Top 10 'must have' home technology trends

ORLANDO, Fla. (MarketWatch) -- The most technologically savvy homeowners bask in crystal-clear television screens when they're home and can control the lights while they're out of town. Without moving an inch, they can decide what music is playing in each room and can monitor the well being of their aging mother in a different city.
So says Greg Hoshaw, owner of High Definition Systems in St. Charles, Ill., who presented the Custom Electronic Design & Installation Association's top 10 "must have" technology trends for homes at the International Builders' Show here this week.
Making the list:
A home theater or media room. A home theater is a room dedicated solely to the viewing of movies and programs, designed with aspects such as sound quality in mind. A media room is incorporated in a home's living space and is more of a multipurpose room, where a homeowner can watch television, read a book or play a game. Home theaters can run anywhere from $15,000 to $150,000 and more depending on the components; one package displayed at the show from Lifeware included a media center, audio-video receiver, 200-disc DVD changer, 50-inch plasma television, six speakers, automated lighting control, remote and software for $31,000.
Home health-care products and installation. As the population ages, there's more demand for health-care products that take advantage of advances in technology. Patient-monitoring systems can allow a caregiver to check up on an elderly loved one from afar. Biometric monitoring devices can keep constant watch on a patient's vital signs.
Media Center Edition (MCE) computers. This audio/visual computer can help manage a home's various media sources, providing such features as surround-sound processing, as well as access to Internet radio and the one-touch recording of TV shows. A top-of-the-line Dell media center system fetches at least $5,500. Hewlett-Packard's HP z565 Digital Media Center starts at $3,000.
Microdisplay-based televisions. High-definition televisions are hot, including LCD (liquid crystal displays), DLP (digital light processing), LCoS (liquid crystal on silicon) or LCD-based rear-projection TVs. Depending on size and type, prices for these products run the gamut.
Lighting and automation. Homes can be set up with the ability to control lighting and other features throughout the house from any room -- and any part of the world. Systems can also create lighting schemes and automation that might, for example, turn the lights down and close the curtains when a DVD is started, Hoshaw said. Honeywell and Home Director are two companies that offer such systems. Lifeware's deluxe system, which includes audio, lighting, HVAC and security controls in addition to its media capabilities, is priced at $54,000.
Security systems. New systems can protect a home while the owner is away by taking a snapshot of light usage in the house over the past two weeks, then mimicking the series while the owner is out of town.
Media servers. Homeowners are increasingly loading all of their media, including music and movie files, on one server, making files accessible in a central location. Hewlett-Packard has developed its HP MediaSmart Server, with the capability to handle 10 accounts on your home network, although the product is not yet for sale.
The iPod revolution. Many people have the popular music player from Apple -- or a competing mp3 player -- but increasingly homes are adding docking systems that allow more flexibility in using the device's media libraries. The Keyspan AV Dock for iPod, for example, will connect the device to a computer, stereo or TV and retails for $64.99 on Amazon.com.
Smart sound systems. Multiroom, multisource sound systems allow a homeowner to control the sound piping through rooms. Often with a touch of a key pad, a homeowner can control what's playing in each zone, independent of the rest of the house. Bose installed such whole-house systems in two of the showcase houses built specifically for the builders show.
Gaming rooms. They're not just your run-of-the-mill ping-pong table in the basement anymore. Video-game spaces have become increasingly common in a home, and are often set up around more traditional games, such as a billiard table.

Ten Reasons to Invest in a Golf Property in Europe

Golf is no longer an exclusive sport for the wealthy. More and more people of all ages and backgrounds are taking up the game, and they are not just content to play on their local course. Golf has gone truly international with world class courses springing up on every continent. A number of professional golfers, such as Jack Nicklaus, Gary Player, Tiger Woods and Ian Woosnam, have put their names to these courses and are developing a new type of golf resort, one with freehold property available to purchase.

Ten Reasons to Invest in a Golf Property:

1. A good investment. The lifestyle factors are important when planning a property purchase however the financial aspects are key. The benefit of purchasing on a course is that the demand for golf property remains high, providing an exit from the market at any point. Buying a property off-plan will also usually result in significant capital gain by the time the course has opened.

2. Money earner. There is excellent holiday rental potential both in the domestic and foreign markets as the popularity of golf continues to grow. On some developments rental returns of up to 6 percent per annum are offered (for a set period of time after purchase).

3. Year-round use. Buy a property in a country such as Spain, Dubai, Florida or South Africa and not only will you be able to make the most of your property all year round but you would also have the option to rent it out 365 days a year.

4. Value for money. Compare average property prices in the UK of £200,000 to just about anywhere else in the world and you can get so much more for your money if you buy overseas. Plus, how many opportunities are there to buy on a golf complex in the UK?

5. Not just golf. If you love golf but your partner doesn’t, never fear. There are plenty of other distractions to be found on site. Choose from tennis, football, volleyball, basketball, swimming, gym and beauty spa.

6. Family fun. Most golfing communities are very child-friendly. Look for courses and clubs which have children’s play areas and swimming pools. If you have very young children look for those places with an on site crèches to enable you to hit the holes without interruption!

7. Living on the green/community living. Enjoy the pleasure of community living, where everyone you meet will be fellow golfing fans and where you’ll always have something to talk about … golf!

8. Amenities. Most sites have their own bars and restaurants but some even have their own shops and cinemas so you never have to leave the grounds. Perfect for a hassle free break.

