AN INVESTMENT IN YOUR FUTURE IS CRUCIAL

Invest In Your Future

Cash Buyers Lists News​​

Are you looking to broaden your business?  Investors are a lucrative client base. According to the National Association of REALTORS(R) (NAR) 2016 Investment and Vacation Home Buyers Survey, total investment home purchases increased 7 percent between 2014 and 2015, and median sales prices rose 15.3 percent over the same period.

Not only does the investment market present the opportunity for an immediate boost to your business, but developing relationships with investor clients can also lead to long-term benefits for your career and financial future. Keep in mind, agents who typically work with primary homebuyers will find working with investors requires a different approach to buyer representation.

Rather than searching for the perfect place to call home, investors are more concerned with whether a property will meet their particular investment goals. 

Agents who work with investors must have the ability to quickly determine a property’s potential to generate income and appreciate in value. Investors expect their agents to have an advanced level of knowledge on topics like cash flow analysis, cap rates and special tax implications. It’s also important for agents to create a network of professionals, such as tax advisors, property managers and contractors, to assist investors in all aspects of the transaction.

While the skills necessary for representing investors are demanding, the benefits of establishing a good working relationship with investors are numerous. Compared to primary homebuyers, investors purchase property with much greater frequency. Agents who have proven themselves knowledgeable and shown an understanding of their client’s investment goals can expect to receive repeat business. This means less time and money spent marketing to new customers and more time on transactions with existing clients.

Favorable circumstances for investing exist across diverse market conditions, depending on the client’s investment strategy. Since investors tend to be interested in a variety of property types, agents will find prospects for everything from multi-unit buildings to single-family homes.

Last, but not least, a significant benefit to representing investors is the opportunity for you to gain in-depth knowledge and experience that can lead to you becoming an investor yourself. In fact, Bill Brown, NAR 2017 president, has made financial independence for all members one of his four priorities, urging all REALTORS(R) to consider real estate investments as a means to ensure their financial solvency.

Not only are investor agents eligible for special tax benefits, but also long-term assets necessary to enjoy a secure and prosperous retirement.

Start down this potentially lucrative path by enrolling in the course "Real Estate Investing: Build Wealth Representing Investors and Becoming One Yourself." The one-day course covers all the fundamentals of getting started on working with investors, planning the final purchase, and beyond. It also includes information that’ll help you build your own investment portfolio. As an investment strategy, developing the unique set of skills required in representing investors can provide you with benefits for years to come. More information on the course can be found at www.REBAC.net/content/real-estate-investing.

Marc Gould is vice president, Business Specialties, for NAR and executive director of REBAC. A wholly-owned subsidiary of NAR, The Real Estate Buyer's Agent Council (REBAC) is the world's largest association of real estate professionals focusing specifically on representing the real estate buyer. With more than 30,000 active members, REBAC awards the Accredited Buyer's Representative (ABR(R)) designation to REALTORS(R) who work directly with buyer-clients.
 
For more information, please visit REBAC.net.

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REAL ESTATE MARKETS IN MIDWEST, SOUTH TAKE TOP BILLING IN 2017

Hot, Hot, Hot Markets: Midwest and South

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Real Estate Markets in the Midwest and South will take top billing in 2017, setting the stage for a year of moderate home price growth, according to Clear Capitals recently released Home Data Index (HDI) Market Report. Home prices on a national scale are projected to increase 2.4 percent in the year ahead, while in the South are projected to increase 3.5 percent and in the Midwest, 3.4 percent.

Starring markets in 2017:

1. Dallas-Fort Worth-Arlington, Texas, No. 1 with 11 percent projected growth;
2. Denver-Aurora, Colo., at 7.3 percent;
3. Nashville-Davidson-Murfreesboro, Tenn., at 7.2 percent;
4. Milwaukee-Waukesha-West Allis, Wis., at 7.1 percent;Jacksonville, Fla., at 6.6 percent.

