Pete Veres and Sean Hellmann would like to share some very good news. Top 10 Housing Predictions for 2013 revealed by RE/MAX Co-Founder and Chairman, Dave Liniger. The housing market made a sharp rebound in 2012, find out if this trend continues in 2013 and what else the New Year has in store homebuyers, sellers, investors and agents. The Elite Asset Management team is here to help with all your real estate requirements.

In this new video released today, RE/MAX Chairman and Co-Founder Dave Liniger makes his real estate predictions for 2013, and states that 2013 could be the best year in real estate in many years.

Dave Liniger's Top 10 Real Estate Predictions for 2013:
1. More Homebuyers and Sellers come back to the market
2. Homes sales will rise by 6-7% and prices rise by 3-4%
3. The inventory of homes for sale will hit a bottom
4. Higher-priced homes begin to sell
5. Distressed property numbers continue to fall
6. Shadow inventory continues to fall
7. The number of short-sale closings will rise to a peak
8. Record-low mortgage rates rise slightly by year-end
9. Lending remains tight
10. Home affordability remains the best in years

Preventing and Thawing Frozen Pipes

Real Estate Provisions in “Fiscal Cliff” Bill

On Jan. 1 both the Senate and House passed H.R. 8, legislation to avert the “fiscal cliff.” The bill will be signed shortly by President Barack Obama.

Below is a summary of real estate related provisions in the bill:

Real Estate Tax Extenders
• Mortgage Cancellation Relief is extended for one year to Jan. 1, 2014
• Deduction for Mortgage Insurance Premiums for filers making below $110,000 is extended through 2013 and made retroactive to cover 2012
• 15 year straight-line cost recovery for qualified leasehold improvements on commercial properties is extended through 2013 and made retroactive to cover 2012.
• The 10 percent tax credit (up to $500) for homeowners for energy improvements to existing homes is extended through 2013 and made retroactive to cover 2012.

Permanent Repeal of Pease Limitations for 99% of Taxpayers

Under the agreement so called “Pease Limitations” that reduce the value of itemized deductions are permanently repealed for most taxpayers but will be reinstituted for high income filers. These limitations will only apply to individuals earning more than $250,000 and joint filers earning above $300,000. These thresholds have been increased and are indexed for inflation and will rise over time. Under the formula, the amount of adjusted gross income above the threshold is multiplied by three percent. That amount is then used to reduce the total value of the filer’s itemized deductions. The total amount of reduction cannot exceed 80 percent of the filer’s itemized deductions.

These limits were first enacted in 1990 (named for the Ohio Congressman Don Pease who came up with the idea) and continued throughout the Clinton years. They were gradually phased out as a result of the 2001 tax cuts and were completely eliminated in 2010-2012. Had we gone over the fiscal cliff, Pease limitations would have been reinstituted on all filers starting at $174,450 of adjusted gross income.

Capital Gains

The Capital Gains rate stays at 15 percent for those at the top rate of $400,000 (for individuals) and $450,000 (for those filing a joint return). After that, any gains above those amounts will be taxed at 20 percent. The 250/500k exclusion for sale of principle residence remains in place.

Estate Tax

The first $5 million dollars in individual estates and $10 million for family estates are now exempted from the estate tax. After that the rate will be 40 percent, up from 35 percent. The exemption amounts are indexed for inflation.

Albuquerque could have a big boost in population during the next five years, according to an American City Business Journals On Numbers report.

Fifty-two U.S. metropolitan areas currently have more than 1 million residents. Tucson, Ariz., was the latest to join the million-plus club, crossing the threshold just five months ago.

But it won’t be the last entry. On Numbers has identified 28 other metros that have a decent shot at reaching a population of 1 million by 2050.

The closest to that goal are Honolulu, Fresno, Tulsa and Albuquerque, according to the report.

Honolulu should get there first. It’s Jan. 1, 2013, population was 976,894, based on On Numbers’ latest estimates. If its recent growth patterns continue, Honolulu will reach 1 million on July 28, 2015.

Albuquerque is expected to grow from 918,876 at the start of 2013 to 1 million on Sept. 21, 2018.

On Numbers has developed a computer program that analyzes more than a decade’s worth of demographic data to project the populations of states, metropolitan areas, counties and cities at any given moment.

Albuquerque, NM

Albuquerque's biggest draws: Diversity, beautiful scenery, and pleasant weather.

Best if you're looking for: Big city

Median home price: $174,000

Top state income tax: 4.9%

There is much to be said for a place where you can ski in the morning and golf in the afternoon; drink Italian-style espresso at breakfast and eat homemade sopapillas for lunch; see ancient petroglyphs one day and gallery hop the next.

With the Rio Grande river near downtown and the Sandia Mountains to the east, Albuquerque is as diverse in its landscape as it is in culture. Downtown revitalization projects have added considerably to the appeal.

One caveat: Crime is on the high side, though locals say it's easy to avoid the problem areas.

4 Signs that a Short Sale is right for your buyer

Today, everyone wants a deal.  In fact, many real estate buyers expect them in today’s market.  In order to get the best “deal” consumers are looking at the distressed and short sale market for their best opportunity.

Unfortunately, short sales are not the best buys for every house hunter.  Pete Veres, CDPE, Certified Distressed Property Expert says "Our responsibility as agents is to spot the signals and understand the key aspects of a short sale to determine if our clients should pursue purchasing this type of property or focus on a non-distressed deal". We also need to qualify the listing agent to make sure they are experienced and certified in short sales.

Here a few signs to help you find out if a short sale can work for your buyer-clients:

1. Your buyers aren’t working against a clock

Sean Hellmann, CDPE agent says "The phrase “short sales “is an oxymoron".  Short sales are short because the bank is taking a, sometimes significant, loss and allowing the borrower to transfer the property without the credit and legal implications of a foreclosure.

