Things to Do Before Listing

This article was originally posted by Lauren Wingrove from American Nationwide Mortgage Company, Inc. here in Chattanooga. You can see the original article by clicking here, and Lauren's profile by clicking here.

If you're thinking of selling your house, now is the time to get serious about the prep work. While the process can seem overwhelming, here's a getting-ready-to-sell checklist that'll take you through the most critical tasks.

Depersonalize the space. Start by taking the "home" out of your house: family pictures, kids' art, collectibles, toiletries and tell-tale signs of pets (toys, food, etc.) all need to go. You want someone to imagine themselves living there - without thinking about you.

Purge and declutter. Tackle one room at a time, breaking it into zones. Then, (ruthlessly) work each area with a trash bag. Do a second pass with a new bag, looking for anything donation-worthy. Give yourself a few weeks for a proper purge - clutter suggests a lack of storage.

Do a deep clean. A top-to-bottom cleaning is what's required. Focus on the kitchen and bathrooms first, taking a toothbrush to surfaces if you need to, and then move on to living and family rooms. Don't forget closets and cabinets (buyers have been known to peek).

Make small fixes. Ask your agent about fixes that have big impact. A new coat of paint goes a long way, as does cleaning the blinds, fixing leaky faucets, recaulking tubs and upgrading a lighting fixture or two.

Detail the landscaping. Focus on sprucing things up. In the winter, keep walkways clear of snow and ice. In the spring, trim back bushes, edge lawn and beds and touch up the mulch. Make fence or deck repairs, and clean the windows. Then add a seasonal planter as a final, welcoming touch.

Get the photos right. Use a point-and-shoot camera, and open curtains to bring in natural light. Remove counter clutter, tuck away cords, lower toilet lids, and shoot from the doorway to capture the most space. Take several shots and then take some more. Pick only the best ones. Listing photos matter - a lot.

The Tax Implications of Selling Property

This is a guest post written by Andrea B, of Round Rock Real Estate in Austin, TX.

A Study of the Tax Implications of Selling Property

Selling your home or investment property can be an exciting experience, and there are plenty of numbers to keep in mind. From principal and interest payments to closing costs and moving expenses, the effect that selling your current home (and purchasing a new home) can have on your budget can be enough to make your head spin, but it’s also important to keep the tax requirements of making a sale in mind. In typical tax code fashion, the tax implications of selling your home can be difficult to comprehend, especially if you’ve never sold a home before, so it’s always a good idea to consult with real estate and tax professionals before listing your property. While there are plenty of ways to go about selling a piece of property, it is important to study all of your options before putting your home or property on the market. By following specific tax guidelines, you could be in line for some major savings when the time comes to file your annual return.

If the property you’re looking to sell has been your primary residence for at least two of the previous five years, federal tax law allows for a tax exclusion on the capital gains from the sale in many cases.

According to Fox Business, you are allowed to shelter up to $250,000 of profit if you’re single (or up to $500,000 if you’re married) when selling your primary residence. If you’ve lived in your home for at least two years and haven’t gone through the sale of another primary residence within the past two years in which you excluded gains, you can, most likely, exclude your capital gains from your annual tax return completely. If you have gains above the exclusion levels, the excess gains are subject to taxation, but any losses on the sale are not deductible. Be sure to consult with your tax professional in order to minimize taxable gains on the sale of your property.

Though you may able to exclude the sale of your primary residence, additional capital gains exceeding the exclusion level are still subject to taxation. Make sure you include every possible cost from the purchase of your home to minimize reported gains.

Capital gains that exceed exclusion ceilings need to be reported on form 1040, Schedule D, Capital Gains and Losses, so it is in your best interest to add all available expenses to the original cost of your home in order to minimize reported gains. If you’ve kept great records, the closing costs from the original purchase of your home, as well as from any refinancing or equity line loans you’ve secured, are one source of added costs that can be deducted from your sales gains. Capital improvements to the residence, including a new roof, windows and landscaping, are also applicable expenses. Selling expenses including realtor’s commission, closing costs and other agreed upon costs in the sales contract are also deductible.

Investment properties require more finesse in order to avoid excess taxation. In many cases, efforts to quickly flip property can result in taxation at two levels that can seriously impact your potential profits.

With the growing popularity of flipping real estate, tax laws were molded to keep an eye on short term investors. According to Bankrate, tax rates depend on how long you own a piece of property. While long-term investments are rewarded by federal tax laws, holding assets for less than a year could cost you. If you sell an investment property after holding it for a year or less, you’re likely to face short-term gains, which are taxed at rates as high as 35 percent. In addition, the IRS has been known to recognize multiple real estate transaction in a short period as a business practice instead of an investment strategy. In this case, you’ll have no escape from paying escalated income tax rates.

