You are currently browsing the category archive for the ‘Real Estate’ category.
Congress has passed a bill which President Obama signed into law today that will extend the expiring Bush tax rates and a host of other expired or expiring provisions.
In addition to extending the Bush tax rates through the end of 2012, the measure covers the following:
- Retains the 15% capital gains rate
- Two point self-employment tax reduction (for both employer and employee portions of tax)
- Reinstates the estate tax and the stepped-up basis rules
- Expands the estate tax exclusion to $5 million
- Lower estate tax rates (Maximum 35%)
- 15-year recovery periods for leasehold improvements
- Enhanced expensing for some assets
- Energy tax credits
- Alternative Minimum Tax relief
Dan Lachman, program manager of The Housing Trust of Santa Clara County, wants REALTORS® to inform their clients that The Housing Trust can provide assistance to first-time home buyers.
“We have money to help your first-time home buyers,” Lachman announced at a recent REALTOR® meeting.
The Housing Trust offers three main financial assistance programs for first-time home buyers – the Closing Cost Assistance Program (CCAP), the Mortgage Assistance Program (MAP) and Equity Share Co-Investment (ESCO):
Closing Cost Assistance Program (CCAP)
The Housing Trust will provide up to $6,500 to help pay for closing costs and other transaction expenses associated with purchasing a first home. This program provides a deferred loan of 3 percent of the purchase price up to $15,000 for down payment and/or closing costs. The loan is not repaid until the house is sold or the owner refinances. No interest or principal payments are due during the term of the loan.
Mortgage Assistance Program (MAP)
MAP is a second mortgage of up to $35,000 available to first-time home buyers in Santa Clara County. The Housing Trust MAP loan is a conventional second mortgage, with interest and principal payments due monthly and compatible with most banks and credit unions. It is a 30-year amortizing loan with the interest rate at 1.5 percent above the rate of the first loan.
To qualify for the CCAP and MAP, the income of a single-member household cannot exceed $86,950, or household income for a four-member household cannot exceed $124,200.
Equity Share Co-Investment (ESCO)
The Housing Trust will advance as much as $75,000 to first-time home buyers. The money will be used to match a buyer’s down payment. Payments on the ESCO loan will not be due until 15 years later, or until the house is sold or the borrower refinances. The borrower repays the loan based on the appreciation of the home in equal proportions to the amount of the original down payments. To qualify for the program, the income of a single-member household cannot exceed $103,390, or the household income of a four-member household cannot exceed $147,700.
Since 2001 The Housing Trust has provided 2,100 down payment assistance loans. Also, The Housing Trust’s definition of first-time home buyer is different from the state or federal government’s definition. A person who has not owned a home in Santa Clara County during the last three years is considered a first-time home buyer by The Housing Trust and may apply for assistance, according to Lachman.
Ask your REALTOR® about The Housing Trust of Santa Clara County, or visit www.housingtrustcc.org to learn more about these and other assistance programs.
The National Association of REALTORS® (NAR) is again asking REALTORS® to contact their members of the U.S. Senate to warn them about the dangers to the housing market and the economy of reducing or eliminating the mortgage interest deduction and making other tax changes that could hurt home owners. SILVAR members should have received a second Call for Action this week from NAR. Its launch came as a response to the co-chairs of President Obama’s bipartisan Federal Deficit Reduction Commission, charged with the task of finding ways to balance the budget by 2015 and to reduce the deficit by $4 trillion by 2020, release of their recommendations in a draft report titled “The Moment of Truth.”
The plan called for significant reductions to the mortgage interest deduction and other major tax reforms. The panel recommended converting the deduction to a 12 percent non-refundable tax credit available to all taxpayers, capped at $500,000, and limited to principal residences only (no credit for interest from second residence and equity). The panel also recommended the elimination of itemized deductions and the taxation of capital gains as ordinary income.
The deficit commission voted on the plan last week, and while it received a majority 11-7 vote, it fell short of the super-majority needed (a vote of at least 14 of its 18 members) to prompt immediate congressional action. Regardless of the outcome of the vote, it is imperative REALTORS® make their voices heard now because individual recommendations, like cuts to the MID and other programs impacting home ownership, could be included in federal budget legislation in early 2011.
