HOME SALES TAX
How will you vote?

Here is a recent email I received asking everyone to send to everyone they know. I thought this would be a great topic for our blog: (I have added a more clear understanding of what this means for Kansas City homeowners just below this original email)

---------- Forwarded message ----------
From: Kenneth Thompson & I received it from Jerry Stots
Date: Fri, Feb 24, 2012 at 2:23 PM

I thought you might find this interesting, -- maybe even SICKENING!

The National Association of Realtors is all over this and working to get it repealed, -- before it takes effect.  But, I am very pleased we aren't the only ones who know about this ploy to steal billions from unsuspecting homeowners.  How many realtors do you think will vote Democratic in 2012?

Did you know that if you sell your house after 2012 you will pay a 3.8% sales tax on it?  That's $3,800 on a $100,000 home, etc.  When did this happen?  It's in the health care bill, -- and it goes into effect in 2013.  Why 2013?  Could it be so that it doesn’t come to light until after the 2012 elections?  So, this is ‘change you can believe in’?

Under the new health care bill all real estate transactions will be subject to a 3.8% sales tax.

If you sell a $400,000 home, there will be a $15,200 tax.  This bill is set to screw the retiring generation, -- who often downsize their homes.  Does this make your November, 2012 vote more important?

Oh, you weren't aware that this was in the ObamaCare bill?  Guess what; you aren't alone!  There are more than a few members of Congress that weren't aware of it either.

You can check this out for yourself at:

http://www.gop.gov/blog/10/04/08/obamacare-flatlines-obamacare-taxes-home

I hope you forward this to every single person in your address book.

VOTERS NEED TO KNOW.
_________________________________________

It's HERE! NAR, MAR (Missouri Assoc of Realtors) and a some of the local Realtors have been fighting it off for years. Does your Realtor go to Jefferson City to help get support for homeowners rights? Do they respond to the requests from our Missouri Lobbyist to get the word out to our Congressment and Senators? Unfortunately only about 10%-15% do.

Something similar to this happened  7-8 years ago when they passed the law that real estate sale prices would be public knowledge. That meant that every sale from 7-8 yrs ago became the new tax assessed value. Did you notice 7 years ago that your taxes started to climb drastically? The reason is they tried to slip this law inside another bill. A handful of local Real Estate agents were in the chambers to fight this one off. They delayed the passing of the law because there was so much controversy. Then, while we were all in Jefferson City protecting the rights of homeowners by visiting with your Senators and Congressmen to help them understand what some of the new laws would do to Missouri homeowners, they put that vote back on the docket and passed it without any opposition. Result? Our local property tax values were about 20% under the current real estate value, and our property taxes began to climb.

The reality of this law passing? This has already been happening in many other states for years. Other states around the country have been paying a 1% (most common) and I have heard of some as high as 2% tax on all sale prices. It is not new, just new to us. We have expected it to work it’s way through after many many years of fighting it off for KC homeowners. The Missouri Association of Realtors has one of the BEST lobbyist on the planet and Sam (our lobbyist) has done an incredible job of helping us protect local homeowners rights AND getting MO Congressmen & House Rep’s to support the homeowners rights. We did expect that something around the 1% to 2% sales tax would continue to work it’s way through the system.

So what is the result? The truth is, this will NOT be something fun to pay and it is going to affect equity (somewhat) if it is passed. We could lose one year appreciation on our property values every time we buy a home or piece of property AND if you hire a Realtor that sells more than one to two properties each month, and rely on someone helping regular home owners get 2-4% higher sale prices because they sell 6-10 properties each month, and know how to help homeowners get more equity then this law may not affect you as much.

Because our appreciation in the past has been very solid around 3-5% appreciation each year up until the end of 2005, that 3.8% sales tax is basically one year of appreciation out the window. In a normal market where we are appreciating, that just means you won’t be able to move every 3-5 years like most Kansas Citians would do, it means you will just move every 4-6 years. This is what has happened lately. In our current market conditions, mostly our market has been flat. If there was any depreciation, it has mostly been in homes priced over $225,000 in Missouri, and homes over $300k in Kansas. That means there has been no appreciation for the past 6-7 years and most people have now been in their homes for 7-10 years. I wanted to thank Jerry for forwarding this email to me because it really makes us all look at your voting decisions more seriously, and even though you may be in complete favor of a new law, especially when it is for schools, etc. you  may be passing another law, buried inside that one, that will cost you thousands of dollars.

