Tax Help for those Facing Foreclosure or Short Sales

From Ilyce R. Glink at Inman News:

It's January, which means it's time to start thinking about filing your taxes. But you may need extra tax help this year, thanks to an active December on Capitol Hill.

In late December, President Bush signed the Mortgage Forgiveness Debt Relief Act of 2007, which provides tax help for homeowners facing foreclosure or who sell their homes in a short sale.

Previously, if the value of your home declined and your bank or lender forgave a portion of your mortgage debt, the tax code treated the amount forgiven as income that could be taxed, according to Eric L. Smith, a spokesman for the IRS.

In other words, if your lender forgave $20,000 in mortgage debt because your house was worth $20,000 less than your mortgage balance, the IRS treated this debt forgiveness the same as income that you earned from your job -- and required you to add $20,000 in phantom income to the amount of your annual income and pay tax on it at your marginal tax rate.

Instead of getting tax help at a time of great need, you were getting a kick in the pants the following April 15.

Under the new rule, taxpayers can exclude up to $2 million of mortgage debt forgiven in 2007, 2008 or 2009 on their principal residence. (The limit is $1 million for a married person filing a separate return.) According to Smith, mortgage debt reduced through restructuring, as well as mortgage debt forgiven in connection with a foreclosure, both qualify for the tax exclusion.

It's worth noting that the Mortgage Forgiveness Debt Relief Act of 2007 applies only to principal residences, not second homes or investment property, says Chet Burgess, an enrolled agent who owns Brookwood Tax Services, in Atlanta. The rules from IRS Section 121 define what a qualified principal residence is, but at a baseline, you must live there the majority of the year.

The IRS doesn't make it easy. You may need some additional tax help to be sure you're filling out the forms correctly.

If this is you, or someone you know, please look into this. If you need any advice or help, let me know. I'll get you in touch with the right people.

Maybe Tax Season will be better than you expected this year.

Dan Hamilton
Keller Williams Greater Columbus Realty
www.HamiltonHomesGroup.com
Search Columbus MLS
Homes For Sale Columbus, OH

Funny Ads from Ameriquest Mortgage

I promise, I won't judge too quickly either when you're ready to buy or sell. Just let me know.

Video posted by YouTube user redboy76.

Dan Hamilton
Keller Williams Greater Columbus Realty
www.HamiltonHomesGroup.com

World Clock - Very Cool

Larger View - See it here...

Dan Hamilton
Keller Williams Greater Columbus Realty
www.HamiltonHomesGroup.com

Selling? Fix It Up or Offer a Buyer's Credit?

The following was copy and pasted from an article written by Dian Hymer of Inman News:

A common opinion expressed by sellers is that it's pointless to fix up a place for someone else whose decorating preferences might be quite different. For example, why not just offer a credit to the buyers so that they can either change the carpet or refinish the hardwood floors -- whichever they prefer?

The problem with this approach is that most buyers have a difficult time imagining how a home will look fixed up. They remember what they see, not what the house could look like with this or that improvement.

Imagine there are five homes listed for sale in an area, all similarly priced, but not all in the same condition. Three houses have old, worn carpet covering most of the floors; one has linoleum over the floor; and the fifth has pristine, recently refinished hardwood floors. Most buyers will gravitate to the home with the beautiful hardwood floors.

The best houses in the best condition and offered for the best price usually sell quickly. A fast sale is important to some sellers in this market. The sooner your home is sold, the sooner you stop paying mortgage payments, property taxes and various maintenance costs.

Dan Hamilton
Keller Williams Greater Columbus Realty
www.HamiltonHomesGroup.comColumbus Real Estate For Sale

Frightening Video on Foreclosure Crisis

The above video was posted on CBSNews.com regarding the subprime foreclosure crisis impacting California (an much of the United States). Watch the whole video and see that this whole thing started from a combination of misinformation and greed.

Feel free to comment.

