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What does the new tax reform mean for homeowners?

by Thomas Makinney

It might be hard to remember with all that’s been going on in the past month, but as of Jan. 1, a new tax policy goes into effect. Many of us will not see many changes until we file their taxes in 2019, but the tax laws could not only impact our paycheck (for better or worse) they also have the potential to significantly alter home ownership incentives.

We can’t speak for individual paychecks, but as far as how the tax policies relate to real estate, we can offer a few insights.

  1. Reduced cap on mortgage interest deduction.

What it is: The Tax Cuts and Jobs Act reduced the limit for mortgage interest rate deduction for new loans to $750,000, starting Dec. 15, 2017. Loans that were taken before this date are grandfathered into the previous tax policy, which featured a $1 million cap on the deduction.

What it means: Homeowners who want to refinance their existing mortgage can do so up to $1 million and still be able to deduct the interest, however, the new loan cannot exceed the amount of debt being refinanced. Nationwide, this should only affect 1.3% of all mortgages, however, high-priced housing areas will feel the impact.

  1. New limits for state and local tax deductions.

What it is: While homeowners previously had an unlimited itemized deduction amount, under the new bill, they can only itemize deductions up to $10,000 for the total state and local property taxes and income or sales taxes. The cap is the same for both individual and married filers.

What it means: Households that itemize deductions and pay more than $10,000 in combined state and local taxes will get a smaller tax break, and for others, having a cap on deductions may be the deciding factor for some as to whether or not to itemize.

  1. Capital gains time frame excluded.

What it is: The previous capital gains tax policy, which stated that homeowners must live in the home for two out of the past five years in order to qualify for the exclusion, remains unchanged.

What it means: Sellers who live in their homes between two and five years can list their homes on a more flexible schedule without fear of a potentially hefty tax hit. (An original Senate bill had proposed an increase in the residency requirement to five years out of the past eight, but it did not make the final version.)

  1. Home equity loan deductions qualified.

What it is: Taxpayers will no longer be able to deduct interest paid on home equity loans beginning in 2018. Previously, there was a cap of $100,000 of home equity debt.

What it means: By taking away a low-cost financing option, many worry that owners will end up paying more for their loans, which could impact the home ownership rate make it more difficult for struggling communities to reinvent themselves. This shouldn’t impact the rate of home ownership but may affect home renovations.

  1. Standard deduction doubled.

What it is: The standard deduction for both single taxpayers and married couples filing separately used to be $6,350; that is being doubled under the new law to $12,000. Married couples filing jointly will see their previous deduction of $12,700 increase to $24,000.

What it means: This increase will most likely impact how many homeowners take advantage of their mortgage interest deduction. With a larger standard deduction and a decreased itemized deduction, many filers will no longer find it financially advantageous to itemize deductions. Under the current tax code, itemizing and claiming the mortgage interest deduction is financially worthwhile for about 44% of homeowners. Under the new law, itemizing and claiming the mortgage interest deduction will only be worthwhile for about 14.4% of homes nationwide.

Of course, it’s much to soon to tell how these new tax codes will affect anyone. According to research in the Wall Street Journal, it appears that taxpayers in high-cost areas (such as New York, San Francisco, Honolulu, and even Chicago) will feel much of the impact, and high-tax burdened markets will most likely receive a higher tax bill with the new limit. Low-tax states, however, may benefit from the new code.

Many thanks to RISMedia, realtor.com, and Zillow Research for the insight and analysis that contributed to this post. And many thanks to our CPA who proofed the piece for accuracy. 

If you have questions about the new tax code, and particularly how it will affect the Elmhurst housing market, please reach out to us. We’re here to help! Call (630) 441-5570 or visit www.gmregroup.com

Don’t let your home sale be stalled by roadblocks

by Thomas Makinney


If you’ve ever wondered why some houses sit on the market for weeks or months while others get snapped up in a matter of days, we have some answers. There are some frequent roadblocks that often lead to a languishing listing. Luckily, they’re all easily fixable.
 
