Tuesday, May 13, 2014

IS NOW THE TIME TO SELL MY ALASKA RENTAL?

Is it time to sell my Alaska rental home you ask?  Many homeowners over the last few years have opted to rent out their homes rather than sell them as they didn't have enough equity to sell without having to come to closing with a check.  For those homeowners that were 'upside down' or 'underwater', as it is commonly referred to, renting the home was an acceptable alternative.

 

If you have a home in Alaska and are curious about the value CLICK HERE for a fast easy evaluation. 

We at Alaska Home Sellers feel that there are a couple of things that you might want to consider.  If your goal was never to become a permanent landlord there are some timelines that you don't want to overlook.  And if you have lost touch with the current values of homes in the Mat-Su, it might be time to revisit the idea.

For many because they couldn't sell before they moved, they have been forced to rent at their new destination because they had always hoped that there would be equity in their home that they could carry forward to use to purchase their next one.  For many that have left the state of Alaska and have moved to the lower 48, they may also want to factor in what the appreciation rates are in their new state to help determine if selling here (albeit not as much as they hoped) might be a good financial move in order to to purchase sooner there.

For many that purchased at the peak of the market in Alaska in 2007-2008 and then tried to sell in 2011-2012, they found that their properties hadn't appreciated enough to cover the costs associated with selling.  Many then opted to rent it out and cross their fingers and hope that the market would come back.  If you have been wondering if now is the time to sell your Alaska rental, it could just be....but more on that shortly.

Did you know that the IRS has specific rules about the length of time that you can be out of your primary residence and still be excluded from a capital gains tax?  IRS Publication 523 has a wealth of information that you need to know about if you are one of those homeowners that rented out your home over the last few years.  In it there is a section regarding "Ownership and Use Tests" and that is the section that you might want to pay particular attention to.  It reads:

Ownership and Use Tests

To claim the exclusion, you must meet the ownership and use tests. This means that during the 5-year period ending on the date of the sale, you must have:


  • Owned the home for at least 2 years (the ownership test), and
  • Lived in the home as your main home for at least 2 years (the use test).
What does that mean?  Here are some examples that it gives: 


Example 1—home owned and occupied for at least 2 years.
Mya bought and moved into her main home in September 2011. She sold the home at a gain in October 2013. During the 5-year period ending on the date of sale in October 2013, she owned and lived in the home for more than 2 years. She meets the ownership and use tests.


Example 2—ownership test met but use test not met.
Ayden bought a home, lived in it for 6 months, moved out, and never occupied the home again. He later sold the home for a gain in June 2013. He owned the home during the entire 5-year period ending on the date of sale. He meets the ownership test but not the use test. He cannot exclude any part of his gain on the sale unless he qualified for a reduced maximum exclusion.

Period of Ownership and Use

The required 2 years of ownership and use during the 5-year period ending on the date of the sale do not have to be continuous nor do they both have to occur at the same time.
You meet the tests if you can show that you owned and lived in the property as your main home for either 24 full months or 730 days (365 × 2) during the 5-year period ending on the date of sale. 

For a homeowner that rented out their home for the last couple of years because they couldn't afford to sell, now could be faced with a capital gains tax on the proceeds of the sale if they have waited too long and no longer can meet the Ownership and Use Tests.

Many homeowners may not have kept a close pulse on the real estate market in Alaska after moving and may not know that property values have been on the increase, and particularly so over the last year. CLICK HERE for a look at Sold vs. List Price.  We pulled up 99654 for this example.  To find out another area, simply change the zip code to find out info about the area you are interested in.

If you have a home in the Matsu Valley that you have rented out because you were upside down, the environment hasn't been better in years to reanalyze your position and determine if now is the right time for you.  If you are getting to a point where time is of the essence, you will also be happy to know that approximately 1/3 of the pending home sales have occurred within 10 days at the moment, as buyers are scrambling to purchase before someone else beats them to it. Take a look at current listing prices here.

If you are curious as to the current value of the property, you can fill out this short form to obtain an approximate idea as to what it's worth.