9. Different culture. Experience the sport you love in a completely different culture where you can enjoy the “vie difference”!

10. Retirement. Buy your golfing property to enjoy now as a second home with the thought that it could be somewhere to retire to when the time is right.

The Main Reasons For Purchasing A Foreign Property - Part 1

There are several broad reasons that people may have for purchasing a property fin Europe. Here are some of the main ones:

They wish to relocate to a geographical location that better suits their lifestyle, income and circumstances. For example, a surprisingly high number of people emigrate to Spain because of it’s great climate, relative low cost of living and the cheaper property prices.

They wish to purchase a foreign property as a form of financial investment. Increasingly, property investment is being touted as the "ultimate" fool-proof way of achieving long term financial gain. Some people are now even using property investment as their main financial provision for old age.

They wish to purchase a holiday home. This is mainly for those who have the resources to purchase a property in their favourite part of the world – somewhere they enjoy visiting, perhaps where they can laze away on the beach and enjoy the fruits of a completely different environment.

Some elderly people may wish to purchase a property abroad for retirement. Often, couples in their twilight years may find that their current life has changed dramatically. They may live in a large house (too large now the children have flown the nest), wish for a slower pace of life or may simply want to move somewhere different for health purposes (for example a less cold climate). More elderly citizens relocate than is commonly thought.

Whatever the motive, there are many advantages and disadvantages that should be considered carefully before taking the huge step to purchase a foreign property. A property is one of the biggest financial investments that an individual can make during their lifetime.

Submitted by Amanda and Cristina at 1Casa.com

Retrieved from "http://www.inmanwiki.com/Real-Estate/Ten_Reasons_to_Invest_in_a_Golf_Property_in_Europe"

International Hot Spots to Watch in 2007

International Living magazine has identified seven emerging international real estate markets that its editors believe are worth watching, visiting, and investing. They are:

1. Montenegro: This lovely European country on the Adriatic has been almost forgotten.

2. Cartagena, Colombia: A walled city that boasts white-sand beaches offering world-class diving and snorkeling.

3. Malaysia: This is Southeast Asia's top retirement haven, which provides a Western-type lifestyle. This underrated destination is also under-priced.

4. Calabria, Italy: This sun-kissed corner of Europe is encircled by clear silver-blue sea on three sides.

5. Ciudad Vieja, Uruguay: One of the world's top 10 cheapest cities. The real estate in this city began a renaissance back around 1995, and began to hit its stride in 2004.

6. Honduras Cloud Forest: This beautiful, forested area is just minutes from a charming beachside town with an international airport.

7. Mexico's Flamingo Coast: With dozens of quaint little beach towns, side-by-side. The Flamingo Coast offers warm weather, friendly locals, a safe atmosphere, and great food.

4 Minor Improvements That Bring Big Results

Sellers who refuse to make minor repairs are likely to pay dearly for their stubbornness, says Sid Davis, author of the new book Home Makeovers That Sell (AMACOM, 2007).

Here are some of Davis’ suggestions for sellers who want to get the most out of the deal.

Start with the kitchen; it’s the most important room in the house for most buyers. Refacing the cabinets or sanding them and painting them white is often a worthwhile undertaking. If the flooring is in poor condition, replace that too.
Update the bath. While paint and flooring help here too, sellers may find spending $200 to replace the mirror and vanity set will net them the greatest payoff.
Clean the laundry room. Hire a carpenter to install built-in shelving and repaint and replace worn flooring. Upgrade the light fixtures.
Scrub, scrub, scrub. Squeaky clean wows buyers, Davis says. “If people think [a home] is super neat, they'll give [the seller] the benefit of the doubt. If it's dirty, they'll assume it's ridden with hidden defects,'' he says.

Source: The Miami Herald, Ellen James Martin (02/11/07)

What are the Best Real Estate Web Sites?

About 80 percent of buyers use the Internet to help find a home, according to research by the NATIONAL ASSOCIATION OF REALTORS®. To help get the most out of their Web search, USA Today reviewed the top 10 most popular real estate Web sites to determine which ones standout among the pack in helping buyers find information on real estate.

Here’s a summary of their findings, in alphabetical order, and what they liked or disliked.

AOL Real Estate. Reviewers liked the online mortgage tools, but weren’t as enthusiastic about research information, which they said was out-of-date.

Century 21. Instant chats with real estate pros are cited as a good idea, but reviewers didn’t like how the searches only turn up Century 21 listings.

Coldwell Banker. Interactive map and price comparison information pleased reviewers, but searches limited to Coldwell Banker were a turnoff.

Homes.com. Includes some information on foreclosures and new homes as well as competing loan terms from local lenders. However, no neighborhood data available for this search.

HomeGain. Reviewers like the listings of comparable homes sold, but criticized its search process and links limited to Keller Williams.

REALTOR.com. Reviewers liked the detailed descriptions and estimated monthly payment tool, and said multiple pictures and virtual tours for some properties are a plus.

Re/Max. Reviewers compliment ease of navigation and easy to find real estate contact information, but say the interactive map of prior sales needs work.

Yahoo Real Estate. Critics weren’t too enthusiastic about its exclusive deals with Prudential Real Estate and how it offers limited new-home sales data.

Zillow. Reviewers liked the site's interactive features, including its new Make Me Move feature that lets you name the price you would move for. But its inaccuracies at times on home estimations didn't please reviewers.

ZipRealty.com. Positives include allowing people to post reviews of homes they've toured. But a negative was its bias toward E-Loan for its loan comparisons.