​The move-up of the Midwest and South will mark an end to the West’s major player-role; according to the report, home prices in the West are projected to increase 1 percent. Affordability, says Clear Capital Vice President of Research and Analytics Alex Villacorta, will also be an issue.

"Affordability will be the name of the game over the course of 2017, as the past few years of relatively impressive price growth have pushed home prices closer to the peak levels of 2006, with several markets reaching above and beyond to all-time highs," Villacorta says. "The national housing market will continue to grow, albeit markedly slower than in past years, with national home prices moderately increasing to the tune of 2.4 percent; however, Western growth will be greatly limited due to a widespread lack of affordability in almost all of the major markets in the region-a key reason for its tempered growth over the course of 2016.

"Contrastingly, the traditionally lower-priced and more affordable regions of the South and Midwest will set the pace for growth over the next year, while the luxury markets of the Northeast will again struggle to make impressive gains," says Villacorta. "In combination with affordability concerns already plaguing demand in some markets, the potential for additional interest rate increases over the coming year, as well as any potential market shake-ups due to the new presidential administration, could further jeopardize the housing markets now moderating recovery. Well be on deck throughout the next year monitoring housing markets across the nation, but for now, our models are predicting softer growth for 2017."

Source: Clear Capital

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ARE CLOSING COSTS TAX-DEDUCTIBLE?

Are Closing Costs Tax-Deductible?

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(TNS)-When you purchase your home or buy land for your new home from a seller, you’re responsible for paying closing costs on top of the negotiated contract price. These costs are sometimes shared by the seller, depending on how you negotiate the deal. As you sign the dotted line, you might wonder, "Are closing costs tax-deductible?"

The IRS has some specific rules on itemized deductions for homeowners regarding deducting real estate closing costs. Here’s what you need to know.

Can You Deduct Closing Costs on Your Taxes?
Homeowner tax deductions aren’t always easy to calculate, but the IRS does break down what types of tax deductions you can take when you file Form 1040. The only way to deduct closing costs, such as property tax, is by using itemized deductions. You cannot take a standard deduction and also deduct your closing costs, so you have to decide which one offers the most tax advantages for your situation.

Deductible Closing Costs
If you decide to itemize, you’ll need to know what closing costs you can actually deduct. The IRS identifies them as:

• Home mortgage interest paid at settlement that is found on the mortgage interest statement provided by the lender
• Certain real estate taxes paid at closing
• Real estate taxes-listed on your real estate tax bill-the lender paid from escrow to the taxing authority
• Sales taxes paid at closing
• Points-also known as loan origination fees, maximum loan charges, loan discounts or discount points-which are a one-time closing cost that provide you a discounted rate on your mortgage and can be deducted only over the life of the mortgage
• Mortgage insurance premiums, except for mortgage insurance provided by the Department of Veterans Affairs or Rural Housing Service​

About Deducting Points

Some situations enable you to deduct the full amount of points in the year if you pass several tests set forth by the IRS. If you meet the following criteria, you have the option of deducting the full amount of points in the year you take out the mortgage or deducting them over the life of the loan, beginning with the year you close your loan:

• The loan is for your main residence
• Paying points is typical in the area where you get your loan
• You didn’t pay more than the points typically charged in your area
• You use the cash method of accounting
• Points were not paid in lieu of paying other fees, such as appraisal fees, inspection fees, title order fees, attorney fees and property tax fees
• The money you paid at or before closing, plus any points the seller paid, were at least the equivalent of the points charged
• You’re using your loan to buy or build your main residence
• The points were calculated as a percentage of the mortgages principal amount
• The points charged are clearly shown on the Uniform Settlement Statement, Form HUD-1

Non-Deductible Closing Costs

There are several settlement costs and closing costs you can’t deduct or add to the basis of your home. The following closing costs are not tax-deductible:​

• Fire insurance premiums
• Charges for using utilities or services if you occupied the home before closing
• Rent paid if you moved into the home before closing
• Charges associated with getting or refinancing a mortgage loan, such as credit report ordering costs, loan assumption fees and fees for a lender-ordered appraisal

