As we reach the end of the spooky Halloween season, we thought it would be a fun send off to discuss a haunted house. The infamous Los Feliz Murder House in LA has a checkered past, but to real eatstae agent Nancy Sanborn, it was just a house.

In 2016, Sanborn was brought on to the selling team to what she thought was just a regular referral listing. She was completely oblivious to its history, one of the few who was. For context, the property was the scene of a gruesome crime about 60 years before, in which Dr. Harold N. Perelson killed his wife and hit his daughter with a hammer, and then took his own life. The haunted legend of this crime has spanned from 1959 to the present day.

The property has been a notorious haunted attraction for tourists and paranormal enthusiasts. Sanborn did her best to treat it as an ordinary listing, however, the residence attracted strange attention and visitors with a sole interest in the paranormal aspect of the home.

Most states require any material defects about a residence to be disclosed to potential buyers in case it has any lingering effects for them. Though many buyers are apprehensive towards the idea of buying a house with a reputation, purchasing a stigmatized house has the benefit of a price reduction, and according to a recent survey, ⅓ of homebuyers would be willing to purchase a house with a haunting reputation.

The Los Feliz Mansion closed in July 2016 for $2.3 million. Don’t let rumors ruin your chance at buying your dream home! We hope you have a very Happy Halloween!

To read the full article, click the link below.

https://magazine.realtor/daily-news/2020/10/30/how-an-la-agent-sold-a-haunted-house

Summer is a season of pool parties, barbeques, and enjoying time with loved ones.  It is also a red hot season for buying and selling homes.  Below we’ll discuss the pros and cons of listing your home during this prominent real estate season. 

Pros

1. You Will Have an Abundance of Showings: With more hours of daylight, there’s more time for real estate showings.  Showings are also more likely to have viewers during the summer season than in the winter.  Interested home buyers are more likely to be spending quality time outside, which makes them more likely to attend an open house. 

2. Buyers Have Extra Motivation: Many busy households want to move into new homes before the fall school season begins.  Buyers might’ve missed out on housing opportunities during the spring, so summer is the perfect time for a new search. 

3. Convenience: With the free time for students and the consistent weather, summer provides availability and certainty when it comes to moving.

4. The House Will Looks Its Best: Natural light abounds in the summer, and this extra brightness is sure to showcase your home at its best.  With radiant windows and flourishing flowers, your home will be ready to list. 

Cons

1. Competition: Because this is such a busy time in the real estate market, this means the market is filled with competition.  Be prepared to see a “For Sale” sign at every corner, but do not let that dissuade you.  Make your home stand out. 

2. Obligations: Selling a house comes with obligations that may interfere with your summer plans.  Cleaning and prepping the house for showings is a substantial job in itself.  However, if you hire a real estate agent, this load of work will be majorly alleviated. 

3. Summer Heat: Loading and unloading a moving truck during hot, humid weather is a struggle.  Prepare yourself with chilled bottles of water, sunscreen, and portable fans.

4. Showing Houses with Children: Even though school is out for the summer, when it comes to selling a house, it isn’t all about relaxation.  You will need to have a place for your kids to go while prospective buyers are looking at your home.  Not to mention you will need to clean the house on a regular basis.  The best piece of advice for selling a home while you have children is to plan ahead of time: playdates or summer camps will give you free time and give your children fun experiences. 

Summer is the perfect time to sell your house, but it’s not without its challenges.  However, with the help of an adaptable, experienced real estate agent at VB Realty, anything is possible. Contact VB Realty Group for al of your real estate needs. 

To read Marian White’s full article, click the link below. 

https://www.moving.com/tips/pros-and-cons-of-selling-a-house-during-the-summer/

If you turn a profit by selling your home, the first $250,000 of that profit will be excluded from your taxable income. (That’s per owner. So for a co-owning couple the first $500K would be excluded).  Yay! But what about if you rented it out for a while before selling?  If you lived in the house for two out of the five years before the sale, the exclusion will still stand.  Any profit above that exclusion will be taxed at capital gains rate.  

(Renting property triggers other tax rules, though, so you may want to consult a tax professional.)

A large profit could affect you in ways other than taxation, though.  For example if you are a Medicare recipient, your premium might temporarily go up if your profit exceeds the exclusion amount. This is because individuals who earn more than $87K per year (or married couples who earn more than $174K) are subject to an income-related “monthly adjustment”.  So again, it’s best to seek out a tax professional:  He or she might be able to structure the sale to lessen the impact on your income in that year.

For more information, read Liz Weston’s complete article:

Q&A: Avoiding capital gains

Do you understand whether or not your retirement savings will ever get taxed, or when that happens?  What exactly are mandatory withdrawals, and when do they start?  How to best leave retirement savings to your heirs?  If your grasp is fuzzy on any of these questions, then read on:

TAXES:  Unless your tax-sheltered retirement savings account is a ROTH type, then any money that you withdraw from it definitely will be taxed.  The government set this deal up for you (and it is a good deal, because it allows your money to grow faster) to encourage you to save…but eventually Uncle Sam wants his share, since your contributions were made with untaxed income.   (With a ROTH account, however, you’ve contributed net income, not gross.  Since you’ve already paid taxes, you won’t pay any more when you withdraw.)