If you would like to find out more about how this law would affect you and the value of your property, don’t hesitate to give The Korn Team a call. We have been helping and average of over 100  home owners and home buyers, per year for the past 7 years, take advantage of the current market  conditions. You can call us directly at (816) 224-KORN (5676) or visit our website at www.kornteam.com to get our email or mailing address. Vote wisely this election year and make sure that when you vote in support for something you are passionate about, that you are not voting for something else you absolutely do not support.

an interview with Brad Korn of The Korn Team, Keller Williams Real Estate:
The episode you were on aired in 2009, if you recorded the show for the same house now, what things would be different when considering what the home was worth?

I would truly have to look at how many sales have happened in the past 12 months and compare that to how many are for sale. If there are twice as many homes for sale vs what sold, then they are going to have to get VERY competitive on their price and stay around the #4-#6 position if there are 10 homes for sale. On the other hand, if there are only a couple homes for sale in that neighborhood and 10 have sold, we are seeing a HIGH DEMAND for that neighborhood, and we can command more in the asking price. Low supply, High demand gets higher price. High Supply, Low demand causes prices to drop.

Your home value is completely determined by the amount of Suppy & Demand. Don't just take someone's word that your house is worth $XXX,XXX, in fact if someone every tells you your home is worth more than you thought it was...grab a real estate contract, hand them a pen, and ask, "So, you will buy it for that right now?"  Get an honest opinion on the value of a property by conacting The Korn Team at (816) 224-KORN (5676)  or visit our website at www.kornteam.com and we can schedule a convenient, no cost, no obligation Broker's price opinion on how you can take advantage of your current neighborhood conditions.

an interview with Brad Korn of The Korn Team, Keller Williams Real Estate:
You were featured in an episode of My House is Worth What? On HGTV. What were the major factors you considered when deciding on the value of the home?

First of all, we look at 3 different reports from the MLS. Where we are different from most Realtors, is we don’t find 3 comparable homes that are for sale, and 3 that sold. When you use that appraiser type method you are picking the 3 homes YOU feel is most like. Appraisers have a contract price in front of them when they do an appraisal. They are hired to help the bank determine if they should loan this amount to the buyer. When an appraiser finds 3 comparable homes, that average the sale price, they are letting the bank know that 3 other homes did average around this price. Where we get in trouble is if everyone is always using the 3 highest sales. Anyone can justify a price…but what are the true buying patterns of the buyers in the market place. The appraiser method isn't wrong, it just does not take into consideration ALL the supply and ALL the demand. To prove the point, if you use 10 different appraisers and give them 10 slightly different sale prices on a property, it would be rare to see all 10 use the same three comparables. They are using their opinion. The best opinion to determine the price of a property is a true buyer (not being sold by an overly aggressive sales person) that looked at 10 similar properties and see what they say the fair value is compared to all the homes they saw.

Here is another thought about why prices are different. Some agents (and even appraisers) might include a foreclosure in the neighborhood into their evaluation. Here is where that might not be a valid comp. If a homeowner is not in a distressed situation think of this scenario: If a neighborhood had 10 regular, non-distressed closed sales and 2 foreclosures sold, do you think the values are dropping in that neighborhood? It appears that a more significant number of regular sales are happening than foreclosures. If you are getting the value of your property from someone that uses the lowest price and the highest price and calculates an average price…that average is skewed and is actually lower than the true average. Can you see how IF the subject property is a regular sale and there are significantly more regular sales..why wouldn't you only use the average of the regular sales (if there were only 1 or 2 foreclosures)? The typical buyers out there in the market place right now, do not see values dropping in that neighborhood because of a couple foreclosures. The sale prices show the actual buying consumers are still paying regular price. The flip side is, if there are 10 foreclosures and 2 regular, non-distressed sales, then what buyer in the marketplace is going to want to buy in a depressed neighborhood when they are comparing that neighborhood to 10 other neighborhoods that may have more “regular” sales.

