Bobbie Files~Taunton Real Estate Berkley, Freetown, Homes for Sale

As an agent that handles a lot of short sales I come across many questions regarding the possible tax implications.  The Mortgage Forgiveness Debt Relief Act of 2007 which covers all homes sold or modified in 2007, 2008, and 2009 has cancelled out many homeowners obligation to pay income taxes on the so called "gifted" income (the difference between what you owe and what it sells for).

 Unfortunately, this new law does not cover all homeowners.

The next challenge is to figure out how much of the "gifted" money is taxable.

In the eyes of the IRS if you bought the home in 2005 and paid $300,000 and are currently unable to pay for your mortgage and due to the market value declining the home is now only worth $250,000 you would in the past been taxed on the $50,000 of "gifted" income.  With the Mortgage Forgiveness Debt Relief Act of 2007 that income is no longer taxable IF this home is your primary residence.

What about a situation in which you bought the same home in 2000 for $200,000 and subsequently refinanced it to $300,000 and now are in a situation where you can no longer afford the payments and the home has declined in value to $250,000? 

This is where it gets sticky! Because... the IRS views this as self induced debt and they will treat that amount as taxable. 

Well than why would you want to do a short sale instead of just letting the bank take it by foreclosure???

Actually this is rather simple, the IRS treats the short sale the same way it treats the foreclosure.  In the eyes of the IRS they are both sales. PERIOD.



So, when the bank forecloses and finally places it back on the market several  months later all the while property values are still dropping the home that WAS worth $250,000 now is only worth $225,000 and that's hoping that it wasn't ransacked while it sat vacant.

Now what do you have? A MUCH bigger loss to be paying taxes on.  

Now I am not a CPA or a tax professional and this is only a very simplistic version and I always recommend people to speak to "their people".                   

If you or someone you know is upside down on their home value and needs to sell please have them contact me at bobbiefiles@kw.com. 

Visit my website at www.BerkleyMass.com for more information on short sales and information on Bristol / Plymouth County Real Estate.

Total Market Report is provided to give you an overall picture of the current market conditions.The following report is for single family homes sold in Berkley from October 1, 2008- October 31,2008.

Single Family Homes

Number of Homes on Market 38 (down 2 from last report)

Average Days on the Market 182 - down 6 (Let's keep on going!)

Number of Homes U.A.G 2

Average Price of U.A.G. Homes $324,900

Number of Homes Sold 4

Average Sold Price $259,125

~$312,913 As of October 3, 2008
~$435,000 As of September 3, 2008
~$0 As of August 16, 2008
~$334,250 As of July 9, 2008
~$317,800 As of June 12, 2008
~$418,333 As of May 1, 2008
~$286,833 As of April 8, 2008
~$180,000 As of March 8, 2008
~$344,250 As of February 7, 2008
~$349,000 As of January 8, 2008
~$262,442 As of December 9, 2007
~$243,125 As of November 7, 2007
~$645,500 As of October 4, 2007
~$331,000 As of Sept.1, 2007
~$349,073 AS OF AUG. 4, 2007
~$356,473 AS OF JUNE 24, 2007


Average Asking Price $404,026

Lowest SALE Price $185,000
Highest SALE Price $315,000

MY LAST MARKET UPDATE WAS October 3rd AND THE AVERAGE SALE PRICE WAS $312,913 which represented 4 homes that sold. 2 Months in a row with a respectable number of home sales.

The number of home on the market is remaining relatively steady, but thankfully continuing to go down. The absorption rate has risen a bit, to slightly over 6 months of inventory. My prior 3 reports had shown a decrease in the absorption rate so I am hoping that this is only a hiccup.

How does this effect you?

Better your odds for a more timely sale by pricing your home ahead of the curve! Pricing it AT the curve in a declining market will put you in line to sell on the 6th month at a lower price than what you would have received had it been priced competitively in the beginning. Remember: Time is NOT on your side in a declining market.

