· Tax credit: Ten percent of the purchase price of a primary residence, up to a maximum of $8,000 for first-time homebuyers and $6,500 for repeat buyers who purchase between December 1, 2009 and May 1, 2010. First-time homebuyers are defined as people who have not owned a home in the previous three years. Repeat buyers must have owned their current home at least five years. The credit cannot be used for houses costing more than $800,000. · Deadline for qualifying: Purchase agreements must be signed by April 30, 2010, and closings must be final by June 30, 2010. · Military deadline: The deadline is extended by a year for members of the military who have served outside the U.S. for at least 90 days from Jan. 1, 2009, to May 1, 2010. · Income limits: Individuals with annual incomes up to $125,000 and joint filers with incomes up to $225,000 qualify for the full credit. Individuals with incomes up to $145,000 and joint filers with incomes up to $245,000 qualify for reduced credits. · How to apply: Taxpayers can claim the credit on their federal income tax returns. If the credit exceeds their tax bill, the government will issue a payment. Taxpayers who want immediate refunds can amend their tax returns for 2008 to claim the credit.
As always, please let me know how I can help you, your family, or friends with their Real Estate needs. Thomas Ray,M.S.,REALTOR,Cell:310-420-1149 Search the MLS like an Agent at my site: www.LAexclusiveProperty.com And, read my BLOG: www.RealEstateBlogLA.com Have a great week everyone!!
"The bear market continues; HOME PRICES are back to their March 2004 levels," (Is this the Bottom????)...says David M. Blitzer, chairman of the Index Committee at Standard & Poor's. "Both composite indices and 14 of the 20 metro areas are reporting new record rates of decline. As of October 2008, the 10-City Composite is down 25.0 percent from its mid-2006 peak, and the 20-City
Three of the metro areas have given back, on average, more than 30 percent of the value of homes since October of last year. Phoenix remains the weakest market, reporting an annual decline of 32.7 percent, followed by Las Vegas, down 31.7 percent, and San Francisco down 31.0 percent. Miami, Los Angeles, and San Diego were close behind with annual declines of 29.0 percent, 27.9 percent and 26.7 percent, respectively.
Here are some of the advantages that investing in Multi-units Buildings has over Single Families.
Cash flow on a multi-family is always greater than that of a single family. Simply because you have more rents coming in. The more units you have under one roof, the less risk you have. If you have a single family house and you lose your tenant, you've lost 100% of your income. In some instances, this could be your entire profit for the year. If you had a three family and lost a tenant, you still have two rent coming in to pay your expenses.
Economies of scale are in mulit-unit buildings. If you have six single family houses opposed to one six family, you have six roofs to be replaced or repaired, six lawns to be maintain, six tenants spread out through out your city or town. In your six family you have one roof, one lawn and your tenants are centrally located. Economies of scale are in your favor.
There's a lot less competition than there are in single family houses. Why? Because no one is out there teaching how to do it and all the single family guru's make flipping single family houses sound as easy as chewing gum in the dark. The smart investors put multi-units in their portfolios along with single family houses.
Because of the bigger cash flows, you can afford to hire management companies to manage your tenants, thus eliminating that hassle while you go out and do what you do best (or should do best), find and finance them.
Your pay days are a lot bigger when you finally sell your property. This is because an apartment complex cost more than single family homes, because of this they obtain a greater dollar amount of appreciation. For example, a $100,000 single family house will in a market that appreciates 10% will be worth $110,000 while a three family house worth $300,000 in the same market (10% appreciation) will increase to $330,000. That's $20,000 more money in your pocket! You've know a few people who have made a lot of money flipping single family houses, but if you think of the all the people you know who have become extremely wealthy through real estate, you'll realize that they did it through owning multi-units (apartments).
