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Cell Easements & 1031 ExchangeDepending on the amount of suitable sites in the area and amount of cellular traffic, a cellular transaction can present a windfall for the property owner, but the way in which the transaction is structured can produce very different tax results for the owner. With the continuing expansion of cellular coverage across the United States, owners of land suitable for placement of cellular towers are being approached by cellular communications companies that desire to acquire easements, licenses or leasehold interests as a means of expanding their cellular coverage. Depending on the amount of suitable sites in the area and amount of cellular traffic, a cellular transaction can present a windfall for the property owner, but the way in which the transaction is structured can produce very different tax results for the owner. An easement, sometimes characterized as a “communications easement”, constitutes a transfer of an interest in the real property under state law. As such, the conveyance of an easement for consideration results in a sale taxable at (currently) lower capital gain rates. The creation of a lease or the grant of a license, on the other hand, results in a contract right to receive rent or license fees over time. Rents and license fees are generally included in the owner’s income when received and are taxed as ordinary income, at rates that are generally higher. Looking at the transactions from a non-tax perspective, the grant of an easement is usually not terminable by the owner since the grantee acquires a deeded interest in the real property itself. The grant of a license or fee, on the other hand, will be terminable upon the expiration of the lease or license term. Given the greater limitations on the owner’s future use of a property subject to a perpetual easement, the grant of an easement generally commands a much greater premium than the grant of a terminable license or term lease. If the communication easement is perpetual (e.g., runs with the land), then there is yet another structuring opportunity that sets the easement apart from the grant of a license or leasehold. In many instances, the IRS has characterized a perpetual easement as property that is “like kind” to a fee interest in real property for purposes of tax deferral under Internal Revenue Code § 1031. Accordingly, if the transaction is structured as sale of a communication easement, the property owner would likely be able to engage a qualified intermediary to facilitate a 1031 exchange of the perpetual easement for other real property to be held by the owner for investment or for use in a trade or business. There is no similar opportunity to defer the tax arising out of a license fee or rent in the case of a lease apart from the limited deferral afforded by the owner’s receipt of license or lease payments over time. PLR 9621012, the IRS determined that a perpetual scenic conservation easement on ranch land was likekind with timberland, farmland, and ranch land. This ruling is based on the State’s civil code, which characterized a conservation easement as an interest in real property. PLR 9232030, the IRS ruled that an agricultural easement was like-kind to a fee simple interest in real estate. PLR 200201007, the IRS ruled that a taxpayer’s exchange of a perpetual conservation easement on a ranch for other ranch property qualified for Section 1031 tax deferral. PLR 200651018, the IRS determined that a perpetual stewardship easement was like-kind to a fee interest in other real property. PLR 9851039, the IRS came to the conclusion that the exchange of an agricultural conservation easement for a fee interest in other farm property was like-kind. Rev. Rul. 72-549, easement and right-of-way that the taxpayer granted and the real estate properties that the taxpayer acquired [fee interests] qualify as like-kind property under §1031 of the Code. Rev. Rul. 59-121, C.B. 1959-1, 212, conveyance of easement for land. Thus, the consideration received for the easement constituted proceeds from the sale of an interest in real property. Rev. Rul. 68-331, C.B. 1968-1, 352, conveyance of an interest in a producing oil lease for a fee interest in an improved ranch held to be an exchange of property of a like-kind under §1031(a) of the Code since both the leasehold interest and the fee interest are continuing interests in real property. Rev. Rul. 55-749, C.B. 1955-2, 295, land exchanged for perpetual water rights considered real property rights under applicable state law. This Revenue Ruling holds that the fee interest in the land and a water right in perpetuity are sufficiently similar to constitute property of like-kind for purposes of §1031(a) of the Code.
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5 Secret Sources of Down Payment MoneyDown payment: the mere utterance of the term strikes dread in the hearts of many a  homebuyer-to-be. Coming up with a down payment often seems like an obstacle that must be overcome, as it is the biggest test of our ability to save money most of us will ever face and it’s a test that stands between us and our ability to become a homeowner.
I think it’s time to flip the script on how we think about down payments. What if we looked at them less as an obstacle, and more as an opportunity? Saving and collecting a down payment takes time, discipline and financial planning. It forces us into creating and practicing sound money management skills and habits, and into making clear choices about what’s important to us - things that will stand us in good stead throughout our tenure as home owners. To boot, the more money we have to put down, the more choice we have in terms of our purchase price range and the more control we have over our monthly payment.
All that said, down payments can be take years to save for, and some buyers are concerned they might miss a good market opportunity by continuing to wait. If you count yourself in that number, here are a handful of less-well known sources for boosting your down payment stockpile:
1. Your City. Most of us remember the days of the zero-down loan, the federal home buyer tax credit era, and even have memories of when we could use tax credit funds toward our down payment and closing cost requirements. The keyword here is ‘memories’ - those days are long gone, as are the times when there were nationwide programs that allowed a home’s seller to ‘gift’ the buyer a down payment from the overall purchase price of the home.
Where have all the down payment assistance programs gone? Local, that’s where.
The best programs of this sort are now largely operated by local governments, primarily cities and counties. As such, the rules vary widely. Some are exclusively operated for buyers with low or moderate incomes. Others are dedicated to helping first-time home buyers, usually defined as someone who hasn’t owned a home in the past 3 years. Many of these programs have a limited pool of funds that may run out over the course of the fiscal or calendar year, and almost all of them require buyers to jump some major hoops in terms of:- bringing their own funds to the table
- picking a home that meets certain minimum condition criteria and/or
- completing a course of homeowner education classes
in order to qualify for the funds. Some state and local programs in areas which were particularly hard hit by the recession also offer big-time bonuses for buyers who agree to purchase a bank-owned home or a property in a designated economic recovery zone.