Source: USA Today, Noelle Knox (02/08/07)

WHEN YOU SELL YOUR HOME, VACANT-LOT SALE MIGHT BE TAX-FREE

DEAR BOB: I enjoy your weekly articles and I have a question about having two vacant lots adjoining my house. Where can I find information on selling one lot tax-free? My accountant and attorney can't seem to find this tax law. --Robert R.

DEAR ROBERT: If you sell a vacant lot within 24 months before or after the sale of your adjoining principal residence, then you can include the lot's capital gain along with the home sale as if it were one sale.

When your total principal-residence-sale capital gain is below $250,000 ($500,000 for a qualified married couple filing a joint tax return), and you meet the other Internal Revenue Code 121 ownership and occupancy tests, then your lot-sale profit won't be taxable. However, this provision applies only to one adjoining lot sale, not two. For details, please consult your tax adviser.

Who does open house really benefit? Inman News

From InmanWiki

Editor's note: The following is a user-contributed article on InmanWiki, an online real estate encyclopedia launched by Inman News. This piece shows how industry experts can strut their stuff on the wiki and contribute solid articles with useful information for consumers and professionals alike. After logging in, readers can go to articles on InmanWiki and click on the "Discussion" tab to add comments or "Edit" to make changes. To get started creating your own articles on InmanWiki, simply go to the home page at www.inmanwiki.com and follow the steps under "Participate."

The Open House has been a mainstay of real estate sales for many years. The house to be sold is cleaned up, painted, landscaped, primped and polished to a spit-shine. Agents produce flyers listing features and benefits, put cookies in the oven to make the place smell "home-like," and engage all the potential buyers who walk through. The buyers are enthralled by the home and write full price offers on the spot. A contract for sale is signed, a "Sale Pending" rider is placed on the yard sign post outside, and off to escrow we go. Such is the typical scenario sellers hope for when they ask their agents to hold an open house. Let's take a closer look at the reality.

Who comes to open houses? Buyers who come to an open house may be unrepresented by an agent. They are a prime target for the agent. Sellers come to an open house to see how agents market homes. They are also prime targets for the agent. Friends and neighbors stop by to see what was done to the house. Other "Looky Lous" stop by because attending open houses is their hobby. They have no intention of purchasing; just looking at the house is fun for them. Others come by with less than honorable intentions.

Open Houses are really a tool for agents to find clients.

The probability of selling due to an open house is rather small. It does indeed occur, but not very often. If that is the case, what happens? Agents are there to try to capture the people who want to buy. Most of the time, visitors rule out the specific house for one reason or another. The onsite agent's job is to capture and convert that buyer to another home if they have no interest in the open home. No conversion, no commission.

Agents will try to qualify visitors to determine if they are buyers, sellers, or both; the time frame of the sale/purchase under consideration, and if the visitor is already working with or loyal to another agent. Buyers/sellers, aware they will be subjected to these friendly queries, put up barriers so they can view the house with the least amount of disturbance by the agent lurking in the kitchen.

One of the major problems with an open house in the 21st Century is that it is a passive activity for the agent: Once the house is open, the agent must stay at the location and wait for prospects to arrive. The number and quality of prospective visitors is unpredictable.

Agents should use active prospecting techniques to drive traffic to the open house: invitation cards and door-knocking around the neighborhood; cold-calling the neighbors to invite them to view the home, calling the agent's buyers and sphere of influence. These techniques are much more effective for the agent than advertisements in local newspapers. Advertising online is supplanting newspapers. There are a plethora of Web sites vying for posting of listings, including Realtor.com, Google Base, Zillow, Trulia, and new ones pop up daily. Some of these sites want to remove the agent from the process and, as a consequence, provide little incentive for agents to post there.

So, why do sellers want their agent to have open house? Mostly, because their agent has not shared with them the low probability of their home selling through this marketing method. Holding an open house on Sunday is the slowest method of selling a home on the slowest real estate sales day of the week. Sellers are much better served by an agent who will actively search for a buyer using prospecting techniques and posting listings on high traffic Web sites along with virtual tours. The majority of qualified buyers have an agent who can arrange for house showings as needed.

Open houses may never go away, due to tradition, but their usefulness as a sales tool is diminished in the online world of the 21st Century.

Loads of Laundries: Washers And Dryers All Over the House : Real estate journal

By Christina S.N. Lewis
From The Wall Street Journal Online
On laundry day, Jodie Galland goes into her kids' four bedrooms and empties the hampers. But instead of lugging all of the laundry downstairs, she simply tosses the clothes into the washer and dryer in each room's walk-in closet.

"I love it," says Ms. Galland, 39 years old, who also has machines in the master bedroom of her 11,000-square-foot home in Provo, Utah, and another set in the utility room near the kitchen. "The clothes pretty much stay in their closet."

Here's another sign that some Americans will spend a little more to walk a little less: They're outfitting their homes with multiple laundries or stashing extra machines in closets, pantries and family rooms.

The Well-Appointed Wash

See a selection of accoutrements vendors are pitching for luxe laundries.
There are no statistics on how many households have more than one laundry space, but builders and interior designers say the practice is growing, especially as homes get bigger and baby boomers get older.

Miami-based Coastal Homes, which specializes in $10 million-plus properties ranging in size from 10,000 to 60,000 square feet, included two laundry rooms in seven of the eight homes it built last year, according to Chief Executive Tom Murphy Jr.

