DC CLOUT "DC Area Real Estate Buzz"

HUD: Tax Credit Can Be Used on Closing Costs

FHA-approved lenders received the go-ahead to develop bridge-loan products that enable first-time buyers to use the benefits of the federal tax credit upfront, according to eagerly awaited guidance from the U.S. Department of Housing and Urban Development on so-called home buyer tax credit loans that was released today.

Under the guidance, FHA-approved lenders can develop bridge loans that home buyers can use to help cover their closing costs, buy down their interest rate, or put down more than the minimum 3.5 percent.

The loans can't be used to cover the minimum 3.5 percent, senior HUD officials told reporters on a conference call Friday morning.

Thus, buyers applying for FHA-backed financing with an FHA-approved lender that offers a bridge-loan program can get a bridge loan to bring down the upfront costs of buying a home significantly but would still have to come up with the minimum 3.5 percent downpayment.

There remain many sources of assistance for buyers needing help with the 3.5 percent downpayment, including many state and local government instrumentalities and nonprofit lenders.

In addition, some state housing finance agencies have developed their own tax credit bridge loan programs, so buyers in states whose HFAs offer such programs can monetize the tax credit upfront to cover all or part of their downpayment. These programs are separate from what HUD announced today.

The first-time homebuyer tax credit was enacted last year--and improved upon earlier this year--to help encourage households to enter the housing market while interest rates are low and affordability is high. The credit is worth up to $8,000 and is available to households that haven't owned a home in at least three years. The credit does not have to be repaid, and is fully reimbursable, so households can get their credit returned to them in the form of a payment.

Courtesy of Al Matlock Washington DC Realtor for DCClout.com      al@dcclout.com

Applying the Home Buyer Tax Credit to Your 2009 Return

Applying the Home Buyer Tax Credit to Your 2008 Return       Tax Credit Can Be Used on Closing Costs

credit details

To claim the credit as part of your 2009 return, you will need: The standard Form 1040 and Form 5405 for the home buyer tax credit.

1. First begin Form 1040.
   
   
2. Be sure to take note of your adjusted gross income, which you enter on lines 37 of the form. Form 5405 actually requires you to note your modified adjusted gross income, but that affects few people, so most will just use their adjusted gross income.
   
   
3. When you come to Line 69 you'll be asked to enter your tax credit amount. To do that, you'll need to first complete Form 5405. 
   
   
4. Once you complete Form 5405, enter the amount on Line 69, then complete your return.
   
   
5. Attach Form 5405 to your return.

Collecting Your Refund

Any refund for which you qualify will be sent to you

Courtesy of Al Matlock Washington DC Realtor for DCClout.com      al@dcclout.com

Applying the Home Buyer Tax Credit to Your 2008 Return

 Applying the Home Buyer Tax Credit to Your 2009 Return   Tax Credit Can Be Used on Closing Costs

credit details

To claim the credit on your 2008 taxes, you must file an amendment to your 2008 return. To do this you will need two forms: Form 1040X (PDF 365K ) for filing an amended return; and Form 5405 (PDF 257K) for the home buyer tax credit.

You can visit the IRS site using the links, print out, and fill in the forms manually or type into the forms and save them on your computer. Be aware, though, that the 1040X tax form can only be filed in hard copy, and cannot be submitted electronically.

1. First, fill out Form 5405 using the instructions in Determining the Amount of Your Home Buyer Tax Credit. 
   
   
2. Then fill out Form 1040X.
   
   On the 1040X you'll find a section called "Payments." Look for Line 15, "Credits." On this line you have three columns. On the first you list the credits you took in your original filing (for most people, this will likely be zero); on the second you list any new credits; and on the third you list the "correct" amount (that is, what the new amount should be).
   
   
3. If in your original filing you took no credits, you enter a zero in the first column.
   
   
4. In the second column you enter the amount of your credit, which for many people will be the full $8,000.
   
   
5. And in the third column you list the correct amount, which in most cases simply means restating the $8,000.
   
   
6. Add your housing tax credit amount to any other amendments you're making then total all the amendments up. 
   
   
7. On the back of the form, write an explanation of why you're filing the amendment. Here you should explain in 2-3 sentences why you want to take the credit. You should include the day that you closed on the house and mention that you're electing to amend your 2008 return rather than wait until 2009.
   
