Real Estate Information

More home owners may start factoring in taxes more as they pick where to live, particularly as some states’ dramatic tax increases make them less affordable.

Some of the states with the largest population gains from the 2010 U.S. Census are also known as low-tax states, such as Florida, Texas, and Nevada, Reuters News reports.

"There can be pretty big dollars involved," says Lisa Osofsky, a CPA and financial adviser who assists clients in New Jersey, New York, and Connecticut. For example, a person who could be earning several million dollars could save $50,000 or $100,000 by living in a lower-tax state, she says.

A family of four with $150,000 income could save $13,368 in state and local income taxes if they moved from New York to Florida, according to figures by Bob Meighan of TurboTax. They’d likely save even more when property taxes and estate taxes are figured in too.

Retirees in particular may be lured to low-tax states. After all, retirees who have money in a tax-deferred retirement account during their work years would profit if withdrawing the money in a low-tax state.

Also, a couple with $85,000 in retirement income and Social Security benefit could make an extra $112 a month in income tax savings by moving from California to Michigan, as well as cashing in on an overall lower cost of living.

Source: “Low-Tax States Attract Budget-Conscious Americans,” Reuters News (Jan. 21, 2011)

As banks continue to tighten their credit standards, many borrowers are getting frustrated at what it takes to get a mortgage with a favorable interest rate and terms.

Bankrate.com offers some of the following tips for mortgage shopping in the new year.

1. Make sure you have the right credit score. Lenders require higher credit scores nowadays. Prior to the subprime fallout, a 720 credit score would suffice; now the best deals often require a 740.

2. Shop around. Interest rate is one key thing to zoom in on, but it’s not the only thing buyers want to consider. They should also heavily weigh discount points and the type of mortgage loan in finding the best rate.

For example, if the buyer plans to live in the house for eight years, they’ll want to compare the total fees and monthly payments that would be required under three or four different loan types. “Ask yourself how much it would cost to pay zero discount points and get a higher interest rate compared to paying discount points in exchange for lower rates? What about a 5/1 or 7/1 adjustable-rate mortgage?” the Bankrate.com article notes.

3. Know your borrowing limit. Use the Federal Housing Administration as a guide to how much debt to take on, even if you’re not getting an FHA-insured mortgage loan, Bankrate.com says. The FHA caps house payments at 31 percent of gross monthly income for most borrowers. The FHA limits total debt payments--which includes first and second mortgages, car loans, credit cards, etc.--to 43 percent of monthly income.

4. See if your buyers qualify for any federal programs for downpayment assistance. Most lenders require borrowers to have down payments of at least 10 percent of the home’s price. There are exceptions, however. FHA requires a down payment of 3.5 percent if you have good credit, whereas the Department of Agriculture's rural development program, which is limited to rural areas, offers mortgage loans with zero down payment. The Department of Veterans Affairs also offers zero-down mortgages for eligible veterans.

Read all 10 tips.

Source: “10 Tips to Snag a Mortgage Loan in 2011,” Bankrate.com (January 2011)

You don’t have to spend a fortune to create a well designed, inviting home. Interior designer Lili Diallo, deputy style editor at Country Living magazine, often uses what home owners already own and just tweaks it to create an inviting space.

Here are a few of her budget-friendly tips for home decorating:

1. Move one piece of furniture.
Just moving one furniture item can drastically change the energy and look of a room. Instead of a sofa against the wall, pull the sofa into the room with a console and two lamps behind it.

2. Update the windows.
Window treatments can make a big statement in a room and simply changing them out can give a room an entirely new look. Try white muslin, or loose, white sheer linen panels so the light will come through them and soften the room, she suggests.

3. Add a large rug.
You don’t need two or three small area rugs in one room. Instead, swap them out for one large rug to unify and pull the room together and even enlarge it, she says.

