Let's talk real estate

We have all heard the down side of owning rental property. Toilets overflowing during the middle of the night. Tenants destroying the property, disappearing during the middle of the night, not paying rent, etc.

Handled properly, there are some great benefits to owning rental properties. Someone else is paying the mortgage for you. The improvements on the land can be depreciated. Maintenance expenses can be deducted on tax returns. Properly maintained, the value appreciates. Passive income is taxed at a different rate.

Just a great way to improve your retirement income.

This February based on the current numbers the Dothan Multiple Listing System sold nine less homes than was sold same month in 2009. The good news is the average price per home was almost $17,000 more than the average price of homes sold February last year. Even with the large inventory availabe now is still a good time to market your home.

I held open house today and had one of the best attandance ever.

    Affordability for a home has never been this high. In relationship to income, housing is the cheapest it has ever been. The fact that prices might still go down kind of means nothing to the person who is going to live in a home for quite a long time, partly because the interest rates are historically low.

    I think buying a home now is a very bright decision. There is a very good inventory to choose from in most any price range. With the low interest rates you can buy more house with your income than ever before.

    Will the price of homes go down? I say, "Who cares?". You will be tying up an interest rate that is probably under 5 percent for thirty years and that may be the real bargain.

    One of the few sources of 100% financing USDA Rural Development changed from an eight tier income limit program to a two tier program Monday April 20, 2009. Effective this date a one to four member household can earn up to a max of $73,600 and still qualify for a USDA loan. Advantages for those who qualify are:

• possible 100% financing
• No mortgage insurance requirement

    Following is information from an article in US News and would report about the tax credit contained in the stimulus bill signed by the President.

   *The credit is equivalent to 10% of the purchase price of the home up to a cap of $8,000.

    *The $8,000 tax credit does not have to be repaid.

    *Available to first time homebuyers only. First time homebuyer is defined as not having owned a home as their principal residence in past three years.

    *Applies only to buyers who purchase a home between January 1, 2009 and December 1, 2009.

    *Tax credit is subject to income limitations. Single buyers need a modified adjusted gross income of $75,000 or less to qualify for full credit, that's $150,000 for couples.

    *Qualified buyers can take advantage even if they do not have much tax liability.

    *Buyers will have to own the home for at least three years to capitalize on the credit. If they sell the home before then, they will have to RETURN the credit to the government. (Exceptions may be made in certain cases.)