   
8. Finally, attach Form 5405 to Form 1040X and file your amended return.

Collecting Your Refund

Any adjustment to your 2008 taxes along with any refund for which you qualify will be sent to you. Since the tax credit is fully refundable even if your tax liability is less than the tax credit amount, you get the full value of the credit. That means the IRS will cut you a check for the balance.

Courtesy of Al Matlock Washington DC Realtor for DCClout.com      al@dcclout.com

How to Improve the Odds of an Offer

1. Price it right. Set a price at the lower end of your property’s realistic price range.

2. Prepare for visitors. Get your house market ready at least two weeks before you begin showing it.

3. Be flexible about showings. It’s often disruptive to have a house ready to show at the spur of the moment. But the more amenable you can be about letting people see your home, the sooner you’ll find a buyer.

4. Anticipate the offers. Decide in advance what price and terms you’ll find acceptable.

5. Don’t refuse to drop the price. If your home has been on the market for more than 30 days without an offer, you should be prepared to at least consider lowering your asking price.

Courtesy of Al Matlock Washington DC Realtor for DCClout.com      al@dcclout.com

Spring Cleaning Checklist

With spring selling season arriving, take the time now to polish your home to perfection.

1. Let the sun in. Make any room look brighter with clean blinds and windows. Mix a solution of one part white vinegar to eight parts water, plus a drop or two of liquid dishwashing liquid, for a green window cleaner. Spray on and wipe with newspaper to avoid streaks. (Washing on a cloudy day also reduces streaking.)
Showing tip: Replace heavy drapes with lightweight shears during warmer months to give a room a brighter, lighter feel for prospective buyers.

2. Sniff out smells. Check the drip tray underneath your refrigerator and wash out any standing water from defrosting. Remove inside odors by washing the inside of the fridge with a baking soda and water solution. Boil lemon juice in your microwave and add it to your dishwasher to eliminate bad smells. Also, put the lemon rinds down the disposal. Add activated charcoal in the fridge to keep odors at bay.
Showing tip: Make the fridge smell fresh instantly with cotton balls soaked in vanilla extract or orange juice.

3. Make your bed better. Vacuum mattresses and box springs, and then rotate and flip over. Do the same for removable furniture cushions. This is also a great time to wash or dry-clean the dust ruffle and mattress pad.
Showing tip: Add new loft to a lumpy comforter by having two people vigorously shake the quilt up and down to redistribute stuffing.

4. Clean those coils. Improve energy efficiency by vacuuming grates, coils, and condensers in your furnace, stove, and refrigerator (either underneath or in back). If a vacuum won’t reach, try a rag tied to a yardstick.
Showing tip: Shut some air conditioning vents on the first floor or basement so that more air will reach and cool the second floor. Reverse the process in winter for heat vents.

5. Wash the walls. Grease, smoke, and dust can adhere to walls and make even the best decorating look dingy. Wash walls using a general-purpose cleaner with hot water. Start at the top of the wall to avoid drips and in a corner so that you wash one wall at a time. Rinse the mop head frequently in clean water. And don’t press too hard because flat latex paint won’t absorb too much water.
Showing tip: Resist the temptation to spot-clean walls since it will make the rest of the wall look dingy.

courtesy Al Matlock real estate agent  Washington DC and Maryland - Realtor 

5 Feng Shui Concepts to Help a Home Sell

To put the best face on a listing and appeal to buyers who follow feng shui principles, keep these tips in mind.

1. Pay special attention to the front door, which is considered the “mouth of chi” (chi is the “life force” of all things) and one of the most powerful aspects of the entire property. Abundance, blessings, opportunities, and good fortune enter through the front door. It’s also the first impression buyers have of how well the sellers have taken care of the rest of the property. Make sure the area around the front door is swept clean, free of cobwebs and clutter. Make sure all lighting is straight and properly hung. Better yet, light the path leading up to the front door to create an inviting atmosphere.

2. Chi energy can be flushed away wherever there are drains in the home. To keep the good forces of a home in, always keep the toilet seats down and close the doors to bathrooms.