The tax deductibility of interest paid on mortgages is a powerful incentive for home ownership and has been one of the simplest provisions in the federal tax code for more than 80 years. In a new survey commissioned by NAR and conducted online in October 2010 by Harris Interactive of nearly 3,000 homeowners and renters, nearly three-fourths of homeowners and two-thirds of renters said the mortgage interest deduction was extremely or very important to them.
Recent progress has been made in bringing stability to the housing market and any changes to the MID now or in the future could critically erode home prices and the value of homes by as much as 15 percent, according to NAR’s research. This would negatively impact home ownership for millions of Americans, including those who own their homes outright and have no mortgage.
Any further downward pressure on home prices will hamper economic recovery, raise foreclosures and hurt banks’ abilities to lend and likely tip the economy into another recession, resulting
Member of the Silicon Valley Association of REALTORS® (SILVAR) presented three grants this week, which will help children and, hopefully, make their holiday season brighter.
At the Menlo Park/Atherton District meeting on Monday, the Silicon Valley REALTORS® Charitable Foundation Trust presented $2,500 to the Westwind 4-H Riding Program for the Handicapped. Silicon Valley REALTORS® Charitable Foundation President Lisa Keith presented the grant to Judy Lookabill, board member of the Westwind Riding Institute.
Westwind 4-H Riding for the Handicapped has been providing horseback riding instruction for children with physical handicaps since 1978. Westwind Community Barn in Los Altos Hills is the home base of the Westwind 4-H riding program.
- Silicon Valley REALTORS® Charitable Foundation President Lisa Keith and Judy Lookabill, board member of the Westwind Riding Institute, hold the big check.
Lookabill thanked SILVAR members for the donation and continued support of the 4-H program. She said the benefits of horse riding are both psychological and physiological. The program builds confidence and self-esteem; develops coordination and balance; and is one of the few recreational activities, other than swimming, that is truly physically therapeutic, since it requires the involvement of the whole body and utilizes every muscle and joint.
On Wednesday, SILVAR’s Los Gatos/Saratoga District presented a check for $3,990 to EMQ FamiliesFirst in Los Gatos. The donation came from proceeds from the district’s annual pumpkin auction. Los Gatos/Saratoga District Chair Bill Rehbock presented the check to Bettina Kohlbrenner, executive director for fund development for the agency.
Los Gatos/Saratoga District Chair Bill Rehbock is pictured here with Bettina Kohlbrenner, executive director for fund development for the agency.
EMQ (Eastfield Ming Quong) FamiliesFirst helps children in crisis and their families. The agency provides shelter and care to children who are displaced and whose families are unable to care for them, so that they can recover from trauma, abuse and addiction, and rebuild their lives. Kohlbrenner said the agency currently cares for 40 children in the area. She thanked the district for its generous donation.
“Your donation will help make the holidays brighter for these children,” Kohlbrenner told SILVAR members.
At the Thursday Cupertino/Sunnyvale District tour meeting, the Silicon Valley REALTORS® Charitable Foundation presented a check for $1,250 to Child Advocates of Santa Clara and San Mateo. Charitable Foundation trustee Carolyn Miller presented the check to Kathy Williams, CASA board director.
Child Advocates of Santa Clara & San Mateo Counties trains and supports Court Appointed Special Advocate (CASA) volunteers to work one-on-one with abused and neglected children. A CASA volunteer speaks up for a child’s best interests, helping to ensure that he or she will live in a safe and loving environment and has the resources needed to grow up healthy and strong. Williams said the child advocates are “like big brothers and big sisters with teeth,” who serve as champions of the children and look out for their best interest.
Charitable Foundation trustee Carolyn Miller and Kathy Williams, CASA board director, hold the big check.
The Foundation’s grant will help underwrite the cost of recruiting, training and supervising additional volunteer advocates for the over 200 children currently on their list. Williams thanked SILVAR for the donation and noted it comes at a good time, and will provide great help for the children during the holidays.
Child Advocates of Santa Clara & San Mateo Counties trains and supports Court Appointed Special Advocate (CASA) volunteers to work one-on-one with abused and neglected children. A CASA volunteer speaks up for a child’s best interests, helping to ensure that he or she will live in a safe and loving environment and has the resources needed to grow up healthy and strong. Williams said the child advocates are “like big brothers and big sisters with teeth,” who serve as champions of the children and look out for their best interest.
