Tuesday, February 15, 2011

5 top tips for increasing the value of your home


5 top tips for increasing the value of your home
 by Matthew Read
If you are a homeowner you are probably aware that over the last few years house prices have fallen quite drastically. In fact Zillow.com report that from 2006-2011 the average house price in the US has fallen by around $65k, from $240 down to $175.

Although the fall in house prices is largely out of the individuals control, due to the recession and problems with the banks, there are still many ways in which you can increase or at least retain your properties value. Check out these tips for increasing the value of your home:

1.       Aesthetic Appeal – When it comes to selling a house first impressions count for a lot. If you arrive at a house with a manicured lawn, well kept flowers and a freshly painted exterior it is much more appealing than one that looks dated, run-down and un-cared for. The better your house looks the more offers you are likely to get, allowing you to push the price up and ask for more. External improvements don’t need to cost a lot or be time consuming but could make a big difference.

2.       Eco Friendly – Green is definitely the new black! People are becoming more and more aware of their emission levels, utility bills and overall energy usage. People are looking to not only reduce their emissions but also their energy bills to save money. If you equip your home with extra insulation, solar panels, energy saving lighting and low-flush toilets etc, your home will be more eco-friendly, more cost efficient and more appealing to buyers, increasing its potential market value.

3.       Renovations – This can be much more simple that knocking down walls or building extensions. By revamping the kitchen with new work surfaces and cupboards or the bathroom with new tiles or fixtures you can add a lot of value to your home. If it looks fresh, new and modern it will be more appealing and attract a higher value.

4.       Brighten it up – A light, bright and airy home is an inviting one and much more appealing than a dark and confined one. Now you don’t need to go knocking through walls to add more windows, you can make a home lighter with a splash of paint, additional lighting and more airy curtains. Some lace curtains, a new coat of white paint and a couple extra lamps could make your home much brighter and more appealing, attracting a higher value.

5.       Add a Garage – Apart from adding an extension this is probably the most expensive option, however the initial outlay could be very much rewarded. Houses with a garage on the whole attract a higher value than houses without as it gives the buyers more space and more security for their car. However, before building a garage it is important to check building regulations and how it will impact on your home insurance costs.

 So there you have it, follow these tips and you could retain or even increase the value of your property. 
  

Friday, February 04, 2011

The Tax Benefits of Home Ownership



Buying a home provides some benefits.
1) Home mortgage interest deduction.  The interest paid on a mortgage or mortgages of up to $1 million for a principal residence and/or second home is deductible as an itemized deduction.  This deduction can reduce the cost of borrowing by one-third or more.

2) Home equity loan deduction: Homeowners can borrow up to $100,000 against the equity in their home and deduct the interest as an itemized deduction. The money can be used for any purpose.

3) Property tax deduction:  Homeowners also get to deduct from their federal income taxes the state and local property taxes they pay on their home. This is another itemized deduction that renters don't get.

4) Deductible homebuying expenses: Some closing costs  in a home purchase are also deductible as itemized deductions, including loan origination fees called points, prorated interest on a new loan, and prorated property taxes paid at settlement.

5)  home-sale exclusion:  Profit when you sell - you must have lived in your home for two of the prior five years prior to its sale - you need pay no income tax on a substantial amount of their profit -- $250,000 for single homeowners and $500,000 for married homeowners who file jointly. Can be used once every 24 months.

6) Free rental income:  You can rent your home out for up to 14 days during the year and pay no tax at all on the rental income.
7) Business use of your home:  If you have a home business and have a home office you may qualify for a deduction.

Tax benefits of renting:

The only tax benefit that a renter can qualify for is the home office deduction. This is a business deduction available to renters who own a business and have a home office they use regularly and exclusively for business purposes.

A good rent vs. buy tool can be found on the Smart Money Magazine website: click here

Be sure to consult your tax professional.