Dr. Sam Chandan (formerly Chief Economist with REIS) speaks on the status of the Multi-Family Apartment market. I normally do not post links on my Blog, but Dr. Sam has his finger on the pulse and speaks on why now is the time to Buy! Here is the Link Please contact me for all your Investment needs. My site:www.LAexclusiveProperty.com Market Conditions, Trends, Multi-Family, Apartment Buildings
(Please contact me to discuss your long term Passive Income Strategy that includes the purchase of Multi-Family Property. My Team at Keller Williams will show you the benefits in this down market.)
The Apartment Rental Market continues to benefit from weak home sales!
"...multifamily is the bright spot," George Ratiu, economist at NAR Research said. "This is in large part due to a high number of foreclosures, and the fact that people still need housing, no matter what is going on in the economy."
"Demand for this sector is healthy with rent growth being positive, if not stellar." NAR forecasts multifamily vacancy rates for the third quarter of 2009 at 5.8 percent, unchanged from the third quarter of this year, which is still low compared with other sectors. Markets with the tightest vacancies include San Diego, northern New Jersey and Boston, with vacancy rates of 4.2 percent or less. Areas with the highest vacancies include Jacksonville, Fla.; Phoenix; and Orlando, Fla., with vacancies of 8.5 percent or higher.
"To a large extent, this is true for the multifamily sector as well," says Ratiu. According to NAR's research, multifamily lending stood at $9.7 billion in the third quarter of 2008 but is expected to drop to $1.5 billion in the fourth quarter, according to estimates made by NAR. "This is a significant drop because financing has pretty much come to a standstill. This is mainly because of a lack of financing. Also, there is a wave of refinancing across the country but very little capital going around," says Ratiu.
Lawrence Yun, NAR chief economist, says there are serious structural problems in commercial lending. "Although access to residential mortgages has improved, the opposite is true for commercial loans," he says. "We need liquidity for commercial mortgage-backed securities not only to free the market, but also to rollover existing debt. At the same time, the loss of jobs has had a significant impact on the demand for commercial space."
Yun added that default rates on commercial real estate loans are very low by historical standards. "However, commercial defaults could deteriorate significantly without a properly structured stimulus that addresses liquidity for commercial mortgages," he said.
The year 2009 is expected to fare better, according to Raiu, with demand going further up. "This is partly because single-family construction has pretty much halted, and with mortgage being extremely difficult to get, people are turning toward multifamily housing. In addition, with the economy being where it is, and home prices falling, consumer confidence is down and people are wary of buying, not knowing when the bottom will be reached."
All this is having a modest impact on rent increases. "Rent is expected to increase 2.8 percent in 2009 as opposed to 2.9 percent in 2008, 3.1 percent in 2007 and 4.1 percent in 2006," says Ratiu.
Multifamily net absorption is expected to be 24,400 units in 59 trackedBy Anuradha Kher, Online News Editor
Washington, D.C.--With the exception of the apartment rental market, which continues to benefit from weak home sales, all commercial real estate property types are showing grim results for 2008, with an equally grim forecast for 2009, according to the Commercial Real Estate Outlook of the National Association of Realtors (NAR).
"If anything, multifamily is the bright spot," George Ratiu, economist at NAR Research, tells MHN. "This is in large part due to a high number of foreclosures, and the fact that people still need housing, no matter what is going on in the economy."
Demand for this sector, Ratiu says, "is healthy with rent growth being positive, if not stellar." NAR forecasts multifamily vacancy rates for the third quarter of 2009 at 5.8 percent, unchanged from the third quarter of this year, which is still low compared with other sectors. Markets with the tightest vacancies include San Diego, northern New Jersey and Boston, with vacancy rates of 4.2 percent or less. Areas with the highest vacancies include Jacksonville, Fla.; Phoenix; and Orlando, Fla., with vacancies of 8.5 percent or higher.
The outlook also shows that with the exception of cash transactions, investment activity in commercial real estate sectors is nearly at a standstill because commercial lending has essentially halted, while job losses are curtailing the demand for space.
