Linda Raymond Real Estate Blog, Fairfield, Westport & More

Fairfield & Westport living- homes, fun stuff & more!


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Save Money, Have Fun, Do a 1031!

If you own an investment property and are thinking of selling it to buy a different one (or two), you can do a 1031 Exchange and enjoy great benefits!  What’s so great about it, and how do you do it?

 

Here’s how it works-

  1. With IRS code 1031, owners can defer paying all capital gains on investment smart ladyproperty. This means that if you own property used for business or investment, you can sell it and use the proceeds from the sale to reinvest in another investment property of greater or equal value to avoid paying taxes.
  2. You have to declare that you are doing a 1031 Exchange before you close on the sale.
  3. You have to meet the 180-day rule: Investors have 180 calendar days to complete the exchange and close on all intended purchases.
  4. You have to meet the 45-day rule:  Identify up to three possible replacement properties within the first 45 days of the 180 day period. You can also sell multiple properties and buy one big property.   If you identify more than three properties, the total cost of the identified properties can’t be more than twice the value of what you are selling.  If you identify more than three properties and they end up totaling more than 200 percent of what you are selling, then you have to buy 95 percent- worth of the properties you identified in order to complete the exchange. Your replacement property must cost more than the net sale price of your existing investment property. Identify 3 Properties
  5. You Must use a Qualified Intermediary (QI) to facilitate the 1031 exchange.  The QI takes care of everything for you including preparing the exchange agreement, handling escrow, and coordinating with the closing agents.  The QI must be a third party to the transaction.  He or she can’t just an attorney or Realtor in the transaction that puts the sale proceeds and funds in an escrow account, nor can the QI be a relative. These are IRS regulations.

And here are six amazing benefits of doing 1031 Exchanges-

  1. You enjoy huge savings on taxes.
  2. You can shelter your earnings in real estate, legally!
  3. You can diversify or consolidate your investment property.
  4. You can gain buying power by reinvesting.
  5. You can create more income to build your wealth.
  6. There’s no limit to the frequency or quantity of 1031 exchanges you can do.

Consider an “equity build strategy” suggested by the Midland company (referenced below) that looks like this:

  • Defer paying up to 25 percent in taxes on your gains.
  • Sell a moderately producing property to buy a higher income-producing property and increase your monthly income.
  • Pay no federal, state, capital gain, or income taxes on the sale of the property.
  • Do 1031 exchanges over and over for a lifetime, and the tax liability will never be passed on to your heirs.
  • Base your strategy on cash flow, and you will have success in any market. The key is to get the highest percentage income on your purchase.  Even if the dollar amount is small, it will grow over time.  For example, if you can sell a property making seven percent cash-on-cash and buy a property that makes 23 percent cash-on-cash, you are well on your way to implementing an excellent equity build strategy!  Equity bulid strategy

It’s a good idea to use a QI that is local or that works in many states and is familiar with the varying regulations and taxes in different states. You want a QI that has experience and is bonded and insured. You also want to look for one that is a member of the National Federation of Exchange Accommodators and that is a Certified Exchange Specialist (CEC).

Here are some resources to get you started:

1031 Exchange Made Simple

Midland Self-Directed IRAs & 1031s

For help selling and locating properties, please reach out to yours truly!

 

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Get to the First Beachfront Open Houses in 2016!

Well, the winter weather was balmy for awhile, but we’re off to a brisk start for the New Year.  It’s a perfect time to dream about summer, so mark your calendars for some great beachfront open house events you can look forward to!

Birdhouse by Russian Beach, Lordship

Birdhouse by Russian Beach, Lordship

Lordship Lifestyle at Russian Beach
OPEN HOUSE: Sunday, January 24,  1-3 PM

Visit this better-than-new colonial with a new price of $859,000 and water views from every room!  Enjoy an open flow, high ceilings, ample light and a private fenced yard for relaxing and entertaining.

See the Listing
Take a Quick Tour


Kensie Point on the Sound
OPEN HOUSE: Sunday, February 28,
 1-3 PM

Come to the beach in Fairfield to see this turnkey beachfront condo priced at $845,000 and enjoy the fabulous water views!

Sunset at Pine Creek Beach, Fairfield

Sunset at Pine Creek Beach, Fairfield

See the Listing
Take a Quick Tour


Come to the beach and make an offer that can change your life!

