How Do the New Tax Laws Affect You When It Comes to Real Estate?

How does The Tax Cuts and Jobs Act impact our local real estate market? I’ll go over a couple of important things that you should know today.

The Tax Cuts and Jobs Act has been signed into law. How do these new tax rules impact our real estate market?

One thing that had very little media presence was capital gains on primary residences. As long as you’ve lived in your home for two out of the last five years, you do not have to pay taxes on the profit of your home sale. There is a cap of $250,000 for single individuals and a $500,000 cap for married couples.

Early versions of the tax reform bill tried to do away with the capital gains exclusion completely. Then, they were going to make it so you had to live in the home for five out of the last eight years.

The good news is that the capital gains exclusion is staying exactly as it was, which is fantastic. If you bought a $200,000 house 20 or 30 years ago, it’s probably worth $400,000 to $450,000. Single people don’t have to pay taxes on $250,000 of the profit, and married couples don’t have to pay taxes on $500,000 of the profit from the home sale.

"The capital gains exclusion remains exactly as it was, which is great news for home sellers."

Investment property taxes are still deductible, as they were before. You can still write off the mortgage interest. Of course, you should verify all of this with your tax accountant, but we just wanted you to know that some of those changes real estate experts were concerned about did not go into effect.  

If you are purchasing a larger or more expensive home and using a mortgage, you should be aware that the mortgage interest deduction cap has been lowered from $1 million to $750,000.

You are also now only allowed to write off up to $10,000 a year on your taxes. Although that will affect 4.1 million people nationwide, it shouldn’t affect too many people in our area.

The main thing to take away from all of this is that the capital gains exclusion is still in place, which is especially great for baby boomers looking to downsize. You will be able to sell your home and take your profit without paying tax on the capital gains.

Again, if you have questions about your specific information, please reach out to your tax accountant.

If you have any other real estate questions, please don’t hesitate to give me a call or send me an email. I would be happy to help you!

Should You Take Your Home off the Market During the Holidays?

Should you take your home off the market during the winter months or not?

There are many great Baltimore area homes for sale. Click here to perform a full home search, or if you're thinking of selling your home, click here for a FREE Home Price Evaluation so you know what buyers will pay for your home in today's market. You may also call me at (410) 638-9555 for a FREE home buying or selling consultation to answer any of your real estate questions.

Today I want to address a question we’ve been getting a lot lately from clients, “Should I take my home off the market during the winter months or not?”

There are two schools of thought at work here. The first is that you should take your home off the market, reset, and re-list in February or March, when buyer activity picks up. The other option is to stay on the market, address a few possible reasons your home hasn’t sold yet, and try again.

We recently had a seller who had a home that wasn’t selling, but after repainting a few rooms, making a few adjustments in the house, and a minor price tweak, the home sold within a week. This time of year is great for showing homes, and you can take advantage of that fact to sell your home quickly and profitably.

For those that do decide to take their home off the market temporarily, this is the perfect time of year to prepare your home for listing on the market in February or March. We’ve been meeting with sellers who plan on selling next spring to go through their homes and figure out how they can prep it for the highest sale price possible. We know exactly where you need to spend money on improvements in order to get a great return so you get the highest possible price in the spring.

There are some hot areas of the market where we are seeing multiple offers, but not all segments are moving well. If you have questions about your specific area and what the market is like there, we would be happy to answer them for you. We’d be happy to go over the numbers with you and decide if it makes sense for you to stay on the market, or wait until spring to list your home. We look forward to speaking with you soon!

How to Make an Informed Decision When Buying

There are many great Baltimore area homes for sale. Click here to perform a full home search, or if you're thinking of selling your home, click here for a FREE Home Price Evaluation so you know what buyers will pay for your home in today's market. You may also call me at (410) 638-9555 for a FREE home buying or selling consultation to answer any of your real estate questions.

Today, our buyer specialist Julie Munchel joins us to share a little about herself and what she does to help clients!

Julie has been on the team for five years and has been in the business for 13 years. She has experience in all areas of real estate, but her expertise is in helping buyers find the perfect home.

Julie believes sitting down with the buyer and having an in-depth conversation is a very important thing to do before beginning the home search. A lot of times, believe it or not, the two people who are looking to get a home together are not on the same page - they don't even know what the other one wants! That's why Julie loves to meet with her clients before she begins showing homes. It gives her a chance to discover their wants and needs so that she can be as helpful as possible to them.

An important thing Julie communicates with buyers during that first meeting is that she is only one part of the team that is working to accomplish the client's buying goals. There are several admins who are always available, even when Julie is not, to answer questions, set up appointments, and take care of paperwork when needed.

Julie's goal is to save her clients time by finding out exactly what they want and then finding homes that meet those criteria. That first meeting typically results in a smooth and successful buying process, which is what everyone involved wants. The biggest value in using a buyer specialist like Julie is the experience she brings to the table to get the job done right and in a reasonable amount of time!

Buying a home is a huge financial decision; Julie understands this and will act as your expert advisor so that you make an informed move. If you would like to learn more about how Julie can help you buy or if you need real estate assistance of any kind, please don't hesitate to reach out to us! We would love to hear from you!