Military Personnel Eligible for Extended Tax Credit through 2011

Military personnel who have served 90 days overseas in 2009 or 2010 are still eligible to receive the federal tax credit of up to $8,000 for first-time buyers or $6,500 for repeat buyers. Eligible troops have until April 30, 2011 to be under contract and June 30, 2011 to close.

In addition, service members are exempt from the occupancy requirements. Home buyers who sell within three years of purchase are typically liable for repayment of the tax credit. Service members have no occupancy requirement. Intelligence and foreign service members are also eligible.

The second benefit for military personnel looking to buy a home is the traditional VA Mortgage. Some of the highlights that make the VA loan attractive one are:

100% financing! That’s right…..100%! You can buy a home with no down payment.

The Seller can pay your closing costs as an incentive to induce you to buy their home. That means you don’t need to come up with that money either.

No Reserve Requirements means you don’t need to have any real savings at all to buy a home with a VA loan. (Now, that doesn’t mean you shouldn’t have money in the bank before you buy a home, but it does mean you don’t have to.)

More liberal understanding of credit challenges (i.e. lower credit scores).

For more information on VA loans, contact one of our mortgage partners.

Help spread the word to our troops and their families! For more information, contact a Nothnagle agent or call 899-MOVE.

Real Estate as an Investment

Real estate has long been viewed as a solid investment when it comes to your primary residence. It allows you to build equity and personal wealth over time, can be passed down to heirs, used as a nest egg, seniors can take equity out of the property through reverse mortgages or it can be sold at a profit to invest in a bigger, better house down the road.

With investments in the stock market having taken a tumble over the past few years, many individuals have turned to investment properties to generate positive cash flow. Of course, you should always consult with your tax professional and an experienced investment property agent prior to getting started.

In today's market climate, typically you will need some cash to get started. Banks have tightened up lending requirements for investors considerably. When getting into rental properties, you need to calculate what the potential cash flow is that the property will generate to determine whether or not it will be worth it to you. An agent can help you determine cash flow.

Many people today are interested in "flipping" homes as a profit generator. The key to being successful at this method is to focus on the buy side, not the sale. You need to be able to buy the property for the right price and then calculate what your carrying costs and renovations will be. Carrying costs and renovation costs are fixed; your purchase price is not.

Example A:

House bought for $100,000. Renovations cost $15,000 and carrying costs for six months is $6,000. Right now you have $121,000 into the property. Renovation estimates almost always come in higher than anticipated....so add another $5,000 for unanticipated expenses. Now you have $127,000 into the property. If houses in the area sell for $140,000 on average, your anticipated profit is $13,000. How can you increase your profit? If you could buy the house for $95,000 that would bring your profit margin up to $18,000. Then you have to determine if that amount is worth it to you.

Again, an agent experienced with investment properties can not only help you find "good buys" but will also help guide you as you analyze what your cash flow will be. Don't forget about taxes....capital gains and other taxes may apply so always consult with a tax professional.

Creating Scent Appeal

There is a big difference between using scent to cover up odors versus using them to enhance the experience and make the environment more appealing. When selling your home, two simple things that will help you keep unpleasant odors at bay are to take the trash out often and watch what you cook. If you have pets, if possible try to limit the animals to a certain room that can be easily cleaned and keep their bedding (and fur!) washed to avoid odors.

Even to smokers, a home that smells of cigarette smoke is typically considered a bad smell. An ionizer can help remove smoke smells and if you are a smoker, you may want to avoid smoking indoors while your house is on the market.

Smoke, pet smells, and musty odors are odors that you need to get rid of to improve your showings and to get your home sold. Simply adding air fresheners, scented candles and/or deodorizers usually will not get rid of the bad smell and can be viewed by buyers as an attempt to cover up the bad odor. Sometimes a thorough cleaning of carpets, drapes and upholstery is well worth the investment.

However, there is a direct connection between smell and people's moods so light fragrances can help create "scent appeal" when used properly in the home. The scents should never be overpowering but more of a subtle background to set the mood. A light floral fragrance can put people in a more pleasant mood while citrus scents tend to have an energizing effect. Vanilla is often found to be comforting and relaxing.

Some suggestions:

A small reed diffuser in a bathroom can keep the room smelling clean while not overpowering the space.

Boil water on the stove and throw fresh cinnamon in it.

If using scented candles stick to basic scents such as vanilla, apple, cinnamon and lemon or grapefruit.

Run lemon wedges through the garbage disposal to eliminate any odors.

Beware of Rental Scams on Craigslist

The FBI and various news outlets have been warning people to beware of a scam involving rentals posted on Craigslist. If you are using Craigslist to find rental property, please make sure that you are in contact with a real person in real life.

Craigslist posts a warning on all of the real estate pages:

Avoid scams and fraud by dealing locally! Beware any arrangement involving Western Union, Moneygram, wire transfer, or a landlord/owner who is out of the country or cannot meet you in person.

Typically the scam artist will only communicate via email and uses a story that they are currrently doing missionary work in Africa and therefore can't meet in person. They will request that you fill out an application and send a deposit and/or first and last month's rent via Western Union. They then indicate if you are approved, they will mail you the key. The key never arrives and the money is gone.

Many of the postings on Craigslist are "hijacked" listings taken from other local and national real estate websites and the Seller has no idea their home is being used to advertise the fake rental. The postings use a photo and provides basic info about the house so it looks legitimate. Often the monthly rent is way below market prices - remember, if it seems too good to be true, it usually is!

People have lost money in this scam! If you have been a victim or if you know of someone who has, please direct them to the scam section Craigslist has set up that includes links to the FTC and Internet Fraud Complaint Center.

Tips for Maximizing Small Spaces

When selling your home, it is important to maximize your space. Easier to do in a large home, but what if you have a small house? Or a small room? There are several ways to maximize your floor space and enhance your home's beauty.

Remember, prospective buyers appreciate what they can see so you need to make sure you are showing them what you've got. The most obvious tip is to remove clutter. Clutter makes the space look smaller. Clutter in the closets, on the counter tops, in cupboards and especially in rooms will "shrink" the space and hide features that should be shown off....granite countertops, custom shelving or unique features of a room.

Some additional tips to help you maximize your space:

#1. Make sure that each room is easily identifiable. The computer desk should not be in the dining room....unless the dining room is being used and marketed as an office. Otherwise, move the desk.

#2. Remove throw rugs to show off your hardwood floors and take down pictures off the walls in order to create less distractions and hence open up the space more.

#3. Remove large pieces of furniture in overstuffed rooms. Put it in storage or if you're not going to take it to the next house, sell or donate it. The key is to create open space so that people can easily move around the room.

#4. High contrasting or dark colors make rooms look smaller. That doesn't mean you have to go out and paint everything white! Color is good but blending and using more medium-to-light tones will help open up the space.

There are many options these days for storage, including furniture and end tables that have hidden storage built in. Another option is to install bed risers, which safely lift a bed in order to create storage space underneath.

Nothnagle's Home Services offers short and long term storage options as well. If you just don't have the space for everything, you can store out-of-season clothing and household items you may not need every day in order to create more space.