To find these programs, just run a series of Google searches to find your city, county and state websites. Most will have a link for Residents, Housing, Homebuyer Assistance or some similar category of resources. And here’s a hint - make sure you’re on a site that ends in .gov - scammers posing as governmental agencies abound. Also, talk with your trusted, local real estate agent or mortgage broker; they often know the ins and outs of the local programs that can help a home buyer out.
2. Your Parents, Family and Friends. Many more home buyers than you might think get by with a little help from their friends (and relatives). Most mortgage programs will allow for some portion of your down payment to come in the form of ‘gift money,’ which is exactly what it sounds like: money someone gives you to help you buy a home. Check in with your mortgage pro about how much of your down payment needs you can satisfy with gift money - guidelines varies widely based on how much of your own cash you have to put down and what loan programs you’re applying for.
While gift money sounds great, it’s far from a panacea to the problem of coming up with a down payment. Taking gift money from a relative may create relationship issues or come with emotional strings attached, something you should consider and evaluate before you even have conversations about it with your potential benefactors.
And gift money generally also comes with lender strings attached, as well. Namely, lenders almost always require that gift money be contributed along with a gift letter that states that the giver is a relative and that the money is a gift, not a loan. The lender may also require to see a bank account statement from the giver showing that the money was theirs to give - just to be sure they didn’t go out and get some sort of loan that they expect you to help them repay.
Most insiders think of gift money as large gifts exclusively allowable in the context of a familial relationship, but at least one program I know of allows any general well-wisher to contribute any amount to your cause, whether or not they are a relative. The FHA Bridal Registry program allows couples to open a down payment registry account with their lender, and to deposit checks into that account from anyone who wants to give any amount to help them become home owners. Talk to your FHA mortgage broker for more information on how to open such a registry account.
3. Your Employer. Universities and the municipal agencies that employ first responders like police and fire personnel frequently make available down payment and other home buying assistance programs to their staffers. So do some large employers or even smaller companies who are seeking to lure top-level recruits, in the form of relocation assistance programs. Check in with your employers’ Human Resource division to explore whether any such assistance is available - and if you happen to find yourself a hot prospect on the job market, consider trying to negotiate relocation or down payment assistance into your offer package.
4. Your Income. This is not about cutting out a cup of coffee here or there. Euro-style austerity measures are just too hard to keep up for the months or years it can take to save up a down payment. Rather, the idea is to get gut-level real with yourself about what’s really important to you. And if the answer is buying a home, then it’s time to go through your spending with a fine tooth comb and look for the leakage you can stop up - cash you can redirect to your down payment savings.
If you spend $20 a workday on oatmeal and coffee at breakfast and your takeout lunch, that’s $400 per month - almost $5000 a year, you can save by simply bringing these things from home (not to mention the health and other benefits you’ll gain). And those numbers are not inflated, if you work in a big city. Nor is the $100/month cable bill, the $15 yoga class or the $2,000 vacation.
Fact is, you can have much of the enjoyment of these things for much, much less than you’re used to spending - at least while you’re in down payment-saving mode. Stream TV shows and movies online at Netflix, Hulu or Amazon - you can also find great workout videos on some of these channels for 10 percent of what you’d pay to go to a class! Bring the staycation back, or cut hotel costs by renting a private room or small apartment on a site like VRBO or Airbnb (you might be surprised at how nice the experience is if you stick with the vacation rentals that have rave reviews - I certainly was.)
Redirecting the dollars you would normally spend - whether intentionally or on autopilot - for some of these big-ticket items back into your down payment savings account is like pressing fast forward on your home buying timeline. The key is to click out of money-spending autopilot and to transfer the saved money, asap, into a separate down payment savings account - ideally one that is online, so you have to think hard and wait a few days before pulling money out.
5. Your Assets. Some retirement accounts allow you to borrow against or pull out funds, penalty-free, to apply them toward your down payment on a home. Is it advisable for everyone, in every situation to deplete their 401K or IRA to plug that cash into a house? Absolutely not. But there are situations in which it may make sense to get your down payment up to 20%, say, by borrowing a few thousand dollars from yourself.
If getting your down payment to the 20 percent mark by borrowing from your 401K gets your mortgage interest rate down and allows you to repay that cash to your own retirement account (vs. to your mortgage lender) with interest, you and your financial advisor might agree that this move is the right move for you. Or not - this is a highly personal decision that must be made strategically, but some home buyers should at least explore whether their retirement accounts are a sensible source of some portion of their down payment funds.
And these aren’t the only assets that can help fund your down payment. I know a young family who has given themselves a complete financial makeover over the last few years by getting rid of unnecessary belongings and selling them at flea markets, yard sales and online. Don’t underestimate what reselling your stuff can yield; my own Mom has had a few four-figure yard sales over the years!
Do you have ‘stuff’ you don’t need or use that someone else would love? Consider liquidating it online or taking it to a consignment store, and using the cash to fluff your down payment savings. Side benefit: you’ll have less to move when you’re ready to move into your new home!
Everyone: What off-the-grid methods have you or your clients explored for coming up with down payment money?