The developers of Isleworth, a 274-home gated community in Windermere, Fla. (residents include Tiger Woods and Shaquille O'Neal), feature dual laundries in five out of six spec homes available. For instance, the 10,000-square-foot Bellagio model, listed for $8.5 million, includes six bedrooms, a wine cellar and two laundries -- one on the first floor and another next to the master-bedroom suite.

Indianapolis-based C.P. Morgan, which builds about 3,000 homes a year, started offering the second-laundry option three years ago.

Some homeowners say they're sick of lugging clothes from one end of the house to another, a hike in some of today's enormous homes. Others want separate machines for separate tasks -- one set near the master bedroom, say, for delicate personal items, and another for heavy-duty family loads.

Home-décor maven Chris Madden recently consulted with a plumber about her plan to put a second unit in the exercise room of her converted carriage house in Purchase, N.Y. Her current laundry room has a Chinese ironing press, a clothesline and an old-fashioned pine worktable, but it isn't big enough for multitasking. "I want to be able to watch television, work out and do the laundry," Ms. Madden said via telephone while on vacation in St. Thomas.

Laundry rooms are multiplying as prices of compact washer/ dryers have come down in recent years. But many homeowners are springing for more expensive, ultra-quiet machines for use in spaces near bedrooms and other living areas; they can cost up to $2,500. A tricked-out utility room with tile floors, granite countertops, custom cabinets and warming drawers (for items too fine for the dryer) can run into the tens of thousands of dollars.

Consumer interest comes as appliance manufacturers are looking for ways to increase sales. Domestic shipments of washers and dryers grew 0.5% in 2006, according to the Association of Home Appliance Manufacturers, marginally better than those of dishwashers, stoves and cooking equipment, and refrigerators, which were down 2.3%, 1.3% and 0.5%, respectively.

While manufacturers haven't gone so far as to urge customers explicitly to buy more than one set of laundry machines, they are encouraging homeowners to get the appliances out of the basement. Brands including LG, Kenmore, Whirlpool and Maytag have introduced appliances in designer colors in the past few years, while recent technological advances in machine motors and drums (the interior shell that holds the clothes) are promising a quieter wash and dry. Bosch says its Axxis Condensation Clothes Dryer, which requires a drain but no venting, "can be installed virtually anywhere" -- even inside a built-in wooden bookcase, as shown in one ad. Marketing materials for the Kenmore Elite HE5t, which Sears introduced in December, show the large-capacity, wine-colored front-loaders in living rooms and master suites.

Water Hazards

Dual laundries are more common in new homes because retrofitting an existing house can be pricey. The plumbing work alone can run anywhere from $2,000, if the plumbing lines are easily accessible, to $5,000, if the job requires opening up walls and ceilings to lay in pipes or a dryer vent, says Andrew August, a plumbing contractor in Freehold, N.J.

Improper installation can prove costly as well. A leaky washer can cause considerable damage if the laundry is upstairs and the water floods down to the rooms on lower floors. To prevent such disasters, Mr. August recommends installing a floor drain, a heavy-duty washer hose and an electric valve that shuts off water to the machine when it's not in use.

Noise can also be an issue. Real-estate investor Janie Budd, 42, used to wince when she did laundry because her children's bedrooms were nearby and the machines often woke them at night or during naps. When she and her husband, Ken, remodeled their 6,000-square-foot home in Advance, N.C., they added a second laundry room downstairs. "Before, I just turned the upstairs machines off" when the children were sleeping, says Ms. Budd, who spends about 10 hours a week doing laundry.

Linda Petersen had an unpleasant shock when she first ran the wash in the $4,000 laundry room she and her husband, Frank, 58, installed off the kitchen of their new home in Washburn, Wis. During the spin cycle, the brand new Bosch "almost sounded like an airplane taking off," recalls Ms. Petersen, 48, a massage therapist. A spokesman for Bosch's parent company, BSH Home Appliances Corp., says its laundry appliances should be quiet if properly installed. Now the Petersens make sure the door to the washer/dryer closet is closed and they're adding a low-tech modification: a laundry chute leading to their second set of (quieter) machines downstairs.

More Dust Bunnies?

That people are adding extra laundries surprises Cheryl Mendelson, the author of "Home Comforts," a 1999 best-seller on the domestic arts, and the 2005 "Laundry." "I wonder about the attempt to buy ease with such extravagance," says Ms. Mendelson, who notes that additional appliances also mean additional maintenance as well as more nooks and crannies to clean.

Others say the dual-laundry action makes sense, particularly in houses whose owners aren't as young as they used to be. "Baby boomers are building homes that they can grow old in," says Rebecca Lindquist, a kitchen and bath designer in Duluth, Minn., who designed two such projects in the past year for couples concerned about climbing stairs when they get older.

"It's a practical matter when you have a two- or three-story home," says Robert Weinstein, whose design company in Boca Raton, Fla., has completed 16 such projects in the Palm Beach area, including a children's-themed laundry room with custom-made choo-choo-train wallpaper festooned with railway signs ("Keep the station clean" and "Don't step in the mud"). The multiple locations make minding the children easier, Mr. Weinstein says.

Additional machines also offer privacy for finicky types who prefer not to share all of their dirty laundry with the hired help. Mike and Jodi Levy have two laundry rooms in their 10,000-square-foot house in Boca Raton, because Ms. Levy, 55, likes to do her own wash. "I don't mind the housekeeper doing my linens, but as far as lingerie or personal clothes...I want to do it myself," Ms. Levy says. She runs at least one load a day in her private laundry room, which has custom cabinetry and a built-in ironing board.