Source: “Decorating Without Breaking the Budget,” The Washington Post (Jan. 20, 2011)

The holiday season is over for another year, and many of us use this time to make personal resolutions for the year ahead — such as promising to lose weight, spend less money, make more time for ourselves and our families, and the list goes on. If you’re like me, it’s a rolling list that gets carried over from year-to-year, yet never seems to get accomplished.

This year, I decided not to do that. Instead, I’ve made a list of resolutions for my home.

Have you made a home resolution list for this year? If not, give it a try, especially if you plan on selling your home in the not too distant future.  It’s never too early to get your home looking its best for potential buyers.

Here are a few items that are on my list in random order:

Tackle the basement storage area. Items that have stayed in boxes since our move five years ago are obviously items I can live without.  If I haven’t used them or missed them in that time period, chances are I won’t yearn for them if they are given away.  The key for me will be to not look inside the boxes. If I do, I know I’ll find an excuse to still hang onto each and every item. Maybe I’ll get my hubby to take a peek inside each box before they “exit the building” though (just in case).

Sort through all my old decor and design magazines. Recycle any magazines that are older than July of 2009. Then by July of this year, I’ll set out to recycle any 2009 magazines that are still left on the shelves. If I keep a rolling one-and-a-half year subscription on hand of the many magazines that I subscribe to, it will be more manageable and take up less space. I’ve bought magazine holders to store them in so that they’ll be much easier to get to if I want to refer back to a particular issue.

Cleanse clothes closets. This is a particularly tough one for me. I have a hard time parting with any of my wardrobe. You just never know when that certain outfit will become trendy again. Logic tells me though that by the time a particular outfit comes back into style, I’ll be way too old to pull off the look anyway, so it’s best that I listen to my head and not my heart and/or ego.

The toughest to let go of: the ‘Remember When Collection’. You probably have a few pieces from the same collection – a.k.a. the “remember when this used to fit me” collection. You know the ones that you hang onto for when you drop those few pesky pounds. If you haven’t worn it in one year, it’s time to let go. If you’re planning on selling your home, remember that people will look inside your closets.

Go through the china cabinet and donate items that are never used. After all, how many of my grandmother’s non-matching china teacups and saucers do I really need to keep? Right now, they’re jammed into the cupboard below my cabinet teetering precariously every time I open the door. It’s a good thing we don’t live on an earthquake fault line!

But to justify their purpose: I vow to use my good china and silverware more often and not just saving it for special occasions. In fact, I’m going to make a four-place setting of “my good stuff” more accessible by keeping it in one of the kitchen cupboards. That way, I can use it whenever I want.  In the end, who is going to want any of it anyway once I’m no longer around?  I know that our kids won’t be interested in anything that can’t go in the dishwasher.  And if I get dish pan hands from using them, so what — I’ll treat myself to a manicure!

These are just a few items on my home resolution list, but I’m sure that as the year goes on and I work through my list, I’ll come up with other items to add as fast as I tick these ones off.  But hey, even if I strike a few of them off the list, I’ll be ahead of other years.

http://styledstagedsold.blogs.realtor.org/2011/01/20/make-some-new-years-resolutions-for-your-home/

More than 15 states are projected to experience housing inflation or appreciation during the year, according to Housing Predictor, which releases an annual report of its choices for best and worst housing markets.

The top five housing markets are:

1. Portland, Maine
2. Kansas City, Kan.
3. Tri-Cities, Wash.
4. Omaha, Neb.
5. Fargo, N.D.

However, not all markets will fare well in 2011, with the foreclosure crisis particularly still battering some areas as well as high unemployment and overbuilding during the boom era that has led to high home inventories.

The top 5 worst markets, according to Housing Predictor, are:

1. Bend, Ore.
2. Las Vegas
3. Atlantic City, N.J.
4. Miami, Fla.
5. Medford, Ore.

View all 25 best and 25 worst markets that made the list in the Housing Predictor report.

http://www.realtor.org/RMODaily.nsf/pages/News2011011901?OpenDocument

By Erica Christoffer, REALTOR® Magazine

Households across the country are moving toward a more casual dining experience.

