Monday, April 25, 2011

Floor the Competition

When people enter your home they usually look down before up, so that first step is vital for attracting a homebuyer and making a great first impression. This is one reason why more people are installing hardwood floors in their homes.

Hardwood flooring enhances the look of any room and can create a classic ambiance that will beautify the interior design of your home. Residential real estate agents agree that homes with wood floors hold their value better, sell faster and fetch higher prices.

Last year, 99 percent of real estate agents responding to a national survey conducted by the National Wood Flooring Association agreed that homes with hardwood floors are easier to sell. The survey also found that 82 percent believe that homes with hardwood floors sell faster and 90 percent said they would sell for more money.

The American Hardwood Information Center adds that restoring hardwood flooring in the home is one of the best long-term investments to be made.

“Hardwood floors are environmentally friendly, forever fashionable, and will last for generations,” said Pembroke Jacobs, president of the Hardwood Manufacturers Association. “Plus, with an expected life span of up to 100 years for certain premium hardwood flooring, you can be assured that that the hardwood really is a one-time investment with a very long-term payoff.”

Real estate agents also agree that carpeting does not impress potential buyers, but hardwood floors are always a draw. Engineered wood floors impart warmth, depth and richness to a home’s decor that cannot be matched by carpeting, tile or vinyl flooring. Despite the existence of modern architectural trends in flooring, hardwood can still compete with floor tiles and other artificial materials. It comes in a variety of colors and grains; light, medium, or dark shades; and a variety of sizes, styles, finishes and species.

Maple, mahogany and oak are the most popular woods, but some homeowners are investing in exotics such as Brazilian cherry and purpleheart.

The Environmental Protection Agency has said that indoor air quality is one of the top health threats and wood floors can help contribute to a healthy living environment. In fact, a recent EPA study found that pesticides used in gardens and homes accumulate on floors and other surfaces in the home, but that wood floors greatly reduce the accumulation of such toxins. Hardwood floors also do not trap or harbor dust mites or molds.

Though wood floors will probably need to be refinished at some point, when properly taken care of they are much easier to maintain than other floor surfaces.
The NWFA recommends regular sweeping of hardwood floors with a soft-bristle broom or dust mop to remove surface dirt and debris. If your floor contains beveled edges, it recommends using a vacuum with a soft bristle brush attachment to remove dirt and debris from between the floorboards.

Having hardwood floors could be the difference between selling your home or watching a potential buyer walk out the door on a less-appealing type of flooring.

Monday, April 4, 2011

‘Tis the Season for Tax Breaks

With April 15 rapidly approaching many are scrambling to complete their taxes. For those who have recently bought or sold a home, there are a number of tax deductions that that may be available to them.

Real estate broker’s commissions, title insurance, legal fees, advertising costs, administrative costs, and inspection fees are all considered selling costs and may be used to reduce one’s taxable capital gain by the amount of the selling costs. That could result in a big savings depending on the final sale price.

Interest that is paid on a mortgage is also tax-deductible, within limits. A married couple filing jointly can deduct all their interest payments on a maximum of $1 million in mortgage debt secured by a first or second home.

Buyers may also be able to deduct some of the interest they paid on a home equity loan or similar line of credit.

One deduction that many buyers often overlook is points. Points or origination fees on a home loan that were paid during the purchase of a home are generally tax-deductible in full for the year in which they were paid.

Refinanced mortgage points are also deductible but only over the life of the loan – not all at once. Homeowners who refinance can immediately write off the balance of the old points and begin to amortize the new.

If your lender required private mortgage insurance, the PMI premiums are tax-deductible for mortgages taken out from 2007 through 2011.

Making improvements to property prior to the sale or once one moves in might qualify for an interest deduction on your home-improvement loan. Qualifying capital improvements are those that increase your home’s value, prolong its life, or adapt it to new uses, such as adding a porch or installing energy-efficient windows.

Many times during a sale, the seller will send the local tax collector’s office a check for real estate taxes prior to the closing. In many circumstances, however, the buyer will pay a pro-rated portion of the taxes for the year at closing. This tax deduction also gets overlooked.

For those working from their new home: If a room is used exclusively for business purposes, they may be able to deduct home costs related to that portion, such as a percentage of your insurance and repair costs, and depreciation.

In some instances, if you have moved because of a new job, moving costs may be deducted. These can include travel or transportation costs, expenses for lodging, and fees for storing your household goods.

Every year the tax laws change and certain tax deductions become available while others phase out. If you have recently bought or sold a home, it’s probably a good idea to seek out a professional tax consultant to do your taxes as missing deductions that you can legally claim can add up to quite a bit of money.