Not everyone is impressed with the setup. "My father doesn't think we need it," says Mr. Levy, 60, the founder of Sportsline.com, an Internet sports-media company. "But he doesn't think we need a house this big or any of the rest of it."

Then again, Mr. Levy adds: "My mother thinks it's great."

Cash-flow recovery via cost segregation: Real Estate Articles from Inman News

Cost Segregation: Reduce Your Income Tax + Increase Your Cash Flow
Real estate investors wisely spend a lot of time focusing on price per square foot, ROI, and other key valuation and market parameters; however, it is equally important to consider cash flow and income taxes when buying or selling an investment property and what strategies will diminish the former and increase the latter.

One area that is frequently overlooked when considering cash flow is the impact of properly configured depreciation. Many property owners are not aware that there is a way to accomplish this and are unnecessarily paying too much in taxes each year. Optimal depreciation strategies applied in the first five to 15 years of ownership significantly decrease income taxes, thereby increasing return on investment. This found money could be used to acquire more property, to improve or rehab today or in the future ... it can be directed in an infinite number of ways, provided you keep it in your hands and not in the hands of the IRS.

For example: properly configured depreciation for a $5 million office building results in additional first-year depreciation of $128,000 and net present-value tax savings of $214,000. What could you do with that newly found cash? $51,200. FOUND MONEY! In your account in the same year of the study, no waiting.

So how can you go about maximizing depreciation deductions? The answer is Cost Segregation studies. Cost segregation defined: An engineering-based valuation approach to identifying components within a building that can be reclassified into a much shorter depreciation class than the building itself. Real estate properties (and everything in them) are generally depreciated using a straight-line method over 39 years (27.5 years for residential multifamily properties). The cost segregation specialist maximizes the inherent tax benefit by identifying, classifying and segregating the personal property components of the building, resulting in shorter, more appropriate, depreciable lives of 5, 7 and 15 years. Without this strategy, owners are actually paying taxes before they are due ... unnecessarily.

Items typically reclassified include certain flooring, finish millwork, specialty electrical and plumbing, and land improvements such as asphalt paving, site lighting and underground utilities. The list is extensive as are the benefits to an owner's bottom line.

Specialized engineering valuation firms that focus on cost segregation, such as Cost Recovery Solutions located in Metuchen, New Jersey, with offices in Philadelphia and Fort Lauderdale, provide a specialized blend of knowledge in tax, engineering and construction that allows them to reclassify between 17 percent and 40 percent of a building to shorter recovery periods. The result is a quicker write off of the building and less taxes for the taxpayer.

The cost seg specialist uses an engineering-based approach, as specified by the Internal Revenue Service (IRS), which includes a thorough examination of your property, complete with numerous photos, measurements, and interviews with key personnel who know the history of the building's acquisition and improvements. These steps result in a comprehensive understanding of all potential elements that should be properly included in your study to achieve optimal results. For new construction or rehab projects, cost data, including the contractor's application for payments, change orders, owner-incurred costs, architectural and engineering drawings and disbursements, are examined. For properties that are acquired, the cost seg specialists use their construction cost estimating expertise to overcome the lack of available information.

It is typical for a reputable cost seg firm to provide a free model of projected benefits that will outline what they think you can save. They will also typically commit to a fee and time frame so that you have the necessary information to make a sound judgment as to whether or not the study is appropriate for your situation. All that is needed for this model is a depreciation schedule (or cost if just acquired) and a brief property description. CRS provides a 3-page model with projected increases in cash flow and additional depreciation for the first 15 years.

Do you have an existing building that might be a candidate for a study? No problem. A retroactive study can be performed without the problems associated with amending prior year tax returns or IRS approval. Neither is needed. You can claim the difference between the allowed depreciation and what you actually claimed in prior years all on your current tax return, which would mean big tax savings for you in the same year, no waiting.

You can also perform these studies for property that has been acquired as part of an estate transfer where the property has a stepped-up basis in the hands of the current owner.

Cost seg. also ties in well with a §1031 Like Kind Exchange. The property received is eligible to benefit from a study subject to meeting certain qualifications.

Many real estate owners assume their accountants are correctly maximizing depreciation of their properties. The reality is that many are not claiming the maximum allowable depreciation deduction because they overlook the benefits of a Cost Segregation study, resulting in a 'pre-payment' of taxes not due for several years.

To determine if a cost segregation study is appropriate for your portfolio, ask yourself the following questions: Is the total cost of my building (land excluded) at least $1,000,000? Have I purchased, constructed or renovated the property in the past 12 years? Do I plan on retaining this property for at least the next few years? Do I have net income that is currently taxed? Cost segregation will reduce your income taxes and increase your cash flow and return on investment if you can answer "yes" to these questions.

--Submitted by Greg Hartigan

Paying mortgage points a smart investment

Returns are 'astonishing,' so why don't more borrowers take advantage?

By Jack Guttentag
Inman News

"I read recently about a study that says that most people would not profit by paying points on a mortgage. Do you agree with that?"

No. The much-cited study by Yan Chang, senior economist at Freddie Mac, and Abdullah Yavas, research director of the Institute for Real Estate Studies at Penn State's Smeal College of Business, claims that most borrowers don't hold their mortgages long enough to make paying points a good investment. The study based its conclusion on the life of fixed-rate mortgages (FRMs) that were originated and terminated during the period from 1996-2003. But almost two-thirds of the loans in their sample were still in existence at the end of the period, and they are bound to have a longer life than those that were paid off. Further, the study did not cover adjustable-rate mortgages (ARMs), which in today's market provide the most attractive opportunities for paying points.

