Monthly Home Prices Are on the Rise | Waccabuc Real Estate
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Harsh weather, tight supply sink U.S. home sales | Waccabuc Real Estate
Home Sellers Can’t Sell If They Can’t Find a Next Home to Move Into | Waccabuc Real Estate
There’s some good news for U.S. homeowners in early 2014, especially those who want to sell.
Data from Seattle’s Redfin citing figures culled from 19 major real estate markets show home prices up 14.3% in January from a year earlier. All 19 markets posted gains on home values.
At the same time, there is a lack of homes for sale, with inventory down 9.4% from a year earlier due to a lack of “demand growth,” the company says.
Redfin says only 28% of its customers made an offer on a “for sale” home last month, compared with 42% at the same time in 2013. That’s the case even as homebuyers taking in visits to homes remains stable at 50% — it’s just that those visits aren’t leading to offers.
Home sellers are still bullish.
The number of American homeowners who say “now is a good time to sell” rose 4% in January. Holding them back is a fear that they won’t be able to find a good deal on a next home.
“Most of my home-selling clients worry the most about what will happen after they sell,” says Paul Stone, a Denver real estate agent. “With so much competition in the market, they fear they will have to move in with their in-laws if they can’t find their next home quickly.”
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Surprise! The Gain on the Sale of Your Home May Be Taxable | Waccabuc Real Estate
Since 1998, most people haven’t had to worry about owing taxes when they sell their home, even if they clear a hefty profit when they do so. There’s no longer any need to buy another house to roll over any gain, and in many cases the taxpayers don’t even have to report the sale of their homes on their tax returns.
You can still owe tax on some or all of the gain from the sale of your home, however. Tax will be due if one or more of the following are true.
1. You didn’t own and live in the house for two of the last five years If you sell your home at a gain before two years are up and you don’t qualify for any of the exceptions, you pay tax on the gain.
Exceptions: If you have to move because of health, a job transfer, or other unforeseen circumstances, you may still be able to exclude your gain. The maximum amount you can exclude will be prorated.
For example, let’s say you were single and you owned and lived in a house for one year before you were transferred by your employer to another state. You met the requirements for 50% of the two-year time period. You can exclude up to $125,000 of gain from the sale ($250,000 times 50%.)
2. The house appreciated in value when you were not living in it Prior to 2008, you could have a vacation or investment home for years — decades, even — and watch it go up in value. So long as you moved into it for two years before you sold it, you could exclude up to the maximum amount of gain. That loophole has been closed. You cannot exclude gain from while you were not living in the house. For this purpose, the house is assumed to have gone up in value the same amount every year while you owned it.
3. The house went up in value more than the exclusion amount It’s not far-fetched, especially in some parts of the country. The amount of gain you can exclude from the sale of a home is $250,000 ($500,000 if filing jointly). A home can go up in value more than $250,000, or $500,000 if you are filing jointly. You’ll pay tax on the gain over that amount.
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Swiss Housing Market Bubble Looms Closer | Waccabuc NY Real Estate
Switzerland’s property market is at greater risk of overheating, raising the question as to whether authorities have done enough to curtail the boom.
The UBS Swiss Real Estate Bubble Index rose to 1.23 points in the fourth quarter from 1.2 points in the third, according to a statement from UBS AG (UBSN) today. A reading above 2 indicates a bubble.
“The potential for correction has increased further,”Matthias Holzhey and Claudio Saputelli at UBS in Zurich said.
The Swiss National Bank (SNBN)’s policy of zero rates, in place since August 2011, has kept down the cost of taking out a mortgage. Coupled with high immigration from neighboring European countries that has fueled a strong increase in real estate prices in Switzerland.
Growth in mortgages has exceeded that of economic output since 2009, and last year price gains of homes and apartments outstripped advances in incomes, according to the central bank.
Concerned Switzerland could fall victim to a real estate crisis similar to that of the 1990s, the government last year forced banks to build up a countercyclical buffer of 1 percent of mortgage-related assets. After that failed to prevent a further deterioration of the mortgage market, it last month doubled the requirement to 2 percent. Even so, it refrained from raising it to the maximum 2.5 percent. Banks have until June 30 to comply.
http://www.bloomberg.com/news/2014-02-05/swiss-housing-market-bubble-looms-closer-ubs-says.html
Hybrid ARMs are Hot | Waccabuc NY Real Estate
Hybrid ARMs continued to be the most popular loan product offered by lenders and chosen by ARM borrowers according to Freddie Mac’s 30th Annual Adjustable-Rate Mortgage (ARM) Survey of prime loan offerings, which was conducted January 6 to January 10,
Hybrid ARMs have an extended initial fixed-rate period — generally three to ten years — and then adjust annually thereafter. Nearly all of the ARM lenders participating in the survey offered a hybrid. The 5/1 hybrid (a five-year fixed-rate initial period before the rate resets annually) was by far the most common, followed by the 3/1, 7/1 and 10/1. Far less common were ARMs where the re-pricing frequency was fixed for the life of loan, such as a one-year adjustable, a 3/3 ARM (which adjusts once every three years), or a 5/5 ARM (which adjusts every fifth year).
Among the 106 ARM lenders surveyed, 84 offered Treasury-indexed ARMs and 22 London Interbank Offered Rate (LIBOR)-indexed ARMs; generally, community and regional lenders were more likely to offer Treasury-indexed ARMs while large, national lenders offered LIBOR-based ARMs. Thus, even though offered by fewer lenders, the LIBOR-based product accounted for more than one-half of ARM originations. LIBOR-indexed ARMs generally had a lower margin (about 0.5 percentage points lower) than Treasury-indexed ARMs, a similar initial interest rate, but a higher index rate (about 0.5 percent-age points higher).
In early January 2014, the interest rate savings for the 5/1 hybrid ARM with a 30-year term — the most common ARM offered in today’s market — compared to the 30-year fixed-rate mortgage amounted to about 1.36 percentage points. For a $250,000 loan, the monthly principal and interest payment on a 5/1 hybrid would be about $194 less than on the 30-year fixed-rate loan over the first five years of the loan.
http://www.realestateeconomywatch.com/2014/01/hybrid-arms-are-hot/