1.     Mediocre Asking Price. Buyers are often indifferent if the price is too high compared to similar homes. And often, you’re missing an entire segment of the market who are only searching in a certain range. The right price makes the home stand out in comparison, especially if it’s an oversupplied sub-category. Don’t make the mistake of thinking that a higher price gives you more negotiating room. In reality, the right buyers either don’t see it or move on when they see better homes in the same price range.
2.     Outdated or dirty. Homes should either be beautifully dated or updated and CLEAN. A clean, dated, and staged home with a compelling asking price sells and so does a clean, updated, staged home with a compelling asking price. Make sure walls, ceilings, and floors are washed and cleaned (and wipe the countertops frequently).
3.     Too much clutter. Buyers want to envision themselves in a home. It can be hard to see beyond too many knickknacks or papers or laundry. Too much furniture makes rooms feel smaller and claustrophobic.
 
If your home is still languishing despite having the right price and being properly updated and clean, consider staging. Staging involves someone coming in and helping place furniture, artwork, plants attractively as well as removing excess items that may make buyers think the home is smaller or has too little storage space.
 
Here at Gracik Makinney, we help all of our clients not only price their homes but offer advice and tips for what to update, clean, and remove. Call us for more information, (630) 441-5570 or visit our website www.gmregroup.com.
 

Best financial investments for Elmhurst homes before going to market

by Thomas Makinney

Thinking of putting your house on the market in the new year? Before you do, you might want to get your house in order. Not sure where to start? Wondering where you can get the biggest bang for your buck? We have some guidance on the best investments you can make in the current market.

First off, neutral painting of walls, trim, doors, ceiling, and even cabinetry is HUGE (don’t forget the outside as well as inside). Updated flooring also makes a major difference. You want to convey to the buyer, “Move in, get comfortable, and take your time making it your own.” It’s hard to see beyond dirty walls and stained carpeting.

Take a look at your front entryway. In the real estate market, people really do judge a book by its cover. Pretend you are a potential buyer walking up to the front door and waiting for the agent to open the home up. Take a sharp critical look at what you see—from overgrown bushes to chipped paint on the door to dim lighting in the entry.

It would be great if every home on the market had an updated kitchen and bath, but this is unrealistic and often cost prohibitive. However, some enhancements can be done for a modest price and really make a big difference. Consider updating appliances, countertops, plumbing fixtures, lighting, and textiles.  

Beyond that, you’ll want to make sure all major problems are fixed. Broken air conditioners, leaky roofs, dripping faucets should all be taken care of before your house goes on the market. If you don’t want to replace a roof, consider a credit to the buyer as part of the sale price.

Other solid investments include a fresh coat of exterior paint, new garage doors, energy-efficient windows, and updated appliances. If you do decide to do a kitchen or bathroom remodel, make sure you don’t price yourself out of the market (or take shortcuts for a high-end home). You don’t want to put a luxury kitchen in a $250,000 home.

If you have specific questions about what you need to do to your home before you put it on the market, please reach out to us at (630) 441-5570 or through our website, www.gmregroup.com. We’ve sold thousands of homes in the area and can give you a free consultation. 

Redecorate, Renovate, or Remodel?

by Thomas Makinney


Fireplace remodel before and after. $600 project.

For many people, spring cleaning means taking a fresh look at our houses and living spaces. As we wipe down the remnants of winter, sometimes our homes flaws become painfully obvious: no place for hats and boots, a dark and dated kitchen, a bathroom that grows smaller every day.

These realizations bring you to three options: You can choose to redecorate, renovate, or remodel. Before you decide, you’ll want to determine your overall budget as well as the potential investment, that is, the amount you will get back from a project when you go to sell the house.

Redecorate:

Sometimes, the easiest and most effective solution to a home’s problem is simply redecorating. A fresh coat of paint, new window treatments, and/or a new area rug can do wonders as can adding shelving or storage solutions. And don’t underestimate the power of decluttering or at least rearranging home décor. Simply moving furniture and adding new lights can make a huge difference.