Although you’re permitted to deduct some types of real estate taxes, you can’t deduct the following types:

• Itemized charges for services, even if the charge is paid to the taxing authority
• Taxes for local benefits that increase the value of your property
• Transfer taxes or stamp taxes
• Homeowners association assessment costs

How to Deduct Home Closing Costs
If you’re eligible to deduct certain types of expenses related to home settlement fees, you can do so on Form 1040 on lines six through 13 when you file your tax return. Here’s the breakdown of where to report different closing costs on the form:

• ​Real estate taxes: Line 6
• Home mortgage interest and points reported on Form 1098: Line 10
• Home mortgage interest not reported on Form 1098: Line 1
• Points not reported on Form 1098: Line 12
• Qualified mortgage insurance premiums: Line 1
• State and local general sales tax reduction: Line 7

Some of your closing costs are tax-deductible, so it pays to know what expenses you can deduct as itemized homeowner tax deductions come tax time. Keep in mind that if your total itemized deductions for the year are less than the standard deduction, it doesn’t make financial sense to deduct closing costs. Consider working with an accountant or tax professional to make sure you’re reporting all of your real estate taxes accurately and deducting only expenses that have the IRS seal of approval.

(C)2017 GOBankingRates.com, a ConsumerTrack web property
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HUD TAKES ACTION IN FINAL DAYS OF OBAMA ADMINISTRATION

HUD Takes Action

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The Obama Administration has taken a slew of steps to cement its legacy in its final days, including addressing issues in housing.

The Department of Housing and Urban Development (HUD) on Friday awarded funds to support both homeless youth and aging-in-place seniors, and issued a final rule regarding household lead exposure in children. ​

Homeless youth in ten communities will receive $33 million through the Youth Homelessness Demonstration Program (YDHP), while aging-in-place seniors in HUD-assisted housing will receive $15 million.

The YDHP provides funds for permanent supportive housing, rapid re-housing and transitional housing, as well as host homes and other programs. The communities awarded include Connecticut ($6.6 million), Seattle/King County, Wash. ($5.4 million) and Austin/Travis County, Texas ($5.2 million).

"A stable home is the foundation for so many other opportunities in a young person’s life," said HUD Secretary Julian Castro in a statement on the youth homelessness grant. "As a former mayor, I know that some of the most innovative ideas come from the close working relationships that occur at the local level. These local programs are proof of that."

Grants awarded to aging-in-place seniors in HUD-assisted housing will cover costs related to hiring full- and part-time help through the Supportive Services Demonstration for Elderly Households in HUD-Assisted Multifamily Housing.

​"It is so important that we afford our seniors the opportunity to live independently," Castro said in a statement on the aging-in-place grant. "These grants will help owners of HUD-assisted senior developments to offer the services that will allow seniors to remain in their homes for as long as they can."

The final rule on household lead exposure in children changes the definition of "elevated blood lead level" to match the more stringent threshold from the Centers for Disease Control and Prevention (CDC), lowering the level to 5 micrograms of lead per deciliter of blood.

The change allows for faster response to children age 6 and younger in HUD-assisted housing who are exposed to lead-based paint. If the child is found to have an elevated blood lead level, the housing provider must test the home and other potential sources of exposure within 15 days, and ensure the hazards are controlled within 30 days, among other mandates.

"Were now able to say that the federal government will speak with one voice when it comes to protecting children from potentially dangerous lead," said Castro in a statement on the rule. "By aligning our standard with CDCs guidance, we can respond more quickly in cases when a child who lives in federally-assisted housing shows early signs of having elevated levels of lead in their blood."

Source: Department of Housing and Urban Development (HUD)

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THE LATEST EVOLUTION OF REAL ESTATE WIRE FRAUD

Real Estate Wire Fraud

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Most articles about real estate fraud have focused on the same scenario: hackers breaking into professionals email accounts to learn about upcoming transactions, emailing the buyer to wire money to the hackers account. In reality, there are many other ways hackers insert themselves into communications, such as tricking the real estate professional into installing malicious software on their computer or phone, or changing escrow instructions (or other disbursements) at the office of the real estate professional via email.