Dan Hamilton
Keller Williams Greater Columbus Realty
www.HamiltonHomesGroup.com
Search the Columbus MLS

New Listing! Real Estate For Sale, Columbus Home For Sale

Dan Hamilton
Keller Williams Greater Columbus Realty
www.HamiltonHomesGroup.com
Columbus Real Estate
Columbus Homes For Sale

Tax Rebate To Stimulate Economy?

What will you do with your money? Feel free to comment.

Dan Hamilton
Keller Williams Greater Columbus Realty
www.HamiltonHomesGroup.com
Columbus Real Estate
Columbus Homes For Sale

October 2007 Stats for Columbus MLS

From www.ColumbusRealtors.com:

The number of listings added to the market in October was down for the third month in a row, a strong indicator that the market is beginning to correct itself. The 3,578 homes listed last month is down 6.9 percent from one year ago. In addition, new listings in August and September were down 8.3 percent and 5.7 percent respectively according to the Columbus Board of REALTORS®.


"The record number of listings added to the market each month has tilted the scales strongly in favor of the buyer this year," said Brad Bennett, President of the Columbus Board of REALTORS®. "As the inventory of homes has been roughly sixty percent higher than our norm, sellers have had to lower prices to compete for the buyer. This has caused home values to appear lower than they actually are. As the listing pace slows, inventory levels will drop and home prices will rise again as the market begins to correct itself."

Dan Hamilton
Keller Williams Greater Columbus Realty
www.HamiltonHomesGroup.com
Columbus Real Estate
Columbus Homes For Sale

Reality Realty TV

Usually on Sunday mornings my wife and I are at church. But this Sunday, we're both recovering from being sick, so we decided to stay in. For those of you who have been in a similar situation, you know what this means: you get to see TV shows you never even knew existed!

Most of the shows on are pretty bad. Lots of infomercials. But I did find one that I want to mention. Your Home Columbus.

Your Home Columbus is on NBC from 12:00-12:30 and it features do-it-yourself projects and tips to help bring extra value to your home. Plus, there is a great website to accompany this show, www.YourHomeColumbus.com.

So, I'm not suggesting you skip church or your regular productive activities, but if you're home on Sunday mornings at 12:00-12:30, check this show out. And at some point, check out their website.

Plus, it's all local... filmed in Columbus by Columbus businesses.

Dan Hamilton
Keller Williams Greater Columbus Realty
www.HamiltonHomesGroup.com
Columbus Real Estate

YouTube Video - Mortgage Fraud

If you have any questions about this or any other related questions, contact your lender or contact me. We will get this sorted out.

Video posted by YouTube user AvoidFraud.

Dan Hamilton
Keller Williams Greater Columbus Realty
www.HamiltonHomesGroup.com

Homes are Selling. I promise.

If you listen to media reports, you might think 2007 was a horrible year for real estate. Surprise, you're wrong. Very wrong.

In fact, 2007 was one of the top 5 years in real estate sales history. Honest.

So, why the negative media reporting? Well, compared to 2004 and 2005, in 2007, sales stats were down. But what do you expect when the market was at such a boom period in '04 and '05. The market has to stabilize. And it is doing just that.

Also, there are some areas of the U.S. that are really thriving. According to Forbes.com, Salt Lake City, Charlotte, San Jose, and Raleigh are the 5 Best Housing Markets right now.

So, don't believe everything you hear from the media. They're looking for a story. Unfortunately, most of them are reporting the wrong story.

Dan Hamilton
Keller Williams Greater Columbus Realty
www.HamiltonHomesGroup.com

Ohio State National Championship Game Tonight

As if you didn't already know... Ohio State takes on LSU for the BCS National Championship tonight.

Go Bucks!

Dan Hamilton
Keller Williams Greater Columbus Realty
www.HamiltonHomesGroup.com

2008: Is the Market Really as Bad as they Say?