Contact us with any questions or to request more info-


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Pricing Your Home Right

Here are a few true stories that occurred in May of 2015.  Three comparable university area homes for sale in Fairfield Connecticut accepted offers.  The properties and prices were similar in scope, but the paths the sellers took to get an offer were quite different.   I’ll assign each house a color instead of using the address to protect privacy.  I am privy to the information because my buyers bid on all three of these homes.

White House

A White house with 2,293 square feet, four bedrooms and two and a half baths on .31 acres came on the market for $675,000 the previous November.  The listing canceled and put back on the market as a new listing for the same price in January 2015.  Over the next 130 days the price was reduced to $669,000 and then 649,000.  It was newly listed again in May for $625,000.  The sellers accepted an offer of $610,000 which was 97% of their final asking price but 90% of their original price from more six months prior.

green house

A Green house was listed in March for $650,000.  It had 2,352 square feet, two and a half baths on .49 acres.  The price was reduced to $619,000 and then to $610,000 and was ultimately re-listed with a new price of $600,000. Less than two weeks later, the sellers received multiple full price offers for $600,000.  The sellers got 100% of their final asking price, but 92% of their original list price.

On May 12, homeowners listed a Red house for sale with 2,164 square feet, three bedrooms and two baths on .22 acres for $619,000 and accepted an offer the next day!

Since the two homes above sold for 97-100% of their final asking price, and the average sale-list ratio in Fairfield from January to mid-May was 97%, my guess is that the sellers got very close to their asking price, and in one day, not bad!REd House

So what are the take-aways?

Price: You won’t get more by pricing your house much higher than market value.  Remember you have to sell your house three times- to the buyer’s agent, to the buyer, and to the appraiser. Buyers may be attracted to your house based on emotion, but their final decision is based on the market data that their Realtor provides to them.

Time: The higher above market value you price your house, the longer it will take to sell, and remember, time is (taxes, utilities, insurance, repairs, maintenance, personal time and energy…) money!  The stories above show that in this price range, a list price of 8-10% above the market value is too high to attract an offer.

Since the market is what determines your property’s value, not your personal finances (or Zillow!), price your house within 5% of, or right at market value.  This way you can enjoy a fast sale at a fair market price, and get to where you want to go sooner rather than later!

Feel free to contact me for a pricing recomendation and custom marketing plan or any questions you may have about the buying and selling process.   I’m here to help!

 


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Open House Pros and Cons for Sellers- What Will You Decide?

Many home sellers expect their Realtor to host an open house as part of the marketing activities, but some labor over the decision and others outright forbid it.    Open House

Starting with the Cons, here are some points to consider that may help sellers decide.

These are the most common Cons I hear,

– I’ll have to spend a day cleaning and straightening up!

– Don’t want the Looky-Loos, Nosey Neighbors and Strangers traipsing through my house.

– No one’s going to buy it during an open house.

– Don’t want anything broken, messed up or stolen.

… and some Pros for sellers to consider

1. An open house is typically scheduled well in advance allowing you plenty of notice before having to tidy up, unlike last-minute showing requests that inevitably occur after all your party guests just went home or your kids just dumped their belongings all over the floor.

2. Likewise, sellers with pets will have ample time to arrange for a ‘furry’ field trip as the case may be, instead of having to scramble to pull pets out of the house when the call from a buyer’s agent comes in.

3. Yes, the open house is a chance for your neighbors to come in and see.  This enables them the opportunity to spread the word to friends, family, and potential buyers, or even to consider trading up or down themselves.  Many agents send direct invitations to the neighbors to come to the open house.  Most people move very close to home, within about a 10-mile radius, so you never know!

4. Although it does happen, most homes do not sell to someone at the open house. However, this is an additional form of marketing that gets the word out about your listing. The greater the exposure you have, the better the chance for your house to sell for the best market value.

5. The multi-hour time block reserved for an open house gives you the perfect excuse to go out and do something fun for the day.  If you are careful to store away or remove valuables, fragile items, and prescription drugs, you are most likely to have a smooth open house event, and you can enjoy a worry-free day.

6. An open house gives potential buyers a chance to experience the chemistry they may have with the home after being attracted to it from photos online.

