Posts Tagged ‘Intero’

Intero Insider: To Forgive Or Not To Forgive? That Is The Question.

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Even in a “normal” year (when someone actually finds one of those, please tell me), I am bombarded each spring with questions about real estate transactions and their implications on Federal and State income taxes.

In a year in which we’re experiencing continued economic hardships, and since many of those hardships relate directly to home sales and foreclosures, I’m getting far more than usual.

Right out of the blocks, I tell them that I’m not a tax professional and that any questions that they have ought to be directed to their accountants and financial advisors. That said, I like to do all I can to help folks out, so I answer questions where I am able.

One of the most frequent questions I hear — and the one whose answer seems somewhat out of reach — pertains to short sales.

“I sold my house this year, but it was a short sale. Can the IRS or my state tax the forgiven debt?”

The answer is, “Yes. Yes, they can.” A better question is, “Will they?”

With regard to the Federal Government, the answer is “no”. In a move meant to encourage homeowners to work out alternatives to foreclosure, the Federal Government has placed a moratorium on the taxation of forgiven mortgage debt through 2012.

Many states have followed suit, but there are a great many who have not. One of the states in which the question has yet to be answered is California, a state that has been hit harder than most in this period of crisis, and also one whose economic woes far exceed that of any other.

While it may sound unfair, forgiven debt has always been treated as income and, until the Mortgage Forgiveness Debt Relief Act of 2007 was enacted, that income could (and would) be taxable.

At the time of this writing, Governor Schwarzenegger had not made a decision with regard to the state collecting taxes on forgiven debts, but in a state that is as cash-starved as California, there is a strong possibility that he’ll have no choice but to do so.

If you sold your home last year and that sale was a short sale, there are heady tax implications attached to it. It is imperative that you consult with your accountant or financial advisor, so that you can adequately prepare to meet the tax man, should he come a’calling.


Intero Real Estate Services, Inc. sustains profitability through innovation in 2009

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Leading U.S. brokerage announces 2009 profits, shares insights on successful model

CUPERTINO, SILICON VALLEY, USA  — Intero Real Estate Services (http://www.interorealestate.com), a leading U.S. real estate brokerage that has recently expanded its brand globally, as a franchisor, through Intero Franchise Services, Inc. and Intero International Franchise Services, LLC, announced today that its brokerage operation – based in California’s Silicon Valley – was profitable in 2009 despite persistent challenges in the housing sector. Intero was founded in 2002 and became one of the fastest growing companies in the history of U.S. real estate.

2009 was a challenging year in real estate. Intero executives attribute the company’s success in this environment to a long-term commitment to innovation that allowed Intero to realize efficiencies other companies were unprepared to leverage, seize opportunities before its competitors and retain productive agents and franchisees.

“Intero sprung from the cradle of innovation here in Silicon Valley, so doing things that are new, pursuing ideas that are different – it’s a spirit that is an integral part of our brand,” said Gino Blefari, Intero’s President and CEO. “While most in our industry remained static in old models which no longer worked, we decided to act – and that action is directly tied to our continued profitability.”

Bob Moles, Intero’s Chairman, added, “Increasing top line revenue growth in 2009 while at the same time growing our bottom line profit in this real estate environment, demonstrates convincingly that the Intero® brand, tools and systems are positioned to perform well even in down markets.”

Blefari offered several examples of initiatives driving Intero’s success, including:

Technology innovation: Intero aggressively pursued the mobile opportunity in 2009, resulting in greater consumer engagement and enhanced productivity for agents and franchisees. The 2009 Intero mobile initiative included a GPS-enabled listings service, a WAP (browser-based) mobile application, and a native iPhone application.

A pioneering new office model: While many real estate organizations continue to discuss a leaner, more attractive office model, the Intero Andare(sm) office concept experienced its third full year of operation. The Intero Andare office concept features a “cafe-style” workspace, a paperless work-flow and a high-tech, stylish appearance that permits brokerage operators to realize efficiencies while presenting a more compelling brand experience to consumers and agents.

