Higher-end Homes Hit by Excise Tax Rate Increase

Sellers of higher-end homes will pay more in real estate excise tax (REET) next year due to changes adopted by the Washington state Legislature. A new graduated tax, or tiered REET, will go into effect for homes sold on or after January 1, 2020.

Washington state has one of the highest real estate “transfer tax” rates in the country, according to a study by the National Association of REALTORS®. That rate will now be higher for sellers of homes valued at slightly over $1.5 million or more. The current single rate REET is assessed at 1.28% on the sale price of the home. In addition, most local governments in the state assess an additional one-half percent on the sales price, making the current effective rate 1.78%.

Under the new system, effective in 2020, the first $500,000 of value will be taxed at a new reduced state rate of 1.1%, saving the seller of a $500,000 home $900. For the value of the sale between $500,000 and $1,500,000, the tax rate remains 1.28%. For the value of the sale between $1.5M and $3M the rate is 2.75 % and for sales above $3M the rate is 3%. Because the tax is assessed at a marginal rate (the different rates apply on each portion of the sale), the actual break even point between the old and the new rates is $1,561,224 of value. Sales greater than that amount will pay more REET under the new system and sales under that amount will pay less.

The local government REET rates do not change and remain in effect. The combined state and local taxable rate is shown in the table above.

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Housing Options Expand in King County

King County residents will have more options for owning a home thanks to a new law championed by REALTORS®. As Seattle and King County continue to experience greater demand for housing and an uptick in home prices, a coalition of housing advocates worked with the Legislature to pass a condominium reform measure that will make condo construction more attractive across the state.

The result: More housing choices for more people in King County.

Read more…

How a Home Office Can Increase Appeal for Homebuyers

With housing inventory remaining tight in recent years, RE/MAX agents are diligent about keeping up with the trends to help clients buy and sell properties in this competitive market.

“Remote-friendly” workplaces are one of those rising trends. In fact, according to 2018 data from the U.S. Census, nearly 8 million people worked at home in 2017.

“In my experience, the home office is an integral part of the millennial homebuying criteria,” says Chris Krzemien with RE/MAX Experience in Fort Lauderdale, Florida.

If you think it might be time to get to work (pun intended) on sprucing up – or creating – that home-office space, here are some tips to help you get started:

  1. Designate a Dedicated Office Space

One of the pitfalls to working from home is distraction. It’s crucial to create an atmosphere that’s conducive to professionalism and creativity. If your home is big enough to accommodate an entire room dedicated solely to work, an office might be a draw for millennials envisioning their productive and comfortable work-from-home days. If not, it’s a great idea to establish a semi-private area in your home where a buyer could picture themselves using a computer, talking on the phone and keeping important documents stored.

  1. Seek the Sunshine

Employees working from home are saying “sayonara” to the cubicle! Rather than putting a home office desk in a corner, try moving it close to a window – a buyer might appreciate the chance to take in the scene during the workday (pro tip: Make sure your view and garden are in tip-top shape for prospective buyers!). And don’t forget lamps in case the shades need to be closed for glare.

  1. Get Comfortable – Stay Awhile!

Many office environments provide a creative space away from desks for employees to think and brainstorm. A home office should provide the same comfy area. Add a chair, coffee table and colorful throw, and the buyer might just choose to brainstorm the next big app there. Voila!

  1. Plant Your Next Move

Houseplants convey a happy and healthy home. When you’re in seller’s mode, you know that a good first impression is key for success. If your office has empty space, add a floor plant. If the space lacks color, pair the plant with a colorful container. You get the idea.

  1. Don’t Make It Personal

This one’s easy. You already know that buyers want to envision themselves in your home, so removing anything overly personal, like photos and kids’ artwork, goes a long way. The same advice applies to the home office. Keeping this carved-out space for work only, when possible, boosts productivity and limits distractions. If you’re preparing a home office before you sell, box up those photos now so you can take them with you to your next home.

“You have to remember, there’s a reason why employees choose to work from home. It’s a feel-good space for them. Make it as bright and pleasant as possible,” added Krzemien.

Staging Your Home for Selling Season

If you own a home, it is likely one of your largest investments. When the time comes to move up or downsize, you want to do everything in your power to protect your equity and get your asking price – or more. One way to ensure your home is listed, and purchased, at the right price point is to work with a real estate agent to boost your home’s buyer appeal. Check out these home-staging tips from experts across the country.

  1. Depersonalize and Neutralize

A home filled with someone else’s personal belongings and clutter can make potential buyers feel as though they are invading private space.

“Neutralizing the atmosphere encourages buyers to envision themselves living there,” says Leslie Cain with RE/MAX Realty Affiliates in Carson City, Nevada. “Think of staging your home as an investment – it typically costs less than a first price reduction [if the home doesn’t sell].”

  1. Focus on Feature Rooms

Your real estate agent can help you see your home from the buyer’s eyes. Focus on the dining and living areas as well as the master bedroom.

“A common mistake is relocating clutter to closets – buyers will look there, too,” said Kathy Henne with RE/MAX Finest in Piqua, Ohio. “It’s best to move all unnecessary belongings out of the house and keep the space as sparsely furnished as possible. Once you have a cleared space, make sure to give it a deep cleaning.”