"To a large extent, this is true for the multifamily sector as well," says Ratiu. According to NAR's research, multifamily lending stood at $9.7 billion in the third quarter of 2008 but is expected to drop to $1.5 billion in the fourth quarter, according to estimates made by NAR. "This is a significant drop because financing has pretty much come to a standstill. This is mainly because of a lack of financing. Also, there is a wave of refinancing across the country but very little capital going around," says Ratiu.
Lawrence Yun, NAR chief economist, says there are serious structural problems in commercial lending. "Although access to residential mortgages has improved, the opposite is true for commercial loans," he says. "We need liquidity for commercial mortgage-backed securities not only to free the market, but also to rollover existing debt. At the same time, the loss of jobs has had a significant impact on the demand for commercial space."
Yun added that default rates on commercial real estate loans are very low by historical standards. "However, commercial defaults could deteriorate significantly without a properly structured stimulus that addresses liquidity for commercial mortgages," he said.
The year 2009 is expected to fare better, according to Raiu, with demand going further up. "This is partly because single-family construction has pretty much halted, and with mortgage being extremely difficult to get, people are turning toward multifamily housing. In addition, with the economy being where it is, and home prices falling, consumer confidence is down and people are wary of buying, not knowing when the bottom will be reached."
All this is having a modest impact on rent increases. "On an average, rent is expected to increase 2.8 percent in 2009 as opposed to 2.9 percent in 2008, 3.1 percent in 2007 and 4.1 percent in 2006," says Ratiu.
Multifamily net absorption is expected to be 24,400 units in 59 tracked metro areas this year and 142,000 in 2009, according to the NAR Outlook.
This week, look for the Fed to cut the Fed Funds rate (the rate for overnight loans between banks) by a half point, to 0.50 percent. While a cut by the Fed often causes home loan rates to rise (because a Fed cut can lead to inflation, which is the arch enemy of Bonds and home loan rates), the deflationary environment we are currently in may prevent home loan rates from worsening.
Another event to note on Tuesday is the release of November's Consumer Price Index (CPI) Report. This widely watched inflation indicator tells us how much more expensive goods and services are this month over last month, and with recent concerns on deflation - this will be an important report to watch.
Bonds and home loan rates ended the week at their best levels of this year and in over five years. Let me know if you want some more information about how you can take advantage of the current situation. Have a safe week!
Thomas Ray,M.S.,Realtor Keller Williams Realty Office:310.862.1786,Cell:310-420-1149 www.LAexclusiveProperty.com Rates, Financials, Fed Action
Income tax, sales tax, estate tax, excise tax, alternative minimum tax...and just when you thought you'd paid them all...along comes your property tax bill as a homeowner. But did you know that the National Taxpayers Union estimates that as many as 60% of homes are assessed for too high of a value, resulting in an incorrectly larger property tax bill? Chances are good you might be in that group of people paying too much, so taking the time to review your property tax bill could save you a nice chunk of change.
The good news is that it's easy...First, contact your local tax assessor's office and ask for someone in the reassessment area. Find out when appeals are heard, and how the process for submitting a property tax appeal works. Additionally, ask for a copy of your property card. Review the card and confirm that the basic information about your property is correct. For example, is the square footage and number of rooms for your home accurate? If the number is incorrect, the county may change the assessment without a formal appeal. If everything on the property card is correct but the assessed value still seems too high, your next step is to gather the following documentation to support an appeal. And don't be surprised if the assessed value is lower than what you think the mark et value for your home is--many counties use a formula which uses a percentage of mark et value to determine assessed value. Ask what the formula is, because an assessment which is less than mark et value still might be too high.
If you have a current appraisal that supports the value being lower using recent mark et-value information, many counties will accept a copy of the appraisal with the appeal. If the appraisal is outdated, you can order a new one--just call me for a referral to a great appraiser. You can also visit the local assessor's office or search online, and look through the public records for other homes that have similar features to yours, but have lower assessments. Additionally, contact me to get in touch with a great Realtor who knows your area. They will be able to give you current mark et information for your neighborhood, and help you see how your mark et value and assessed value stacks up against your neighbors'.