An aggressive digital media strategy: Over the past three years Intero shifted 90% of its media spend from print to digital, increasing Web traffic and consumer and agent engagement. In 2009 the company accelerated this effort, launching a network of blogs, expanding its presence on Facebook, Twitter and YouTube and launching a highly successful series of email newsletters.
“The Intero® brand, with its proven formula for rapid growth and sustained profitability, has been received extremely well by entrepreneurs around the world looking for a compelling business opportunity,” said Javier Parraga, President of Intero International Franchise Services, LLC. “Because of the innovative spirit that drives the company, we’ve been able to present a compelling picture that other, more traditional brands cannot.”

Concludes Blefari, “2009 was a difficult year in many ways, but served to validate our vision for a different kind of real estate organization guided by an innovative sensibility that produces results.”

About the Intero® brand

Founded in 2002 Intero Real Estate Services, Inc. has quickly become one of the premier real estate brands in the U.S. Today, the Intero® brand  has over 1,800 agents and 40 company owned and franchise offices covering California, Colorado, Nevada and Texas. The company is private and headquartered in California’s Silicon Valley.


Intero Insider: Seeing Signs of Recovery Yet?

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One week, it’s up. The next week? Down. No matter what the experts say, the fact remains that no one really seems to be able to put their finger on how fast or slow the recovery of the real estate market will be.

There are some who say that we haven’t seen the worst of it yet (and we sincerely hope that’s not true).

Others have a shinier view, saying that the turnaround has been made and that we’re well on the way back.

I think it’s more prudent to take things more cautiously. To brace myself for setbacks, but to take heart in the great strides the real estate industry has made in the past year. Make no mistake, however, the recovery of this sector isn’t going to be instantaneous, no matter how badly we’d like it to be. The boom market by which we were spoiled lasted the better part of a decade, and it left a great deal of wreckage in its path.

That said, last week, Standard & Poor’s released its quarterly home price numbers. And what they show is encouraging. They show that, while it’s gradual and slow, recovery is, most certainly, taking place. For the seventh consecutive month, there was an improvement in pricing. Granted, this quarter’s increase was just three tenths of a percent, but it’s an increase all the same.

Substantial gains were seen in San Francisco, which saw a five percent gain, in San Diego and Dallas, each of which showed gains of three percent, and gains that were far above average in Washington, DC, Boston and Denver. Even cities that have been hit (and hit very hard) by the sagging real estate market, such as Las Vegas and Phoenix, saw increases, and that’s not something that’s happened for them in a very long time.

Even Warren Buffet, whom we all can agree knows a thing or two about money, seems to feel that we’ll have recovered from this slump by 2011. He said recently that while prices will remain below “bubble” levels, a more normalized market will be return by sometime next year.

We are, by no means, over every hurdle. We are not sprinting toward the finish line. But we are making progress. Slow and steady, to be sure, but progress. I take heart in that. I think that a measured recovery is the key to winning the race and standing on the podium, once and for all.


Does it Pay to Remodel?

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Every year, Remodeling Magazine publishes the Remodeling Cost vs Value Report. You can now view the 2009-2010 Cost vs Value Report here:

2009 was a year of transition for the remodeling and real estate. One would have thought that the costs for remodeling projects would have fallen, but that turns out to not be the case, although the rise was smaller than in previous years. On the other side of the coin, even though costs increased slightly, the value added of the projects dropped slightly. Of courses some of the difference could be the result of consumers sticking to projects that are “back to the basics”.

According to the report, for now, it looks like “Bling is not the thing.” The four-year Cost vs. Value trend toward smaller, low-maintenance projects and an emphasis on essentials over extras will likely continue to influence homeowners remodeling plans. Exterior improvements were more common, primarily because exterior improvements contribute to the overall look and feel of a building. In other words, in a market where there are more buyers than sellers “curb appeal is king.”

For the San Francisco Bay Area, improvements that increase a home’s value above the project’s cost included, adding a bedroom in the attic, a new deck, new entry doors, kitchen and bath remodels and window replacement.

The report provides data on a national, regional and local level for easy comparisons.


A Condo Here or a Single Family Home There?