Here is a recent article I found on InmanNews.com (written by Bernice Ross):

Laurence Yun, the chief economist for NAR, had plenty of positive news for Realtors at last month's conference. Yun attributed much of today's subprime mortgage problem to greed. Wall Street wanted the 10-12 percent return that subprime mortgages yielded as opposed to the smaller returns from more traditional mortgage products. His take on the Wall Street types: "They gambled. They lost."

Yun's outlook for 2008 sees a shift from greedy speculators to serious homeowners. 2008 will be a year of opportunity where there will be serious, healthy business. Furthermore, Yun predicted that the market returns to normal by 2009.

According to Yun, one of the biggest mistakes that reporters make is talking about national trends. Nationally, 2007 was the fifth best year ever on record. Home prices declined about 1.5 percent after a 50 percent run up in prices.

The challenge is that national numbers are pretty much irrelevant. Yun argues that talking about national averages is about as effective as having a national weather forecast. Like the weather, all real estate markets are local. In fact, you may have a buyer's market and a seller's market operating within a single market area based exclusively upon price point. Here are the other key pieces of positive news from Yun's economic report:

1. New housing starts: Even though these are dropping, there was too much building in recent years. The market is simply adjusting to normal supply-and-demand pressures. The inventory is "being controlled which makes stabilization occur more quickly."

2. Foreclosures: According to Yun, the 41 percent increase in foreclosures has resulted primarily from investor-heavy real estate purchases in Arizona, California, Florida and Nevada. The majority of these individuals are flippers whose investments did not payoff. More importantly, the number of foreclosures in Utah, New Mexico, North Carolina and South Carolina is actually declining.

3. Under-priced markets and superstar cities: Although the coastal markets are still overpriced, Middle America is under priced. Nevertheless, Yun cites a new trend termed, "superstar" cities. These cities will command premium prices, regardless of what the market does. There is so much wealth concentrated in these areas, that measurements are simply not predictive. In addition to London, Paris, Tokyo and New York, Yun also identified San Francisco, Miami and Seattle as potential new superstar cities.

4. The recovery has started: Other than the three states hit heavily by job losses in the automotive industry (Indiana, Michigan and Ohio), the states that first experienced a downturn in the Northeast, are now in recovery. Specifically, Connecticut, Massachusetts, New York and Rhode Island were the first to feel the slump and are now well into a recovery. Furthermore, there appears to be a pent-up demand for first-time buyer properties due to a large number of Gen Ys (born 1977 to 1994) that are now buying their first homes. Falling interest rates will motivate many of these buyers to step into the market now.

5. New jobs and corporate profits are still strong: Corporate profits are still strong with companies as diverse as Microsoft and Jack Daniels reporting close to record profits. Furthermore, the economy has generated 4 million net new jobs and wages are rising.

6. A weak dollar may harbinger more foreign investment in U.S. real estate
Although the decline of the U.S. dollar will end up costing us more when we go overseas or purchase imports, it has resulted in more manufacturing jobs returning to the U.S. It also may mean more foreign investment in U.S. properties as well. Just a few years ago, the Canadian dollar was only worth 70 cents in U.S. currency. Today, the Canadian dollar has been hovering at about $1.05 to $1.10 U.S. What this means is that we can expect more Canadians and Europeans to be purchasing U.S. property, because our prices are approximately 50 percent cheaper than they were just three years ago.

7. Real estate: Still the best shelter: For those agents who represent reluctant first-time buyers, Yun points to some interesting research from the Federal Reserve. Between 1995 and 2004, the average renter accumulated $4,000 in wealth. In contrast, the average homeowner accumulated $184,400. Furthermore, the typical homeowner holds their property for six years. Within this period of time, NAR's research shows that approximately 97 percent of the homeowners will have a positive equity position after that period of time.

Bottom line: 2008 represents the best window that buyers will have to find excellent deals with excellent financing. Get the word out there. If they wait, prices and interest rates will be higher and the reluctant buyer may be forced out of the market.

Dan Hamilton
Keller Williams Greater Columbus Realty
www.HamiltonHomesGroup.com
Columbus Real Estate