Submitting an appeal is generally a fairly simple process, but make sure to take the time to fill out all forms in advance and be prepared with your documentation if there is an in-person hearing that needs to take place.
More good news - according to the National Taxpayers Union , about 33% of property tax appeals succeed! Taking the time to review the accuracy of a tax bill could easily save you hundreds of dollars per year, adding up to thousands of dollars during the time you own your home. Please feel free to contact me for more information on this money-saving tip.
I am now featuring REO Pre-Listings on my site. If you or your Buyers are not familiar with a Pre-Listing, you are not alone.
A Pre-Listing is an REO that may not be vacant so it is not on the market. However, the Bank will accept offers on these allowing your Buyers to beat the rush to buy REO homes in the very HOT REO MARKET here in Los Angeles,CA.
24 November 2008 Save on Your Credit Score this Holiday Season
To help you make sure you manage your credit cards--and your credit score--during the upcoming holiday spending season, follow these steps:
Double-check your card limits. Many credit card companies today have started lowering credit limits. That means you have less credit available, but it also may mean that your credit score is about to take a hit. That's because approximately 30% of your credit score is based on the amount you owe in relation to your available credit. So, if a credit card company cuts back your limit, you may find that you're suddenly almost maxed out. That's not a good sign for your long-term credit score rating.
Ask, pay down, or move around. If some of your credit limits have changed or are nearly maxed out, you can take a few steps to help alleviate the problem. First, consider simply asking for a higher limit to your card...not necessarily to use up with spending, but to allow more unused credit line to be available and therefore boost your credit score. You can also pay more money to the cards that are near the credit limit, if you can. Or, if you have cards with little to no remaining credit line, transfer some of the larger balances onto the cards with lower balances. That'll give you a more... well... balanced financial picture.
Leave home without it. One of the best tips for the holiday season is to: make a budget, identify specific items, and then leave home without your credit card. Instead, bring just enough cash to purchase the items on your list. That will help you resist the urge to impulse buy, and keep your credit card balances lower.
Pick a card... not just any card. If you can't bring cash, make a credit card plan. Identify specific items that you'll pay for on specific cards. By making a plan and spreading your purchases to different cards, you won't overspend and you won't risk running up one or two cards that are near the credit limit, which will hurt your credit rating.
Resist card offers at the counter. Retailers are famous for offering "savings" when you open a credit card. But those savings often don't outweigh the long- and short-term negatives. For one thing, opening a new account--or multiple accounts in a short period of time--can negatively impact your credit score. In addition, consumers often spend more than planned when a new card is suddenly available. So this holiday season, resist the temptation.
Stay active. If you have older cards that you don't use, make sure you keep them active. For one thing, some of those older cards help establish a longer history of positive credit. For another, the available credit on those older cards can help keep your credit score higher because it improves your overall debt-to-credit ratio. To keep those cards active, make sure you charge one or two items on them throughout the year... like, say, when you go shopping for the holidays. Then, pay them off when the bill comes in.
Always pay on time. Your payment record is a very large part of your credit score, so it's crucial that you have an idea how your holiday shopping will impact your credit card bills and that you make a plan to pay those bills on time. If you have trouble for any reason, contact your card companies right away to work out a plan that helps you pay down your debt... and save your credit rating from a huge hit. My Site: www.LAexclusiveProperty.com
Local up-to-date Real Estate news and activity for Buyers and Sellers in the Los Angeles California areas of Santa Monica, Pacific Palisades and the Westside.
Disclaimer: ActiveRain Corp. does not necessarily endorse the real estate agents, loan officers and brokers listed on this site. These real estate profiles, blogs and blog entries are provided here as a courtesy to our visitors to help them make an informed decision when buying or selling a house. ActiveRain Corp. takes no responsibility for the content in these profiles, that are written by the members of this community.
;)
;)