It is truly all about Supply & Demand! Remember that class in high school everyone hated…ECON 101? Guess what, that is what real estate is. If there are 10 homes on the market and a homeowner wants (or needs to be) priced at the #10 spot on that list that would make them the MOST expensive home on the market. In a FLAT or Depreciating market, that overpriced listing will make #1-#5 look like a really great deal! That is when I would advise a homeowner to not sink any more money into the property. It is already  going to sell for less than they want, so why lose more money? Each property and each day brings a new set of circumstances therefore you truly want someone knowledgeable in this aspect of valuing property to help you determine what the market will bear.

The best value for spending money on a home is adding square footage or adding a bedroom. Believe it, or not, adding a bathroom is truly not going to add more to your sale price (UNLESS you are going from one bath to get 2 baths in your property). Think about it…do you really think a buyer will pay $5,000 more for a home that has 2 ½ baths vs 3 baths? When they compare the two…they may make the offer on the home with 3 baths, but they will offer the price they would have paid for the 2 ½ bath home.

See more about our HGTV episode at www.kornteam.com

interview with Brad Korn, The Korn Team, Keller Williams:
What trend do you see when it comes to individuals house hunting? Are more people looking for new builds or homes in established neighborhoods?

They are looking for BEST VALUE! Buyers typically look at 10 homes before they make a decision. In today’s market they might even look at 20 homes. Remember, as I said in the nicest home comment…buyers are comparing a property to 5-10-20 other homes. The nicest home can only sell for the top dollar if it wre the ONLY home for sale. A Seller typically gets bad advice from the everyday, average Realtor that is pricing in negotiating room. Again, this only works if you property is the ONLY home on the market. When a seller puts negotiating room into a price, then the other house on the market that is now priced properly TAKES THEIR BUYER! When seller’s say, “well, they can make us an offer” the reason they don’t get the offer is because they just made their competition look like a better deal AND the buyer made the offer on the better deal…not the overpriced listing.

The Korn Team has one of the most aggressive marketing plans in the country! While others are cutting marketing out, we continue to do the things that help our clients get 1-4% higher sale prices over almost all of our competition. Don't trust your equity with just anyone. Contact The Korn Team today at (816) 215-KORN (5676) or visit our website at www.kornteam.com to see how our marketing plan can help you find more buyers and get more exposure to your property. Our marketing plan has proven to help us average over 100 sales each year for the past 7 years.

interview with Brad Korn, The Korn Team, Keller Williams:
What advice would you give to individuals trying to sell an older home in this market?
 

Before you spend a lot of money, we need to truly evaluate the “return on investment” in any money being spent just to sell. An older home can look and compete if the seller first does some easy things without spending money. The main thing is to STAGE the house. When The Korn Team says “stage” we mean pack up everything! Well, really our general rule of thumb is no more than 1-2 things on every wall, shelf, flat surface, etc. AND there are 2 rules that go along with that. #1- no personal or family photos anywhere. #2) nothing sitting out that reminds the buyer they are in someone’s home. Buyers are uncomfortable ‘snooping’ through a total strangers’ home. Put the daily things you need, coffee pots, toasters, toothbrushes in the cabinet. Heck, just pack everything up that you don’t need for the next 30-60 days and put the daily needs in the cabinets. You are moving, right?

Don't just trust anyone with your equity. National Board of Realtors track that the average agent only sells 4-6 properties per year. Unfortunately, many Realtors don't sell enough houses each month to truly help home owners take advantage of a market or give you the real true advice you need to hear. The Korn Team has average around 100 sales per year for the past 7 years. We know what it takes to get the most equity out of a market. You can get a free, no obligation evaluation by contacting us at (816) 224-KORN (56756) or visit our website at www.kornteam.com. We can schedule a convenient time to meet and evaluate how your home will compete in today's market.

interview with Brad Korn, The Korn Team, Keller Williams:
How do you feel being the nicest home in the neighborhood affects the ability for the home to sell?

