Governor O’Malley Signs New Real Estate Legislation

On May 20th, Governor Martin O’Malley signed hundreds of bills into law.  Summaries of several real estate bills he signed are listed below, including three MAR priorities: legislation prohibiting the taxation of forgiven debt in short sales; legislation giving small businesses the ability to pay property taxes semiannually; and legislation regulating real estate teams.

No “Sales Tax” on Home Sales in Recently Enacted Health Reform Bill

Contrary to reports and newspaper articles circulating widely on the Internet, there is not a “sales tax” or “transfer tax” on the sale of a home included in the recently signed health care reform bill. The analysis underlying these reports is incorrect.

Beginning in 2013, the health bill imposes a new 3.8% Medicare tax on “net investment income” earned by taxpayers with Adjusted Gross Income of more than $200,000 for individuals or more than $250,000 for married couples. Since capital gains are included in the definition of net investment income, a tax obligation might result from the sale of real property. In the case of the sale of a principal residence, the existing $250,000/$500,000 exclusion from capital gains on the sale of a principal residence remains unchanged. Therefore, even when the AGI limits are met, the new tax would apply only to the gain realized on a home sale in excess of the $250K/$500K existing primary home exclusion that pushes the filer’s AGI over the $200K/$250K adjusted gross income limit.

Here is the language from the bill:

Celebrate The Finer Things – A benefit for Cystic Fibrosis

You are Invited to Celebrate a night of The Finer Things
A benefit for Cystic Fibrosis

At the home of Tim Evankovich and Jamie Coles
Saturday, May 22, 2010 6 – 11 PM
13037 Hall Shop Road
Highland, MD 20777

GRAND SHOWCASE OF LIFE’S FINER THINGS BY OUR SPONSORS:

Wine Tasting by Salvestrin Wines
Art Exhibit by World Renowned Artist, Thomas Arvid
Private Dinner featuring Culinary Delights by Chef’s Expressions
Silent Auction featuring the finest selection of exquisite jewelry by J. Brown Jewelers and Rolex
Sunset Cruise on “Suzie’s Choice” by Stuart & Suzanne Amos and Aris Melissaratos
Dinner for Two by bistro blanc
Introduction to The Ritz Carlton Residences at the Inner Harbor Baltimore
Explore the new Mercedes-Benz MAYBACH
Enjoy Premium Chocolates by GODIVA Chocolatier
Live Music & other delights!

Tickets are $100 each – proceeds benefit The Cystic Fibrosis Foundation

($50 per ticket is tax deductible)

Purchase Your Ticket Now!

Reservations are limited. Cocktail Attire.

Housing Affordability Near Record High

You have no doubt seen or heard the press mention that the ‘Affordability’ index is at or near record levels. The NAR’s Housing Affordability Index (HAI) rose to the range of 160-170 this year, setting record high levels.

Housing Affordability – Whichever Index You Look at, The Value Story is Great for Buyers

• First, there are actually several indexes out there from various sources. For example, the NAHB (National Association of Home Builders) has one they call the Housing Opportunity Index or HOI and the NAR (National Association of Realtors) publishes the Housing Affordability Index or HAI.
• While both indicate we are at or near record levels, I want to focus on the NAR index as the topic of today’s note.

The NAR Housing Affordability Index – What is It?

• Essentially, the index is a measure of the financial ability of U.S. families to buy a house.
• In the simplest terms, an index value of 100 means that a family with the median income has exactly enough income to qualify for a mortgage on a median-priced home.
• An index above 100 signifies that a family earning the median income has more than enough income to qualify for a mortgage loan on a median-priced home, assuming a 20 percent down payment.

The NAR Housing Affordability Index – Trending Higher

• The current index at the end of 2009 stood at 171.6 – 56 points above where it was at the end of 2007!
• What this shows is that the relationship between home prices, mortgage interest rates and family income is very favorable right now.
• The NAR has said that it is the most favorable since tracking began in 1970!

Just Released – Northrop Team Certified Home Collection Spring 2010

The Northrop Team is proud to announce the Spring 2010 issue of The Northrop Team Certified Home Collection is now available! This custom magazine allows us to keep one step ahead of our competition and showcase all of our active listings, in full color, to potential homebuyers across the Baltimore/Washington area.

Over 30,000 printed copies are currently being distributed in coffee shops, restaurants, metro stops, hotels, dry cleaners, and other high traffic locations near you. Be sure to pick up a copy, or click below to view a cutting edge, digital, flip-through version!

As you know, The Creig Northrop Team has devoted ourselves to ensuring that ALL of our properties receive the highest level of service at all times and we will continue with these extraordinary expectations throughout the coming year.

Sincerely,

NEW Mobile Real Estate Application Now Available!

One of the top real estate agents in Maryland is introducing a way for clients to view all of the homes for sale in the area with any cell phone. The Creig Northrop Team of Long & Foster Real Estate is providing clients with a mobile real estate search created by Smarter Agent that makes it possible to search all local property listings from their mobile device, regardless of whether it is listed by Creig Northrop or another broker or agent. Creig Northrop’s mobile real estate search is the only house-hunting tool that works on 95% of cell phones across all carriers.

With Creig Northrop’s Smarter Agent application, interested home buyers can be in any neighborhood and view detailed property information at the touch of a button. The GPS technology in the mobile phone, when available, locates users and pulls up addresses and information on listings in their immediate area. Sales price, square footage, tax information, beds/baths, interior and exterior features, pictures and more become available instantly in the palm of their hand.