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HouseLogic Helps Homeowners Get the Tax Breaks They’re Due Media Contact: Michelle Wardlaw / 202-383-1042 / Tax season is underway, and homeowners gearing up to meet the April 15 filing deadline can find the tax tips and insights they need at HouseLogic.com, the award-winning comprehensive website for homeowners from the National Association of Realtors®. HouseLogic’s “Homeowner’s Guide to Taxes” can help filers take advantage of the tax benefits that come with homeownership while avoiding common home-related tax mistakes. “From the mortgage interest deduction to energy tax credits, many homeowners can take advantage of a variety of tax strategies that can lower their tax bill,” said Pamela Kabati, NAR senior vice president of communications and HouseLogic spokesperson. “For example, a family who bought a home last year with a $200,000, 30-year, fixed-rate mortgage, assuming an interest rate of 4.5 percent, could save nearly $3,500 in federal taxes when they file this year.” HouseLogic also offers tips to keep homeowners from making unnecessary mistakes on their taxes. “9 Easy Mistakes Home Owners Make on Their Taxes”  identifies common errors like deducting the wrong year for property taxes, confusing the escrow amount for actual property taxes paid, and neglecting to take the private mortgage insurance deduction. Homeowners who make certain energy-efficient home improvements may be eligible for certain tax credits, and owners who had a portion of their mortgage forgiven as part of a workout plan, short sale, or foreclosure don’t have to pay income tax on the forgiven debt, provided the mortgage was secured by a principal residence and the total amount of the outstanding debt is not more than the original purchase price plus improvements. Among the tax questions you’ll find answers to at HouseLogic.com: • How to Deduct PMI • How to Deduct Mortgage Interest and Equity Loan Costs • How to Amend Your Tax Return • How to Claim Your 2012 Energy Tax Credits Homeowners should consult a tax professional for any advice applicable to particular transactions or circumstances; the information on HouseLogic should not be relied upon as tax or legal advice. HouseLogic is a free source of information and tools from the National Association of Realtors® that helps homeowners make smart decisions and take responsible actions to maintain, protect, and enhance the value of their home. HouseLogic helps homeowners plan and organize their home projects and provides timely articles and news; home improvement advice and how-tos; and information about taxes, home finances, and insurance. The National Association of Realtors®, “The Voice for Real Estate,” is America’s largest trade association, representing 1 million members involved in all aspects of the residential and commercial real estate industries. Information about NAR is available at www.realtor.org. This and other news releases are posted in the “News, Blogs and Video” tab on the website.  

Buyers Value Storage Space, In-Law Suites, NAR Survey Finds Media Contact: Leanne Jernigan / 202-383-1290 /  Email Purchasing a home is an important life decision, and many factors can influence the home choices buyers make. The National Association of Realtors® 2013 Profile of Buyers’ Home Feature Preferences examines the features buyers prefer when it comes to purchasing a home, as well as the differences in preferences when it comes to factors such as region, demographics and household composition. The survey captures buyers who purchased a home between 2010 and 2012. “Deciding where to live comes with a lot of options, but buyers quickly realize that some features are more important than others when it comes to choosing the right house for them,” said NAR President Gary Thomas, broker-owner of Evergreen Realty, in Villa Park, Calif. “Buyers need to have a clear idea of what features are important to them and know where they are willing to compromise; in this respect, Realtors® can bring buyers home. Realtors® visit hundreds of homes with buyers each year, and have a unique understanding of what buyers value in their local markets.” Geography and demography strongly influence what buyers value in a home. The typical recently purchased home was 1,860 square feet and was built in 1996. Repeat buyers, buyers of new homes, married couples and families with children typically purchased larger homes. First-time buyers and single women tended to buy older homes. The typical buyer purchased a home with three bedrooms and two full bathrooms. Slightly over half of the homes purchased were on a single level. Southerners tend to buy newer homes; they were more likely to want a home less than five years old and in a wooded lot with trees when compared to other regions. Not surprisingly, buyers in the South also placed a higher importance on central air conditioning. While more than three-fourths – 78 percent – of all buyers purchased a home with a garage, garages were more popular among new-home buyers, Midwesterners, and