Renovate:

Then there are situations where fresh paint and new throw pillows aren’t going to change anything, and you might need to consider making a larger change. You may need to knock down a wall to give the house better flow, install new flooring and baseboards, update doors and hardware, or build a bigger closet in a bedroom. These projects require a bigger budget and time commitment but can really change the functionality, not to mention personality, of a room.

Remodel:

Alas, new countertops in your kitchen won’t change the size of the kitchen and new shelving in the bathroom won’t ease the morning rush. For some problems, the only real solution is a remodel. Kitchens, bathrooms, and master bedrooms tend to give you the most return on your investments. But, keep in mind not only your budget, but also the value of neighboring homes when deciding what to do. You don’t want to be the priciest house on the block, but you don’t want to be the lowest either.

Read this to find out what home improvements offer the most value.

If you have questions about a project or want to know what you need to do to get your house ready to list, call us at (630) 441-5570 or visit our website, www.gmregroup.com.


Despite the influx of internet articles and do-it-yourself books on selling a home, the real estate industry is not only thriving but booming. And with good reason: A real estate agent is still one of the best investments you can make when you choose to buy or sell a home. 

If you’re wondering how a good agent adds value to your process, read on:

Experience – Not only are realtors educated on the many complicated aspects of real estate transactions, but chances are they’ve experienced some of the unusual scenarios even the most seemingly simple transaction. Buying and selling property can involve bullying tactics, bidding wars, counteroffers, all-cash offers, and tight competition. Realtors know how to handle these situations without losing their cool.

Neutrality – Sometimes a buyer falls in love with a house that is overpriced or needs more work than they realize, or they fail to explore possibilities outside of their comfort zone. Similarly, some sellers hold out too long for a higher offer or are afraid to disclose something about the house. A realtor is a neutral party who can help clients navigate the often tricky line between expectations and reality.

Neighborhood Knowledge – One of the biggest mistakes that Sell-By-Owners make is to overvalue the worth of their home, leading to extra days on the market and more money spent. A good realtor will be able to recommend a listing price for your home competitively so that you get the most money and sell quickly. Similarly they’ll be able to tell you if a home you’re interested in purchasing is priced competitively for the neighborhood. And they usually know about homes not yet on the market or ones that aren’t being actively marketed, very helpful if you’ve honed in on a specific neighborhood.

Selling tips – Buyers often make their decisions within minutes of first seeing a home. For sellers, this means they need to do everything they can to make a good impression. Real estate agents can help sellers determine what work should (or shouldn’t) be done to their house before putting it on the market. Not sure if granite counters or real hardwood floors are worth it? Want to keep photos of kids and grandparents on the wall? A realtor can give suggestions, offer resources, and hire a professional photographer so that your home looks bright and inviting when buyers view it on the web.

Buying tips – A real estate agent can walk buyers through costs and issues to turn a home into a dream home. They’ll be able to estimate the cost involved with a new roof or knocking down a wall or re-doing a kitchen. They can also tell you local variances that would affect putting up a fence or raising chickens in your backyard.

Vendor recommendations – Most realtors have a handy list of service providers they have experience with and recommend. They can’t tell you whom to choose, but if you need a home inspector, general contractor, electrician, etc, chances are they have a list of names and companies along with some background to help you choose.

Legal paperwork – Real estate transactions today typically run ten-plus pages, and that’s not including the federal- and state-mandated disclosures. Someone with experience in the industry can make sure that the contract works in your best interest and that you are fully aware of everything you are signing.

And remember, realtors are dependent on referrals in order to make a living. It’s in their best interest to have a good relationship with their buyer or seller in order to get glowing recommendations for the next transaction that comes their way.

At Gracik-Makinney, we have a combined 40-plus years of experience helping buyers find their dream home, and sellers receive top dollar on theirs. Reach out to us for a free consultation or for more information, (630) 441-5570 or www.gmregroup.com

Tips for avoiding wire fraud

by Thomas Makinney

It can happen to the best and brightest people. You receive an email or phone call asking you to transfer money or make a payment. Often, the request seems legitimate — maybe it comes from a company you do business with or a charity you support or even someone you know.