The Foundation’s grant will help underwrite the cost of recruiting, training and supervising additional volunteer advocates for the over 200 children currently on their list. Williams thanked SILVAR for the donation and noted it comes at a good time, and will provide great help for the children during the holidays.
Also, in late November, SILVAR members of the Palo Alto District celebrated the district’s annual Partners in Education(PiE) Campaign and presented a check for $30,740 to the PiE Foundation and Palo Alto Unified School District.
Palo Alto Partners in Education is a nonprofit foundation dedicated to supporting Palo Alto public elementary, middle and high schools by raising money to meet classroom needs otherwise left unfunded. PiE funds support programs in art, home to school translations, math and science.
Palo Alto District PiE Campaign Chair Desiree Docktor is pictured here with PAUSD Superintendent Kevin Skelly.
Thank you to all SILVAR members who generously contribute to the Charitable Foundation and district fundraisers that help individuals and families in need in communities where members live and work!
The National Association of REALTORS® is asking REALTORS® to contact their members of Congress to warn them about the dangers to the housing market and the economy of reducing or eliminating the mortgage interest deduction and making other tax changes that could hurt home owners. REALTORS® should have received the Call for Action on Wednesday night. Its launch came just hours after the co-chairs of President Obama’s bipartisan Federal Deficit Reduction Commission, charged with the task of finding ways to balance the budget by 2015 and to reduce the deficit by $4 trillion by 2020, released their recommendations in a draft report titled “The Moment of Truth.”
The plan called for significant reductions to the mortgage interest deduction and other major tax reforms. The panel recommended converting the deduction to a 12 percent non-refundable tax credit available to all taxpayers, capped at $500,000, and limited to principal residences only (no credit for interest from second residence and equity). The panel also recommended the elimination of itemized deductions and the taxation of capital gains as ordinary income.
The deficit commission voted on the plan today, and while it received a majority 11-7 vote, it fell short of the super-majority needed (a vote of at least 14 of its 18 members) to prompt immediate congressional action. Regardless of the outcome of today’s vote, it is imperative REALTORS® make their voices heard now because individual recommendations like cuts to the MID and other programs impacting home ownership could be included in federal budget legislation in early 2011.
The tax deductibility of interest paid on mortgages is a powerful incentive for home ownership and has been one of the simplest provisions in the federal tax code for more than 80 years. In a new survey commissioned by NAR and conducted online in October 2010 by Harris Interactive of nearly 3,000 homeowners and renters, nearly three-fourths of homeowners and two-thirds of renters said the mortgage interest deduction was extremely or very important to them.
Recent progress has been made in bringing stability to the housing market and any changes to the MID now or in the future could critically erode home prices and the value of homes by as much as 15 percent, according to NAR’s research. This would negatively impact home ownership for millions of Americans, including those who own their homes outright and have no mortgage.
Any further downward pressure on home prices will hamper economic recovery, raise foreclosures and hurt banks’ abilities to lend and likely tip the economy into another recession, resulting in further job losses for the country. It will effectively close the door on the American dream.
REALTORS® must remain vigilant in opposing any plan that modifies or repeals the mortgage interest deduction. Please answer NAR’s Call for Action now and let your representatives know that the Mortgage Interest Deduction (MID) is vital to both home ownership and our economy.
Today, in a draft document titled “The Moment of Truth” the co-chairs of the President’s Deficit Reduction Commission proposed how the federal government should address ongoing budget shortfalls and an ever-growing national debt. This week, the 18-person commission is scheduled to vote on this report, which requires a 14-vote majority for approval.
Embedded in the 66-page draft is a proposal to significantly rewrite the federal tax code (figure 7 on page 31 gives the best explanation). Here are the four big tax changes proposed that would impact homeowners and REALTORS®:
- Mortgage interest deduction (MID) would be capped at $500,000, and no deduction will be allowed for interest paid from a second residence or equity loans.
- Continuation of standard deductions, but elimination of itemized deductions.
- Change from a five to three income tax brackets, taxed at the following rates12%, 22%, and 28%.
- All capital gains and dividends will taxed at ordinary income rates, which will mean an increase for the two upper income brackets.
Regardless of the vote this week, Congress would still need to propose, debate and pass many of these recommendation before the President could sign any into law. The National Association of REALTORS® (NAR) has already announced its opposition to any tax reform plan that does not retain the deductibility of mortgage interest. NAR also opposes any effort to convert the mortgage interest deduction from a deduction to a tax credit, and firmly believes that the MID is vital to the stability of the American housing market and economy.