suburbanites. Forty-one percent of homes purchased had a basement, but this feature was more popular among buyers in the Midwest and Northeast. Northeastern buyers also value hardwood floors more than people in other regions. Southerners typically bought the largest home at 2,000 square feet. Those in the Northeast followed closely behind with a typical home purchase of 1,850 square feet. Among buyers 55 and older, 42 percent considered finding a single-level home very important, compared to just 11 percent of buyers under age 35. Single women also placed higher importance on single-level homes, while single men wanted finished basements. Both single men and married couples placed higher importance on new kitchen appliances. Among all 33 home features in the survey, central air conditioning was the most important to the most buyers; 65 percent of buyers considered this feature very important. The next most important feature was a walk-in closet in the master bedroom; 39 percent of buyers considered this feature very important. Closely behind was having a home that was cable-, satellite TV-, and/or Internet ready, as well as an en-suite master bathroom. When it came to actually buying a home, among buyers who considered central AC and cable-, satellite TV-, and/or Internet ready very or somewhat important, 94 percent bought a home with these features. The next most common feature was an eat-in kitchen; 89 percent of buyers who thought this was important purchased a home with an eat-in kitchen. Buyers value some features so much that they are willing to spend more money to have them. Sixty-nine percent of buyers who did not purchase a home with central AC would be willing to pay $2,520 more for a home with this feature. Sixty-nine percent of buyers who did not purchase a home with new kitchen appliances would be willing to pay $1,840 more for a home with this feature. A walk-in closet in the master bedroom was the third most common feature on which buyers would spend more. Sixty percent of buyers who did not purchase a home with a walk-in closet would be willing to pay $1,350 more for a home with this feature. The features on which buyers placed the highest dollar value were waterfront properties and homes that were less than five years old. Thirty-two percent of buyers would be willing to pay a median of $5,420 more for a home on the waterfront, and 40 percent of buyers would be willing to pay a median of $5,020 more for a home that was less than five years old. The rooms that buyers were willing to pay the most for were a basement and an in-law suite. Thirty-three percent of buyers would be willing to pay a median of $3,200 more for a home with a basement, and 20 percent of buyers would be willing to pay a median of $2,920 more for a home with an in-law suite. When it came to rooms that buyers want in a home, 55 percent of buyers thought it was very important to have a living room, although buyers in the Northeast placed more importance on a home with a dining room. Buyers aged 55 and older placed more importance on a bedroom on the main level of the house. Buyers aged 35 to 54 placed more importance on a laundry room, while those with children placed more importance on a family room. The two most common rooms buyers were willing to spend more for were a laundry room and a den/study/home office/library. Sixty-three percent of buyers who did not purchase a home with a laundry room would be willing to pay $1,590 more for a home with this room. Forty-four percent of buyers who did not purchase a home with a den/study/home office/library would be willing to pay $1,920 more for a home with this room. Although 97 percent of recent buyers were satisfied with their home purchase, there are always features buyers would like that they don’t have, said NAR Vice President of Research Paul Bishop. “Most satisfied homeowners still said they would like more or larger closets and storage space. In addition, nearly half of recent buyers would prefer a larger kitchen, and two out of five would prefer a larger home overall.” Within three months of a home purchase, 53 percent of buyers undertook a home improvement project. The typical buyer spent $4,550 on various projects. Remodeling the kitchen was the most common home improvement project; 47 percent of buyers undertook a project in the kitchen. Bathrooms were a close second at 44 percent. Forty-one percent of buyers who made home improvements added or replaced lighting, and 37 percent added or replaced appliances soon after becoming a homeowner. In October 2012, a sample of households that had purchased any type of residence real estate during 2010 to 2012 and still owned the property was surveyed. The survey sample was drawn from a representative panel of U.S. households monitored and maintained by an established survey research firm. A total of 2,005 qualified households responded to the survey. Households were sampled to meet age and income quotas representative of all home buyers drawn from the 2011 NAR Profile of Home Buyers and Sellers.

