Should You Sell Your Home-Turned-Rental?

In the last few years, some people who were unable to sell their homes, rented them instead. The market has improved in most places and the home may easily sell now and possibly, for a higher price.

Even though the opportunity to sell in the near future might not change, there could be unnamedanother opportunity that could quickly disappear for some homeowners.

Most homeowners are aware that there is a capital gain exclusion on the profits of a principal residence of up to $250,000 for single taxpayers and $500,000 for married taxpayers filing jointly. The rule requires that you must own and use the home as your principal residence for two out of the last five years.

A homeowner can rent their home for up to three years and still be eligible for the exclusion. As an example, if they had owned and lived in it for two years and then rented it for two and a half years, they would need to sell and close the transaction before the remaining six months expired.

If there was a $200,000 profit in the home that didn’t qualify for the exclusion, a 15% long-term capital gain tax of $30,000 could become due depending on the tax bracket of the owner. With some careful planning, the tax could be avoided. Awareness of the time frames and the right team of tax and real estate professionals could save a considerable amount of the homeowner’s equity.


 

As your real estate professional, I have the training and experience to provide solutions to make homes more marketable and help structure favorable transactions.  Please forward this article to your friends or family who could benefit from it.

Joe Ward
Re/Max United
Joe@JoeWard.net

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How Much Will It Cost To Wait?

It has been said that change is the only constant. Most of the financial experts have been expecting interest rates to increase along with home prices. While homes, in most markets, have definitely seen increases over the past five years, the mortgage rates today are actually lower than they were a year ago.

cec2f9ac-b61f-4ad2-b66a-4b3524ff1c1cIf the interest rates were to increase by 1% over the next year while homes appreciated at 6% during the same time frame, a $250,000 home would go up by $15,000 and the payment would be $211.53 more each month for as long as the owner had the mortgage. The increased payments alone would amount to $17,769 for the next seven years.

When facing a decision to postpone a purchase for a year, a legitimate question to ask oneself would be: “how will it feel to have to pay more to live in basically the same home a year from now?”

It is easy to understand that if the price of a $250,000 home goes up by 6%, it increases the price by $15,000. A slightly more difficult concept to realize is that if the interest rate were to go up by ½%, it is approximately equal to a 5% increase in price. A 1% increase in mortgage rates would approximately equal a 10% change in price. This means that if a home goes up in price by 6% and the interest rate goes up by 1%, it is equivalent to the price of the home going up by a little more than 16%.

Use the Cost of Waiting to Buy calculator to estimate what it might cost to wait to purchase based on your own estimates of what interest rates and prices will do in the next year. It may just give you the nudge you need to START SHOPPING!!!


Don’t wait!!! Inventory is LOW, Prices are RISING, and interest rates are DOWN…….. It’s a great time to buy if you can find the perfect home for you and your family! Contact one of the buyer’s agents on the Joe Ward team today. We are more than happy to get you pointed in the right direction.

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From left to right, Deborah Swainey (919-412-8650), Joe Ward (919-518-8182),
Valerie DeLoach (252-916-5048), and Kellie McDonald (919-961-2720).

We are a real estate team who cares about our clients. If you are considering
selling your home and would like some honest, professional, and
experienced guidance,
please contact us today.

Connect with us on social media to learn more about our team and
how we can help you find your new home!

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Your Dream Home Awaits!!!

12108 Betts Lane, Raleigh NC 27614
Swans Mill
5 Bedroom, 5 1/2 Baths
6,583 Square Feet

$1,100,000

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Welcome Home… Elegant & Stately Entrance!

This gorgeous, executive home is located in North Raleigh on a private, landscaped 1.88 acre lot. It has a stately presence with a circular driveway and a 3 car side entrance garage. Beautiful updates throughout boast quality and charm!

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Stunning Entry
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Dining Room
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Study with built in shelving
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The den looks even more charming in person! The exquisite fireplace is the focal point of this gorgeous room and will not disappoint!!!

The stunning kitchen features a stainless steel hood with a professional gas cooktop and Thermador refrigerator. The refrigerator and freezer are built in to match the pristine cabinetry in the room. There’s plenty of space to congregate with friends and family!

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Gorgeous kitchen
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Beautiful view of backyard from prep/handwashing sink!
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Cedar-Lined Wine Cellar

Master bedroom suite is perfect. This entire house is in such good condition that you will be convinced this is staged!!!! It’s just loved and well taken care of…

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Master Bedroom
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Master Bath
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Bath with a view!

There is one bedroom on the main floor and the other four (including master) are on second floor. Hardwood and tile floors throughout the home, with carpet in the large bonus room.

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First Floor Guest Room
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Upstairs Landing with Hardwoods
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Bonus Room with Tons of Room to Play!!!!

The huge sunroom is walled with windows and overlooks the private backyard. This room is versatile and has a separate dining area and sitting area that allows you to enjoy the backyard. The back yard is a must-see if you have young children because it is private and flat. Plenty of room to run free!

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Enormous Sunroom
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Sitting Area and Dining Area in Sunroom
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View of sunroom from the backyard
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Back porch
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Gardens

There is not a bad view in the house and the neighborhood is a must-see!!! It’s a pool and tennis community conveniently located in North Raleigh. There is too much to see in this house to write down!

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The house was built in 1992, but feels brand new! Would this home be perfect for you????

Call one of the Joe Ward team’s selling agents today to see this beautiful home!
Click on the name below for contact info!

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From left to right: Deborah Swainey, Joe Ward, Valerie DeLoach, Kellie McDonald