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5 real estate assumptions to rethinkMood of the MarketBy Tara-Nicholle Nelson
Inman News® Share This Real estate appraisal reports are almost always accompanied by a set of assumptions: statements or conditions that the appraiser assumed to be true for purposes of drawing some of the conclusions necessary to create an estimate of the home's value. Interestingly, though, many appraisal reports give their basic set of assumptions the subtitle "Limiting Conditions." This implies that the assumptions may limit the validity of the appraisal findings in the event the assumptions turn out to be invalid. For example, appraisers commonly assume that the land on which a home is built is not contaminated; if it turns out later that it is, all bets are off in terms of the property's value. The same goes for our decision-making in real estate and in life, generally, for that matter. We get so accustomed to our thought shortcuts and assumed beliefs about a subject that they can actually limit the integrity of our thought processes and decisions -- especially if we fail to notice, question or ditch assumptions that are flat-out false or have become invalid over time. The housing recession has changed the facts of the market, and has changed our minds about real estate. Those changes warrant a deep rethink of some widely held real estate assumptions, old and new. Here are a handful of the real estate assumptions that we should all reconsider: 1. Renting is cheaper than buying. The days when this one was a given are long gone in some places, and in some cases. In some places, the housing recession delivered a sound spanking to home prices. But it had the opposite impact on rental rates almost everywhere else. On top of all the would-be buyers who had to keep renting because they couldn't qualify for mortgages over the past few years, there was also an influx of former homeowners who had lost their homes to foreclosure into the rental market. Higher rents and lower sale prices mean that, in many areas, renting costs just as much or more than buying or owning a home. Real estate website Trulia's recent Rent vs. Buy Index found this to be the case in 98 percent of America's 20 largest cities, taking into consideration both the added expenses and tax advantages of owning vs. buying (the exceptions were areas like San Francisco and Manhattan, the markets that were the most recession-resistant). If you're operating on this assumption and it has kept you in the rental market, you might want to actually do some online house hunting, meet with a local real estate agent and a mortgage broker, and run your own numbers to see if your assumption might actually point to homeownership as the more affordable option for you. 2. Buying is better than renting. For various reasons throughout the last century, the American dream evolved to include homeownership virtually without question. But on today's market, it is absolutely not the case that everyone who can afford to buy a home should. If your own personal finances are immature or you're living paycheck to paycheck, or if you are in a career or relationship situation that may cause you to have to move in the near term (less than five years or thereabouts), it might be advisable to rent instead of buy a home. You'll lose out on the tax and other financial advantages of owning, but you won't find yourself unable to make your mortgage if you have a bad month, and you will avoid being stuck in an upside-down home you can't sell. Of course, these guidelines apply mostly to your primary residence. With the increased mobility younger generations seek, I have already started to see a trend of young people with strong incomes taking advantage of low prices and interest rates to buy income and vacation properties that they can rent out and possibly retire to before they settle down enough to buy their own residence. 3. Sellers are greedy. OK, so some sellers are probably greedy. But so are some buyers, for that matter. The reality is that sellers are protective of their biggest financial asset and the place where they have often spent some of the precious moments of their families' lives, and are not willing to give their homes away at a bargain-basement price. The deeper reality is that sellers often have mortgages they must pay off from the proceeds of sale or face a short sale or even a foreclosure. Even those that are not upside down or in mortgage distress may have money invested in the property that they want to try to get back out, or may be looking to the proceeds of the sale to fund their family's next move. For some sellers, this translates into an unrealistic fantasy about what their home is worth. For many others, though, the reality of their financial investment and involvement with their home simply underpins their willingness to invest in preparing and staging their home for sale -- and an unwillingness to take the first lowball offer that comes their way. 4. Buyers are cheap. Many buyers are certainly frugal, and especially so when it comes to trying to squeeze the absolute most bang from their hard-earned, hard-saved homebuying bucks. That said, buyers absolutely will pay for properties and locations that press the emotional buttons that activate the vision of the lifestyles they crave for themselves, their families and their futures. Speaking of emotional priorities buyers will pay for, they will also pay for the certainty of securing their dream home and eliminating threats to it, whether those threats come in the form of competing offers or feet-dragging, short-sale staffers at the seller's bank. That's why, even on today's slow-to-grow real estate market, homes that are in great condition, in great neighborhoods, and in great and thriving cities are getting multiple, over-asking-price offers. And this is especially true for "regular" equity sales, in which buyers are manifesting their willingness to pay a premium for the luxury of not having to do a deal with the seller's bank. 5. Buyers can name their price on today's market. We've all heard the pundits crowing and read the headlines blaring about the buyer's market that many buyers have begun to believe the hype. Unfortunately, many buyers will have to house hunt for months, make several lowball offers and lose several dream homes before they understand the truths discussed in the points above -- namely that no seller will give their home away for less than what it's worth, and that great properties will be subject to great competition even on today's market. Smart buyers are the ones who work with their local agent to understand the recent neighborhood sales and other market and personal factors to make an educated, reasonable offer based on the fair market value of the property -- an offer that neither throws money at the seller nor unreasonably lowballs them, wasting everyone's time. Tara-Nicholle Nelson is author of "The Savvy Woman's Homebuying Handbook" and "Trillion Dollar Women: Use Your Power to Make Buying and Remodeling Decisions." Tara is also the Consumer Ambassador and Educator for real estate listings search site Trulia.com. Ask her a real estate question online or visit her website, www.rethinkrealestate.com. |
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3 strategies to price your listings rightStubborn sellers need dose of realityBy Bernice Ross