As it relates to tax matters, we always recommend discussing the tax ramifications with an accountant or other tax professional in order to find out how it will impact you. 

Thursday, May 8, 2014

Homes for Sale in The Ranch Subdivision and Creekside at The Ranch Wasilla, Alaska

Homes for Sale in The Ranch and Creekside at The Ranch Subdivision Wasilla, Alaska


Looking for a home in The Ranch or Creekside at The Ranch Subdivision?

If you are interested in finding a home for sale in The Ranch and the new Creekside at the Ranch Subdivision of Wasilla, AK please click on the link for immediate information about homes for sale.  If you would like to know a bit more about the neighborhood I have included a few facts and links that may be helpful for you. 


Why Do People Live in The Ranch and Creekside at the Ranch Subdivisions?

The Ranch and the new Creekside at The Ranch addition is a large neighborhood of single family homes, situated between the cities of Palmer and Wasilla, AK and located within a short distance of the Parks Highway. One of the big draws to this neighborhood is the proximity to the Machetanz Elementary School and of course the gorgeous neighborhood and beautiful surroundings.

What's the Neighborhood Like?

The homes you would expect to find for sale in The Ranch and Creekside at the Ranch Subdivision are generally going to range between 1460 and 4713 square feet. Most of the homes were built starting 2005 to 2014.  The typical configuration is mainly 3 to 5 bedrooms and 2 baths. The lots are approximately a little less than an acre to almost a full acre, most being at around 1/2 acre.

What's Going on Nearby These Subdivisions?

The Ranch and Creekside at the Ranch is conveniently located just off the Parks Highway between Palmer and Wasilla, Alaska and it is an excellent commute location to Anchorage and JBER.  Mat-Su Regional Medical Center is close by as well as big box discount shopping areas, most chain fast food establishments, as well as the local movie theater within 10 minutes. In addition we have a wonderful collection of local favorite restaurants, including Locals.  Find out about The Ranch and the surrounding area's community information including banks, schools, shopping and what the community statistics are at my web page.

What Schools are nearby?

If you buy a home for sale in The Ranch Subdivision and Creekside at The Ranch of Wasilla AK, the local schools serving this area are Machetanz Elementary School as well as Colony Middle and High School. To get local school scores and more information about these schools check out the Wasilla school reports on my website.
Because the area is in a growth phase sometimes school boundaries change, so you will need to reconfirm this.

Now You Really Want to Find a Home Here, Right?If you are interested in the current homes and lots for sale in The Ranch Subdivision and Creekside at the Ranch of Wasilla AK click on the link. Our 'for sale' property information is a direct feed from the Alaska MLS and is updated multiple times per day.


To Search for Homes in the Palmer, Wasilla, Houston and other areas please visit my site.
 Spring Buying Guide

Wednesday, May 7, 2014

Alaska Real Estate is in a Stong Seller's Market


Alaska Real Estate is in a Strong Seller's Market.

The supply and demand ratio has tipped in the odds of the seller.  If you are curious what your home value is PLEASE CLICK HERE FOR MORE INFORMATION

Future House Values? Simple as Supply and Demand
For some time now, we have attempted to shed light on the fact that pricing in today’s real estate market, as it is in the markets for every other saleable item, will be determined by the concept of ‘supply and demand’.
According to dictionary.com:
“The relationship between supply and demand determines the price of a commodity. This relationship is thought to be the driving force in a free market.”
In real estate, supply and demand is represented as the current month’s supply of homes for sale (the number of homes for sale divided by the number of homes sold in the previous month).
While there is no steadfast rule that will apply to pricing in every category of housing, here is a great guideline:
  • 1-4 months supply creates a sellers’ market where there are not enough homes to satisfy buyer demand. Appreciation is guaranteed.
  • 5-6 months supply creates a balanced market. Historically home values appreciate at a rate a little greater than inflation.
  • 7-8 months supply creates a buyers’ market where the number of homes for sale exceeds the demand. Depreciation follows.

What is happening across the country right now?

