I frequently have investors, landlords, or prospective buyers call and ask how the market is doing. Most articles state Austin has one of the best real estate markets in the county. This insinuates that we are experiencing healthy appreciation. In reality, Austin may be one of the best markets in the country. For example, our unemployment rate is lower than the US average and our real estate market is more stable than most areas. However, Austin's home appreciation has been flat if not experienced a slight depreciation the past couple of years. I don't think the real estate market will recover until consumer confidence improves, mortgage restrictions ease, and the unemployment rate returns to pre-recession levels.

Property flipping is a practice where a property was recently acquired by an investor and is sold for a considerable profit within a short period of time. Many lenders have title seasoning requirements for homes that are being flipped by investors. Lenders have specific guidelines that must be met before they will originate a mortgage for a prospective borrower.

Most lenders will require a seller to have ownership a minimum of 60 days before a buyer can obtain a mortgage for the subject property being flipped. Additionally, a desktop appraisal review will be required to further audit the initial appraised value of the home if the seller has not been on title of record for 90 days.

A homestead exemption gives homeowners a discount on their property taxes by lowering the tax assessed value by a set amount and placing a yearly cap on the amount the tax assessed value can increase each year.  In order to qualify for this exemption, homeowners must have owned the home  January 1^st of the current year of filing, occupy home as primary residence, and you and your spouse (if applicable) do not claim a residence homestead exemption on another property.

I frequently get calls from investors or prospective home buyers and sellers who use Zillow or other tools to estimate the value of their home or a home they may be interested in purchasing. These tools can sometimes provide an accurate analysis but are limited in providing a detailed and accurate market value. I will share my experience with three recent transactions. Read more...

A new law was passed April 2011 that changes how loan officers are compensated for a home purchase or refinance transaction. There are two options for borrowers. Borrowers have the option of paying for the cost of originating a mortgage (borrow paid) or have a credit be issued by the lender (lender paid).

The IRS has passed new rules regarding the issuance of 1099 forms for services performed by independent contractors, landlords, and businesses. I the past, businesses were required to issue a 1099 to any individual or business that was paid more than $600 in a single year. If the business was a corporation, you were not required to issue a 1099 form. The new law has changed these requirements.

As a business owner and individual taxpayer, I try to maximize write offs and reduce my tax bill each year. I thought I would share some of my ideas.

Pay January mortgage in December
Mortgage interest is paid in arrears. When you make your December mortgage payment, you are paying interest from the month of November. If you want to save a few hundred dollars in federal income taxes, consider paying your January mortgage payment in December of this year. This will give you an extra month of interest you can write off. Keep in mind the following year you will only have 11 months of interest unless you the January mortgage payment early again.

Many homeowners consider their primary residence to be an asset. I define an asset as something of value that puts money in my pocket. My definition of a liability is something of value that takes money out of my pocket. So, is the home you live in really an asset?

Based on my definition, an asset would include an appreciating stock, interest bearing savings account, mutual fund, an asset producing a dividend or revenue stream, or a rental property producing a positive cash flow. These types of assets generate revenue and put money in your pocket.

Your primary residence does not produce an income stream or put money in your pocket. It takes money out of your pocket, and is therefore a liability. Most owners pay a mortgage. Even if home is paid for, owners must pay for hazard insurance, property taxes and maintenance expenses. These expenses take money out of your pocket, and homeowners can only write off the interest and property taxes on their primary residence.

As a landlord and property manager with over 15 years of experience, I just was surprised with a recent insurance claim I made on five of my rental properties. The agency I was doing business with no longer had a relationship with ASI Lloyds. They sent me non-renewal notices for five of my rental properties. I knew all of my homes had hail damage. All homes were all in the Cedar Park and Leander area, and we had some pretty bad hail/wind storms in spring of 2009.

I had not planned on filing an insurance claim until years later. My strategy was to wait until the roofs were much older and file a claim with a future hail storm in the next 5-7 years. I contacted my agent who handles all of my commercial insurance. He recommended I file claims on all homes since they were not renewing the policies. It was better to start with a clean slate when starting a new policy for each home.

The Home Valuation Code of Conduct (HVCC) went into effect May 1, 2009 for all 1-4 unit and single family conventional mortgages sold to Fannie Mae. The purpose of the new HVCC appraisal process is to establish an arms-length transaction between the appraiser and loan officer/real estate agent and to avoid fraud. Through the HVCC process, all appraisals are ordered through a third party agency who assigns an appraiser. The loan officer no longer is able use a personal appraiser. Our office has had many sales transactions delayed due to this process.

The purpose of an appraisal is to protect the lender to make sure there is enough collateral in the property being purchased by the buyer. Unfortunately, many appraisers are going into depth regarding the condition of the property instead of simply providing a value of the property. Cosmetic and minor repair issues are leading to appraisal problems and closing delays.