Specific government incentives for homeownership in this country have existed for more than 150 years. That’s because homeownership helps foster communities, creates social stability, builds wealth over the long term, and contributes significantly to the U.S. economy. Realtors® believe that anyone who is able and willing to assume the responsibilities of owning a home should have the opportunity to pursue that dream.
If modifications to the mortgage interest deduction are moved forward, beyond an attack on homeowners, this will also be a three-pronged attack on the middle-class, the state of California, and the next generation of homeowners. Changes to the MID to enhance federal coffers would simply be a transfer from state and local governments, including school districts, that rely heavily on property tax revenues. Many cities in Silicon Valley have median home prices far above $500,000. Under this proposal, the negative impact felt here locally will be unequivocally greater than in other parts of the nation.
The tax deductibility of interest paid on mortgages is a powerful incentive for home ownership and has been one of the simplest provisions in the federal tax code for more than 80 years. In a new survey commissioned by NAR and conducted online in October 2010 by Harris Interactive of nearly 3,000 homeowners and renters, nearly three-fourths of homeowners and two-thirds of renters said the mortgage interest deduction was extremely or very important to them.
“Housing affordability has never been better, but the high unemployment rate, slow job growth and difficulty in obtaining credit, especially for high-cost homes, continue to be stumbling blocks to a complete housing recovery,” according to Jeff Bell, president of the Silicon Valley Association of REALTORS®.
Uneven Recovery, but Sales Clearly “Off Bottom”
The National Association of REALTORS® reports today that sales of existing homes in October declined 2.2 percent to a 4.43 million annual rate from 4.53 million in September. The national median existing-home price for all housing types was $170,500, down 0.9 percent from October 2009.
NAR chief economist Lawrence Yun said the recent sales pattern can be expected to continue, but he believes sales will steadily improve to healthier levels of above 5 million by spring of next year. “The housing market is experiencing an uneven recovery, and a temporary foreclosure stoppage in some states is likely to have held back a number of completed sales. Still, sales activity is clearly off the bottom and is attempting to settle into normal sustainable levels,” he said.
Overly tight credit is making it difficult for some creditworthy borrowers to qualify for a mortgage. “A return to common sense loan underwriting standards would go a long way toward achieving responsible, sustainable homeownership,” said NAR President Ron Phipps.
Home Builder Confidence Up, but Obtaining Credit Is a Problem
Home builders are also complaining that tight credit is getting in their way. Nationwide housing starts declined 11.7 percent to an annual rate of 519,000 units in October. Despite the decline, the National Association of Home Builders reports builder confidence is up slightly, as builders are starting to report some improvement in buyer demand and quality of buyer traffic.
“The great concern is that this positive momentum will be stifled due to builders’ inability to obtain financing for new construction at a time when inventories of completed new homes are very thin,” NAHB Chief Economist David Crowe said in a press release.
In addition to tight credit, worry continues about the high unemployment rate, slow job growth and looming shadow inventory. Distressed homes accounted for 34 percent of sales in October, according to NAR. There’s also the threat of foreclosures mounting as a growing amount of homeowners remain out of work and those who have borrowed against their equity default on their mortgage.
GDP Growth Better Than Anticipated
On the upside, the Commerce Department reports the economy grew at a 2.5 percent annual rate in the third quarter, more than previously calculated, due to increased shipments abroad and business spending for equipment and software.
Santa Clara County October Median Up Slightly
Although October home sales fell, Santa Clara County saw a slight year-over-year gain in its October median home price. According to a California Association of REALTORS® report released today, the October median price for a single-family home in Santa Clara County was $637,750, was up 8 percent from the same time a year ago. October sales of single-family detached homes in the county were down 24 percent from October 2009, when the first-time home buyer credits was available.
C.A.R. reports DataQuick statistics, which are based on county records data rather than MLS information, ranked the Silicon Valley cities of Los Altos, Palo Alto, Cupertino and Los Gatos among the top 10 cities with the highest median home prices in California during October 2010. The October median home price in Los Altos was $1,700,000; Palo Alto, $1,050,000; Cupertino, $1,022,500; and Los Gatos, $1,000,000.