While ease is a virtue, buyers also want technology-equipped, stylish spaces where their family members can come together.

For all these reasons, dining rooms have lost their appeal. Simply, they’re not flexible enough.

“Dining rooms are definitely on the way out,” said Danielian Associates’ design coordinator Joe Digrado at the International Builders’ Show in Orlando Friday. “Ask your buyer if they really need one. In some markets they do. But many prefer an open, flexible space that will serve various functions.”

Open kitchens facing multi-use dining and social areas with a great room or living room are taking over the traditional dining room. Eat-in kitchens or seating areas at the island also popular with trends supporting a more informal lifestyle.

And when it comes to the kitchen, it’s all about function, function, function. If it doesn’t allow for ease of cooking, then you’re going to lose people, said Digrado. Cooking stations allowing for multiple chefs in the kitchen are becoming more common; as are work areas for laptops and homework, charging station for mobile devices, and casual seating for hanging out.

Outdoor rooms/entertainment areas just off the great room or kitchen are a way to expand the indoor space, said Digrado, especially has buyers seek smaller homes.

Laundry rooms can also become a second center of a home. They’re often combined as a crafts room, mud room, or sewing room. “It really becomes a command post for many of the functional activities,” said Martin van Koolbergen of Kaplan Gehring McCarroll Architectural Lighting, Inc.

And don’t forget about the garage. Buyers are interested in extended storage options and flexible space.  (A good location for creative storage as buyers downsize to smaller homes.)

Here are a few more highly desired home features:

• Raised, articulated ceilings.
• Home office space (with an outdoor access, even better).
• Parent suites with a larger bedroom and attached bath.

Quick Tip from van Koolbergen: Make sure the color of the lights match in a single room, such as overhead lights and lower table fixtures. When the color temperature is mismatched, it’s very obvious and can be distracting.

By Erica Christoffer, REALTOR® Magazine

Smaller spaces, energy efficiency, Earth tones, and outdoor entertainment are all the buzz as the latest design trends debut at the International Builders’ Show in Orlando this week.

A survey of 2,000 consumers conducted by Better Homes and Gardens found that buyers don’t want any “wasted space” in their next home. They are seeking more value for their dollar, said editorial director Jill Waage, who presented the study’s findings Thursday. Affordability remains a high priority as well as energy efficiency, which was ranked highest to 68 percent of the consumers polled.

“Consumers are once again dreaming about their next home as well as planning ways to make their current home reflect their personal style and needs,” said Waage. “They are also setting priorities and watching their wallets in the process.”

The top ranked living space features listed by consumers are a separate laundry room, additional storage space with walk in closets or build-ins, a home office or workspace, outdoor living areas, at least one bathroom with its own private bath, and everyday eating space in or close to the kitchen.

“Today’s family wants a hive area where they can move seamlessly from mealtime to tech time to game/entertainment/hobby time to homework time,” said Waage.

Kay Green of Kay Green Design echoed Waage’s findings in her International Builders’ Show presentation Friday. “People want more of a clean line look with contemporary interiors,” Green said. “Stainless steel continues to be popular.”

Here are more design trends taking hold in 2011:

• Outdoor amenities such as grills, sinks, showers, and entertainment areas.
• Freestanding tubs with a separate stand-up shower in the bathroom.
• Color schemes – Earth tones, blues and blue greens, chocolate browns.
• International design influence, especially Asian design in both décor and functional products.
• Ceiling details accenting rooms within open floor plans.
• Media space for flat screen TVs and gaming systems, and living areas wired for technology.
• Organizational features, built-ins, and smart storage areas throughout the home.
• Universal design features incorporated in subtle ways.
• Artistic tile in kitchens and baths, often emulating organic patterns found in nature.
• Energy efficient products – washing machines, dish washers, toilets, and showerheads.
• LED lighting incorporated into sinks, showers, and medicine cabinets.

