Thursday, January 21, 2021
Wednesday, January 13, 2021
I have had several seller clients ask me recently about the implementation of California Proposition 19, which passed back in November. I think most people assumed it would go into effect at the beginning of 2021, however that is not the case. I prepared a table that I hope will be a helpful reference tool for those seeking general information.
The property tax basis portability element of Proposition 19 actually goes into effect on April 1, 2021.
This allows seniors (over age 55), the victims of wildfires, and severely disabled to transfer their existing property tax base up to 3 times, anywhere in the state, and to a property of higher or lower value.
Many Sacramento home sellers have asked me if they can sell the current home and close the sale prior to April 1. Or if a home they sold in 2020 would qualify if they have not purchased another one yet. The short answer is - I do not know.
Proposition 19 (which was Assembly Constitutional Amendment 11 in the state Legislature) does not address that. A qualified homeowner has 2 years to identify and close on a replacement property to transfer the low property tax base over to, however it is unclear if that 2 years commences on April 1, or there is perhaps a 2 year lookback period commencing on April 1.
It is possible that there will be some new legislation introduced soon to eliminate that ambiguity in Proposition 19, but as of this minute there is no clarity.
For now, I suppose the safest solution is -- do not close the sale of your current home until April 1 or later. Realistically, if you want to list your Sacramento home in the near future, you should be able to do so. The closing date of your transaction is completely negotiable. And your listing agent can note in MLS that the sale must close on or after April 1.
So for example, if you were to list your home on February 17th, respond to offers received on the 24th, get into contract with your buyer on the 26th, -- closing on Friday, April 2nd would be slightly over a 30-day escrow.
I have a couple seller clients who will be employing this very strategy. It's a seller's market right now, and they'd love to list their homes asap.
Since I am not an attorney and not a CPA, it is best to get tax and legal advice from qualified professionals.
Wednesday, December 23, 2020
Thursday, December 10, 2020
While in December 2020, we are FINALLY seeing something that looks like a normal seasonal slowing typical of the holidays, the combination of really low numbers of homes on the market, really low sub-3% interest rates, and people highly valuing different uses of space has lead to HIGH buyer demand and LOW SUPPLY, and increased prices. In fact, from November 2019 to November 2020, according to Trendgraphix, the median home price in Sacramento county has increased 15.3%, from $385,000 in November 2019 to $444,000 today.
Multiple offers abound, homes selling for more than listing price, prices increasing. I know: this is contrary to what you were probably thinking. But if you dig into the dynamics and data it makes a lot of sense. I wrote about Sacramento real estate market dynamics in July 2020 and the housing market trajectory in Sacramento has remained the same.Sacramento as there were this time last year. And you will also notice that far more homes in contract or that have sold compared to the same months last year. Referring to the graph, it is a stunning illustration of the supply and demand of the current Sacramento housing market. You will see that in June, July, August, September, October, and just in November there were MORE homes that went into contract (dark green bar) or sales that closed (red lines) than the number of homes available. That is absolutely breathtaking.
Aside from a slight slowing that is normal for this time of year with the holidays, I do not see any signs of slowing buyer enthusiasm. In fact, in the last couple of weeks since Thanksgiving, I have received numerous calls from new home buyers who are proclaiming that 2021 is the year they will buy a home.
I think as the pandemic has unfolded there are many people who had planned to sell their homes who have hunkered down, deciding not to sell yet. I personally have several would-be seller clients who were ready to list their homes before COVID-19 hit who are staying put for now. I am still listing plenty of properties -- folks still need to move, whether relocating out of state, or moving to different school districts, or moving closer to work, finally getting that home with a pool they always wanted, or upsizing to have a home office, or downsizing after the kids move out, or selling an empty home in a living trust or probate estate, etc. But many sellers are holding off to see what happens.
2021 should be an interesting year. 2020 sure has been!
Tuesday, December 1, 2020
Probate is a legal process through which the applicable county court verifies that a deceased person's assets are distributed according to the deceased's Will or via applicable law. Most people filing for probate need to connect with an attorney who specializes in estate law - I know several great ones if you need a referral.
It is an emotional time for any family, and a confusing path to navigate. Having an expert to help sell the real estate assets of a probate estate is really a key.
This is a path I have traveled both personally and professionally. Not only have I sold many homes via probate processes, but I have also been the personal representative and administrator of my mom's probate estate when she passed away unexpectedly.
I know first hand what the process is like from the inside out, and I try to smooth out the rough edges for my clients.