MANDATORY WITHDRAWALS:  Once you hit age 70½, you must start withdrawing—and paying taxes on any money you’ve withdrawn (unless it’s a ROTH).   The minimum withdrawal at that age is only 3.65% of the total balance, but it increases gradually with each year.  However if you live to be 100, the minimum withdrawal is still only 15.87% of the total.  (No mandatory withdrawals are required for ROTH accounts.)

LEAVING $$ TO HEIRS:  Therefore, if you only withdraw the required minimum over the years, you can leave the rest to your children—who will then have to pay tax on their withdrawals.  Before Congress recently changed the law, your children were able to spread the withdrawals over their lifetimes, but now they must drain the accounts completely within ten years of inheriting it.  (Your children will not have to pay any taxes on withdrawals from a ROTH account.)

ROTH:  These accounts have definite advantages, and if you can afford to contribute net rather than gross income you may prefer to do that.  (Ask your tax professional if it makes sense for you.) However if you decide not to go with a Roth, know that traditional non-Roth savings accounts are still wonderful vehicles for saving for your retirement. 

For more details, read Liz Weston’s complete article:

https://www.oregonlive.com/business/2020/01/liz-weston-why-am-i-paying-taxes-on-my-required-ira-withdrawals.html

An ADU is a secondary dwelling unit with complete, independent living facilities for one or more persons and generally takes three forms:

•   Detached: The unit is separated from the primary structure

•   Attached: The unit is attached to the primary structure

•   Repurposed Existing Space: Space (e.g., master bedroom) within the primary residence is converted into an independent living unit

•   Junior Accessory Dwelling Units: Similar to repurposed space with various streamlining measures

ADUs offer benefits that address common development barriers such as affordability and environmental quality. ADUs are an affordable type of home to construct in California because they do not require paying for land, major new infrastructure, structured parking, or elevators. ADUs are built with cost-effective one or two story wood frame construction, which is significantly less costly than homes in new multifamily infill buildings. ADUs can provide as much living space as contemporary condos being built in new infill buildings, and serve very well for all types of households.

ADUs are a different form of housing that can help California meet its diverse housing needs. Young professionals and students desire to live in areas close to jobs, amenities, and schools. The problem with high-opportunity areas is that space is limited. There is a shortage of affordable units, and the ones that are available are out of reach for many people. To address the needs of individuals or small families seeking living quarters in high opportunity areas, homeowners can construct an ADU on their lot or convert an underutilized part of their home (like a garage) into a junior ADU. This flexibility benefits not only people renting the space, but the homeowner as well, who can receive an extra monthly rent income. ADUs give homeowners the flexibility to share independent living areas with loved ones; they allow seniors to age peacefully with room for extra care and help bring extended family members together while maintaining privacy.

Relaxed regulations and the cost to build an ADU make it an easy, affordable housing option. A UC Berkeley study noted that one unit of affordable housing in the Bay Area costs about $500,000 to develop, whereas the highest price for an ADU goes up to approximately $200,000.

ADUs are a critical form of infill-development that are affordable and offer important housing choices within existing neighborhoods. ADUs are a powerful type of housing unit because they allow for different uses and serve different populations: ranging from students and young professionals to young families, people with disabilities, and senior citizens. By design, ADUs are more affordable and can provide additional income to homeowners. By encouraging the development of ADUs, local governments can improve access to jobs, education and services for many Californians. 

With the economic uncertainty that arose due to the coronavirus pandemic, it was expected that remodeling projects and housing changes would decline drastically.  However, people who have been working from home and have accessible income may be pondering the idea of renovations to increase home functionality.  To effectively conduct a renovation, one must contact contractors and designers for advice.  Below we’ll discuss 3 tips for executing a home renovation.

Tip #1: Make Sure Everyone Involved Is On The Same Page 

Have a plan for the work you want to get done.  Make sure every contractor/designer knows their duties, and clearly outline the details of the project along with who is leading it.  Miscommunication can have drastic consequences. 

Tip #2: Construct an Agenda 

Prepare for mistakes and construction issues by giving yourself enough time on the schedule to recover from any possible missed deliveries, declined permits, or natural disasters.  Throughout the renovation, schedule multiple meetings with everyone involved in the project (contractors, designers, and service providers) to ask questions and discuss new information.  Joint meetings allow everyone in the party to come together to create an effective, efficient plan. 