7. An open house enables a pool of buyers that don’t have an agent yet to come and consider it as their new home.

8. One of the most important benefits of an open house is that it’s an event that gives your Realtor a perfect reason to do a big round of promotion for your listing.  The promotion may include everything from email announcements to buyers and agents that link back to your online listing.  It can include a plug on all the social media outlets.  It may warrant a postcard mailing and door hanger invites to the neighbors.  The big day at your listing gets posted on numerous real estate and brokerage websites, which in turn boosts your listing exposure in online search results. The local paper promotes open house events.  And let’s not forget the yard signs pointing out your fabulous listing to everyone in town.

9. Last but not least, the open house enables a “show time” opportunity for your property that is not always practical for everyday appointments.  Your agent can ensure that the lights are all on, the window treatments are open, music is playing, flowers are on the table and the scented candles or simmering apple cider are working their magic.  This creates an excellent first impression for all that attend.  And these visitors could be the ones to direct the final buyer your way!

So when you become a seller, what will you decide?

Drop me a line!

William Raveis Real Estate, Mortgage & Insurance
2525 Post Road, Southport, CT  06890


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Fabulous Beachfront Condo – Now Live on MLS!

10 Pine Creek Avenue 401W, Fairfield CT

10 Pine Creek Avenue 401W, Fairfield CT

Live the sweet life in your new carefree ranch style beachfront condo at Kensie Point! Decks and penthouse-like water views from all rooms, elevator entry, private furnished beachfront garden, set on town-managed Pine Creek Beach. Near‪#‎town‬ and ‪#‎train‬, an hour from ‪#‎NYC‬. Two bedrooms, two full baths, 1900 square feet updated and move-in ready. Now live on MLS, check out the listing right here!  ‪#‎coastalconnecticut‬ ‪#‎ilovefairfieldct‬ ‪#‎beaches‬ ‪#‎condos‬‪#‎ranches‬ ‪#‎multiplelistingservice‬ ‪#‎fairfieldctbeaches‬ #‎fairfield‬ #‎investment‬ ‪#‎commuters‬ #retirementhomesct


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Fab Home on Laurel Beach in Milford!

Bird's Eye View of 226 Second AveDid you ever wish for a charming home on Laurel Beach in Milford, CT?   This elegant home is a two-family that can easily be converted to a single family or used as an investment property.  Featuring new kitchen and baths, water views and charming wrap around porches, this home is a must-see! Enjoy the private association with club house and tennis.

Contact me for more information or to request a showing! Linda Raymond, Realtor 203-912-4440, Linda.Raymond@raveis.com.

LoPumpkin Houseoking at unit sales and the average sale price for single family homes in Westport, Weston and Fairfield, there appeared to be a similar trend across the three markets as of the end of September.    Unit sales were down, but the average sale price was up.

In Westport, there were 26 sales in September which was down from 39 from last year and 50 in the previous month.  Year to date sales were 291, down 19.6% from 362 last year at this time.  However the average sale price in September was $1,510,448 which was up 5.7% from last September.  So far this year, the average sale price was $1,566,866 which was 1.9% higher than last year.

There were 54 sales in Fairfield in September which was well below the 77 units in August but just 1.8% below the 55 sales in September 2013.  Year-to-date sales were down 7.6% with 523 vs. 566 last year.  Prices followed a very similar trend to Westport with the year over year value up 5.9% for the month of September and just a slight increase of 1.6% for the year to date average sale price of $723,563.

Weston had the most significant reduction in unit sales of the three towns in the month of September but showed a better tally for the year to date.  With seven sales in September compared to 16 the previous year and 21 in August, the good news was that for the year to date, sales were down just 11.6% (122 vs. 138).   The average price for sales in September was down slightly from August and down 12.8% from last September but followed the trend of the other two towns for the year to date average price, with a small increase over 2013 of 1.8%, resulting in $882,423.

Fall Image 2

Let’s wait and see if the activity catches up to last year.  Tell all your friends that are thinking about moving to go ahead and do it!  In the meantime, click to see a table of all the Housing Market Numbers each month from 2013 to 2014 through September.

If you would like specific market numbers on a neighborhood near you, just send a request below, and I’ll be happy to provide you with the information.