homes to prospective buyers, I always love to show homes that are Staged. These homes are free of clutter and show well. It is easy for a buyer to see whether it would be a good match for their needs. Staged homes tend to sell faster and quite often for more money.

The initial decision to purchase a property is an emotional one and  driven by the sub conscious. It’s a great house, feels good, has lovely colors, great yard etc etc. This decision is justified afterwards by reason: the house is well maintained, no major flaws, great neighborhood etc etc. The different property inspections confirm the condition of the house, major appliances plumbing, electrical etc etc.

There is a flip side:

Staged KitchenWhen a home shows well it sets the expectation that it is well maintained and there are maybe only a few items that need attention. Imagine the response of a buyer who totally falls in love with a house and the inspections show a list of major and minor problems that need attention: plumbing leaks, improper drainage, ducts laying in the mud, a patched roof at the end of it’s life etc etc. The response more often than not is: what else is not maintained/taken care of/do we not know?Staged family room

While it is always wise to do at least a pest inspection prior to putting a home on the market, it is a must for homes that staged to perfection. I also highly recommend a general home inspection. The reason being the incredible first impression might turn into a incredibly low one. Neither of these are true to reality yet it is what is very likely to happen.

Especially in the higher priced areas -Sonoma County, Napa County- it’s worth spending the $350-$400 on a pest inspection to avoid cumbersome negotiations while in escrow. Preparing for a smooth sales process is beneficial for all parties involved.

Mirjam

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Mortgage debt relief act, and beyond…

You might not remember, in 2007 the Mortgage Debt Relief Act was passed, helping homeowners who sold their home for less than what they owed.

expired

The Mortgage Debt Relief Act of 2007 generally allows taxpayers to exclude income from the discharge of debt on their principal residence. Debt reduced through mortgage restructuring, as well as mortgage debt forgiven in connection with a foreclosure, qualifies for the relief. The amount of forgiven debt in a short sale would have been subject to taxes as ordinary income, the Mortgage Debt Relief changed this. Initially it ended December 2012 but was extended for an other year till December 2013.  But what about next year? Some good news to report:

Recent announcement from C.A.R. :

C.A.R. has been working with California Sen. Barbara Boxer to protect distressed homeowners from debt relief income tax associated with a short sale in California.  As part of this effort, Sen. Boxer requested the Internal Revenue Service (IRS) to provide guidance on whether mortgage debt forgiveness in a lender-approved short sale would be taxable income under federal law, given California’s recent non-recourse laws for short sales, which were hard fought victories by C.A.R.

The IRS has clarified in a letter that California’s troubled homeowners who sell their homes in a short sale are not subject to federal income tax liability on “phantom income” they never received.  The IRS recognizes that the debt written off in a short sale does not constitute recourse debt under California law, and thus does not create so-called “cancellation of debt” income to the underwater home seller for federal income tax purposes.  This clarification rescues tens of thousands of distressed home sellers from personal liability upon expiration of the Mortgage Forgiveness Debt Relief Act of 2007 on Dec. 31, 2013.

C.A.R. is seeking a similar ruling from the California Franchise Tax Board (FTB), which has been awaiting the IRS action; C.A.R. anticipates the FTB will act promptly.  Short sales may raise other tax issues and, as always, REALTORS® should advise their clients to speak with their tax professional regarding the tax consequences of a short sale. C.A.R.’s Legal Department has prepared a Realegal to further explain the IRS’s clarification.
– end announcement
Although the state tax is not as high as federal tax, we are eagerly waiting for the response of the Franchise Tax Board.
Coming from the Netherlands where it’s normal to pay appr. 60% income tax it was a relief to find out that taxes are much lower here, yet paying taxes on mortgage debt that is forgiven is difficult since the one reason that you do a short sale is to avoid foreclosure, not a time of financial prosperity.
As mentioned many times, a short sale is a gracious alternative to foreclosure on so many levels, please consult a good realtor should you face a foreclosure or have a need to sell while still owing more than your house is worth.
Sunset Sonoma Coast
Besides this, enjoy the beauty of nature that surrounds us, take a hike and let the sunset take your breath away…
Mirjam
P.S. Thank you Mathew Schweifler for helping with the research for this blog posting 😉

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Location: Walkability…

Zwolle walkFor more and more people the walkability of a neighborhood is no 1. Walking to stores, restaurants, schools and parks is on top of the list of  needs as to location . Come to think about this: this is common in small town Netherlands. When I visit my mother or my brother in Netherlands we usually walk to the store or farmers market, to the doctors office, restaurant etc. This might say more about the small towns my family live, yet this is very common in Netherlands.

De kaasboer

According to Walk score, New York is the no 1 in most walkable cities. Sonoma County in general doesn’t come out that well. AND that is where the knowledge of your local Realtor as well as your own research comes in place. We have great local neighborhoods that score high as to walk-ability. In Santa Rosa: the JC area, Proctor Terrace, Montgomery Village, West End, all score high as to proximity to stores, restaurants, shopping and schools. For Sebastopol: the whole downtown area scores high, it’s a small town anyway so that helps.  Also Petaluma: West Petaluma is very popular for that reason: walkability to the downtown area has caused a revival in some of the neighborhoods, while the historic district always has been very desirable.

Most people will have different need. Walkscore.com is a great website to help you with your research and help you find your perfect location.

Mirjam

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