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One of the classic trade-offs in real estate is the choice between a single family house with a longer commute versus a more centrally-located condo or townhome.   If you decide to go for the condo or townhome – here are 9 critical items to consider when considering a purchase:

  1. Homeowners Dues – are they too high?  too low?  High dues (in comparison to other similar properties in the area) could reduce your purchasing power and may indicate that the complex is playing “catch up” on deferred maintenance.  Unusually low dues may indicate that the association is under-budgeting for future maintenance and repairs – potentially resulting in a future “special” assessment.
  2. HOA Financial Analysis – how are the budget and cash reserves for the Homeowner Association (HOA)?  Are there any special assessments in the recent past or in the near future?
  3. HOA Documents – Carefully review the documents governing the Homeowners Association – including the CC&R’s  (Covenants, Conditions & Restrictions) as well as less formal documents like newsletters.  Consider hiring a real estate attorney to review these documents.  Newsletters may indicate potential issues that could become litigation or special assessments in the future.
  4. Exterior condition – do you like what the outside of the complex looks like?  If the landscaping, parking lot, or pool looks like a “fixer upper” – it may not be easy to convince your new neighbors to agree and fund the changes.
  5. Parking – how’s the parking in the complex – not only for you – but also for your guests?   If guest parking is limited to “street parking” – check out its availability at a peak “at home” times like Sunday evenings.
  6. Floor plan – does the layout of the condo work for you?  Unlike a single family home – you won’t be able to “bump out” the dining room 4 feet to make room for Grandma’s china hutch.
  7. Who are Your Neighbors? Two vital stats that may affect your ability to get financing are the percentage of owner occupants in the complex as well as the number of units in foreclosure.
  8. Size of the Complex – Is the complex too small, too big, or just right?  This is a matter of personal taste.  Very small complexes with only a few units may demand more of your time and money to manage.  Very large complexes may feel impersonal, be more complex to manage, and always seem to have several competing properties on the market (which may affect your future resale).
  9. Location, Location, Location – and finally – where is the condo or townhouse located?   Consider both the macro location – where in the Bay Area do you want to live – as well as the specific location of a given complex (commuter route, shopping nearby, schools).

Intero Insider: Selling Short? Keep Track of Everything

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It’s that time of year again. The Winter Holidays are behind us, we’ve cheered a new Super Bowl champion and exchanged boxes of chocolates for Valentine’s Day. That can only mean one thing: Tax Season is upon us.

When it comes to your home, there is plenty of documentation of which you need to keep track when it comes time to file your annual return. For those of you filing “standard” income tax returns, this is all fairly clear and straightforward.

With the current real estate climate, however, there are scores situations, like having lost a home to foreclosure, or staring personal bankruptcy in the face, in which many never thought they’d find themselves. Situations like these can make filing taxes a bit trickier.

There’s one circumstance in particular on which I’d like to focus today:

Short sales.

If you’ve gone through the short sale process (where you can no longer afford the payments on your home, but your lender allows you to sell the home at loss, rather than go through with foreclosure), then you know it’s long, it’s arduous, and it’s one in which things have the potential to be very murky.

When completing the reams and reams of paperwork required by your lender to complete the short sale process, it’s likely that you signed a promissory note, or other like document, granting the lender the right to take action against you to collect the deficient amount. This is pretty standard. It’s possible, though, that you also got a copy of a document with the heading 1099-C, which the lender has filed with the IRS, indicating that the unpaid portion of the loan has been canceled. This is a trigger for the IRS to assess taxes against the forgiven debt.

Wait. What?

“How is that possible?” you might ask. Good question. It doesn’t stand to reason that a lender can pursue you for unpaid debt and that the IRS can assess taxes, as well. Logic would dictate that one or the other is reasonable, but not both.

Keep copies of everything having to do with anything related to the transaction.

If you signed paperwork indicating that the lender can take collection action against you, but you’ve also received a 1099-C for the uncollected debt, you’ll have plenty of documented proof to show the IRS that you don’t owe taxes on that amount. Similarly, if there is nothing in your sale paperwork that gives the bank the right to collect the debt, nor is there any other reference to it, the 1099-C will serve as evidence should the bank, at some point, decide to take action against you.

They can’t have it both ways.