My normal response in a market like this is that “you do not want to be the castle in the neighborhood” and therefore if someone ‘TRULY’ has the nicest house in the neighborhood, they need to realize that is not going to help them. The only way this can help is if they were the only house for sale…or there is very low inventory AND everyone currently on the market is way overpriced. Remember, it is truly about Suppy & Demand…NOT 3 most-like comparable sales. Let me explain. If you have 12 homes for sale, and use the 3 highest sales as comps…we can justify why someone would price higher, but what about the true read on the market that there are 9 more sales lower.

We help a seller with the nicest home in the neighborhood realize that they are going to get just a little bit more than the other homes if they have incredible updates, however, hopefully they have some enjoyment value from living in an incredible house.

If you feel your home is one of the nicest homes in a neighborhood, be sure you contact The Korn Team at (816) 224-KORN (5676 or visit our website and reach us at www.kornteam.com. We can help you determine if you can put more equity in your pocket. Do not list with anyone else until you have met with us. Our meeting is not a sales pitch..it is an evaluation of your currrent situation and we help over 100 home owners and home buyers get the most out of these market conditions every year.

October Real Estate Update as we enter the 4th Quarter of the Year

This is a National perspective from our friend Terri Murphy who shared this information with us in a recent podcast on tips for sellers. She mentioned there are some interesting changes on the home sales front. Existing home sales INCREASED in August even though we are still impacted by tighter credit and appraisal issues. Add to that the regional disruptions by Hurricane Irene, NAR reports that we actually saw monthly gains in all regions. Total sales that included single family, townhomes, condo’s and co-ops rose 7.7 percent and are 18.6 percent higher than August of 2010.


Terri also shared that when we look at PENDING home sales, we see a slightly different picture. The numbers for properties that are pending, but not closed slipped a bit in August, but are higher than a year ago according to the same report by the National Association of Realtors. There are some positive market fundamentals. And the NAR chief economist says they may be the result of sales that were delayed in the preceding months. But we still enjoy great low rates for favorable affordability. And Joe, we see a rise in rent which of course motivates more buyers and investors to absorb foreclosed properties.

So with great low rates, and good pricing and high motivation, it’s a great time to buy and sell. But we do know that properties that are staged sell faster and for more money. The Korn Team has had a record summer selling properties in the Greater Kansas City area. They are helping seller's stage their homes to get top dollar given the current market conditions.

In the past 2 months, the Korn Team actually helped 2 seller's sell their property (in the 300k price range) who had been on the market for 6 months and the other, 1 year. We simply helped them restage their property, put a better marketing plan in place, and sold them both in under 30 days. That is after they had been on the market with not much activity. There really is no reason your showings should be slow, or that you should be on the market for 6 months. Let us help you show you how to position yourself in the market to be one of the next properties to sell and stage your home so you can win the buyers over when they see you home. You can schedule a one-on-one marketing evaluation strategy plan for your property by giving us a call at 816-224-KORN (5676) and if you would like to hear our latest podcast on staging tips, visit http://www.kornteam.com/ and click on our podcast icon on the left side of our webpage.

Do You Rely on a Computer
to Give You the Value of Your Home?

I recently received a request from a gentleman that would like to move. He visited some sites to see what the value of his home would be. He contacted The Korn Team because we have been endorsed by national radio personalities on their programs and we sell over 100 properties throughout the KC area in both Missouri and Kansas. We also have a team and sell in Lincoln, NE.

This property was located in a small rural community just about 30 minutes south of the Greater Kansas City area on the MO side in Cass County. One site he may have relied on lead him to believe his home could be valued at clost to $150,000. As you can see from an indepth market review through our MLS and even looking outside of his community and using data from the entire County...There are only a few homes that sold higher than 70k....and the absolute most expensive property that did sell and close in the past 8 months was for 122k.