Move right in to this 1200+ sf home. Master bedroom has master bath with separate shower and garden tub.Home has 3 bedrooms with split bedroom design, two full baths. Kitchen has new laminate wood flooring, stained glass cabinet fronts and trendy colors. What a great deal, move in just in time for spring!  $17,000

Call the Jodi Home Team @ 309-303-1000!

By Brian Summerfield, Online Editor, REALTOR® Magazine

One of the biggest obstacles for a recovery in housing has been — and will continue to be — mortgage lending. Although rates fell to historic levels in 2010 and will likely remain relatively low through a good portion of this year, credit still isn’t easy to come by, even for many borrowers who would be considered safe in a normal market.

With that in mind, what can we expect in mortgage finance during 2011? Here are a few predictions, with help from Tom Wind, managing director at J.I. Kislak Mortgage, former CEO of JPMorgan Chase’s residential mortgage lending businesses, and former president and COO of CitiMortgage:

1. Several proposals will be made to reform and reconstitute Fannie Mae and Freddie Mac, but no new plan will be implemented this year. The U.S. Treasury Department is expected to offer recommendations to Congress this month on how to restructure the mortgage market, and incoming GOP representatives have made Fannie and Freddie reform a top priority for its agenda this year. However, Wind expressed some reservations about a speedy resolution to the issue. When some sort of reconstitution — or even replacement — of Fannie and Freddie does come, though, it will probably include an overt guarantee of government backing, he added.

“Government support is essential to a well-functioning market,” Wind explained. “There may be times when the market can function without it, but long-term, ensuring the liquidity of mortgages is essential.”

2. FHA will continue to be the prime mover in the secondary mortgage market. Because Fannie and Freddie are still in limbo, the FHA will remain the most important institution in the mortgage space during 2011. And while Wind sees its role diminishing somewhat as the secondary mortgage market settles into some as-yet-undefined new normal, he says it will probably remain the primary driver of home loans for first-time buyers for the foreseeable future.

3. Refinances will go down, purchases will go up. Overall, Wind expects U.S. mortgage lending activity to be way down in 2011, due almost entirely to a severe drop in refinances. (Wind predicts that the refi market will fall more than two-thirds, from $1 trillion to $350 billion.) This decline — along with changes to compensation caused by new rules from the Federal Reserve and the Dodd-Frank Wall Street Reform and Consumer Protection Act, which could mean 30-40 percent less in earnings on each loan — will drive many loan officers out of the business this year.

The silver lining here is that with favorable affordability conditions, improving economic fundamentals, and moderate interest rates, mortgages for home purchases will likely go up. “Any way you cut it, it’s going to be a smaller market,” Wind says. “But purchases will probably grow.”

4. Jumbo loans will remain hard to come by. Although Wind sees private investors and financial institutions easing back into jumbo mortgage loans, there’s still substantial concern about high-end homes holding their value over the next couple of years. He predicts this will be the last strata of mortgage loans to recover: “For a healthy jumbo market, we need a healthy housing market [first].”

When Web visitors come to Realtor.com, they most often are looking in the sunshine states for real estate, according to a list of the most searched real estate markets at Realtor.com for 2010.

Realtor.com, operated by Move Inc. and an official Web site of the National Association of REALTORS®, based its list on the number of visitors at Realtor.com that viewed properties in each metro area in the United States from January 2010 to December 2010.

Here are the top 10 most searched for cities at Realtor.com for 2010:

1. Las Vegas

2. Los Angeles

3. Orlando

4. San Antonio

5. Miami

6. Phoenix

7. San Diego

8. Austin, Texas

9. Tampa

10. Chicago

"Online search is a critical measure of interest in real estate, especially now that more than 90 percent of buyers search for their homes online," says Realtor.com President Errol Samuelson. "Changing conditions throughout 2010 in the sunshine states resulting from foreclosures, the tax credit, interest rates, and other factors created more interest in real estate compared to other states that we hope leads to increased activity and sales in 2011."

Source: “2010 Top Ten Most Searched Real Estate Markets Released by Realtor.com,” Move Inc. (Jan. 11, 2011)