Tip #3: Carefully Choose the Contractors, Designers, and Other Workers Involved in Your Renovation

Ensure you know their skills and experience, and discuss the building blocks of your renovation plan to gage their perspectives.  Even though lower prices are appealing, accepting them may entail a sacrifice of product quality and craftsmen experience.  Do not be afraid to question the choices your contractors make; open communication is necessary for a successful home renovation.  Guarantee an outstanding home transformation by choosing the best fit for you, whether it’s contractors or paint colors.  

To read Michael Lerner’s full article, click the link below. 

https://www.washingtonpost.com/business/2020/07/17/tips-handling-major-renovation/

A foreclosure occurs when a borrower does not maintain their mortgage payments, and the lender who gave the loan reclaims the property and sells in an attempt to regain the money that was lost. 

Steps Leading Up to Foreclosure 

1. About 2-3 weeks after you’ve missed your first mortgage payment, a letter from your lender will appear in the mail detailing the past due payment and describing the possible measures that will be taken if the mortgage payments are not made.  Usually, lenders will provide a grace period of about 10-15 days where late payment can be made free of penalties.

2. You will receive multiple methods of notifications (calls, messages, letters, etc.) if you continue to miss payments.  Late-payment penalties may be instituted by the bank.  

3. After 90 days of missed payments (3 mortgage payments), a notice of foreclosure in 30 days may be issued to you by your lender. 

4. The lender is allowed to begin foreclosure after 120 days of missed payments.  Depending on the state, the process may take from one week to one year.

A foreclosure forces the eviction of all the tenants living on the property.  To prepare the property for a resale, the locks will be changed and the premises will be secured.  Timelines and foreclosure policies depend on the town and the lender; the local economic standings may also affect how the foreclosure functions. 

Impacting your credit 

A foreclosure entry will appear on your credit report, and it will stay there for seven years from the date of the first payment you missed.  Foreclosures are seen as damaging entities in your credit history, and influences the judgement of creditors.  It will also affect your credit score, but the weight of that effect depends on the state of your score beforehand.  The action that most negatively impacts credit scores are missed payments, so the odds are your credit score will be significantly lower if you undergo a foreclosure.  

Foreclosure Alternatives 

More often than not, lenders prefer to avoid the time consuming, expensive process of foreclosures whenever they can.  Within their missed payment notices, lenders will list a lender representative for you to speak to for help.  Utilizing that opportunity could lead you to a financial recovery.  It is possible to negotiate a new payment plan with your lender (provided you agree to fees and a higher interest).  Worst case scenario, this gives you time to find a buyer for your home that way you profit off of the sale.  You may also get your lender to agree to a short sale, but that is an unfavorable option for both parties.  A short sale entails you selling the house for the highest price you can get, and the lender will accept the proceeds of the sale as a form of settlement for your mortgage loan.  Though this option is viable, it provides no benefits to the client.

Explaining Foreclosure Sales 

Foreclosures provide some great opportunities for homebuyers with determination and willingness to accept a potentially challenging estate.  Homes that have been foreclosed have the potential to be sold at a cheap price, but it is best to know the risks before you enter the world of auctions or lenders.  

My House Has Been Foreclosed, Now What? 

Foreclosures can have substantial effects on your credit score that will take at least a couple years to recover from.  The best approach you can take in this situation is to start rebuilding your credit.  Stay consistent and patient; your credit score will eventually return to a good standing. 

To read Jim Akin’s full article, click the link below. 

https://www.experian.com/blogs/ask-experian/what-is-a-foreclosure/

Many people are oblivious to the different kinds of trusts and the purposes trusts serve to maintain estates.  Below, the two basic trusts are compared: revocable and irrevocable. However, when firmly deciding which trust to invest in, a discussion with an attorney will provide you with in-depth information and professional guidance. 

The terms of a revocable trust can be changed at any time, whereas an irrevocable trust cannot be modified without the approval of the beneficiaries. If you choose to put property in a revocable trust, you maintain the ownership of the trust and have complete control over it.  The property can always be taken out of the trust, and you control everything that happens to it.  In terms of the IRS, revocable and irrevocable trusts are treated the same.  However, if you choose an irrevocable trust, you essentially lose personal control over it.  The trust claims ownership over the property and controls its future.  The former owner of the trust (you) would not be able to remove the property from the trust or sell the trust itself.  The future of the trust can only be controlled by the beneficiaries. 

Choosing which trust is right for you depends entirely on your individual circumstances.  However, the purposes of each trust can be separated based on their standard uses: usually, irrevocable trusts are used for estate and federal estate tax purposes, and revocable trusts (a.k.a. living trusts) are initiated to evade probate issues but do not affect your federal income or estate income taxes. 

This decision should be made with the consultation of an attorney.  An attorney will be able to guide you and explain each type of trust in more detail.  With the information and purpose of each trust, you will be able to make an informed decision on what will most benefit you and your family. 

To read IIyce Glink and Samuel J. Tamkin’s full article, click the link below. 

https://www.washingtonpost.com/business/2020/06/17/purposes-revocable-vs-irrevocable-trusts/