Real Estate Taxi » Income property

How do I switch my Primary Residency?

Walter G — Mon, 15 Jun 2009 20:52:14 +0000

“My husband and I sold our primary home this year, but still own another house in a different state. We are now renting in the city of our primary home, but would like our second home to be considered our primary for capital gains reasons. I spend at least 50 % of my time at our second (now only) home. What do we need to do to make our 2nd home our primary?”

Primary Residency

First and foremost, I suggest you consult a tax professional. Tax professionals deal with state residency issues on a regular basis. There are a great deal of people whom claim they live in another state, then they truly live in. The reason being some states are state-income-tax-free, an example would be Florida. This benefit would be considered tax evasion, and it will cost you time and money. By definition Primary Residency is a residence which the borrower intends to occupy as the principle residence (where they will live most of the time).

It would be smart to start keeping a detailed booklet, logging when you are actually present in each home. I think you need around 183 days in a home to consider it your primary residence. In order to qualify for the tax exemption, you may need to actually log 2 full years out of the past 5 actually living in that home, so if you’re only there half the year, it may take you 4 of those 5 years just to get 2 full years that actually qualify.

Primary Residency.

For majority of the year, a owner lives within the property.
The property is in a location that makes sense in relation to their employment.
The home contains characteristics that suits the needs of their immediate family.
The borrower intends to occupy the property.

Secondary Residency.

A secondary residence or vacation home must be a reasonable distance away from a principal residence.
The owner must occupy the property for some portion of the year and the property must be suitable for year round occupancy.
It’s generally a little tougher to qualify for a second home.

I am not a tax professional so reaching out to one is the best advise I can give you. It is just too complex of a situation to just guess on. Spending a couple hundred bucks with a tax adviser now could save you thousands in taxes or penalties, if your wrong. There’s no official declaration of state residency. You’re normally considered a resident of the state where you spend most of the year.

The issues that most people need to deal with are:
1) driver’s license
2) auto registration
3) voter registration
4) income taxes

Wikipedia has more information on Primary Residency

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Locating an real estate agent for a Investors?

Walter G — Wed, 27 May 2009 19:11:44 +0000

Selecting A Good Agent for an Investor

“I am a real estate investor and am looking for an experienced real estate agent as well as a real estate broker who specializes with investors. Can you please tell me how to find one, I have googled, ect and haven’t come up with much.
Thank you.

-Tim”

Most Real Estate Agents our trained and specialize in brokering deals for residential homes. Being that as it may, you may find it hard to locate an agent whom has experience in locating and brokering investment deals. When I say investment deals, I mean the type of deal where the home needs to be improved upon. Most agents don’t understand how to locate and evaluate a property with an investor’s eye. There are a few tactics I would suggest to locate an Investors Agent.

Being that you probably want to invest in your local area, I suggest you start calling local realties and asking if any of their agents work with investors or investment properties. I understand this task is time consuming but in order to find the correct agent, it will take work. After you have called a few realties and have the names and numbers of their suggested agents, start calling each to setup appointments and interviews.

Another way is to join a real estate investment group AND BE ACTIVE within the group. In most areas, there are landlord associations and/or a real estate investment groups. These groups are the best way to network with like mind individuals, whom will be looking for help and guidance just like you. They are gateways to improving your knowledge within the area of real estate investments.

You also have the option of just going for a little ride in your neighborhood or local area. Look for complexes, lots, or homes, which have either realty offices managing them or an investment group. Once you have the names of the groups or offices that our managing the types of properties you are looking to invest in, call them for an appointment.

It’s really up to you to do your homework, and find the best course of action for yourself.

Walter Grande

If you know anyone in my area of Staten Island, New York that is in need of a good real estate agent, feel free to have him or her contact us as well.

Do I have to pay the Realtor?