If an immediate sale isn’t necessary, consider alternative tactics to keep your tax bill minimized. Moving into the investment property for a few years or completing a Section 1031 exchange are worthy of consideration if you’ve got time to wait.

If possible, it’s always a good idea to look at alternative ways to limit your tax burden. Converting an investment property into a primary residence can be accomplished in two years and, potentially, eliminate your tax bill. On the flip side, 1031 exchanges could be a great idea if you plan to continue investing in property following the sale of your current investment. In any case, be sure to consult with your real estate and tax professionals in order to maximize your tax savings.

Andrea B. loves Round Rock real estate, the round Rock Express, and new restaurants in the Austin, TX area.

Sources:

http://www.foxbusiness.com/personal-finance/2012/08/30/tax-implications-selling-your-home/

http://www.bankrate.com/finance/money-guides/tax-consequences-of-flipping-real-estate-1.aspx

So you want to sell your home in 2015...

Five Crucial Home Selling Decisions if You Want to Sell in 2015

If you’re planning on selling your home in 2015 there are five crucial decisions that can help you maximize your sale price, get your home sold quickly and do it all without the mountain of stress that often comes with the sale of your home.

Decision #1 – Decide to prepare sooner than later. Home sellers who wait until spring to get their home “ready” are already behind the curve. The real estate year is in full swing by March 1st and homes that sell quickly and for top dollar during the “selling season” are the homes where the owner had a plan, got their home ready, staged, and listed early in the year.

Decision #2 – Decide to prepare yourself emotionally. Selling your home can be very emotional. When you receive an offer for less than you think your home is worth, it generates a whole host of negative emotions. You can feel angry, frustrated, and think everyone is trying to steal your home from you.

Well, they’re not. Buyers just want to know they’re getting the best price. We all feel similar when we make a big purchase. So be careful to manage your emotions. And if you get a “low-ball” offer rely on the help of a trusted professional. A good agent can often gently negotiate the price into a range where everyone wins. The key is to keep your emotional swings in check.

Decision #3 – Be realistic and price your home accordingly. One of the big keys to getting your home sold quickly, for the most money, is pricing it correctly. If you price your home too high, thinking you’ll “test the market,” it can be costly. Your home can sit on the market too long and get labeled as a “no-need-to-show” because you’re viewed as being unrealistic.

You see it all the time. Sellers think they are going to “hold out” and get a better price. Well, you need to consider how soon you want to sell? The reality is you can get just about any price you want if you’re willing to wait long enough. If you wait 5-7 years your home will very likely sell for a more than it will today. But if you want to sell in 90-120 days for top dollar, pricing is a crucial issue that you should discuss at length with a trusted real estate professional.

Decision #4 – Reconcile reality quickly. This is somewhat similar to decision #2, but it’s actually more practical and actionable. Emotions can be hard to define and control, like in point #2. But what is fairly easy to judge is your market’s numbers, and the realities of value.

Agents always hear things like, “But my home has this, this and this. Therefor it should be worth a lot more.” In theory that’s somewhat true. However, the reality you have to be prepared to reconcile is, if people won’t pay more for those things, it doesn’t make your home worth more.

Now don’t get me wrong. I’m not trying to soften you up so you give your home away. The goal is to help you get the highest possible price, in the shortest time, with the fewest hassles. But something that’s very important to deal with is reality, not wishful thinking. Wishful thinking backs tens of thousands of home sellers into very difficult positions every year.

Having a clear objective view of reality, as well as a trusted professional to help guide you through the emotional ups and downs, can help you avoid a massive mountain of emotional stress, while your home just sits on the market.

My encouragement is, prepare yourself for the true realities, while maintaining high standards throughout the process. It’s a balancing act that with the help of a trusted professional can be far easier to navigate.

Decision #5 – Trust your gut. When interviewing agents there are few things more important than a deep level of trust between you and the agent you choose to represent you. And trust comes in two crucial parts. The first is professional competency.

To trust someone with what is likely the single biggest financial transaction of your life, you need to have confidence that the agent you choose has the skills, technology and ability to fight hard and win what’s in your best interests. That’s why choosing someone just because they’re a “friend of the family” isn’t always the best choice.

The second layer of trust is personal. When you work with someone on something as important as the sale of your home, you need to know you can trust that person personally.

You need to feel a deep sense of confidence that your agent puts your needs in front of their own. It’s not about flash and glitter, or how many homes that agent sold. What’s important is, “Can I trust this person with my financial future?”

That’s where “listen to your gut” comes in. most of us can sense authenticity and integrity. It comes out in many ways and generally when you’re in the presence of it you know in your gut. Sometimes the person might be a little quirky, other times they’re not, but again it’s not about flash and charisma.

The bottom line, choose someone you trust on both a professional and personal level and “go with your gut.”

This content originally comes from Gary Elwood of Proquest Technologies. You can find the original post by clicking here.