Study: ‘Green’ Home Owners Less Likely to Default Daily Real Estate News |      Thursday, March 21, 2013 Owners of energy-efficient homes are one-third less likely to default on their mortgage, according to a new study released by the University of North Carolina at Chapel Hill Center for Community Capital and the Institute for Market Transformation. “Consumer and industry acceptance of energy efficiency is high,” says Roberto G. Quercia, one of the author’s of the study. “But the lack of broad consideration of potential energy savings in the mortgage underwriting process still prevents many moderate- and middle-income home buyers from fully enjoying the cost savings. Since our study findings now show that energy efficiency is strongly and consistently associated with lower mortgage lending risk, lenders and policymakers have one more reason to promote it.” Researchers evaluated 71,000 single-family home loans, originated between 2002 and 2012, from 38 states as well as the District of Columbia to assess the link between home energy efficiency and mortgage default risks. About 35 percent of the homes evaluated were Energy-Star rated for efficiency. “It stands to reason that energy-efficient homes should have a lower default rate, because the owners of these homes save money on their utility bills, and they can put that money toward their mortgage payments,” says Cliff Majersik, executive director of IMT. “We long believed this to be the case, and now this study proves it. Successful housing market reforms will require reconsidering the risk factors in mortgage default, including energy costs.” The study’s authors recommend that Congress might even consider requiring an energy audit or rating as part of the mortgage underwriting process, given the study’s findings. Source: UNC Center for Community Capital and Institute for Market Transformation

First-Time Home Buyer? Here’s What Not to Do Date:March 7, 2013|Category:Tips & Advice|Author:LearnVest Our friends at LearnVest offer sound financial tips and advice for every aspect of life. Check out these friendly warnings for prospective home buyers. Insanely low mortgage interest rates — and the knowledge that they’ll eventually go up again — make a lot of people feel like it’s time to buy a house right now. And maybe it is … if you go about it the right way. Buying a home is a major purchase (to put it mildly), and there are plenty of ways to trip up. But don’t worry — we’ve got your primer right here. Don’t … buy a house if you’re planning to move again soon If you’re a renter, it can be frustrating to write a rent check every month and have no home equity to show for it at the end of the year. But if you aren’t certain that you’re going to stay put for a few years, it’s probably not the right time to buy — equity or no equity. “Some people tend to buy a house knowing that they’re going to be relocating after a few years,” says LearnVest Planning Services certified financial planner Ellen Derrick. “Don’t buy property and automatically assume that you’ll be able to rent it out or sell it when you move.” What to do: If you aren’t in an area with a strong rental market that would allow you to cover the mortgage on your home if you move elsewhere, then stick with a rental for now. Don’t … bust your budget Shopping for houses can make you a little giddy. Look at this one! And this one! For a little bit more, you could get granite countertops, plus an office nook! You’re dealing with such large numbers when you’re browsing real estate that it might not seem like such a huge deal to stretch another $10,000 or $15,000 to get the home you really love. But that’s not a game you want to play. “People look at the top end of their affordable monthly payment, and they don’t really think about what happens if their income goes down or they have to change jobs,” says Derrick. (If you’re wondering what percentage of your budget should go toward housing, check out the 50/20/30 Rule.) What to do: Get pre-approved for a mortgage. Not only will this prove that you’re serious to your real estate agent and home sellers; it will also give you an idea of your upper limit. “Remember that the lender is there to make you a loan, and the more money you borrow, the better it is for them,” Derrick says. “They want you to max out. I would take the pre-approval number and cut about 20 percent off.” Don’t … forget about added costs Buying a home isn’t just a matter of replacing a rental payment with a mortgage payment. There are also maintenance costs, utilities (which will likely cost more) and property taxes. “People tend to forget about both property taxes and insurance when they’re thinking about how much house they can afford,” Derrick says. “The actual monthly payment could end up being well out of your price range when you figure those things in.” What to do: Ask the homeowners about their average utility costs and property taxes, get a homeowner’s insurance quote, and budget about one percent of the home’s purchase price for annual maintenance. Then run the numbers to see if you can afford the home. (And, don’t forget about closing costs.)