I’m not a tax professional. I’m not certified to give that sort of advice. But I can advise you to seek the counsel of a tax professional, so that negotiating the maze of tax ramifications that come with a short sale is made somewhat easier.

For additional information you can also download IRS Publication 4681 from the IRS website at www.IRS.gov


2010 Census: More than Just Counting People

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2010 Census Details:
The objective of the 2010 Census is to count all residents living in the United States on April 1, 2010. Census forms will be mailed in March and are scheduled to arrive in mailboxes between March 15-17th. Residents are asked to answer ten questions (one of the shortest in history) and return the form by April 1, 2010. Responses to the Census questionnaire are required by law.

Besides counting all residents, the 2010 Census population totals also determine which states gain or lose representation in Congress and how more than $400 billion of federal funding is spent each year on infrastructure and services like hospitals, job training centers, schools, senior centers, public works projects, and emergency services. How California will be affected by the 2010 Census will surely be an anticipated result of this survey.

All responses are confidential, by law, and cannot be shared with any other government agency such as the FBI, the IRS, welfare and immigration.

History:
The first census was taken in 1790 to determine the number of seats for each state in the House of Representatives. This census also provided a better understanding of where people lived and helped to establish settlement patterns as the nation grew. In 1902 the Census Bureau was established. Besides gathering population data every 10 years which is constitutionally mandated, the Census Bureau administers more than 200 surveys annually including the Current Population Survey and economic censuses every five years.

For more information on the 2010 Census, log onto www.2010census.gov.


Are Greener Homes a Passing Fad or Here to Stay?

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solar home

Whether one takes climate change seriously or not, one truth stands tall for any home buyer – energy efficiency, resource conservation and healthy indoor air is becoming a must.  But with the economy still unraveling and the cloud of uncertainty hanging over our heads, a question looms… Can green homes gain traction in our fragile housing  market?

As you may be aware, Santa Clara County real estate market has been quite unpredictable.  It went from four months of inventory into less than one month of inventory in one year and no one really knows what the future holds.  Even some of the biggest market experts have been embarrassed and increasingly keep their Nostradamus like market predictions to themselves.

At the same time, for the past few years, we may have noticed a quiet revolution taking place in our hearts.  Not only we are craving to live happier, healthier and more empowered lives, we are seeking friends and atmosphere that will support that earning.  Also, with raising energy costs and ever growing health problems, many of us are looking for answers right where we sleep – our homes.

So what has kept more people from seeking out these energy efficient and often healthier homes?  Mainly – the lack of awareness and price.  We’ve been conditioned to think that everything green and organic come with an extra big price tag, and with a good reason!  However, when it comes to homes it’s not always true.

Some new home builders who have built green home developments in San Jose claim that their homes are not more expensive than their non-green certified competition. The reason being is that builders are able to buy renewable energy systems like solar panels at bulk prices and receive incentives from PG&E and the state.  In fact, smart builders can use fewer resources to build homes and save money on materials.  This effectively helps developers pass the savings to the consumer.

Now if an older home has undergone a deep retrofit and was upgraded with energy saving systems like solar panels or solar water heater, it may indeed cost a bit more than regular homes.  One must keep in mind though that here we must look at price vs. cost of ownership analysis.  What do I mean?  Well, imagine your home had a mortgage that is $100 higher than your neighbor’s but you were saving $150 in utility bills, would that be such a terrible predicament to be in?

One may say… but wait, some folks really go all out with their upgrades and “eco-chic” elements that they will never re-coup the costs.  It’s true, but it’s also true with high end upgrades that have nothing to do with energy efficiency or sustainability.

As for the future of our real estate market and green homes, my crystal ball has nothing but beautiful images.  Why?  Because energy conserving homes not only produce less pollution but also because owning one will absolutely, most definitely make perfect financial sense.

Think about it, if you had a choice whether to buy a home that is more energy efficient, healthier for your kids, and conserves resources or a home that was built to minimum standards that had high utility bills, which would you choose?  You see, once we are increasingly presented with this choice in the future, the decision will be as easy as popping a soap bubble.