Even if the study was right, what "most people" would profit from is beside the point. What matters is whether you would profit from it. Well, then, how do I know whether or not it makes sense for me to pay points?

Points are an investment on which the return consists of lower mortgage payments in the future, and a lower loan balance if the loan is paid off before term, which almost all are. The investment makes sense for borrowers who have the money and find the return high enough to be attractive.

The standard view is that the borrower's time horizon must be quite long to make points worthwhile -- I have made this statement myself many times. However, when I recently calculated rates of return for different types of mortgages, I found that the standard view holds only for FRMs. On ARMs, the returns are high over periods equal to the initial rate period.

For example, while the return over seven years was only 8 percent on a 30-year FRM, on a 7-year ARM it was 22 percent. On a 3-year ARM, the return over three years was 17.5 percent. I found this so astonishing that 10 days later I looked again to be sure I hadn't made a mistake. Sure enough, I hadn't.

Do most borrowers pass up this opportunity?

They do. In the sample selected by Chang and Yavas, less than 15 percent paid points. Borrowers are predisposed against an increase in their cash outlays at closing for a benefit that will accrue in the future. Nobody tells them what the rate of return on investment might be. Often, they aren't even offered the option.

Mortgage brokers and loan officers don't encourage borrowers to pay points. Points make it more difficult for loan officers working for lenders to earn an "overage" -- a price above the lender's stated price, which the loan officer usually shares with the lender.

Similarly, if borrowers pay points for a lower rate, mortgage brokers are forced to disclose their own fees upfront where borrowers can see and possibly question them. The broker can't avoid disclosure when his fee must be added to the points. It is much better to steer the borrower to a loan with a rate high enough that the lender will pay points to get it, referred to as a "yield spread premium," or YSP. Then the broker can pay himself out of the YSP, which existing rules permit to be disclosed in ways that usually mean nothing to the borrower.

How can borrowers be sure that the option to pay points will be made available to them?

One of the advantages of shopping for a mortgage online is that the alternative rate/point combinations appear on the screen. The rates of return shown above were calculated from data shown by one such lender, Amerisave, an Upfront Mortgage Lender. Upfront Mortgage Brokers will also provide the required data. Since their fee is set upfront, they have no financial interest in which rate/point combination the borrower selects.

How do I find the rate of return?

You need two price quotes for the loan type you want. One is the rate/point combination with points closest to zero. The other is the combination for the lowest rate available. Using calculator 11c or 11d on my Web site, enter the two rate/point combinations and the period you expect to be in your house. Presto, you have the rate of return.

The writer is professor of finance emeritus at the Wharton School of the University of Pennsylvania. Comments and questions can be left at www.mtgprofessor.com.

Real Estate Articles from Inman News: A lesson in real estate problem-spotting

Stay involved in home sale


By Dian Hymer Inman News

All too often, home buyers and sellers remove themselves as active participants in their real estate transaction when the contract is signed, confident that their agent will handle everything for them. This approach can result in an unpleasant surprise if your agent calls to tell you at the 11th hour that the sale has been delayed or won't be closing at all.

A real estate agent should, of course, stay on top of the details. But an agent is not your surrogate. Ideally, you and your agent will work as a team to close the deal. However, remember that you are the decision maker, and your agent is merely the facilitator.

For example, let's say the people who have agreed to buy your home are having trouble lining up financing. They request a couple of extra days to finalize a loan commitment. The request will be made through your agent. It would be inappropriate for your agent to grant the extension. That's a decision for you, the seller to make, while relying on the good advice of your agent.The delay in financing could be due to the fact that the lender hasn't received a forthcoming document. Or, it could be due to a bad credit report. The first is nothing to worry about; the second could mean big trouble.

Suppose your agent decides not to bother you with the request for an extension. Instead, your agent tells the buyers' agent that it's OK to take the extra time. The agent has now stepped in to the role of decision-maker.

A few days turns into a week and you still don't know that anything might be amiss with your sale. If the buyers aren't successful in obtaining the financing they need to close, you could have wasted precious marketing time by not staying involved.

Some agents think they're doing their clients a favor by insulating them from bad news. They hope to solve the problem so that the buyer or seller isn't bothered. Although the agent's intentions might be good, they are ill conceived.

HOUSE HUNTING TIP: To ensure that you have a successful home purchase or sale, resolve to stay involved in the process from beginning to end. This may seem impossible to buyers and sellers who are extremely busy. There's usually a lot at stake, so it's worthwhile to make time to stay involved in the outcome of your real estate transaction.

One reason buyers and sellers shrink into the woodwork as soon as the contract is signed is they feel they're out of their element. They have little or no real estate experience and think it's best to leave the heavy lifting to people who know what they're doing.

A good way to stay on top of your transaction -- regardless of your level of expertise -- is to ask your agent to provide you with a summary of the critical details of your purchase contract as soon as possible after the final contract is signed.

The summary should include key contract dates for such things as the date the buyer's deposit is due, contingency deadlines (for financing, inspections, the sale of another property, etc.), a final walk through of the property and the closing date.

It should also include the names and contact information of the people involved in the transactions, such as the buyers and sellers, their real estate agents, the closing agent, inspectors and the buyer's mortgage broker or loan agent. A synopsis of who pays for what (transfer taxes, mortgage fees, etc.) is also useful.

