Are You Taking Your Tax-Deductible Home Improvements?

With tax day approaching, have you checked out these potential tax deductions?

 - Energy Efficient Upgrades, including Energy Efficiency Home Improvement Credit up to $3200; a home energy audit identifying health and safety issues in the home; Energy Star's exterior windows and skylights; biomass stove which has a thermal efficient rating of at least 75% to qualify for the credit.

 - Clean Energy Upgrades, including the Residential Clean Energy Credit, including a solar water heater and geothermal heat pumps.

- Historic Home Upgrades, for the federal Rehabilitation Tax Credit for renovating a historic home, involving such items as pipes, stairs,  posts and beams.

 - Medically Necessary Upgrades, to qualify for a medical expense deduction.

 - Home Office Repairs and Improvements, including wiring, security, dual and triple-pane windows, repairing damaged outlets.

 - Rental Property Repairs, If part of the home is rented out, certain repair expenses may be deducted; repairing water leaks to avoid mold issues; repairing leaky ducts to prevent heat loss and improve air quality.

See the article below for more information:

7 Types of Tax-Deductible Home Improvements

Your tax professional will be able to give you complete advice on these and other possible tax deductions.

 Julia Huntsman, REALTOR, Broker | http://www.abodes.realestate | 562-896-2609 | California Lic. #01188996

New Real Estate Practices in California

There are changes coming to the way REALTORS and all real estate licensees do business. 

One change has actually been discussed many many times since about 2004, or perhaps a little earlier, and that is, requiring buyers to sign buyer representation agreements with their agent of choice. Of course, listing a home with a listing agreement in place has been in place for decades, but working with  a buyer, until July 2024, did not require that practice.  Well, this is all changing.

The Road to Solutions

California Regional MLS, one of the largest  MLSs in California and the nation, is soon putting a rule into place that a buyer-broker agreement must be executed before property is shown to a buyer by a REALTOR.  You may have been reading about the lawsuits over the past few months, and the settlement reached with the National Association of Realtors--much information that has come out in the media is just plain inaccurate--however, the following statement comes directly from NAR concerning one of the agreements in the settlement and which I actually look forward to:

"Written agreements for MLS participants acting for buyers: While NAR has been advocating for the use of written agreements for years, in this settlement we have agreed to require MLS participants working with buyers to enter into written agreements with their buyers. This change will go into effect in mid-July 2024."

Many brokers already utilize these agreements, which have been available to the industry for years, with their clients.  The buyer-broker agreement, which is a standardized form provided through California Association of Realtors, may have varying terms, such as length of time, geographic area, commission to agent, or even for a specific number of homes or type of homes to be shown. Putting someone in their car, or meeting them at a property, just scratches the surface of what an agent does to help a buyer find the right home.  Buyer-broker agreements are legally binding contracts which  work in both directions: the buyer commitment to the agent and the broker/agent commitment to the buyer.

An agent should be first sitting down with a buyer and taking in the buyer's thoughts and questions about a home purchase, before showing property. This is how I've always done business since I started, and I believe it's the best way. When there is good communication between buyer and agent, there is usually a better understanding of the process, and less of the phenomenon known as buyer remorse. The buyer should expect a very clear and thorough review of a buyer agreement from the agent.

A home purchase is a huge commitment to a mortgage, obtaining home insurance, understanding future maintenance expenses, property taxes, and how a buyer's income will absorb these costs. A buyer is making a commitment, and that commitment deserves clear professional communication by an agent, and the agent who is offering his/her professional help also needs the commitment of the buyer in order to get to the goal of a home purchase. 

More updates will be provided on this topic, and please don't hesitate to contact me with questions!

Looking forward to the future!

 

Julia Huntsman, REALTOR, Broker | http://www.abodes.realestate | 562-896-2609 | California Lic. #01188996

California Insurance Issues May be Affecting You

Numerous residential insurance companies have stopped writing certain policies, most recently it is State Farm cancelling the insurance of approximately 42,000 apartments. This affects anyone who owns units they are not living in if they have a State Farm policy.

In spite of State Farm's cost issues of coverage on claims, catastrophes, reinsurance and decades of working with old insurance regulations, "State Farm recently reported a net worth of $134 billion, up $3 billion from the year before. The state insurance commissioner says that raises serious questions about its financial situation — questions the company must answer to regulators." But supposedly the claims payout is $1.08 for every dollar taken in on premiums in California.  Read more here: https://www.nbcbayarea.com/news/california/california-homeowners-insurance/3492251/  As the article states, you must receive at least 60 days notice of cancellation from your insurer. And, by the way, water claims are always a sensitive subject, it's better to avoid them if at all possible.

House sitting at edge of eroded beach

For buyers and sellers of residential or income property, it's important to find your insurance coverage very very early in your transaction.   Long gone are the days when a buyer could line up insurance coverage 7 days before closing.  In the current market, buyers must make sure they can get coverage within a few days after going into escrow, if not before. Some people (in fact, many people) are turning to the California Fair Plan, but it is now inundated with requests. A prospective owner is better off turning to either their current agent if they can work with outside carriers, or start searching multiple insurance sources.  One source to turn to is the website for the Insurance Commissioner.  What, you don't like this guy? Forget it, what's important is finding ways to meet your insurance goals. It's tough, you probably will end up paying more (as we all are anyway) than your current policy, and different coverage (I already received notice of less coverage on my earthquake policy from the State), but it's important to get it to meet your goals and satisfy your lender's requirement to be covered. 

Someday, I believe, the crisis will be past us, or at least the worst of it.

Julia Huntsman, REALTOR, Broker | http://www.abodes.realestate | 562-896-2609 | California Lic. #01188996

Long Beach Residential Market for February 2024

Long Beach February sales information

 For the Long Beach single family market, the months supply of inventory remains low, under 2 months.  On a rolling basis over the last 12 months, closed sales are down 18+%, and both the median and average sales prices are up as much as 2.5%.

New SFR listings are down over 18%, and the average sales price, on a 12 month basis, rose to $1,038,606

It's a similar story for condos, with the average sales price over a 12 month period rising to $578,267.  However, condos also have a somewhat higher months of inventory at 2.7 months, an increase of 42% compared to February of 2023.  Condo are also receiving a somewhat lower amount from original list price than single family houses, at -1.5%.  Which is not a huge difference from SFRs which are  down only .5% from original list price.  Still, there seems to be a somewhat greater demand for houses than condominiums in Long Beach.

Compare to all of Los Angeles County over the last 90 days where sales are down by 11%, and the total months of inventory is 8 months, an increase of 13%, compared to Long Beach at under 2 months. The current average sales price for the County as of January 24th is $1,024,684, a level that has remained stable over the last 12 months.

 

Los Angeles County SFR Market for the last 90 days

 

 

 

 

 

 If you are considering a sale of your home or condo, I am happy to provide an estimated selling price based on price within your immediate area. Please call, email or text me.  And, go to my website to search properties to find out what's going on in your market.

Julia Huntsman, REALTOR, Broker | http://www.abodes.realestate | 562-896-2609 | California Lic. #01188996