Real Estate for St. Louis and St. Charles metro area  

Home     Commercial      Buying Homes      Selling Houses     Life and Senior Planning     Links and Resources   Communities

     

  Your Professional Realtor of Choice  -  Dwight Puntigan  -   dpuntiga@charter.net                    636-219-6242


Trading Down
Reverse Mortgage  
Probate Q & A
Planning For You
Foreclosure
Charts and Graphs 
Hire a Real Estate Agent  
Family Budget  
 
 
Trading Down

If your home is larger than you need, trading down to a smaller place may be a good way to increase your retirement income. The difference between the price that you receive for your present home and the cost of a smaller new home can be added to your retirement funds to provide you with additional investment income. The amount of cash that you can get by trading down depends on the value of your present home, the cost of purchasing a new home, and the incidental costs involved in the trade (e.g., brokerage commissions, legal fees, closing costs, and moving expenses). You should estimate these amounts to get some idea of the net amount that you will receive. To check the present value of your home, you should get an estimate of its selling price from me.  General term is a CMA, comparative market analysis.  You should also get an estimate of the cost of your replacement home by shopping around for the type of home that you think you'll want.  These services are provided by myself and other agents as services at no cost to you.

Note: If you think that the tax consequences of trading down are a drawback, think again. You may be able to exclude from federal taxation up to $250,000 ($500,000 if you're married and file a joint return) of any resulting capital gain, regardless of your age. To qualify for this exclusion, you generally must have owned and used the home as your principal residence for a total of two out of the five years before the sale. An individual, or either spouse in a married couple, can generally use this exemption only once every two years. However, even if you don't meet these tests, a partial exemption may be available.  Just be sure to verify with your accountant or tax preparer.

Depending on your situation it may be practical to consider keeping the existing house and using it as rental property.  To finance this consider a reverse mortgage or a home equity loan.  There are good and bad features of both that may or may not apply to your situation.  I can refer lender, accounting, and attorney counseling to you.  If you are considering trading down to avoid foreclosure, talk to me.

 

From a NAR newsletter:

CURRENT REAL ESTATE NEWS/TOPICS & ISSUES
Rightsizing Your Home How to reshape your house for the way you live now -- and take control of your future
When you are not quite ready to downsize, consider rightsizing. Rightsizing is the process of making the best use out of the space you have, without losing any existing space. Rightsizing is the answer if it is possible that your adult children or elderly parents may need to move in with you. Look for alternative purposes for rooms like the guest bedroom and dining room! Read more...
http://www.realtor.org/narlservredirect.nsf/pages/NT000017CE?OpenDocument&WT.mc_id=LS100610&CAT=Curr
 

Found In My Zillow email

3 Reasons to Live in a New Home Before Renovating

Posted: 02 Dec 2011 11:20 AM PST

Especially during a time of flat or declining home values, I’m a huge believer in making smart improvements to a property. Not only can you customize the home to your requirements, you can build some equity to protect your investment from any potential future decline.

That said, I often recommend that buyers live in a new home for six months to a year before undertaking any major remodeling or home improvements. I’m not talking about necessary repairs to lighting or plumbing and such to make the home habitable. Rather, I’m referring to discretionary remodeling, expansions, and other improvement projects.

Many buyers today want their new home to be move-in ready, and having work initiated after you’ve settled in may seem inconvenient at best. But I’ve got my reasons for suggesting that you at least consider holding off on the big home improvement projects, and here they are:

1. Living in the home can change your plans

You may have grand visions for what you’d like to do to a home, based on its condition and your priorities at the time you buy it. But until you’re actually living there every day, it’s difficult to know exactly how you’ll use the house, what will work for you and what won’t. Ultimately, it’s this day-to-day experience with the house that should inform your home improvement decisions, instead of early notions of how you want your day-to-day experience to be.

For example, a client of mine bought a home with a kitchen and a formal dining room separated by a wall. The living room was at another end of the house. The kitchen needed work, and she wanted to renovate it before moving in, though I counseled her to live in it first. As it turned out, the family spent way more time cramming into the kitchen and very rarely used the dining room or even the living room. It soon became clear that, as a part of the renovation, they should open up the wall between the kitchen and dining room and transform the space into one big, open, informal living/dining/kitchen area.

2. After buying a home, you deserve a break

Buying a home is a huge project, an enormous change to your life, and a shock to the system — if not your finances. I’ve seen buyers jump through hoops, spending months on end looking for a home. In some situations, it becomes a part-time job. Once they find the home, getting their finances together and going through the purchase becomes extremely stressful.

A home renovation can be yet another big and stressful project, what with all the decisions to make and contractors to deal with. My recommendation is to take a break after the stress of buying your new home. Enjoy it for a while. Take some time to get used to your new setting. Some buyers have told me it took them six to 10 months to really feel settled and comfortable in their new home. And after coughing up a big down payment, you may need time to get back on your feet financially before taking on any home improvement projects.

3. You need time to carefully plan your home improvement project

Any renovation, no matter how small, should be planned with care. This means speaking to multiple architects, contractors or designers to get their take on your ideas and options — a time-consuming process.

An hour with a well-qualified contractor can uncover opportunities where you least expected them. For instance, even though it may be an added cost now, moving the laundry from the garage to the top floor during a larger renovation may save you time and money down the road.

Conversely, hiring architects and contractors while under the constraints of an escrow period is likely to cause problems for you later. Some buyers want to get the renovation ball rolling as soon as possible because they feel like they can’t live in the home while the work is being done and they don’t want to pay rent and a mortgage at the same time. While this may make some sense economically up front, it can still cause costly problems later.

Take your home for a test drive

Often, buyers who said on day one they don’t want a home that requires any work end up buying a home that needs at least some work. It’s the natural evolution of the buying process. Rarely does someone end up buying the home they started off thinking they wanted.

While you should be open to doing work on a home, don’t feel stressed about getting it all done at once. Live with the home as is for six months to a year. Take it for a test drive and see how it runs. You may be surprised at how your perspective, and your priorities, change once you settle in.

Brendon DeSimone is a Realtor and real estate expert based in San Francisco and New York. He is a contributor to Zillow Blog, has collaborated on multiple real estate books and is often quoted by major media outlets. Follow Brendon on Twitter.

Note: The views and opinions expressed in this article are those of the author and do not necessarily reflect the opinion or position of Zillow.

  

 

 

    Manta Logo  StumbleUpon Logo 
 

Hotfrog US online business directory   Dwight Puntigan on Zillow  

 

Logo by MerchantCircle Product Team Mountain View 94040
   

Increase your website traffic with Attracta.com