We see this happen all the time. Before you send money or give out personal information in response to an email or phone call, STOP. Electronic communication is neither secure nor confidential, and scammers have gotten very sophisticated at hiding their true identity. You need to verify the person or institution before you respond to an unsolicited request.

To verify an identity, do some due diligence.

  • Call the company using a phone number that you look up, not a phone contained in an email or given over the phone.
  • Look at the email address of the sender.  Reputable companies will have a professional address with their company name embedded, and it will not end in gmail.com or yahoo.com or other server names.
  • Don’t believe caller ID. If you recognize the company or person making the call, ask to call them back before you give them any information.
  • If the request comes from a company you do business with, go into your online account and verify that the request is there as well.

Any time you receive an electronic communication with wire instructions for the transfer of funds, even if that communication appears to be from @properties, your real estate agent or your attorney, do not initiate a wire transfer unless you have verified the source.

Making sure that your assets and funds are secure and in the right hands is important to us. We want to help you reach your goals. If you have any questions about wire fraud, or about how @properties will communicate financial transactions, please call us at (630) 441-5570 or contact us through our website, www.gmregroup.com    

April Checklist. Are You Ready for Spring?

by Thomas Makinney


A little work on your home in April means that you can head into spring ready to relax over a barbecue and tackle garden work. Take some time now to make a few repairs and get your house sparkling.

Clean gutters and downspouts. Don’t neglect this important task. Clogged gutters from fall and winter debris can cause water to pool, damaging the roof and siding. Cleaning out the gutters also prevents water from cascading down the side of the house into the foundation and window wells where seepage can occur.

Inspect paths and driveway. Repeated freezing and thawing takes a toll on asphalt and concrete. Check your driveway and paths for cracks and schedule repairs as needed.

Wash windows. Welcome the spring sunshine by clearing dirt and grime from windows inside and out. Consider rinsing off your screen doors and windows, and check your screens for any small tears, which can let in mosquitoes and flies. Pick up a screen patch kit to repair them.

Lighten up your house. Make room for the sun by lightening up your interior. Go room by room and clear out unloved items. Put away heavy throw blankets and extra couch pillows. Freshen up the mantel or other styled spaces. Wipe down walls and baseboards. Consider changing out curtains or rugs to something lighter for the season.

Change up the garage. Empty the snow blower, stack the snow shovels and ice melt, and organize sleds and ice skates. Tune up the lawnmower, pull out garden tools and sprinklers. Check air pressure on bike tires and get them tuned up if needed. If you have young children, clean off outdoor toys and swing sets.  

Maintain wood decks and fences. Outdoor woodwork needs to be regularly stained and resealed. Check gates, fencing, decks, railings, pergolas and other outdoor structures for any repairs needed.

Other tasks to consider:

Wash siding. If your siding is looking dingy and dirty, attach a siding cleaning kit (available at most home improvement stores) to a regular garden hose and clean off the winter grime.

Spruce up the porch or entryway. Sweep the floor and wipe down any exterior windows, windowsills, and doors. Lay down a fresh doormat and put out a pot of flowers. If you have porch furniture, clean it off and wash the cushions.

Boost curb appeal. Spring is a great time to make upgrades to your home’s exterior. Even small changes, like new house numbers and a shiny new mailbox, can make a big impact. If you’re planning to put your house on the market soon, boosting curb appeal can help lure in potential buyers.

Schedule cooling-system maintenance. If you have central air conditioning, schedule professional maintenance before the start of summer. A properly maintained system cools better, uses less energy and lasts longer.

If you’re thinking of putting your house on the market this spring, give us a call. We offer free consultations and have loads of great ideas to get your house sparkling and sellable. Reach us at (630) 441-5570 or at www.gmregroup.com.