The tax assessed value on this home is $67,840. As a professional we do not rely on computer systems, let alone the tax assessed value, by itself. We must truly evaluate what is the demand for properties in the area under the current market conditions. Once we determine what the actual sale prices have been, then we can determine how much competition we have at that price...what is currently for sale. Does that sale price postition you as one of the cheapest homes on the market? In my experience after evaluating thousands of homes...yes it does. SO, be careful!!!! You may underprice your property if your supply is low and every other seller is underpricing thier properties. In that case, you might be able to position slightly higher and get more out of the market than you are supposed to.

On the other hand, if the supply is high, and there is a 1-2+ year supply of homes on the market, and they are priced low, you must position yourself competitively...wether you like that price or not (of course that is if you must sell your property or home).

The Korn Team, Keller Williams Eastland Partners can help you determine where you should be positioned in the market to get the most money, in the shortest amount of time. Don't Take ANY chances when considering selling your home. Too many people out there may tell you want you WANT to hear. The great news is not only will The Korn Team be honest with you, but if you made a great investment, we may tell you what you want to hear as well. Remember, you have worked hard to protect your equity. You owe it to your self to make sure you get professional advice from someone that sells a lot of real estate AND can properly help you intrepret the market. Visit our site at http://www.kornteam.com/ to see how we market properties, tell us you are thinking of selling, or if you want to shop our list of over 19,000 homes currently for sale in the Greater KC area. You may also contact us directly at 816-224-KORN (5676) or email us at brad@kornteam.com

Low Interest Rates and Strong Housing Inventory Provide Opportunity and Promise for Summer Home Buyers

Mortgage rates recently dropped to all time lows with conventional 30 year fixed rates approaching the 4.99% range in April of this year. It must be working because mortgage applications rose 1.1%. The Credit Unions are jumping into the mortgage game as well. They have been able to get customers with slightly higher credit ratios into a loan. There are typically low costs to join credit unions and many times that local connection is a nice touch.

So, not only is it possible to get a loan right now, with summer here there is a lot favoring buyers right now. We have all heard the saying, more homes sell between Memorial Day and Labor Day. The reality to that statement is that the most amount of homes to chose from are available during those times. With increased competition, that can help a buyer find more homes that meet most of your needs and wants. We typically advise buyers in this market that instead of getting 5-6 of the things you want in a home (during a fast selling market with low inventory) you can get 8-9 of the things you want when there is a lot of homes for sale. There is just more to choose from.

It is important if you truly want to take advantage of this market that you do several things. First, identify your preferred area. We can help you put together a checklist of what areas to look for and how to ensure you know about properties as they become available. Second, (and probably most important) is to get your finances in order. If you truly want to take advantage of a great deal this summer we can show you how this one step can be the difference between buying your dream home AND getting a great deal OR losing out on that home. Losing the right property to another buyer can be avoided if you are pre-approved.

Just those two points validate that using an experienced agent to negotiate the best price and guide buyers through the inspection and to closing is so important when someone is dealing with one of the biggest purchases in their lifetime...a home. Plus, buying a home should be fun and exciting. This is not the transaction where you want to give that up by using an agent that only sells 4-10 homes a year. When you find an agent or team that sells 100 homes a year, there are going to have 10 times the experience and most likely have systems in place to make the home buying process and enjoyable as possible.

You can hear more about this topic by visiting our Korn Team Podcast at http://goo.gl/t9fas and if you would like to start you home buying experience visit http://www.kornteam.com/ where you can search our list of over 20,000 homes currently for sale in the greater Kansas City area. You can call us directly at 816-224-KORN (5676)

Will Sell Your House for FREE!!!

We just had a call from a potential client that has an upper bracket home to sell. Since we met and discussed the marketing program The Korn Team uses to get homes sold, the owner received some enticing offers from other Realtors. We showed the homeowner how we are getting more exposure to our clients properties which means more people see our clients homes AND because more people see our homes, our clients are reaping the benefits of 3-4% more equity than our competitors in the same marketplace.