If your client needs a house tomorrow, short sale properties should be as far away from their radar as possible.  Consumers who can afford a 3-6 month waiting period from the time they write their offer to get a bank approval or denial are much better suited for a short sale.

Timeframes vary from state to state, lending institution, and type of loan; but there will be a wait in almost all cases.  If your client has time on their hands and an interim place to live, a short sale may be a great option. Those buyers have a leg up on other consumers who will forgo looking at short sales because of the time frame for approval.  Less competition equals a lower sales price. It’s a supply and demand principle.  If they have the time, they may save some money but that’s if the home will actually make it to closing. Many things can come up to prevent the sale from actually taking place. A perfect example is the home being foreclosed prior to the close date.

2. Your buyers like change and surprises.

Short sales purchasers cannot be averse to change.  This type of transaction is all about change and surprises.  Rigid, type-A personality clients are usually not the best candidates for purchasing a short sale.

There is no rhyme or reason for short sale approval/ denial sometimes.  The banks make decisions that they feel are in their best interest, sometimes ask for the same form multiple times, and in some cases will send you contradictory forms.

In addition, there are a variety of things that can go wrong and cause you to have to restart the short sale process in the middle of negotiations. These include the bank selling the lien to another loan servicer after the short sale is initiated, policy and regulation changes, and many other changes you can’t predict until you’re working on the transaction. We have also seen the loan servicing company transfer the loan and most recently lately loan companies being bought out. Great example is the Nationstar buyout of Aurora Loans. This means you have to start the process all over from the start.

A short sale purchaser has to be change tolerant to change (I like this better) and willing to work with the system when change arises.  Flexibility is a virtue when involved in this type of transaction.

3. Your buyers are willing and have the funds to renovate.

Short sales may seem cheaper to purchase than most traditional sales and foreclosures, but there is one very important caveat for the purchaser to consider; repairs will be on them.  That’s right; most short sales are sold “as-is.” Also note that the banks will not pay for inspections, appraisal fee’s and also limit some of the closing costs. This results in more out of pocket costs for the buyer.

Many short sales carry the condition that the seller can’t invest any more money into the property.  That means, buyers who have loans that require repairs be made before the loan can be issued shouldn’t shop for a short sale.  FHA and VA loan products are good examples of loans that may require repairs before lending. This could mean extra out of pocket costs.

In these cases, if the purchaser or seller bank is unwilling or unable to make the repairs, the deal could be dead.

For buyers with loans that don’t have the repair requirement, it comes down to willpower (?).  If your buyer client is squeamish about cosmetic issues or a little construction dust, he or she probably isn’t a good candidate for a short sale.

4. Your buyers are willing to wait for a return

A good deal today could mean great profit tomorrow, but “tomorrow” is a figurative term in the world of short sales.  Gone are the days of accruing 32 percent price appreciation in 6 months.  Purchasing real estate is a long-term investment of at least 5 years.  The more focused on the long-term bottom-line a short sale purchaser is, the more likely they will enjoy the outcome of the transaction and future profits.

Short sale purchasers need to be able to examine the dollars and cents of the property and determine if they are truly getting a bargain.  They may be paying more for the short sale, in the long run, than had they purchased a traditional property

Making sure your buyer clients are good candidates for a short sale property is very important.  If they are willing to wait for bank approval, are not averse to change, willing to make repairs to the property, and can keep the long term bottom-line as a top priority, you are more likely going to have a successful transaction.

Pete Veres and Sean Hellmann want to share some more good news. RE/MAX CEO Margaret Kelly talks about new home sales in June 2012 on Bloomberg TV. Our inventory in the Albuquerque area has been dropping and prices are starting to stabilize in certain areas. Margaret has some great information to share. Thanks for watching!

 Are you thinking of selling your home? Here is a great article that I found on Kiplinger's that discusses how to find the right Real Estate Agent to sell your home. In a quick summary there are 5 steps to selecting the right agent;  

1. Round up good prospects. 

2. Ask Tough Questions. 

3. Find out who the agent is working for.  

4. Make sure your agent has a back up.  

5. Sign the right contract.  

For more details please read the following article on each 5 steps. http://realestate.msn.com/5-steps-to-picking-the-right-agent-to-sell-your-home 

The Spring time is here and if you know anyone that is thinking of selling please contact Sean Hellmann or Pete Veres of the Elite Asset Managment Team with Re/Max Elite. Many of you have had the pleasure to work with us and any referral would be greatly appreciated. You can be assured that your referral will be treated to the same level of service we provided to you. Have a great Spring.

Pete Veres and Sean Hellmann want to share this quick video. Warren Buffet continues to state that SF homes are the Best Investments. Pete Veres, CIAS - Certified Investment Agent Specialist also wants to add that right now multi family units are providing a great ROI & cash flow as prices are extremely low right now and rental demand is high.

Buying is more affordable than renting in 98 out of the nation’s 100 largest metropolitan areas – even in New York, Los Angeles and Boston, according to real estate company Trulia’s rent vs. buy index. To read more from this report from Housingwire please visit this link: http://www.housingwire.com/news/buying-cheaper-renting-nearly-100-major-us-markets-trulia

Pete and I are also seeing this trend in the Albuquerque Real Estate Market. We are working with a number of clients that are purchasing properties where their mortgage payments are less than their current rent. One of the major factors that are allowing lower mortgage payments is that interest rates are at all time lows. If you would like to know more about how you can save money and STOP renting please contact Pete Veres or Sean Hellmann.

The Elite Asset Management Team has some great relationships with lenders with great First Time Buyer loan programs and other affordable loan programs.

Enjoy the article and have a great week!

Pete & Sean