3. The master bed should be in a place of honor, power, and protection, which is farthest from and facing toward the entryway of the room. It’s even better if you can place the bed diagonally in the farthest corner. Paint the room in colors that promote serenity, relaxation, and romance, such as soft tones of green, blue, and lavender.

4. The dining room symbolizes the energy and power of family togetherness. Make sure the table is clear and uncluttered during showings. Use an attractive tablecloth to enhance the look of the table while also softening sharp corners.

5. The windows are considered to be the eyes of the home. Getting the windows professionally cleaned will make the home sparkle and ensure that the view will be optimally displayed.

courtesy Al Matlock real estate agent  Washington DC and Maryland - Realtor 

April 2009 Home Sales Statistics for Washington DC

Washington DC  Home Sales Statistics are in for April 2009. Here's a brief snippet- more details coming.....  The 1st numbers are for 2009/2nd number for 2008/3rd change percentage 

Average. sold price $517,045 - $582,266  (-11.20%)
Total Units Sold - 417 - 368  ( 13.32%)
Of that  417,  178  were condos/coop
Average sold price Condos - NA

Avg. Days on Market  92 - 77   (19.48%)

For Washington DC Home Sales Statistics by zip code click here  Also compare stats for 2007, 2006, 2005

April 2009 Home Sales Statistic for Montgomery County

Montgomery County Home Sale statistics are in for April 2009. Here's a brief snippet- more details coming.....  The 1st numbers are for 2009/2nd number for 2008/3rd change percentage

Average. sold price $426,182 - $543,277    (-21.55%)
Total Units Sold - 708- 708 (00.00%)
Of that 708, 133 were condos
Average sold price Condos - NA

Avg. Days on Market - 106 - 112  (-5.36%)

Compare 2007/2006/2005  Real Estate Statistics for Montgomery County Maryland and Washington DC click here

source mris

courtesy Al Matlock real estate professional Washington DC and Maryland - Realtor

April 2009 Home Sales Statistic for Prince Georges County

The Prince Georges  County Home Sale statistics are in for April 2009. Here's a brief snippet- more details coming.....  The 1st numbers are for 2009/2nd number for 2008/3rd change percentage

Average. sold price $245,146  - $303,220  (-19.15%)
Total Units Sold - 424 - 371   (14.29%)
Of that 424, 37 were condos
Average sold price Condos - NA
Avg. Days on Market - 151 - 142   (6.34%)

source mris

courtesy Al Matlock real estate professional Washington DC and Maryland - Realtor

Understanding Capital Gains in Real Estate

When you sell a stock, you owe taxes on your gain — the difference between what you paid for the stock and what you sold it for. The same holds true when selling a home (or a second home), but there are some special considerations.

How to Calculate Gain
In real estate, capital gains are based not on what you paid for the home, but on its adjusted cost basis. To calculate, follow these steps:

1. Purchase price: _______________________

The purchase price of the home is the sale price, not the amount of money you actually contributed at closing.


2. Total adjustments: _______________________

To calculate this, add the following:

• Cost of the purchase — including transfer fees, attorney fees, and inspections, but not points you paid on your mortgage.
• Cost of sale — including inspections, attorney fees, real estate commission, and money you spent to fix up your home just prior to sale.
• Cost of improvements — including room additions, deck, etc. Note here that improvements do not include repairing or replacing something already there, such as putting on a new roof or buying a new furnace.

3. Your home’s adjusted cost basis: _______________________

The total of your purchase price and adjustments is the adjusted cost basis of your home.

4. Your capital gain: _______________________

Subtract the adjusted cost basis from the amount your home sells for to get your capital gain.

A Special Real Estate Exemption for Capital Gains
Since 1997, up to $250,000 in capital gains ($500,000 for a married couple) on the sale of a home is exempt from taxation if you meet the following criteria:

• You have lived in the home as your principal residence for two out of the last five years.
  
• You have not sold or exchanged another home during the two years preceding the sale.
  
• You meet what the IRS calls “unforeseen circumstances,” such as job loss, divorce, or family medical emergency.
  

courtesy Al Matlock real estate agent  Washington DC and Maryland - Realtor