THE CLOSING: Enter the key contracts dates on your calendar and follow up with your agent on the critical deadlines as they come due.

What Prospecting Is – And Isn't

What Prospecting Is:


Calling past clients

Calling people in your sphere of influence

Calling expired listings

Calling FSBOs

Cold calling for listings and sales

Knocking on doors

Hosting open houses

Calling absentee owners

Cold calling from lists of names

What Prospecting Isn't:


Mailing magnets, calendars, and almost anything else

Setting up a website

Joining service organizations

Wearing your name badge

Placing magnetic signs on your car

Sponsoring a community sports team

Doing floor time

Answering e-mails

Pinning your business card on bulletin boards
While marketing is all well and good, prospecting is the pathway to sales success.

10 Quick Fixes To Sell a Home Faster

Here are 10 quick fixes that make a house more likely to be snagged up by buyers:

1. Paint the trim, columns, front door, and the light fixture.
2. Replace the storm door with a full-view one.
3. Clean all the window screens.
4. Add new mulch and a potted plant by the front door.
5. Remove mirrors from over the fireplace so buyers focus on the fireplace.
6. Move furniture 1 1/2 to 2 feet away from the walls to create the illusion of more space.
7. Get rid of any movable storage pieces in the kitchen and take all the clutter off the refrigerator.
8. Clean and regrout the bathroom floor tile.
9. Replace dated bathroom vanities with trendy (and economical) pedestal sinks.
10. Put colorful bedding and matching window treatments in all the bedrooms.

Real Estate Articles from Inman News :TenantMarket.com pairs owners with prospective renters

Founder says site is 'rental industry equivalent of Match.com'

A new Web site, TenantMarket.com, allows apartment owners and managers to search through a national database of prospective renters -- it's like "the rental industry equivalent of Match.com," says founder and CEO Jeremy Bencken.

Bencken is also co-founder of ApartmentRatings.com and affiliate sites ohmyapartment.com and thinwallstalk.com.

The new site, launched this week, features Resident Listing Services, a searchable database with information entered by prospective renters. Apartment owners can search through resident profiles and contact them with personalized offers and information about current and upcoming rental homes.

Basic features at the site are free and do not require registration. Contacting prospective residents requires a paid subscription. Site subscriptions start at $29.95 for 10 days of access with a single vacancy.

"The service works because over 56,000 renters have already shared their detailed housing search with TenantMarket, enabling landlords to send one-to-one offers to renters," the company announced. "For example, a property manager could waive the application fee for renters who sign an 18-month lease and offer two weeks free rent to nonsmokers."

Prospective renters can receive personalized offers, can save housing searches and can receive notification when new rental properties enter the market.

"Aside from helping traditional apartment and rental-home owners, homeowners can also use TenantMarket to discover how many renters could cover their mortgage," according to the announcement. "Real estate investors unable to sell properties profitably can use the service to find renters to cover their expenses while they wait for a better resale market. Realtors can use the service to help their clients explore rental demand in different neighborhoods."

Prospective renters can communicate anonymously with property owners and managers, and they can choose to accept or decline contact when there are incoming offers.

Through a sister Web site, ThatRentalSite.com, TenantMarket syndicates listings on sites such as Google Base and Oodle.

"For renters, TenantMarket provides an efficient way to signal information that allows property owners and managers to present personalized incentives and rewards," Bencken said. "For landlords, TenantMarket eliminates the uncertainty and lag time of a blind ad buy, in turn eliminating costly days of vacancy."

Real Estate Articles from Inman News : Where and how brokers partner online

Part 2: New age of online marketing and ROI


By Glenn Roberts Jr.
Inman News


Editor’s note: Online marketing in real estate is quickly moving forward as brokers test new methods for reaching consumers on the Internet. Marketing choices have grown more complicated with a larger selection of Web sites to promote property listings and a growing list of lead generation and management technologies to choose from. In this three-part series, we take a look at new broker strategies and where new partnerships are cropping up. (Read Part 1.)

It's becoming increasingly clear. Brokers want control of property listings information, and they aren't waiting.

"Multiple listing services and brokers have come around to understand that brokers need control of their data. I believe there is a fundamental shift going on at the MLS level to begin giving brokers access to their data," said Luke Glass, chief financial officer and chief operating officer for real estate technology and data company Threewide Corp.While brokers have traditionally supplied property listings information to MLSs for display at Realtor.com, public MLS Web sites and MLS-member Web sites through data-exchange agreements, their attention is turning to their own online marketing.

The challenge for brokers is in deciding how to use their newfound control to market properties -- or not to market properties -- on a growing list of consumer-facing property-search Web sites. "Brokers are really leaning toward controlling their own marketing decisions," Glass said. And agents, too, are seeking the best online venues to market properties to the massive Internet audience of prospective home buyers.

These are not easy decisions -- some brokers and agents say they want to offer maximum exposure for properties while others say they worry that some Web sites may get in the way of real estate professionals' direct interaction with consumers. There is no single solution that suits every real estate professional in every market. Brokers and agents are working to build their own unique brand on the Internet and the operators of property-search Web sites are working to build a brand, too.

"The broker obviously feels that the number one place to attract customers is his Web site," Glass said. And many third-party Web sites, while seeking to become a search destination, also direct Internet traffic back to the agent's or broker's Web site when consumers at those sites seek more detailed property information.