Walter G — Fri, 15 May 2009 19:38:48 +0000

“I’m checking out rental properties online, hopefully I’ll find something worth putting a deposit down on. I’m had a friend in the Annadale look at a few locations & take pictures… If I contact the Realtor to get more info, or have her show my friend a few properties, and end up signing a lease with her… Do I have to pay her??? Or is she already being paid by the person who listed their home with her company? If you could let me know that’d be great! Thanks Kim”

Do I have to pay the Realtor?

Real Estate Agents are normally paid by the owner whom gave them the listing either for the purpose of finding them a renter, or in the hopes of finding them a buyer for their property. Just ask the real estate agent when you first make contact with him/her about whether there will be a fee charged too you. Real estate agents our required to disclose who will be paying the commission – but just simply ask them when you make contact.

When the landlord enlists a real estate agent’s help, it for them to lease, rent, or sell there property. The commission is earned by the real estate agent because they found you for the landlord. The landlords are extra careful when selecting the person whom will represent there interests, and so should you.

If you feel uncomfortable using a real estate agent, there are other avenues when finding a rental. I suggest looking threw the local newspaper of the town you want to rent in. The newspaper is still a great source for rentals. Another option for some, is on the Internet. There are so many great websites out there designed with the renter in mind, Craigslist.com being one of them.

Hope this helps ease your jitters.

Good Luck Kim, If you need any more help feel free to Contact Us again

If you know anyone in my area of Staten Island, New York that is in need of a good real estate agent, feel free to have him or her contact us as well.

Real Estate Terms starting with (I)

Walter G — Thu, 16 Apr 2009 13:56:42 +0000

The Following are real estate terms and topics: Starting With the Letter (I)

A | B | C | D | E | F | G | H | I | J | K | L | M | N | O | P | Q | R | S | T | U | V | W | X | Y | Z

Are you confused and overwhelmed by the extensive terms and words used in real estate? Every person working in real estate or planning to buy or sell real estate can benefit from learning some of the terms….

Real Estate Terms I

Implied Contract
A contract inferred from the actions of various parties, but is not necessarily written or spoken.

Income property
Real estate developed, purchased or improved to produce income.

In-file credit report
Unverified credit report which may contain unchecked, duplicated or overlapping data, Used for “quick look” at a prospective borrower’s credit history.

Inflation
An increase in the amount of money or credit available in relation to the amount of goods or services available, which causes an increase in the general price level of goods and services.

Initial interest rate
The original interest rate of the loan when it is closed.

Installment
The regular periodic payment that a borrower agrees to make to a lender.

Installment loan
Borrowed money that is repaid in equal payments, known as installments.

Insurable title
Title that a title insurance company is willing to insure.

Insurance
A contract in which one party agrees to compensate another party for any losses or damages caused by risks identified in a contract in exchange for the payment of a lump sum or periodic amounts of money.

Insurance binder
A document that states that insurance is temporarily in effect. Because the coverage will expire by a specified date, a permanent policy must be obtained before the expiration date.

Insured mortgage
A loan secured against land for which an insurance policy exists promising to compensate the lender for all losses

Interest
The fee, paid on borrowed capital.

Interest accrual rate
the percentage rate at which interest accrues on the mortgage. In most cases, it is also the rate used to calculate the monthly payments.

Interest rate
An interest rate is the price a borrower pays for the use of money he does not own, and the return a lender receives for deferring the use of funds, by lending it to the borrower. Interest rates are normally expressed as a percentage rate over the period of one year.

Interest rate buydown plan
a temporary buydown gives a borrower a reduced monthly payment during the first few years of a home loan and is typically paid for in an initial lump sum made by the seller, lender, or borrower.

Interest rate ceiling
The highest interest rate possible under an ARM contract; same as “lifetime cap.” It is often expressed as a specified number of percentage points above the initial interest rate.

Interest rate floor
The lowest interest rate possible under an ARM contract. Floors are less common than ceilings.

Investment property
A property purchased for the sole purpose of earning a return on the investment, either in the form of rent or capital gain. The owner does not live in the property.

IRA (Individual Retirement Account)
A retirement account that allows individuals to make tax-deferred contributions to a personal retirement fund.