Price it ahead of the curve and you will open your home up to the largest pool of potential buyers which will sharply lessen your market time AND increase your bottom line! I would rather see any seller get multiple offers to choose from than no offers at all.

Call me for a competent, accurate analysis of your home.

To view all Berkley homes on the market visit http://berkleyhomes.berkleymass.com

Visit http://www.berkleymass.com/ for all your Bristol County Real Estate Needs!

Bobbie Files
REALTOR
Keller Williams Realty
508-238-5000 x.296 Office
508-789-0217 Direct
bobbiefiles@kw.com Email

5 Things You Never Knew Your Cell Phone Could Do

For all the folks with cell phones. (This should be printed and kept in your car, purse, and wallet. Good information to have with you.)

There are a few things that can be done in times of grave emergencies .

Your mobile phone can actually be a life saver or an emergency tool for survival. Check out the things that you can do with it:

FIRST
Emergency

The Emergency Number worldwide for Mobile is 112. If you find yourself out of the coverage area of your mobile network and there is an Emergency, dial 112 and the mobile will search any existing network to Establish the emergency number for you, and interestingly, this number 112 can be dialed even if the keypad is locked. Try it out.

SECOND
Have you locked your keys in the car?

Does your car have remote keyless entry? This may come in handy someday. Good reason to own a cell phone: If you lock your keys In the car and the spare keys are at home, call someone at home on their cell phone from your cell phone. Hold your cell phone about a foot from your car door and have the person at your home press the unlock button, holding it near the mobile phone on their end. Your car will unlock. Saves someone from having to drive your keys to you. Distance is no object. You could be hundreds of miles away, and if you can reach someone who has the other 'remote' for your car, you can unlock the doors (or the trunk).

Editor's Note: It works fine! We tried it out and it unlocked our car over a cell phone!.

THIRD
Hidden Battery Power

Imagine your cell battery is very low. To activate, press the keys *3370#. Your cell phone will restart with this reserve and the instrument will show a 50% increase in battery.

This reserve will get charged when you charge your cell phone next time.


FOURTH
How to disable a STOLEN mobile phone?

To check your Mobile phone's serial number, key in the following Digits on your phone: *#06#. A 15-digit code will appear on the screen. This number is unique to your handset.

Write it down and keep it somewhere safe.

If your phone gets stolen, you can phone your service provider and give them this code. They will then be able to block your handset so even if the thief changes the SIM card, your phone will be totally useless. You probably won't get your phone back, but at least you know that whoever stole it can't use/sell it either. If everybody does this, there would be no point in people stealing mobile phones.

And Finally.....

FIFTH
Free Directory Service for Cells

Cell phone companies are charging us $1.00 to $1.75 or more for 411 information calls when they don't have to. Most of us do not carry a telephone directory in our vehicle, which makes this situation even more of a problem. When you need to use the 411 information option, simply dial: (800) FREE411, or (800) 373-3411 without incurring any charge at all.

Program this into your cell phone now.

Total Market Report is provided to give you an overall picture of the current market conditions.The following report is for single family homes sold in Berkley from September 1, 2008- September 30,2008.

Single Family Homes

Number of Homes on Market 40 (down 1 from last report)

Average Days on the Market 188!!!!!!!! (up 2)

Number of Homes U.A.G 5

Average Price of U.A.G. Homes $297,740.00

Number of Homes Sold 4

Average Sold Price $312,913

~$435,000 As of September 3, 2008
~$0 As of August 16, 2008
~$334,250 As of July 9, 2008
~$317,800 As of June 12, 2008
~$418,333 As of May 1, 2008
~$286,833 As of April 8, 2008
~$180,000 As of March 8, 2008
~$344,250 As of February 7, 2008
~$349,000 As of January 8, 2008
~$262,442 As of December 9, 2007
~$243,125 As of November 7, 2007
~$645,500 As of October 4, 2007
~$331,000 As of Sept.1, 2007
~$349,073 AS OF AUG. 4, 2007
~$356,473 AS OF JUNE 24, 2007


Average Asking Price $410,400

Lowest SALE Price $180,000
Highest SALE Price $408,650

MY LAST MARKET UPDATE WAS September 3rd AND THE AVERAGE SALE PRICE WAS $435,000 which represented 1 home that sold. I guess it was 1 better than what had sold in July. But September was an Okay month, 4 homes sold is a nice solid performance.

