To Stage or Not to Stage?

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So many real estate agents today advise their clients to stage their home in preparation for the sale. But the truth is that while it may work in some cases, we believe it is not necessary most of the time.

Video is Taking Over Traditional Methods

With staging being more of a traditional form of preparing for a sale, we feel that it is far more valuable to put resources toward a good, high quality video that creates an experience for the buyer.

We recorded today’s video from one of our listings. And once you have seen the video tour of this property you will immediately see that photographic images or stills do not nearly do enough justice to a property as a full-on 360-degree video tour. Now, here again we are not talking about posting a series of photos and making a slideshow video out of them. We are referring to a full-blown tour of the property, showing its amenities and highlighting all areas and spaces to be shown.

Using a video camera by capturing moving images of each room and how they relate to one another in the space is just one of the many advantages of doing a video property tour. Not only does it give the prospective buyer a better viewpoint of the entire space but it also allows them to see additional features such as the depth of a space or the outside view.

See How Video Captures Buyers’ Attention

Being able to see the entire floor plan as well as other amenities as they relate to the overall space is a fantastic benefit for buyers. Also, the cost of video is far more manageable than what it costs to stage a home. And the process is much less time-consuming. Here is the video tour of the property from where we have recorded our video today. Notice how a viewer instantly gets a feel for the property from the outside, leading in. They get to experience the walk down the hall, stop by to visit the recreation center and get a great view of the pool – LIVE.

Once in the living space, they are able to see the openness of the area and also how each area relates to the outside view. After watching this video, the visitor gets a fairly good sense of the property and all within a matter of minutes.

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If you would like to have your property showcased in an exclusive video tour, contact us today so we can put together the video and share the rest of our marketing plan with you. And remember, you can also listen to us every Saturday morning on AM830 KHVH for the Lally Real Estate Show from 11am to Noon.  We look forward to meeting with you soon!

Mortgage Debt Forgiveness Act

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By now, chances are you have probably heard the term “short sale” – especially during the past five years with our housing market struggling to recover from the housing market crisis of 2007. Luckily, Hawaii has enjoyed a strong economy and we have not seen too much of the same dire circumstances many homeowners across America have experienced. Still, if you owe more on the house than what it is worth and are looking to sell it, a short sale is likely your best option.

Everyone has a pretty good idea of how a short sale might impact one’s credit outlook. Though it may not have as heavy an impact on credit as a foreclosure might, a couple years after a short sale before the homeowner can consider buying a home again. There is, however, a tax implication of doing a short sale that many people are not aware of. The amount of debt that a bank agrees to forgive in order to allow a short sale to take place is forgiven debt and the IRS considers that amount as income. As such, all income is taxable, leaving the homeowner that opts for a short sale with a significant tax bill at the end of the year.

Mortgage Forgiveness Debt Relief Act

In light of our nation’s struggles with property ownership after housing values plummeted, the Mortgage Forgiveness Debt Relief Act was signed into action, allowing homeowners an exemption on discharged or forgiven debt from the sale of a primary residence.

This benefit has been around for some time now and has been extended by the government in the past, however its deadline is fast approaching with a program end date of December 31, 2012. This means that all homeowners considering short sales should complete their transaction before the end of the year.

Short Sale Process Can Take Months

At first, when countless Americans struggling with the economy and declining values, short sales were slowly began picking up pace. Then, when the 2010 robo-signing scandal broke loose, banks again lacked confidence in doling out relief in this form to borrowers, ending up in short sale processes that could take up to a year or even more. 

Today, however, many banks have streamlined the process and even prefer the short sale route versus a foreclosure. Compared to the lengthy process times and extensive legal fees involved in a foreclosure, banks are even willing to pay out cash in some short sale cases.

Window Of Opportunity Will Not Last Long

Since the halfway mark of the year has passed, we strongly advise any homeowner looking to sell their home despite owing more than its current value, to contact us today. Timing is key and with just a few months before the end of the year to take advantage of this benefit, now is the good time to start the process.

We are here to answer any questions and our short sale specialist Attilio Leonardi will be happy to assist and guide you through it. Contact us today at 808 687 8921.

Ten Facts the IRS Wants You to Know About the Mortgage Debt Relief Act

1.  Normally, debt forgiveness results in taxable income. However, under the Mortgage Forgiveness Debt Relief Act of 2007, you may be able to exclude up to $2 million of debt forgiven on your principal residence. 

  

2.  The limit is $1 million for a married person filing a separate return.

3.  You may exclude debt reduced through mortgage restructuring, as well as mortgage debt forgiven in a foreclosure. 

  

4.  To qualify, the debt must have been used to buy, build or substantially improve your principal residence and be secured by that residence. 

  

5.  Refinanced debt proceeds used for the purpose of substantially improving your principal residence also qualify for the exclusion. 

  

6.  Proceeds of refinanced debt used for other purposes – for example, to pay off credit card debt – do not qualify for the exclusion. 

  

7.   If you qualify, claim the special exclusion by filling out Form 982, Reduction of Tax Attributes Due to Discharge of Indebtedness, and attach it to your federal income tax return for the tax year in which the qualified debt was forgiven. 

  

8.  Debt forgiven on second homes, rental property, business property, credit cards or car loans do not qualify for the tax relief provision. In some cases, however, other tax relief provisions – such as insolvency – may be applicable. IRS Form 982 provides more details about these provisions. 

  

9.  If your debt is reduced or eliminated you normally will receive a year-end statement, Form 1099-C, Cancellation of Debt, from your lender. By law, this form must show the amount of debt forgiven and the fair market value of any property foreclosed. 

  

10.  Examine the Form 1099-C carefully. Notify the lender immediately if any of the information shown is incorrect. You should pay particular attention to the amount of debt forgiven in Box 2 as well as the value listed for your home in Box 7.