Mortgage Interest Deduction – Will Homeowners Still Benefit?
Homeownership is supposed to be the American Dream, and the government has long supported offering tax advantages to homeowners. The question is: Will this tax benefit continue? With the government looking for more revenue, and mortgage interest being one of the highest dollar tax deductions, a change to the laws may be in our future.
As it Stands
Currently, homeowners are able to deduct interest on loans up to $1.1 million for first and second homes. The opinion is that this deduction is no longer necessary, and benefits mostly the wealthy, who are more likely to have multiple homes and large dollar mortgage loans.
Recent Proposals
In 2009, there were talks about allowing deductions for first homes only, and only for loans up to $500,000. In 2011, other ideas included eliminating the deduction all together and replacing it with a straight tax credit. Still more talks revolved around a mortgage interest deduction based as a percentage of adjusted gross income. President Obama’s 2013 federal budget proposes limiting the tax deduction for families with incomes over $250,000.
What it Means to You as a Bucks County Homeowner
During this election year, we can probably not expect to see too many strong opinions about changing or limiting the mortgage interest deduction. Most voters are homeowners, and politicians don’t want to ruffle feathers at this time. However, this issue will certainly be revisited as long as there is a continuing need for increased federal revenue. The effect on home values is yet to be determined.
I’ll continue to keep you updated on issues that affect you as a home buyer or home seller in Yardley, Newtown or anywhere in Bucks County, PA. Please contact me for more information about Bucks County real estate.
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New Listing – Walk to the Makefield Township Golf Club
Golf Lovers in Lower Makefield Township:
Introducing….
This is a beautifully appointed home on a large one acre lot with golf course views!
This 4 bedroom, 3 bath, 4364 Sq Ft home in Lower Makefield Township has many upgrades and features, including custom wainscoting in the formal living room, airy den that could be used for office or playroom, two-story great room with extravagant riverstone hearth, bright kitchen with granit counters, stainless steel appliances and a freestanding island with barstool seating.
Upstairs, the spacious master suite offers a separate sitting room, jetted tub, separate shower and double vanity with makeup area. All other bedrooms are on the second floor, and are spacious and bright.
The professionally finished basement is well lit and offers a separate office, ample storage space and endless space that can be used as a play or game room.
This home won’t last long with its great location, features and price of $688,000. Contact me to see this home, or any other great homes for sale in Yardley, Newtown or other areas of Bucks County.
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Lowest Interest Rates in History – What it Means to Bucks County, PA
Interest Rate News
Freddie Mac announced on May 3, 2012 that the 30-year fixed-rate mortgage interest rate is at an all time record low. Lowest-ever rates and still-recovering property values are creating an interesting real estate market for both buyers and sellers.
According to Frank Nothaft, vice president and chief economist at Freddie Mac, “Signs of slowing economic growth and inflation remaining subdued allowed yields on Treasury bonds to ease somewhat and brought most mortgage rates to new all-time record lows this week.”
The national 30-year fixed rate averaged 3.84%, down from 3.88% last week. 15-year rates averaged 3.07%, down from 3.12% last week. Freddie Mac has been keeping records of interest rates since its inception in 1970. See Freddie Mac’s site for more interest rate history.
What it Means to Bucks County
As I have been observing for the past few months, the real estate market in Yardley & Newtown and all over Bucks County has experienced the most active spring market, especially for sellers, in years.
Correctly priced houses are selling much quicker than they have in the past few years, and we have even seen a few multiple offer situations.
Everyone knows that interest rates have been incredibly low, for some time. The recent announcement by Freddie Mac, confirms exactly how low, historically, interest rates are.
I believe that one of the factors that may be helping the increase in activity this spring, is that buyers are slowing coming to the realization that interest rates will not stay at this level forever. I think that we are seeing a bit of an increase in buyer motivation, because many buyers do not want to miss this incredibly opportunity to take advantage of lower home values, along with incredibly low interest rates.
I also believe that many sellers are afraid of the market, because of all of the negative publicity, so sellers who can avoid selling in the current market environment are not putting their houses on the market. So in many cases we see lower inventory, along with increased demand.
This is not to suggest that we are back to the double digit, crazy days of real estate. I am suggesting that the dynamics in the Yardley, Newtown and Bucks County real estate market are much more balanced today than they have been in years.