You see, 90% of all agents truly do not spend any more money than they have to to get more exposure to a property. National Association of Realtors states that the average agent is selling 4-6 properties each year. That is only one sale every 2 months. There just is not enough margin in Real Estate to make a decent living AND have money to spend on marketing. Now, the reality is that most full time agents might be selling 12-20 homes each year. If half of those are buyers, that means they are helping only 6-10 sellers sell their home each year. Again, that is only 1 sale every couple months. It is truly hard to get the experience and become the BEST if you are only doing something once or twice a month.

As a home owner, your equity can disappear quickly...and it disappears by the THOUSANDS!!! Contracts don't get negotiated for a couple hundred here, couple hundred there...it is a Thousand here AND a Thousand there...

So, what was the enticing offer?
After talking, this homeowner mentioned that a Realtor from their church had offered to sell their home for FREE! Wow, really, free is awesome....if the Realtor will get the house sold, and get them the most money. I asked, my soon to be new seller client, who was the agent? Let's see if they have sold a lot of properties. The home owner did mention that this was a pretty successful agent and had seen their stuff around quite a bit, and knew them from church or school (can't remember which they said). I had heard of the agent before so I they have probably been selling real estate for a little while. When I pulled up the sales from the Multiple Listing service, we found that in the past 14 months, this realtor had only sold FOUR homes (that were listings). "Is that really who you want helping you sell your upper bracket home?", I asked.

When a home owner is hiring someone to sell their property, you think you would want someone that sells a LOT of homes. Not just homes (because that could be a lot of buyers), but homes they were marketing to sell. I even went back over the past 26 months and this agent sold 7 listings (14 total sales including buyers). That is a home every 2 months. The Korn Team in that same time frame had sold and closed 100 properties (not counting the buyers we have helped buy homes) and averaged between 97%-98% of our clients' asking price. That was just the signs we put in yards and marketed to sell. FREE sounded great, however, when you think about it...who really can market your property to get you top dollar and do it for free? If anything, you will be leaving equity on the table because all the marketing that needs to be done can get done for free. It costs money to make money.

In today's market (and truly, even in great markets) we have watched home owners sell homes fast in hot markets and we have seen homes sit on the market with no activity....Our homes get shown because our marketing definitely gets our listings in front of more potential buyers. We get our properties sold faster and for more money because we find buyers other typical agents may miss. Brad always says, "if you get more eyeballs on the property, you will get more for the proeperty and sell it for the most the market will bear."

Don't take ANY chances with your equity. There hasn't been much in the past few years, and every thousands of dollars in equity you have in your property is yours to get. You just have to have someone that is not afraid to spend money and focus on marketing that will get you the most exposure possible for your property. It costs nothing to meet with The Korn Team and it might make you THOUSANDS!

Take your interview process very seriously. There are so many things you need to be aware of when considering marketing your home or property.

You can see how the Korn Team markets properties at http://www.kornteam.com/ and click on featured properties. We take over 100-150 photos of our listings. We use wide angle lens and photo software to show our properties off. We have virutual tours, best positioning for print media, upgraded websites on the real estate sites that matter and we have 24/7 marketing for our clients where buyers can get information about the property. More exposure means more equity. Call The Korn Team today for your free, no obligation market evaluation. You can find us online or call directly at 816-224-KORN (5676)

The Korn Team
http://www.kornteam.com/
(816) 224-KORN (5676)

Now is the time
Mortgage Interest rates are at ALL TIME low's
and they will not be there forever.

What were the interest rates in the 1980's? Did you know they were actually around 13% when I got into Real Estate 20 Years ago? today the average rate on a thirty year mortgage is as low as 4.36% as of August 2010. That is lower than mortgage rates have ben in the past 50 years. Home mortgage interest rates for the same time last year were averaging 5.19%. Did you know that is a difference of $90 per month on a $200k home with 10% down. Also, when that rate drops from 5.19% to 4.36% that is a savings of $32,460 over the life of the loan. If you would like to find out how you could save almost $100/month in your mortgage payment and put another $32k towards your retirement, contact us at http://www.kornteam.com/ either by phone, email or text and we will send you a free copy of our ebook explaining why NOW is the best time to buy real estate and move into your next home. (816) 224-KORN (5676)