Inman News® Share This Persuading sellers to price their properties realistically is always a challenge. This can be especially difficult when your market is still experiencing price declines. The question is how to unhook your sellers' price anchors and then persuade them to list their property at a price where it will sell. In psychology professor Daniel Ariely's book, "Predictably Irrational," he discusses how people become firmly attached, or anchored, to ideas. According to Ariely's research, these anchors are extremely strong when it comes to the price of someone's home. For example, when a homeowner sells his home for $500,000 in Los Angeles and moves to Dallas where the same home would cost $250,000, in almost every case, the homeowner will purchase a new home that is at least $500,000. Breaking a seller's price anchors can be challenging. Here are three proven strategies that really work. 1. Rate of absorption
A tried and true approach for addressing this situation is to use the rate of absorption (i.e., how much inventory is on the market and how quickly it is selling). To illustrate this point, assume that there are eight months of inventory on the market. In other words, only 12.5 percent of homes on the market will sell in any given month. The other 87.5 percent will not. Sellers who want to place their properties under contract must position their property in the marketplace where they will be in the best 12.5 percent in terms of value, which is a combination of condition and price. If not, their listing will sit on the market until it expires or until they lower their price sufficiently to motivate a buyer to purchase it. The way to close the buyers on using this approach is to say: "Mr. and Mrs. Seller, you have an important decision to make. Will you position your property where it will be in the top 12.5 percent that will sell next month or will you position your property where it will be in the 87.5 percent that will still be listed next month? It's your choice, what would you like to do?" 2. Use the price-per-square-foot data
A different alternative is to use the price-per-square-foot data. As a general rule of thumb, properties fall into three price-per-square-foot categories based upon their condition and location. a. Top price per square foot
The first category is the property is either new and/or in excellent condition and in a top-notch location. b. Midrange of the price-per-square-foot numbers
The second category is for properties that have "amenities similar to many of the homes found in this area." This is a nice way of saying that the home is in an average location and in average condition. c. Bottom price per square foot
The third category is there is either something wrong with the location, the condition, or both. Now you may be curious as to how you get the sellers to accept their house is average or even less than average. There are several ways to approach this issue. First, you can take the sellers out to look at the competition. Next, ask them which house is most like yours? If you don't want to take them out to see the competition, another way is to gather as many interior photos of closed sales as possible. Let them choose which houses most resemble their house. You can then use the price-per-square-foot sales numbers to generate an accurate list price. The beauty of using the closed-sale statistics (i.e., showing the sellers pictures of properties that have closed) is that it shifts the discussion from list prices to sold prices. This makes it easier for the sellers to choose a more realistic price. 3. The pricing line
The late Lee Coats, who wrote much of the training for Coldwell Banker back in the 1990s, invented what he called a "pricing line." If you haven't worked with this approach, it's extremely effective. The system is fairly simple. Imagine a page with three different charts that resemble rulers marked in 1/4-inch segments. The top chart has the "recently sold" properties. The agent records each property that has sold on this pricing line using the price-per-square-foot data. The agent then repeats the process by recording the properties currently for sale on the second line and the properties that did not sell on the third line. The sellers can quickly see the range of the most recent sales, what the current competition is, as well as how much higher priced the expired listings were on a price-per-square-foot basis as compared to those listings that sold. When you show the seller the listings that are currently available, the closing question is, "Which line would you choose?" When properties have comparable amenities, it's easy to demonstrate that the lower-priced listings usually sell more quickly. The next time you're facing a seller who wants to overprice his listing, try one of these three approaches. There's a good chance you'll walk away with a property that is priced to sell. Bernice Ross, CEO of RealEstateCoach.com, is a national speaker, trainer and author of the National Association of REALTORS®' No. 1 best-seller, “Real Estate Dough: Your Recipe for Real Estate Success.” Hear Bernice's five-minute daily real estate show, just named "new and notable" by iTunes, atwww.RealEstateCoachRadio.com. You can contact her at Bernice@RealEstateCoach.com or @BRoss on Twitter. |
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Start Planning Now for Next Year's Tax Return
The tax deadline may have just passed but planning for next year can start now. The IRS reminds taxpayers that being organized and planning ahead can save time, money and headaches in 2013. Here are eight things you can do now to make next April 15 easier.
1. Adjust your withholding Why wait another year for a big refund? Now is a good time to review your withholding and make adjustments for next year, especially if you'd prefer more money in each paycheck this year. If you owed at tax time, perhaps you'd like next year's tax payment to be smaller. Use IRS's Withholding Calculator at www.irs.gov or Publication 919, How Do I Adjust My Tax Withholding?
2. Store your return in a safe place Put your 2011 tax return and supporting documents somewhere secure so you'll know exactly where to find them if you receive an IRS notice and need to refer to your return. If it is easy to find, you can also use it as a helpful guide for next year's return.
3. Organize your recordkeeping Establish a central location where everyone in your household can put tax-related records all year long. Anything from a shoebox to a file cabinet works. Just be consistent to avoid a scramble for misplaced mileage logs or charity receipts come tax time.
4. Review your paycheck Make sure your employer is properly withholding and reporting retirement account contributions, health insurance payments, charitable payroll deductions and other items. These payroll adjustments can make a big difference on your bottom line. Fixing an error in your paycheck now gets you back on track before it becomes a huge hassle.
5. Shop for a tax professional early If you use a tax professional to help you strategize, plan and make financial decisions throughout the year, then search now. You'll have more time when you're not up against a deadline or anxious for your refund. Choose a tax professional wisely. You are ultimately responsible for the accuracy of your own return regardless of who prepares it. Find tips for choosing a preparer at www.irs.gov.
6. Prepare to itemize deductions If your expenses typically fall just below the amount to make itemizing advantageous, a bit of planning to bundle deductions into 2012 may pay off. An early or extra mortgage payment, pre-deadline property tax payments, planned donations or strategically paid medical bills could equal some tax savings. See the Schedule A instructions for expenses you can deduct if you're itemizing and then prepare an approach that works best for you.