Continue Reading > Add a Comment |Yardley, PA real estate market update
So what is happening in real estate in Bucks County, and Yardley?
First quarter real estate market results are in, so lets take a look at what is happening.
First, looking at Bucks County real estate, what is really striking, is that the number of houses for sale, was more than 7% lower at the end of March this year, than last year at the same time.
I have blogged a couple of times recently, about the changing dynamics in the market. It seems as though more houses are selling faster than they were last year, and based on the decrease in inventory levels, that makes sense.
The other extremely striking statistic, in the Bucks County real estate market, is in pending sales. Pending sales represent homes where the seller has accepted an offer, but the house is waiting for closing. Pending sales in Bucks County were up by an incredible 26% at the end of March, compared with last year.
I am not quite sure what to make of that number, yet. I sense that buyers are more motivated, and more buyers are coming to the realization that 4% interest rates will not be around forever.
Check the chart, for Bucks County real estate details.
Bucks County real estate market in a shapshot
Yardley Real Estate
In the Yardley, Lower Makefield Township real estate market, the number of homes on the market is actually about 2% higher at the end of March than it was last year at the same time.
Inventory was up by almost 12% from the end of February, which is to be expected, as we entered the spring market.
I think that there are still an abundance of houses in Yardley that have been on the market for a long time, because they are overpriced, given current market conditions. Even though inventory levels are higher, there is definitely more activity in the real estate market right now.
It is also interesting to note that the average price of a house on the market in Lower Makefield Township was $476,000 thie year, compared with $481,000 last year.
In addition to that, it may surprise people to know that the average price of a home sold in 2011, increased slightly in 2011, and is up by 5% this year, so far.
In Lower Makefield Township, there still is about an 8 month inventory supply, which indicates that factors are still favorable for buyers. We consider the real estate market to be balanced, when there is about a 6 month supply of homes on the market.
Yardley real estate appreciation chart
In summary, the real estate market in Bucks County, and especially in the Yardley-Newtown areas, is showing the most encouraging signs that I have seen in about 4 years. There are still homes that have been on the market for months and months, because they are overpriced. However, homes that come on the market that are priced realistically, based on current market conditions, are selling much fast than they have at any point in the past 4 years. If you are getting ready to put your house on the market, please ask me for a copy of my ebook, 450 ideas to help get your home sold quickly. Send me your email, and I will email it to you. My email is: Marty@MartinMillner.com.
Continue Reading > Add a Comment |5 Things to consider when making an offer on a Yardley area house.
The real estate market in the Yardley area in Bucks County, is showing very encouraging signs of life this spring. I have had 7 or 8 Yardley area houses, in the past couple of weeks, that have gone on the market and sold in just days. In a couple of cases, we received more than one offer!
Yesterday, a prospective buyer, who found my profile on-line, sent me a very interesting questionaire. He was basically conducting an interview, to see if we would be compatible. I am happy to say, that I am meeting he and his wife on Saturday, so I passed the first step in the interview process.
One of the interesting questions he posed, though, was how I would help them with making an offer on a house, once we found the right house? That question got me thinking about the steps to take in preparing an offer on a Yardley area house. There is no doubt in my mind, that the more information you have, the better off you will be in making an appropriate offer.
There is so much information available online, and your realtor should provide a tremendous amount of additional information.
1. In evaluating a sellers asking price, the first thing that I look at, is how long the house has been on the market, and whether there has been price adjustments. Markets find their proper balance, and if a house has been on the market a long time, it generally means that the asking price is too high. I realize that sellers may dispute this, but in my opinion, if the asking price is correct, for market conditions, then the house will not sit on the market for weeks and weeks.
2. Evaluate activity in the neighborhood. This can sometimes be difficult, depending on how large the neighborhood is, assuming the house is in a neighborhood, and also whether there has been a lot of recent activity in the neighborhood. The strongest comparison, which we would refer to as a comparable, would be a similar house in exactly the same neighborhood. If there have been recent sales, you would have a very solid frame of reference for structuring an offer.