To help consumers navigate the home buying process, the U.S. Department of Housing and Urban Development (HUD) and the National Association of REALTORS® (NAR) unveiled three how-to videos to help prospective homeowners find a home they can afford, shop for a mortgage they can sustain, and learn what to expect when they go to closing.
HUD produced the three consumer education videos in coordination with NAR and released them at the REALTORS®’ annual convention in New Orleans. Each video focuses on a critical part of the home buying process, including Shopping for your Home, Shopping for your Loan, and Closing the Deal.
HUD’s videos are easily accessible from both HUD and NAR’s websites, as well as from HUD’s YouTube channel. They include:
Shopping for your Home – The home buying process obviously starts with finding a place you’ll want to call home. This short video will instruct viewers on assessing how much of a home you can afford, working with a real estate agent and what happens once you find the home you want to buy. Housing counselors can assist home buyers and home owners on issues such as home buying, fair housing, credit issues, and foreclosure prevention.
Shopping for your Loan – Once you’ve found the home of your dreams, the next step is to shop for a mortgage loan. This video will help consumers use the good faith estimate (GFE), which is a form that spells out the terms of a loan offer, to shop for the best loan for them. Consumers will learn how to use the GFE to determine how long an interest rate is available for a particular loan and how to identify key loan terms and costs of a particular loan offer. HUD suggests consumers shop and compare GFEs from multiple mortgage brokers and/or lenders in order to get the best loan for their situation.
Closing the Deal – Finally, this video walks consumers through the actual closing process, including how to make sure the loan they were offered closely matches what they encounter at the settlement table. In particular, HUD will walk the viewer through the HUD-1 Settlement Statement and demonstrate ways consumers can compare their actual costs with those reflected on their Good Faith Estimate.
To view HUD’s new home buyer education videos, visit HUD’s YouTube channel at www.youtube.com/HUDchannel.
In an effort to be in compliance with federal case law and to have an enforceable sign ordinance, the Los Altos City Council unanimously approved two new sign ordinances this week. The ordinances dealing with signs on private and public property will be enforced starting December 30. A final version of the ordinances will be released shortly, but here’s a view of the draft ordinances.
There are changes included in the new ordinances that impact REALTORS®. The biggest change is when it will be permissible to place an open house sign on public property. These amendments were necessary to ensure that the sign rules had reasonable time and place restrictions for open house signs to prevent a legal challenge similar to what occurred in Menlo Park and led to a citywide ban of all signs on public property.
Here is a brief overview of the new rules for real estate and open house signs for Los Altos:
Residential on-site signs:
• One non-illuminated for sale sign allowed per property.
• For sale sign can be no taller than six feet in height and the sign face no larger than four square feet.
• Up to 12 square feet of real estate signage is allowed per property, which allows for both an A-frame open house sign and a for sale sign to be placed on private property at the same time.
• There are no day or time restrictions for real estate signs on private property.
Residential off-site open house signs:
• Size: A-frame signs no larger than four square feet per face, plus two riders, can be no taller than 32 inches.
• Location: Only on sidewalks where it does not obstruct pedestrian or bicycle access, cannot be placed on any medians or on the expressway right-of-way.
• Number per intersection: A single open house can only have one sign per intersection.
• Time restrictions: Signs will only be permitted during the following days and times:
o Friday: 9 AM-1:30 PM
o Saturday, Sunday and Holidays: 11:30 AM – 6 PM
A final version of the ordinance will be distributed to members once it is available.
After providing significant support behind an opposition campaign against Measure Q in Saratoga, SILVAR is pleased the measure proposing a two-story height limit for commercial and office property appears doomed.
The article, written by Joe Rodriguez of the Mercury News, concludes there are still ballots to be counted, but the measure is essentially headed for defeat. Rodriguez questions whether this would mean the Village “could grow taller than the town’s majestic redwood trees, and would development and increased traffic harm the surrounding neighborhoods,” as proponents of the measure fear.
Not so, says Councilman Chuck Page. Page, who won re-election and opposed the measure, says in the article that a previous 35-foot building height remains in effect and would prevent high-rise developments.
“The planning commission isn’t going to let anyone build to the max,” Page said in the article. “We have to do everything smartly and retain the character of the town, which is what everyone wants.”
Measure Q’s defeat is a huge victory for businesses and property owners in Saratoga!
Silicon Valley Association of REALTORS® says ... 