In response to the demand for broker control of listings information, Threewide has launched a data distribution product called ListHub that allows brokers to interact with MLSs in receiving broker-specific property listings information and in controlling where to send that information. The product also allows brokers to monitor Web traffic generated by their property listings information at those third-party sites, and to eliminate the need for re-entering data numerous times at the various sites.

Other companies, too, are offering variations on this theme: Web-based tools that allow real estate professionals to automate the process in sending property listings information for display on a number of Web sites. Point2, Postlets, SubmitYourListings and vFlyer are among the companies in this category. Such companies can simplify the process of sending bulk data feeds or individual property information to multiple property-search sites simultaneously, and in updating the information displayed on those sites.

And the list of online marketing sites for properties is a mouthful: Craigslist, eBay, Edgeio, Google Base, LiveDeal, Oodle, Point2NLS, Propsmart, Trulia, Vast, Yahoo and Zillow, among others.

While agents are also making decisions about how to market properties, Glass said that the ListHub product gives brokers ultimate authority in deciding where to redirect traffic from the other property-search sites. "They have to agree to where the traffic goes," he said. Brokers within 13 MLSs are using the ListHub product, and these MLSs represent about 100,000 agents across the country, he said.

Online marketing should drive consumers to a physical storefront or online storefront, Glass said. "I think the Web site itself is becoming an online storefront. Don't let others intermediate the traffic. Your online storefront is for your listings -- where you should feature your listings. It's all about the data," he said.

MLSs are generally moving away from making online marketing decisions for brokers, though there are exceptions, he said. The Houston Association of Realtors, as an example, has formed an agreement with its brokers to send property listings information to the Google Base classified listings site, while it is typically brokers or agents who are submitting this information to the site. "For the most part MLSs don't want to be involved with marketing decisions."

Some MLSs maintain their own public property-search Web sites, though many of these MLSs don't actively market the sites, Glass noted.

Mike Montsko, president of the Weichert Lead Network, a technology division that manages online leads for the Weichert, Realtors brokerage company, said it is definitely difficult for real estate companies to decide where to distribute property listings information.

"This one keeps me up at night. There are lots of sites ... that are willing to drive free traffic to your site," he said. "With one caveat: You have to provide them with your listings. For now these sites are happy to give you the free traffic because they need the content. Without the listings they would have no product."

He added, "I know a lot of brokers feel that by working with these sites we may be raising an 800-pound gorilla. As these sites become more popular consumers will demand that their homes be displayed on them. Once this happens we could be facing the same problem we have today with newspapers: large spends with little return."

So why do companies decide to post property listings information at these third-party Web sites? "Our job is to help our associates sell homes and to ensure that our customers are getting the best service available," Montsko said. "Putting the listings up on these sites gets those homes more exposure, which is good for the associate and the customer."

Joe Ballarino, president and founder of Amerivest Realty, a Naples, Fla., real estate company, said that online marketing decisions are complicated by the rising number of third-party property information sites. "We now have to evaluate each and every site to determine whether our listings should be placed on those sites. We have to balance our sellers' needs with general business goals when making those decisions.

"We look at many variables when deciding which to be placed on ... the traffic at that site, are our competitors' listings appearing, and does the site compete with us and if so, how? We will only look at sites where we can automate a bulk export. With over 300 agents and 1,00 listings a manual process is just not sensible," he said.

Obtaining optimal exposure for a property does not mean pushing property information out to every possible source on the Internet, said John Chang, vice president of marketing and eBusiness at John L. Scott Real Estate. Chang said the company's marketing efforts target prospects who are most likely to purchase a home.

"This targeted promotion does not rely on broadcasting listings to every conceivable would-be portal in cyberspace, but rather it focuses on the best medium through which we can manage the promotion of homes to the best prospects," he said. "At the forefront of this marketing plan is JohnLScott.com, where we can ensure that properties listed by (our) agents are optimally showcased."

Chang also noted that the company has not established a "one-size-fits-all" policy for its brokers, and individual brokers can make their own marketing decisions in promoting properties online.

At Coldwell Banker Howard Perry and Walston, a brokerage in Raleigh, N.C., the decision to market properties is based on a number of factors: "We evaluate the quality of the site, what consumer marketing and promotion they are doing for the site, what they have to offer the consumer in an online experience, what their business plan is, and are they going to work with us or against us," said Sean Nally, chief information officer for the company.

"We guide our agents to utilize the sites we have determined to be our best online marketing partners and then encourage them to get Web exposure for all their listings in order to increase their marketing reach and, of course, listings and sales," Nally added. He said the company has embraced sites like Realtor.com and Trulia.com. "Trulia has some fantastic tools," he said, such as "Heat Maps" that offer a color-coded map indicating market trends.

Brendan King, chief operating officer for Point2 Technologies, a company that offers online marketing services, said during the Real Estate Connect NYC conference earlier this month that real estate professionals should experiment in sharing property listings information with various Web sites and measure what works best. "Don't be scared to set the data free," he said. "There is a value proposition for the Realtor. Don't be scared of Google or Yahoo or any of these search places -- put it out there with your branding, with your contact information, and then measure these leads that come back to you."

And Charlie Young, senior vice president of marketing for Coldwell Banker Real Estate Corp., said during that conference that the job of brokers is to "put properties in front of consumers," though there is "no right answer" in deciding where to market properties. "Every market is going to be different. I would look at traffic. I think you need to look within the marketplace. What are the objectives that (a Web site) has? Are they contradictory? Put your listings where consumers get the most value."