3. Next, I would suggest looking beyond the exact neighborhood, for houses that are similar to the one you are looking to make an offer on. If you can find houses that are close to the same size, with similar amenities and upgrades, again, you are armed with useful information for an offer. This is very similar to the process that an appraiser would go through. When looking for similar houses, it would be important to stay within the same township and school district. Yardley housing is different from Newtown, for example, so homes in Yardley and Newtown, would not be priced the same, even if they had similar amenities.
4. Pay close attention to condition of comparable homes. Remember, a low priced home that needs lots of upgrading, may not be such a great deal, if the cost to do the upgrades makes the price higher than homes in a similar neighborhood that have been upgraded. Other vital elements to consider include location within the neighborhood. If a particular house backs to a busy road, clearly there will be a significant impact in the price.
5. Finally, armed with all of the above information, plan your negotiating strategy. I help buyers all the time, with this process. Depending on how the house is priced, the art of drafting an offer, from the buyer perspective, is to be as aggressive as possible, without being insulting to the seller, assuming the house is priced realistically in the first place. If you start the process with an offer that is perceived to be unrealistically low, you run the risk of not getting a counter offer back from the seller. Obviously if the house is significantly overpriced, then I would not be too concerned about that.
I work very hard to make sure that buyers have as much information as possible, so that we can make realistic offers, that buyers are comfortable with. I would be happy to discuss this further, and can be reached at 215-519-1399 or Marty@MartinMillner.com
Continue Reading > Add a Comment |Yardley, Bucks County, Early Spring
I can remember many times, where we still have snow on the ground, towards the end of March.
That is definitely not the case this year, in Yardley, here in beautiful Bucks County. After an incredibly warm winter,
we have experienced a very early spring. Here are a few early spring photo’s from the area I love so much,
Yardley, Pa in Bucks County
Yardley pond in early spring
Another one of my favorite spots in the Yardley and Lower Makefield area, is the canal towpath.
Colors are coming alive, along the canal towpath in spring
Lower Makefield Township. with tress in full bloom, is beautiful. Here is a picture of the gorgeous,flowering trees, along Edgewood Road, at the Library and municipal complex.
Lower Makefield Township is gorgeous.
Canal Street, in Yardley Boro. Narrow street, very charming.
Canal Street in Yardley Boro.
One of my favorite, local restaurants, the Continental Tavern, undergoing some exterior work. Hopefully getting ready for outdoor dining! We love the Continental.
Continental Tavern in Yardley
Buttonwood Park, in Yardley Boro. Getting nice enough to relax in the park.
Buttonwood Park in Yardley
Couple of additional pictures of the pond.
Yardley pond
Old Library in Yardley
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Bucks County Happenings: Third Annual Restaurant Week
Foodies of New Hope and Lambertville areas, it is time to get out your fork and spoon. The Third Annual New Hope/Lambertville Restaurant Week takes place Sunday, March 18 through Friday, March 23.
28 restaurants will be offering some of their popular appetizers, entrees and desserts to diners as three-course prix fixe meals with several selections available for each course. Some eateries are even offering a four-course meal. Two different price options are available to match your budget: $19.95 for casual restaurants and $29.95 for fine dining establishments.
The varied fare is sure to tempt the taste buds of every patron. Choices range from Corn-Crusted Tofu Wedges at Café Galleria at Lambertville House to Crab Strudel with Seared Scallops at Logan Inn across the bridge in New Hope.
This is not just an event for local area residents. Visitors from out of town and out of state have been known to spend a vacation week in the New Hope/Lambertville region, exploring our community by day and enjoying a different restaurant every evening.
Reservations are recommended. Visit http://www.visitnewhope.com/restaurant-week/ for more information on participating restaurants and their menus. Great food for great prices; it’s an mouth-watering opportunity that you don’t want to miss!
Continue Reading > Add a Comment |Yardley Home Buyers and Sellers Update
I just received the National Association of Realtors (NAR) 2011 profile of home buyers and sellers. As we move further into the spring real estate market in Bucks County, I always enjoy reviewing the NAR survey, which comes out around this time every year.
Contrary to what the press would have us all believe, people actually bought and sold houses in 2011! NAR interviews literally thousands of home buyers and sellers every year, and generates a very comprehensive review of the prior year in real estate. What did we see in 2011?