7. Strategize tuition payments The American Opportunity Tax Credit, which offsets higher education expenses, is set to expire after 2012. It may be beneficial to pay 2013 tuition in 2012 to take full advantage of this tax credit, up to $2,500, before it expires. For more information, see IRS Publication 970, Tax Benefits for Education.
8. Keep up with changes Find out about tax law changes, helpful tips and IRS announcements all year by subscribing to IRS Tax Tips through www.irs.gov or IRS2Go, the mobile app from the IRS. The IRS issues tips regularly during summer and tax season. Special Edition tips are sent periodically with other timely updates.
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Deck footings: How low should you go?Frost depth a key factor in structural designBy Paul Bianchina
Inman News® Share This Q: How do you determine the depth of the deck footings to assure you have gone below the frost line? I live in central New Jersey, and thought I've always heard that the frost line here was 18 inches. But from reading a few articles on decks, I've seen conflicting information. Do you have a reliable resource? --Frank G. A: As you can imagine, frost lines vary widely by region. Also, most codes require that your footings be an additional 12 inches below the frost-line depth, as an added precaution against rare deep-freezing conditions. So, your best bet is to simply call your local building department and ask. However, if you would like to try to figure it out yourself, there is a good booklet available for free from the Department of Housing and Urban Development (HUD). Go to www.huduser.org. In the search box, enter "Structural Design Loads for One- and Two-Family Dwellings," which will take you to the booklet. It's about 50 pages, in PDF format, so you can read it online or print it out. You can also order a copy from them if you'd prefer. Q: We currently have a wood-burning fireplace and electric heat and a heat pump that work fine but are 20 years old. We are thinking that we would like to replace them with a new electric furnace and heat pump when the time comes, but would like to wait until the electric furnace gives out. In the meantime, we would like to install some kind of heating device in the fireplace. We don't know if we should go to the expense of having gas installed so we can have gas logs installed in the fireplace or do as a neighbor has done and have a propane tank installed in the yard to supply logs to the fireplace. We know the gas company will cover the cost of installing the gas line only if we change three or more appliances. Any suggestions? --April E. A: It depends a lot on exactly what you're trying to accomplish. Adding a vented gas log set to your existing wood-burning fireplace will get you the convenience of watching a fire without the mess of wood, but it won't do much for heat, since a large amount of the heat generated by the gas logs goes straight up the chimney. If you're looking for the convenience of being able to start wood with a gas lighter, then a small propane tank installation plumbed to a gas log lighter will do the trick. If the goal is more heat, then you have a couple of options. You could install an airtight wood-burning insert in the existing fireplace, which still burns wood but does it more efficiently, and doesn't require any gas connection. Or you could have a sealed gas insert installed in the existing fireplace, which is easier and cleaner to operate than a wood-burning one and produces more heat, but requires propane or natural gas. As to which gas source to use if you go that route, it depends on the cost. You would need to talk with the gas company about how much a meter would cost to install with only a single gas connection, as well as a plumber to determine the gas line costs. I suspect propane might be less expensive, but you would also need to talk to a propane company. If you don't like the looks of an exposed propane tank, you can have an underground tank put in, but that adds the cost of excavating. A lot of this also depends on the condition of your existing fireplace, and whether it's in good enough condition to accept an insert. So all that being said, I would start with an experienced, licensed fireplace company and have them come out, inspect everything, and help you out with some options and cost estimates. Incidentally, if you are doing this to save on your electric bill by not running your furnace as much, you would need to look at the cost trade-offs -- electricity savings versus installed cost and operating cost of the new gas unit. It's doubtful you would see any kind of financial payback within any reasonable time frame. Q: We live in northeastern California. In 2002 we had our home constructed. This year we have decided to merely "cover" the existing small wire mesh [foundation vents] with something that can be removed in the summer. Both my husband and I, have in our mind's eye, a removable-type vent (my eye sees a little wing nut type, wooden frame with a small wire 1/8-inch square mesh encased in a plastic material-type thing that you can turn to release the cover for storage. I can't imagine what my husband sees!) In any event, we can find no such type of product. We have approximately 30 vents to cover! Internet searches reveal: flat 4 screw-type covers you leave on (don't want that); then there are louvers (don't want that); then there is one that appears to have a concave appearance (not exactly what we're thinking of either). Do you have any idea of a "plan" so that hubby can build them out of a wood frame, plywood or other material? Or where we can find something described that we have in mind? --Jacquelynne M. A: I don't really have much to offer you in the way of plans. However, because your house is fairly new, I'm assuming you have standard foundation vents -- a grey or black plastic, screened vent set in the concrete foundation wall. There are white foam blocks that are made specifically to fit in those vents and seal them off, and that's what most people use for this purpose. Cost is typically around $1 each. Just press them into the vent at the start of winter, and pull them out again once the threat of freezing weather is past. They're reusable, and will last quite a few seasons. Remodeling and repair questions? Email Paul at paulbianchina@inman.com. All product reviews are based on the author's actual testing of free review samples provided by the manufacturers. |
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This Friday & Saturday 9am - 1pm, 4302 Adrienne Drive, in Chula Vista, off of Bonita Glen. This is a great sale with something for everyone. For furniture there is a French Provincial dining table with chairs & china hutch, bedroom set with high and low chest & French provincial nightstands, another highboy chest of drawers, old chinese trunk, desk with hutch top, metal desks, claw foot oak table with large leaf and four chairs, sofa, side chairs, beautiful antique leaded glass china cabinet, carved alabaster stand, drop front desk, queen size bed and cabinets. The man of the house had a nice shop with tall rolling Craftsman tool chest, Rockwell model 10 contractor's table saw, Craftsman standing/stationary belt sander, Makita router, Enknoh's drill press, welding set up, electric drills, wrenches, screw drivers and all kinds of stuff. The lady of the house was a crafter and made dolls - there is greenware, doll molds, a kiln, fabric, doll parts, repair & paint. There are lots of electronics - stereo equipment, computer equipment, printers, and scanners. There are collectibles, nick nacks, Christmas collectibles, China sets - one is Noritake Goldkin, glassware, art, tons of frames, books, records, pots & pans, small kitchen appliances, collector plates, stainless flatware set, vintage Kamado smoker, Black & Decker bbq, yard tools, dolls, portable heaters and fans, household misc. So much more. Don't miss this one.