The number of home on the market is remaining relatively steady, but thankfully going down slightly. Right now there is less than 5 months worth of inventory on the market, which is, by numbers a Neutral Market. A Neutral Market indicates that we have finally hit the axis point of home price to affordability. Home prices have adjusted to the point that the median income buyer can afford to own. This is now 3 months in a row of less than 6 months of inventory, we may have finally arrived at a neutral market. What that means is, if no more homes came on the market and all the current homes stayed on the market until they sold it would take 4.5 months for all the homes to be sold, assuming that they are all priced correctly. It is a widely accepted rule that if we have less than 6 months but more than 3 months worth of inventory we are in a neutral market. A neutral market means that home prices are in line with affordability and are being absorbed at a moderate pace.

For the past 3 months we have not seen a sharp increase in the absorption rate and to the contrary we have seen a decrease, which is very good news. The law that Massachusetts passed requiring banks to give homeowners an additional 90 days to cure default prior to foreclosing did not have the impact on 9/1 as it was projected to do. However, do not be fooled to think that there isn't an onslaught of foreclosures yet to come on the market.

How does this effect you?

Better your odds for a more timely sale by pricing your home ahead of the curve! Pricing it AT the curve in a declining market will put you in line to sell on the 6th month at a lower price than what you would have received had it been priced competitively in the beginning. Remember: Time is NOT on your side in a declining market.

Price it ahead of the curve and you will open your home up to the largest pool of potential buyers which will sharply lessen your market time AND increase your bottom line! I would rather see any seller get multiple offers to choose from than no offers at all.

Call me for a competent, accurate analysis of your home.

Visit http://www.berkleymass.com/ for all your Bristol County Real Estate Needs!

Bobbie Files
REALTOR
Keller Williams Realty
508-238-5000 x.296 Office
508-789-0217 Direct
bobbiefiles@kw.com Email

Just so we are all clear and on the same page, albiet there are over 451 of them in the bail-out package, below are the artificial sweeteners added on the the "Financial" Bail Out Package.

_Provide business tax breaks, including for production of, investment in, and use of renewable fuels.

_Require group health plans that include mental health or addiction treatment to provide coverage for those conditions that is equitable to other medical coverage.

_Increase personal credits against the AMT, shielding more than 20 million taxpayers from the tax.

_Grant tax relief to victims of natural disasters in the Midwest and elsewhere.

_Extend through 2011 a program that funds rural schools and local governments that have low property-tax bases because they lie within or are adjacent to federal lands.

_Extend until end of 2009 the deduction for state and local general sales taxes.

_Extend until end of 2009 individual tax breaks, including deductions for higher education costs and teachers' personal expenses.

_Increase, from $100,000 to $250,000, the limit on federal bank deposit insurance.

Now please excuse my ignorance, or my lack of a Washington D.C. education, but the way I see all those sweet little nuggets is that they have nothing at all whatsoever to do with the Wall Street crisis.

Where is there anything to help, I don't know, maybe the average Joe?

Even better than that is their wonderful tired old cliche of "I'm for Main Street not Wall Street"!

Well, based on what I see, they are helping the people that work on Pennsylvania Ave. more than anyone!

According to the Drudge Report McCain never even read the bill he is so forcefully backing and promoting.

It would be a cheaper scenario to just give every taxpaying homeowner who is over 30 days late on their mortgage a check to pay the entire mortgage off, than it would be to allow this package.

Bobbie Files
www.BerkleyMass.com