  1. Go Virtual

You want your home to be clean and decluttered, of course, but not having enough furniture can also be a problem, says Cynthia Fazzini with the Fazzini Group at RE/MAX Realtec Group in Palm Harbor, Florida.

“Since most potential homebuyers begin their home searches online, we often recommend digital staging to our clients with vacant homes,” said Fazzini. “Adding in furniture, artwork and rugs gives the home warmth and helps the buyer envision how the space can look with their belongings and decorations. We recently took on a new construction home that was vacant and had been on the market for six months with multiple price reductions. After digital staging, the house was under contract in seven days.”

Agents Report Sharp Declines in Bidding Wars

There will likely be less competition for home buyers this spring—a widely reported index from Redfin shows a significant decrease among real estate professionals reporting bidding wars in March, compared to a year ago. Only 16 percent of offers written by Redfin agents on behalf of their customers in the first three weeks of March faced a bidding war, down from 61 percent a year ago, according to the brokerage’s index.

San Francisco, Boston, San Diego, and Portland, Ore., are the most competitive housing markets this month, according to the report. However, even in these markets, only one in five buyers faced bidding wars; a year ago, real estate agents in these markets reported that 65 percent of their buyers’ offers faced multiple bids.

Read the full article on REALTOR® Magazine…

How Will the Housing Market Fare This Spring?

Real estate pros often anxiously await for the spring selling season, a time known for an uptick in home sales. But will spring be as hot for the housing market this year as it has been in the past?

Since the end of last year, home sales have slowed (a decline of 10 percent in December compared to a year prior), and properties have been sitting on the market for longer (46 days compared to 30 days a year ago).

Nevertheless, Lawrence Yun, chief economist at the National Association of REALTORS®, says that “multiple data show definitively improving conditions” heading into the spring selling and buying season.

Consumer sentiment about home buying is turning more upbeat, and there have been greater reports of foot traffic at open houses, according to recent NAR surveys. The number of openings of lock boxes—which real estate pros use to access a key prior to unlocking a home for a showing—is “measurably higher” in January and February compared to the second half of 2018, according to NAR SentriLock data.

Further, the number of consumers applying for a mortgage to purchase a home is on the rise. “After the weak conditions of late last year, mortgage applications have picked up notably in 2019 with more consumers evidently searching for a home compared to one year ago,” Yun writes in his latest real estate column at Forbes.com. Also, contract signings to purchase a home rose 4.6 percent in January—another healthy sign about the market Yun points to.

With mortgage rates staying low, Yun expects more home buyers and sellers this spring. So far this year, the 30-year fixed-rate mortgage has fallen to under a 4.5 percent average. That means a typical home buyer could save nearly $100 per month due to the drop. In addition, wages are up 3.4 percent year-over-year on average, the hightest rate in a decade, .

“The slump is over” in the housing market, Yun notes. “Better times are ahead for home buyers.”

Source: REALTOR® Magazine

A Successful Move Is All in the Details

Nearly 35.5 million Americans move each year, according to data from Move.org. With so much to think about, from organizing and packing to lifting and moving heavy boxes, it’s easy to forget the little things that can make life a little easier during a move. Here are some small details that may get overlooked – tips to make any move smoother and stress free.

Unplug Carefully
Don’t just pull the plug on expensive electronics and toss them in a box – a little planning will help you protect expensive gadgets, like TVs, laptops and stereo systems. Think before dismounting that big, flat-screen TV by yourself. Follow this guide to make sure nothing is damaged. Place all user manuals in a folder so they don’t get lost in the shuffle, but don’t panic if you’ve misplaced them because you can usually find manuals on manufacturers’ websites. Consider a professional mover for your more delicate electronics. Atlas Van Lines suggests using a qualified professional to uninstall any wall-mounted AV equipment and to call in advance to schedule an appointment so you’re not scrambling at the last minute.

Food for Thought
Don’t forget about dinner – you still need to eat during a move. Packing up the kitchen is usually the last, most challenging part of the moving process, but if you make plans you won’t go hungry.

  • Donate: Think about donating canned or unopened food to your local food bank. This leaves one less thing to pack and supports your community.
  • Meal Plan: Use the foods still left in your fridge and freezer for meal planning. Take inventory of the foods you have available leading up to the big day. Home Cooking Memories has some tasty ideas.
  • Label and Organize: Don’t pack up those cooking utensils just yet. Label your moving boxes to easily access the kitchen gadgets you still need to whip up a quick dinner. Consider the packing order of appliances you won’t need, like the blender, and place everyday items, like spatulas, on top for easy access.

The Essentials
You’ve unloaded the last box and you’re ready to shower, eat and relax – only to remember that your toiletries are buried in a dozen boxes, spread across the house. Avoid this all-too-common mistake by packing one or two “essentials boxes” that contain extra clothing, towels, toiletries, medications, bedding and phone chargers that will last up to three or four days.

Know Your Limits
It may be tempting to save money by doing the moving yourself, but don’t get in over your head. Know your limits, suggests OZ Moving and Storage, “If you’re not sure if you can accomplish some part of your move without professional help, don’t try. We were called up once by a trio of college students who had gotten their couch stuck in a staircase. Getting in over your head and having to call emergency help is not ideal.” Get quotes from a few moving companies to determine what needs to be moved or packed by a professional.

A successful move is all in the details – but, with a plan in place you won’t forget the small stuff!