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Distressed Property
Acquisitions in a 1031 Exchanges
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Real
estate investors are purchasing properties at steep discounts by utilizing
techniques such as short sales, courthouse step sales, and purchasing bank
owned properties (REO). While these approaches can often provide excellent
buying opportunities, buyers who are engaged in 1031 tax deferred exchanges
must pay extra attention to the details of their particular acquisition, as
each of the aforementioned approaches can present difficulties in completing
a successful 1031 exchange.
The
important point to realize is that each of the aforementioned approaches has
unique issues which must be understood and addressed early on. Some of the
problems include:
1)
Problems meeting the 45-day identification period requirement due to the
inability to control the closing of the purchase. This is a common problem,
particularly with short sales. Prudent exchangers will minimize this risk by
taking full advantage of the 45-day identification
rules. In short, you are on the seller's time schedule,
not on yours.
2) These
transactions often have rigid structures. As such, you may have difficulty
complying with 1031-specific requirements, including contract assignability
and deeding flexibility. Often, sellers in these situations are not willing
to respect the need for slight modification to their “procedure” to
effectuate a technically valid 1031 exchange.
3) In the
case of courthouse step purchases, advanced planning is necessary, as
cashier's checks must accompany the winning bid at the time of the purchase.
You will not know what the final winning bid figure will be, therefore it is
prudent to have multiple cashier's checks in appropriate increments ready. Of
course, all cashier's checks must be immediately returned to API if you are
not the winning bidder.
Many of
the aforementioned problems can be overcome with advanced planning and
creative structuring. In many cases, the use of an Exchange Accommodation
Titleholder (EAT) can allow for creative techniques such as using exchange
proceeds for capital improvements after the replacement property has been
acquired, and acquiring multiple properties before or after the relinquished
property has been closed.
For the
full article on Distressed Property Acquisitions in 1031 Exchanges, read more...
 
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'Chosen spot’ near artist colony inspires creative juices On the northwestern slope at the foot of Mt. Helix, is a home that seems to be artfully framed and situated for peace.
Located near the northern border of the Casa de Oro,east of La Mesa,this two-story house is in an area that once was known as San Diego’s artist colony in the early-1900s.
Bill Gross and Ed Fletcher were the business partners that owned the land in 1912 when Overland Monthly wrote the following about the area: “It is the chosen spot of many of the gifted in art,literature and science as a place where they may establish a quiet home, with delightful climate,beauty of surroundings and the peace that comes from dwelling in high places.”
Coincidentally,it was a family of artists from New York that established a home on this 1.33-acre property in 2004.
Patience Brewster is a reknown artist from upstate New York whose work as an illustrator turned into a family business.Today,her greeting card company and three-dimensional curios known as“Krinkles” are sold internationally.Along with her husband Holland Gregg and daughter Marrieta Gregg,the family is active in fundraising for many charities including the Leukemia Lymphoma Society. “The house was so perfect for us,because my son Holland was ill at the time,” said Brewster.“We had seven people living there,
 COLIN MCBRIDE
U-T REAL ESTATE CORRESPONDENT and there was lots of space and lots of privacy.” For three years,the family lived in San Diego together.It was an important and poignant time for them.At once,the household was there for recuperation as well as for work.” “We each had our own work space,”said Brewster. She said that the views from her sun room inspired a prolificacy that surprised her.“It’s an unbelievable space for creativity.” Located at 10444 Russell Rd.,this five-bedroom,four-bath home is approximately 4,493 square feet. It has an office den,a bright and large kitchen,and a wine cellar. Steps lead from a large patio down to a black-bottom pool and pool house.Below the pool level is a winding path,enveloped in luscious greens from the recent rains,through mature fruit trees to a work shop shed at lowest point of the property. “This home offers spectacular panoramic views of the El Cajon Valley and local mountains,” said Realtor Brendan McKee of McKee Asset Management,which is selling the home for the family. “This specially appointed home resembled a piece of country in the city, similar to (the family’s) permanent residence in Skaneateles, New York.With large trees and open land,it felt like a piece of upstate New York in Southern California.” Inside the house,the entry way flows into a living room area that commands your attention to the view of the valley below.High ceilings and plate glass provide ample light on the main level.There is a patio off the kitchen and master bedroom.Downstairs,each of the bedrooms open to the private backyard. “Russell Road is a very unique property.It is very serene,making it feel like it’s in the country, yet just 20 minutes from downtown San Diego,”McKee said.“Surrounded by a beautiful zen-like garden and trees,the property feels like a mountain retreat.” You can reach Colin McBride at colin. mcbride@utsandiego.com 
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Value Increase for Probate Exemptions
The total value of a decedent’s estate that can be transferred using simplified petition procedures, rather than a formal probate administration, has been increased from $100,000 to $150,000. The total value of all real property in a decedent’s estate that can be transferred by an affidavit procedure, instead of a formal probate administration or the petition procedures, has been increased from $20,000 to $50,000. The amount of salary or other compensation that a surviving spouse can collect from an employer for the personal services of the deceased spouse has been increased from $5,000 to $15,000 net.