Personally, I am thrilled to see more and more people considering the impact their homes have on the environment.  In addition, something very profound is taking place during this economic turmoil – we’re shaping to be smarter consumers.  We’re growing in wisdom that we must consider the true cost of owning “stuff”.  This is why greener homes will set new standards of quality and resource management in the very near future.

More on Green Homes:  http://SanJoseGreenHome.com


Intero Insider: A Delicate Balance

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For the past two years or so, our nation’s economy has been floundering, doing all it could to get its head above water. The real estate industry has played — and continues to play — rather a large role in how the story pans out. But contributing to successes and failures in our own industry are untold numbers of mitigating factors, from fraudulent lending and sub-prime mortgages, to over-inflated sales prices, foreclosures, tax credits, and the some of the best sales prices in recent memory. When working together properly, these things can spur wonderful upward movement.

When something is knocked even slightly askew, however, that delicate balance can be thrown into a tailspin.

There has been great news of late, of course. Many neighborhoods across the nation have seen upticks in sales prices, many listings are, once again, seeing multiple offers, and interest rates are at astonishingly low levels.

Now, though, we are holding our collective breath, as several things that have helped spur the market along are poised to come to a halt.

First, the homebuyer tax credit. It’s been credited (no pun intended) with getting a lot of buyers into the market that wouldn’t have been otherwise. It was expanded in the Fall, but will expire this Spring.

Strike one.

Second, foreclosures. As we’ve reported already, the incidence of foreclosure continues to rise. Many homeowners in financial distress are simply making the decision to walk away from their homes, and their debts right along with them.

Strike two.

Third, we have another wrinkle. Those low interest rates that we just mentioned? They’re due in large part to Federal Reserve purchases of mortgage-backed securities. Thus far, the Fed’s purchases total almost $1.25 trillion dollars, but those purchases are due to stop near the end of March. This move will likely cause interest rates to turn upward. How much will they rise? That remains to be seen, but initial estimates have them climbing by more than a percentage point by year’s end.

Strike three.

These three factors coming together at roughly the same time could, potentially, throw the tenuous balance and modest signs of recovery we’ve seen thus far completely off kilter. The ever-changing conditions make the handling of a real estate transaction, whether for a buyer or a seller, all the more difficult. Intero’s real estate professionals stay up-to-date with the latest trends and will know which will affect you, and which won’t.

Negotiating the most important financial decisions of your life requires all of the information.  Your Intero real estate professional has that information and will help you keep things in balance.


Mortgage That Matters: A MORTGAGE IS NOT A COMMODITY

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From time to time I hear people saying that the mortgage loan officer is a dinosaur.  The reasoning is that a mortgage is commodity, that every mortgage has the same criteria, and that they are, therefore, mere commodities.

By extension, the argument goes, borrowers do not need humans involved in the process, and that they can benefit from reduced costs by eliminating the human element from the equation.

When I hear this argument, I wonder if the person ever got a mortgage.

If they had, they’d know that the “human element” is critically important and that many, if not most, borrowers would never be able to buy a house without assistance from the Realtor and the loan officer.

As an example, think about all the subtleties of various loan programs.  Let’s assume a borrower goes online and choose Program 1-A and gets turned down.  He then applies for Program 2-A, Program 3-A and Program 4-A, getting turned down at each of them.

At this point, does he get so discouraged that he simply gives up?

Had their been a loan officer and Realtor involved, he’d have known that of the ten programs offered, he only qualified for the tenth one.  A knowledgeable loan officer could have steered him right away to program 10-A and made certain he chose the right loan program to match his individual situation.

One argument for eliminating the human element also has to do with the reduced number of programs. The argument is that loan officers were needed 2-3 years ago when there were hundreds of programs, and the borrower needed help choosing among all these choices.  Now, they, say, it’s either a conventional 30 year fixed or an FHA 30 year fixed, and anyone can choose between these two.

Again, no one would say this if they’d tried getting a loan recently.  Awhile the number of programs has, indeed, shrunk, it’s a heckuva lot more than two.  And more importantly, while there maybe be fewer programs, they’re all much harder to qualify for.

A good loan officer can help borrowers choose the right program and help them qualify for that.

And no computer program can ever do that as well.