Hacking can also be done by less sophisticated methods, including phone, fax or inter-office memo. The latest evolution of the scam, however, is truly insidious.

1. A hacker obtains a REALTOR(R)’s transaction management/e-signature system login credentials by using a phishing email that looks like it’s from the transaction management system.​

• The user first types their credentials into the fake transaction management website, then are forwarded to the real one where their credentials work. They never even notice they’ve been phished. They just think they mistyped a password the first time.

2. The hacker logs into the transaction system to identify target transactions and collect information to fool participants.
3. If the agent uses the same credentials for both email and the transaction system, the hacker now has access to the agents email.

• The hacker may set up an email-filtering rule so emails from the client "skip the inbox" and go right to the hacker.
• Emails to clients can now be sent from the agents real email address. It’s not a spoofed email (which only looks like it’s from the agents account).
• Changing their email password may help, but at this point, the hacker only needs to spoof future emails-and unless the agent notices the filtering rule, the hacker still has access to those email conversations.

4. Because the hacker has information about the mortgage and title company from the transaction system, they can spoof an email from those parties, too. When a client receives a (spoofed) email from multiple parties - which confirms each other’s message – they’re more likely to trust each of those emails.

5. From that point, it’s a typical wire fraud scenario: At the appropriate time, the client is told to wire funds to an account the hacker has access to.

This is only one variation of many that Clareity has seen "in the wild."

Clareity Consulting has written a paper that more thoroughly explains the wire fraud issue and provides concrete guidance on how to reduce the risk. Download the paper by visiting clareity.com/reducing-the-risk-of-real-estate-wire-fraud.

Matt Cohen is chief technology officer at Clareity Consulting.
For more information, please visit www.clareity.com.

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HOW TO BOOK A BETTER VACATION FOR LESS

How To Book A Better Vacation For Less

Cash Buyers Lists News​​

Looking forward to your next big trip? Are you trying to make sure you’re able to find the best deals to help your pocket book? Read on for five ways to book a better, cheaper vacation, courtesy of Booking.com.

1. Book your trip at the right time

Purchasing airplane tickets 21 days or more in advance offers the best prices-especially for trips within Europe and the United States. Some trips can give discounts of as much as 30 percent for booking three weeks before the departure date.

To get the best deals on trips within Europe, you need to book flights almost two months ahead (at least 56 days) so for short haul Easter breaks its best to start booking now. For travel to Asia and the US its best to book flights around 6 months ahead (+ 171 days for Asia and + 180 for the US) so now is also a great time to plan your big summer break.

2. and 3. Book flights and Hotel at the same time
One critical, but often overlooked, method to drive savings is for travelers to simultaneously book their flight, hotel and/or rental car on an online travel agency. Flight and hotel bookings can be offered at a steep discount.  Those savings can be lost if travelers book these elements independently, which is common, so flight and hotel bookings remain the single easiest way for travelers to save hundreds on travel, both domestically and internationally.

4. Include a Saturday night stay
After evaluating terabytes of data regarding the impact of including a Saturday night stay on average ticket prices, Booking.com has concluded that the urban myth is true and most tickets including a Saturday stay offer the lowest prices and best deals. In Central Europe, average ticket prices for itineraries that include Saturdays can be as much as 74 percent less and 47 percent less for flights within the UK and Ireland. The impact of Saturday night stays exists independent of what day of the week a ticket was booked and how many days in advance it was purchased.

5. Head to an alternative neighborhood on your city break
By checking out the alternative areas of a city you can save even more on your hotel. Booking.com’s local experts have provided advice - such as booking in a business district for a weekend stay - to help travelers to find money-saving alternate destinations that aren’t too far from the downtowns or most popular areas of the cities in question.  For example, staying in the Financial District, or Battery Park City, when traveling to New York, can offer savings but still offers the chance to stay in two spots that are fast becoming the city’s new must-visit areas.

 Source: Booking.com

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