Assembly Bill 1305 (codified as Cal. Probate Code §§ 7620, 13200, and 13600) (effective January 1, 2012).
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Deferral for Seniors and the Disabled
Counties can elect
to participate in a County Deferred Property Tax Program that allows senior and
disabled citizens to defer payment of property taxes owed. If the claimant who
applies is eligible, and the county’s Property Tax Deferral Fund has adequate
funds, the county treasurer or tax collector may defer property taxes for a
claimant’s residential dwelling for that fiscal year. The amount of deferred
tax plus interest shall be secured by a judgment lien as specified.
Assembly Bill 1090 (codified as Cal. Gov’t Code §§ 20800 et
seq.) (effective January 1, 2012).
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Short Sale Soundoff: BofA adds standardized third-party
authorization form
Bank of America has
developed its own form to standardize the third-party authorization
process. The two-page document requires signed acknowledgements from all
borrowers and designated representatives in a short sale.
Over the next few
weeks, Bank of America will continue to accept other third-party authorization
documents. However, beginning April 14, the bank will accept only the official
Bank of America Third-Party Authorization Form for short sales.
The form is now available on the Agent Resource Center at
bankofamerica.com/realestateagent. There is a grace period to transition to the
new form before it becomes mandatory on April 14
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Community
Ongoing Events Throughout March 2012
Tuesdays
Hotel Del Walking Tour, Coronado - 10:30 am. Docent-led
walking tour. Res. req’d. 619-437-8788
Tues Nite Out (5-8pm), Hillcrest - Discount
dining.fabuloushillcrest.com
Wednesdays
Coronado Heritage Walk, Coronado - Docent-led walking
tour. Res. req’d. 619-437-8788
Cajon Classic Cruise, El Cajon – 5-8 pm. Free. Southern
California’s largest weekly classic car show.
downtownelcajon.com
Thursdays
TNT (Thursday Night Thing), Balboa Park - Street
art, music, activities. mcasd.org
Family Fun Nights, San Diego Botanic Garden, Encinitas -
sdbgarden.org (June - September)
Fridays
Hotel Del Walking Tour, Coronado - 10:30 am. Docent-led
walking tour. Res. req’d. 619.437.8788
Friday Live Music Nights, Del Mar Plaza – Free
live entertainment. delmarplaza.com
The Dinner Detective, Downtown - Murder mystery dinner
show. thedinnerdetective.com
Cruisin' Grand, Downtown Escondido – Car cruise
& street fair. downtownescondido.com (May - October)
Concerts on the Green, Downtown El Cajon -
6-8pm. downtownelcajon.com (May - September)
Saturdays
Free Fishing Class, Lake Cuyamaca, Julian - 10-11 am.
lakecuyamaca.org
Hotel Del Walking Tour, Coronado - 2 pm.
Docent-led walking tour. Res. req’d. 619.437.8788
The Dinner Detective, Downtown - Murder mystery dinner
show. thedinnerdetective.com
Saturday Garden Tour, The Water Conservation Garden, El
Cajon - Seminars. thegarden.org
Sundays
Wacky Science Sundays, Natural History Museum, Balboa
Park - sdnhm.org
Hotel Del Walking Tour, Coronado - 2 pm.
Docent-led walking tour. Res. req’d. 619.437.8788
Sunday Pipe Organ Concert, Spreckels Pavilion, Balboa
Park - sosorgan.com
Sunday Live Music Nights, Del Mar Plaza –
Free entertainment. delmarplaza.com
Through April 8
Ghost Fleet, Oceanside Museum of Art – Collection of
14 mixed-media miniature ships. oma-online.org
Through April 15
Whale Watching Tours (Daily at 9:45am & 1:15pm), Birch
Aquarium at Scripps La Jolla – Naturalist guided,
3 hour tours. aquarium.ucsd.edu
Through April 16
Sculpture in the Garden, San Diego Botanic
Garden, Encinitas - Outdoor art exhibition. sdbgarden.org
Through April
Anza-Borrego Desert Wildflower Bloom, Anza-Borrego State
Park, Borrego Springs -
Check for bloom size and dates. www.desertusa.com.
All That Glitters: The Splendor & Science of Gems
& Minerals, Natural History Museum, Balboa Park –
sdnhm.org
Through May 29
“Homefront La Jolla: An American Community During WWII”,
La Jolla - Images, articles and oral histories.