Buyers
- 37% of recent home buyers were first time home buyers. This represented a drop from 50% in 2010. No doubt the high number of first time home buyers in 2010 was a result of the first time home buyer tax credit. To me, even 37% is a very high percentage. I know that personally, I worked with a number of first time home buyers in Yardley and Newtown in 2011.
- The typical buyer was 45 years old, which was a jump from 39 years old, in 2010
- The 2010 median household income of buyers was $80,900. Median income was $62,400 for first time home buyers, and $96,600 for repeat buyers.
- 64% of recent home buyers were married couples, which was the highest percentage since 2001. 18% of recent home buyers were single females, which was the lowest share since 2004. Not exactly sure why that was the case.
- For 27% of recent home buyers, the primary reason that they bought, was simply a desire to own a home!
Sellers
- The typical seller lived in their home for 9 years. The median tenure has increased in recent years. As recently as 2007, it was six years.
- 87% of sellers used a realtor when selling. (I love that statistic!)
- Recent sellers sold for 95%of the listing price, and 61% reported that they reduced the price at least once.
- 41% of sellers offered incentives to attract buyers, most often offering home warranties and help with closing costs.
The entire buyer and seller report is almost 200 pages, and includes interesting charts and graphs. I can email the report, if anyone is interested in seeing it.
I like to look at the report and see how the national experiences of buyers and sellers, compares with what I find in my real estate business in Yardley, Newtown and Bucks County. I will talk about the report in future posts, but it is always important for me to emphasize that, especially in our area, real estate is moving. I have had recent listings that have sold within a very short period of time, and the market is active.
If you would like to see the home buyer and seller report, please email me at Marty@MartinMillner.com.
Continue Reading > Add a Comment |Buying a Home in Yardley or Newtown, Bucks County? 10 Important Questions for Your Home Inspector
Maybe because the weather has been so warm and snow-free, it seems as though the so-called “spring” real estate market in Yardley, Newtown and all over Bucks County has started early. I have written a few recent posts on changes in the Yardley, Newtown area real estate market.
When working with buyers, I always stress how important it is to have a thorough and complete home inspection. For any buyer of real estate in Bucks County, it is critically important to know that any offer you make on a house, can be made contingent on the results of a home inspection. Over the years, I have worked with many area home inspectors. I thought it would be interesting to review what I think are 10 great questions to ask your home inspector.
There are a number of highly qualified, experienced home inspectors in the Yardley, Newtown area, and there is nothing wrong with interviewing more than one. Here are the questions:
1. What does your inspection cover?
At the time of the inspection, most home inspectors will give you a document to sign, that explains, among other things, the limits to what they will be inspecting. The inspector should ensure that their inspection and report meets all applicable requirements for Pennsylvania. They should also ensure that the report will comply with the local standards of practice and code of ethics. If you have specific concerns about something in the house, or an area in the house that you are concerned about, make the inspector aware and be sure that those things are covered in the inspection.
2. How long have you been practicing in the home inspection professions and how many inspections have you done?
This should not be a problem for the inspector to answer. You should be able to review their history in the profession, and perhaps get referrals.
3. Are you specifically experienced in residential inspection?
If the inspection is for a commercial property, you should ask the same question. The inspector may have a construction or engineering back round. but there is no substitute for training and experience in the unique discipline of doing home inspections.
4. Do you offer repairs or improvements based on the inspection?
In some states, this is specifically outlawed. Years ago, in Bucks County, inspectors often did work on repairs, and I never liked that idea since there was an obvious conflict of interest. For the most part, this is no longer an issue with home inspectors in the Yardley and Newtown area.
5. How long with the inspection take?
I have found that the average inspection in our area takes between tw0 and three hours. For the purposes of budgeting your time, you should have a general understanding of how long the inspection should take.
6. How much will it cost?
Costs can vary from inspector to inspector, and it is one of the questions that you should ask, so that you are not surprised the day of the inspection. There are also some variables in terms of what inspections are needed, that will impact the cost. If you need a septic and/or water and well inspections, the cost will be somewhat higher than if those inspections are not needed. When I meet with buyers, I include an approximate cost for the home inspection in my closing cost estimate.