In most parts of the country, home values are rising. This is for two reasons:
  1. According to NAR’s latest Existing Homes Sales Report, raw unsold inventory is at the lowest level since December 1999 when there were 1.71 million homes on the market.
  2. According to this month’s Pending Sales Report from NAR, houses going into contract reached levels last seen in April 2010 which was the month the Home Buyers' Tax Credit expired.
This has resulted in a 4.2-month supply at the current sales pace which is the lowest housing supply since April 2005 when it was also 4.2 months.
Based on the table above, we can see that the supply/demand ratio is leaning toward a sellers’ market where prices will appreciate. That has created positive movement in housing values in most parts of the country.

DO YOU KNOW WHAT THE COST OF WAITING WITH PRICES ON MAT-SU VALLEY HOMES AND RATES ON THE RISE?

Do you know what the cost of waiting with prices on Mat-Su Valley Homes and Rates on the rise?

We, at Alaska Home Sellers, have often broken down the opportunity that exists now for Millennials who are willing and able to purchase a home NOW... Here are a couple other ways to look at the cost of waiting.
Let’s say you're 30 and your dream house costs $250,000 today, at 4.41% your monthly Mortgage Payment with Interest would be $1,253.38.
But you’re busy, you like your apartment, moving is such a hassle...You decide to wait till the end of next year to buy and all of a sudden, you’re 31, that same house is $270,000, at 5.7%. Your new payment per month is $1,567.08.

The difference in payment is $313.70 PER MONTH!

That’s like taking a $10 bill and tossing it out the window EVERY DAY!
Or you could look at it this way:
  • That’s your morning coffee everyday on the way to work (Average $2) with $12 left for lunch!
  • There goes Friday Sushi Night! ($80 x 4)
  • Stressed Out? How about 3 deep tissue massages with tip!
  • Need a new car? You could get a brand new $22,000 car for $313.00 per month.
Let’s look at that number annually! Over the course of your new mortgage at 5.7%, your annual additional cost would be $3,764.40!
Had your eye on a vacation in the Caribbean? How about a 2-week trip through Europe? Or maybe your new house could really use a deck for entertaining.  We could come up with 100’s of ways to spend $3,764, and we’re sure you could too!
Over the course of your 30 year loan, now at age 61, hopefully you are ready to retire soon, you would have spent an additional $112,932, all because when you were 30 you thought moving in 2014 was such a hassle or loved your apartment too much to leave yet.
Or maybe there wasn’t an agent out there who educated you on the true cost of waiting a year. Maybe they thought you wouldn’t be ready, but if they showed you that you could save $112,932, you’d at least listen to what they had to say.
They say hindsight is 20/20, we’d like to think that 30 years from now when you are 60, looking back, you would say to buy now…
Agents: How are you preparing to help Millennials understand the opportunity available TODAY by become homeowners? Watch a free replay of our most recent webinar, "Spring Ahead in 2014: KCM's Action Plan for DOMINATING the Spring Buyers' Season" to find out the steps you need to take!

Wasilla Alaska Real Estate for sale... But don't blink or that home will be gone

Wasilla Alaska Real Estate for sale ...

But don't blink or that home will be gone



In keeping a watchful eye on the state of  the Wasilla real estate market, something has really stood out as of late.  Homes are selling....and fast.

We thought that you may like to receive an update on the Wasilla Market that doesn't appear in the Market Insider information that you receive, and that is the percentage of homes that are currently under contract and how many of them have sold within 10 days.  Of the 211 homes that are pending today, 20 of them sold in less than one day!  There are a lot of multiple offers on homes right now as a result of the frenzy that we are experiencing.    
Here is the breakdown as of 5-2-14:

        PRICE                     # OF PENDING SALES               % SOLD IN LESS THAN 10 DAYS
$100,000-$150,000                           18                                                       55
$150,000-$200,000                           43                                                       37
$200,000-$250,000                           54                                                       35
$250,000-$300,000                           34                                                       32
$300,000-$350,000                           26                                                       23
$350,000-$400,000                           21                                                       33
$450,000-$500,000                            7                                                        43
$500,000 and higher                           2                                                          0