lajollahistory.org
Through May
Working on Thin Ice: 25 Years of Research in Antarctica,
Natural History Museum, Balboa Park -
sdnhm.org
Through September 9
Titanic: The Artifact Exhibition, Natural History Museum,
Balboa Park - sdnhm.org March 1-26
Circus Vargas, various locations - New show for 2012,
under the Big Top Tent. circusvargas.com
March 1 through May 13
Ranunculus Tours, The Flower Fields, Carlsbad
- Yearly display of color. www.theflowerfields.com
March 2
First Friday (5-9pm), El Cajon -
Multi-cultural activities. downtownelcajon.com
Cat In The Hat-A-Thon For Dr. Seuss’ Birthday (10-2), Children’s
Museum, Escondido - sdcdm.org
March 2-4
Gem Faire and Spring Home & Garden Show, Del Mar
Fairgrounds - delmarfairgrounds.com
March 3
Downtown Bus Tour (10-11:30am) - Free parking
for tour at Horton Plaza. ccdc.com
March 3 through June 3
PENUMBRA: An Ode to Oceanside in a Time of War, Oceanside
Museum of Art – oma-online.org
March 4
Living History Day, San Pasqual Battlefield
State Historic Park - Reenactments. 760-489-0076
March 5
Senior Monday Lecture “Return to the Moon - Apollo’s
Legacy” & IMAX Film “Hubble”,
Fleet Science Center, Balboa Park - rhfleet.org
March 7
“The Sky Tonight“ Planetarium Shows, Fleet
Science Center, Balboa Park – rhfleet.org
Tidepooling For Tots (1:30-3pm), Birch Aquarium
at Scripps La Jolla – Res. req’d. aquarium.ucsd.edu
March 8
Nature & Me Preschool Storytime, Natural
History Museum, Balboa Park – 10:30am, sdnhm.org
Full Moon Dinner Cruise, Hornblower Cruises, Embarcadero
- hornblower.com
March 8-18
Latino Film Festival, Mission Valley UltraStar Cinemas - www.sdlatinofilm.com
March 9
Kettner Nights in Little Italy - Art, design,
antiques, food. littleitalysd.com
March 10
Saturday Science Club for Girls “Forensic Detectives,”
Fleet Science Center, Balboa Park - rhfleet.org
2nd Saturday Art Walk, Downtown Escondido
- downtownescondido.com
Family Day, San Diego Archaeological Center, Escondido -
sandiegoarchaeology.org
Asian Pacific Historic District Walking Tour, Chinese Historical
Museum, Downtown - sdchm.org
March 10-11
Crossroads of the West Gun Show, Del Mar Fairgrounds
- delmarfairgrounds.com
March 11
Daylight Savings Time begins - Turn your clocks FORWARD one hour!
Ugly Dog Contest, Del Mar - uglydogcontest.com
March 15
Taste of 3rd Avenue & Art Walk, Chula Vista -
Restaurant walk and art fair. thirdavenuevillage.com
March 16-18
2nd Anime Conji, Town & Country Resort,
Mission Valley - animeconji.org
March 17
Science Family Day (10am-7pm), Fleet Science Center,
Balboa Park - rhfleet.org
St. Patrick's Day Parade and Festival, Balboa Park
– Traditional dancers and music. stpatsparade.org
shamROCK, Gaslamp Quarter, Downtown – St. Patrick’s
Festival. 21+, sandiegoshamrock.com
SEA Days, “Birds of the Sea” (11am–3pm), Birch Aquarium,
La Jolla – aquarium.ucsd.edu
Cherry Blossom Festival (10am-4pm), Japanese Friendship
Garden, Balboa Park - niwa.org
March 17-18
Herb Festival, Spring Plant Sale & Tomatomania,
SD Botanic Garden, Encinitas – sdbgarden.org
SOHO’s Annual Historic Home Tour - Tour of
historic homes. www.sohosandiego.org
March 18
Family Drop-In Day, Museum of Art, Balboa Park - Free
w/admission. Kid’s activities. www.sdmart.org
SuperSeal Triathlon (7am), Coronado - 1500 meter swim,
40K bike, 10K run. superfrogtriathlon.com
March 19
History for Half Pints “Telling Time” (10-11am),
San Diego History Center - sandiegohistory.org
March 24
Race for Autism 5K, Balboa Park - raceforautism.org
Ultimate Skateboarding Competition, Del Mar Fairgrounds -
ultimateboarder.com
March 24-25
6th Annual Busker Festival, Seaport Village -
Colorful street performers. seaportvillage.com
March 25
Antique Street Faire, La Mesa Village - lmvma.com
March 30 through April 1
Del Mar Rod & Custom Nationals, Del
Mar Fairgrounds - Over 2,000 cars. good-guys.com
San Diego Crew Classic, Mission Bay - Premier rowing
event and outdoor festival. crewclassic.org
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FSBO Site Founder Reaches Out to Real Estate ProsDAILY REAL ESTATE NEWS | FRIDAY, FEBRUARY 17, 2012 ForSaleByOwner.com founder and former chief operating officer Colby Sambrotto made headlines in August 2011 when he hired a real estate broker to sell his Manhattan condo. Now he’s working to bridge the gap between FSBOs and real estate pros with his most recent online venture,USRealty.com. The property listing Web site allows sellers to post their homes for sale for a fee, with costs running as high as $399. As a licensed brokerage, the company will then post those listings on multiple listing services in the sellers’ local markets. As with his prior site, this new business aims to reduce expenses associated with real estate transaction — including commissions. However, Sambrotto said that USRealty.com is not an attempt at disintermediation, unlike ForSaleByOwner.com. He aims to get real estate professionals involved this time around. “I learned a lot of lessons at ForSaleByOwner.com,” he told REALTOR® Magazine. “People want to buy and sell their homes without having to pay commissions. It was great at reducing transaction costs, but it didn’t sell enough houses to be the game changer I thought it would be.” How can he persuade practitioners to participate in this site while reducing the amount of commission paid on transactions? By encouraging buyer’s agents to show their customers the listings on the USRealty.com site, he explained. If their buyers purchase a home listed on USRealty.com, they’ll get a standard 3 percent commission, Sambrotto said. Also, the site will refer unsuccessful sellers out to real estate pros in local markets. Sambrotto said his goal is to provide a good experience for real estate professionals while serving a distinct section of the housing market. “I want to have warm relations with agents: The fact that this model is what it is validates that,” he explained. “But at the end of the day, a lot of Americans cannot afford to pay those commissions. We’re here to serve a specific niche. There’s always been a segment of the market that’s not traditional. A lot of these people can’t sell their home in the traditional way.” While he didn’t roll out USRealty.com with distressed home owners as the intended user, he said the site has drawn a great deal of interest from that group. “It wasn’t built with that specific purpose in mind, but that seems to be the consumer that’s most attracted to this,” Sambrotto said. By Brian Summerfield, REALTOR® Magazine
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