 

 

Real Estate in the Real World: Appraisals Matter

by Thomas Makinney

If you’re a first time home buyer or seller, you may have questions about some of the steps along the way.  We’re here to help, and this week in our Real Estate in the Real World series we’d like to shed light on the appraisal process.

signing.jpg

When a buyer’s offer is accepted and the application for their loan is pending, one of the approval factors is the appraisal of the home.  As brokers on the listing side, we are always present for the appraisal.  We will note the amenities and features that distinguish the home, and with the appraiser’s permission we will review and discuss the comparable properties in the area both sold and under contract.  
appraisal-gb.jpg

Without the justification of the purchase price, the loan will not be approved, and the transaction could end there.

 At the Gracik Makinney Group, we work actively and diligently to ensure that every part of the process is as smooth and successful as possible.

When buying or selling a home, it is of highest importance to enlist the help of a qualified professional who will do what it takes to complete the best possible transaction.  If you or someone you know are interested in buying or selling, The Gracik Makinney Group is happy to be a valuable resource in Elmhurst real estate.  Give us a call at 630-441-5570 or visit us on the web at www.gmregroup.com

Holiday Season Home Sales

by Thomas Makinney

For our first installment of a new blog series ‘Real Estate in the Real World,’ we’d like to share with you a common misconception surrounding holiday home sales.

It’s not unusual, and this year is no exception, for our clients to have hesitations about trying to sell a home during the holiday season.  Should they hold off on listing it?  Should they temporarily take their home off the market until after the new year?  We've listened to our clients concerns, and we’d like to share with you the real life factors that sellers have to consider.
winterhome.jpgSellers fear that their home will sit on the market with no activity because buyers are busy, the days are shorter, or they worry about arranging showings when they are busy with seasonal festivities, and the landscaping doesn’t quite shine like it did a few months ago.

 

We understand the concerns, and of course we want what is best for our clients and their successful home sale.  Without pressure, we present the flip-side facts about selling. Believe it or not, November is an ideal time to get your home sold.

Since it is such a common inclination to hold off or suspend the listing this time of year, many sellers DO give in to the temptation of taking a vacation from their home sale, decreasing the competition in your local market. Excellent! Suddenly your home is the best on the block because other comparable properties go unshown, and unsold.  Remember, you have a 100% chance of not selling if your home is not on the market.

househunting.jpgSure, it can
be somewhat inconvenient to show your home during the holidays, but you’ll find the buyers to be highly motivated.  When buyers are out there touring homes in the snow and in between shopping trips or prepping for holiday parties, chances are, they are ready to purchase as soon as possible. Not only are you more likely to get an offer from this type of buyer, you’re more likely to get an offer closer to asking price than you would when your competition rears back up in the Spring.  So while the quantity of showings may decrease, the quality goes up.  At the Gracik Makinney Group, we do our very best to give as much advanced notice for showings as possible, and we only want what is best for our clients.  

 

Listing or suspending your home during the holiday season is a decision that our clients and many sellers face in the real world, and we hope we’ve provided some helpful feedback to guide you in future.  Give us a call at 630-441-5570 or visit us on the web at www.gmregroup.com for more information.

Drone Technology for Real Estate Marketing?

by Thomas Makinney


drone.jpgWe don’t yet have hoverboards or power shoelaces, but the McFly version of the year 2015 is not terribly off.  Amidst a list of the ‘Back to the Future’ franchise promises that never became a reality, the hovering camera is here.  Though the FAA has strict regulations against using drones for commercial purposes, the National Association of Realtors would like to amend the ban to allow aerial shots to be taken via drone for the purpose of enhanced real estate marketing.  

Cubs.jpg
Lifting the ban could create potential issues with privacy, abuse of the technology, and other industries appealing to lift the ban for their business uses.  The new regulations that are expected to set new parameters and give a timeframe for the possibility of an allowance for drones is expected within the next few weeks.

 

With the year 2015 nearly upon us, there is a short list of Back to the Future predictions that have actually come to fruition, and there is still time for more.  (Cubs fans, don’t hold your breath on that 2015 World Series win prediction!)
 

When selling your home, marketing is key.  Contact the Gracik Makinney Group at 630-441-5570 for more information on our comprehensive marketing plans for your next home sale.

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