7. What type of inspection report do you provide and how long will it take to receive the report?
I think it is a good idea to ask for samples of the inspectors report, so that you are comfortable with the format, and that you can understand the report language and style. You also need to be sure that the time parameters meet your needs. In our Pennsylvania agreement of sale, there is a time limit to the inspection contingency. It is critically important that the report be available to you in enough time that you can evaluate it and respond to the seller appropriately.
8. Will I be able to attend the inspection?
I always encourage buyers to attend the home inspection, and I would be highly suspicious of any inspector who did not encourage that. I have never actually encountered a problem with an inspector suggesting that a buyer not attend the inspection, but you should ask the question, just to be sure. The inspector will share maintenance information, as well as explaining any defects, and attending the inspection gives you a great chance to learn about the house.
9. Do you maintain membership in a professional home inspector association?
There are actually tw0 national home inspection associations, and in Pennsylvania, the inspector needs to be a member of one of them in order for their report to be used as a basis to negotiate with the seller as a result of an inspection report. There should be no problem asking the inspector whether they are a member of one of the organizations.
10. Do you participate in continuing education?
I think this is a good measure of the inspectors professionalism and service. The more knowledge an inspector has, the better they should be in evaluating any unusual or unique condition in a house.
I hope that these suggestions are helpful if you are considering a home inspector for a house in Yardley, Newtown or anywhere in Bucks County. I would love to hear your thoughts. I can be reached at 215-519-1399, or Marty@MartinMillner.com. If you are considering buying a Yardley or Newtown home, please let me know if I can help you.
Continue Reading > Add a Comment |Home Buying 101 in Yardley, Bucks County
I saw an interesting article this morning from MSNBC entitled, “What you should know before buying a home”.
The author of the article described the journey from moving 9 times in 9 years, from college dorms to various apartments, before deciding to look for something a bit more permanent in the form of a house. In 2009, the author purchased a home, and based on that experience, has suggested five important pieces of advice.
This story resonated with me, because I have three kids who, I suspect, are within a couple of years or so of the author.
Each of my three kids has already purchased a home, or is currently in the process of purchasing a home. I have learned first hand, from their experiences, how daunting and potentially confusing the home buyer process can be, especially for fist time home buyers.
Yardley, Newtown and the entire Bucks County area offers great opportunities for owning real estate. Especially now, with prices lower than they have been in years, and with interest rates at historic lows, it is a great time to buy real estate. However, if you have not been through the process before, it is scary!
I appreciated the advice given in the MSNBC article, and thought that these are five great suggestions.
1. Have a good realtor. I know that I am biased, because this is what I do. But personally, I love working with first time home buyers. I feel that it is my responsibility to be sure that first time home buyers are comfortable with the process, and at each step in the home buying process clearly understand their options and what is happening. I enjoy guiding and educating first time home buyers through the experience, and I know that as we move through the experience, they will understand the process completely.
2. Educate yourself. Again, I think this is great advice. There is a tremendous amount of information that you can find on-line. I actually have a book called, “Before You Buy”, that I can send to people who are interested while my supply lasts. It is a great book on buying a home. The National Association of Realtors also has a buyers guide. It is important to learn as much as you can.
3. Talk to neighbors. I think that this is a great suggestion, and it isn’t done often enough. Before finalizing an offer on a house, it is a great idea to speak with neighbors. Ask them what they like about living in the neighborhood, and ask whether there is anything they don’t like. You may be surprised by what you learn.
4. It is OK not to do everything in the house in the first month you own it. I have worked with buyers who become a bit overwhelmed by thought that they have to furnish, decorate and update an entire house. Remember, there is nothing wrong with taking on projects in stages. Start with rooms and spaces that are most important, and do not feel that it is necessary to everything at once. It will all come together, eventually, and that is fine.
5. Be aware of, and prepared for, hidden costs. When you are a home owner, unexpected costs will occur. Try and be prepared. Could be plumbing issue. Maybe the heater needs a repair. When working on a budget, try and allocate a reserve for these, sudden, and unexpected costs that will come up.
Finally, in searching for your first home, you should love it. It is exciting, it is a lot of money, but in the end, should all be worth it.
If you want a copy of the book, “Before You Buy”, send me your contact information, and I will get a copy out to you. I have about five or six copies left.
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