Benefits of Working with a Boca Raton Realtor

Home buyers and sellers find limited success without Realtors

In Boca Raton, many home sellers find themselves to be internet savvy. So when the time comes to sell their home, many decide to use a Web-based real estate company that promises to charge less than a traditional real estate agent. But, for most clients, the process doesn’t work out as planned.

Many times, sellers who try to sell their home have to deal with extremely low bids because buyers think they can deduct the normal realtor’s commission from the asking price. The price ends up being under market value, yet the seller has all the headaches and work ahead of them.

After months of not being able to sell their home, or becoming tired of dealing with low bids, most home sellers change to a traditional Realtor who is able to market their home both online and offline. This in turn provides more exposure allowing the seller to sell their home in less time for a higher price.

With home selling slowing down, it is becoming more and more apparent how crucial the role of a Boca Raton Real Estate Agent is when selling a home. Many sellers have come to realize that they are better off with the services of an agent who can best market their home and who are most familiar with the specific activity of their Palm Beach County neighborhood when pricing their homes.

Buyers are also realizing that using a local expert to find the right home can save them money when it comes to negotiating down the road.

Real estate on the Internet

Selling or buying a home on your own can be very emotional and time consuming. The Internet allows people to educate themselves about what's on the market, preparing them for the realities of the future.

The National Association of Realtors estimates that 77% of home buyers used the Internet to search for a home in 2005. Ten years ago, only 2% of home buyers used non-traditional methods.

With the rising use of the Internet, consumers still turned to Realtors to help them with the process of buying a home. While only 9% bought their home directly from a seller, 12% worked with a builder and 77% of home buyers used an agent.

"Real Estate Professionals provide a value and service that will never go away. Says Steven Koolik, broker of Koolik Group Realty. If you are using a realtor that is not familiar with the neighborhood you are moving into, you may find yourself paying too much for your next home.”

Sellers and the Internet

One of the main advantages for sellers to use a Boca Raton Realtor is to help them market their home to the most buyers as possible. Sellers should consider an agent's complete marketing plan before giving them the responsibility of selling their home.

Sellers need to have maximum exposure in order to sell their home quickly. “Since being in business for over 15 years, I have found that our unique marketing plan allows us to sell more homes quickly.” Says Elliot Koolik of Koolik Group Realty. “With the proper use of a detailed marketing plan that utilizes multiple print and online venues, we had a home that recently went under contract in 2 days!”

Maximum exposure can be especially beneficial for higher-end homes that may have a more niche clientele. Taking pictures of a property is a key part of the homes marketing power.

“Some agents fail to take enough photos.” says Michelle Linger of Koolik Group Realty. “We find that it’s best to take 20 or more pictures to provide buyers an in depth view of the home they are interested in.”

Sellers who are thinking about selling a home without a Realtor from the Boca Raton area should keep in mind some of the turbulences that can be encountered to complete the deal at the right price -- even with the help that the Internet has to offer.

Online home valuation web sites can often mislead sellers on the correct pricing of their home. Most of the home values sites are based on public-records – but don’t provide for exceptions.

Pricing a home should not be based entirely on public-record information that can be found online because it won’t take into account a home that will be priced lower for being on a busy street, or a home that will be valued more for being on a lake.

Using a Realtor is a key component of selling a home during a slow market. Successful realtors have access to a list of buyers, and homes not being professionally marketed by an agent could take longer to sell.

Buyers and the Internet

The Internet has revolutionized helping buyers to become more efficient with their research. It's easier to narrow down the neighborhoods they're interested in, saving them valuable time. Web sites are offering more and more features daily, including statistics about the neighborhood, schools, development/subdivision information, surrounding areas of interests, etc.

The number of people who locate their dream home through the Internet and then execute a contract for sale completely through an online process is slim to none. Mainly, the Internet provides a starting place for buyers to begin their search.

Although many listings find their way to the Internet, Realtors are still ahead of the curve when it comes to all available homes on the market. Most of the time, Realtors know about properties that are going to be coming on the market well before they become listed for sale.

Actually negotiating a contract, also requires a certain finesse, that a licensed Realtor will be trained to handle. Using a local expert from the Boca Raton, Delray Beach or Highland Beach area, will help buyers make sure they don’t pay too much for a home. An expert Realtor familiar with the neighborhoods of Palm Beach County will know more about the price that homes are currently selling for – versus only knowing the price homes have sold for in the past. This can make a big difference when negotiating your final offer price on that home you’ve fallen in love with.

The Internet has become more of a research tool for prospective home buyers and sellers -- not a replacement for a real estate professional who can take you from the beginning to the end of the home buying process.

About Wendy and Elliot Koolik: Wendy and Elliot Koolik are a recognized leader in the Boca Raton luxury and country club real estate communities. While they are active in all of Palm Beach County, they focus on Boca Raton, Delray Beach and Highland Beach.

Wendy and Elliot Koolik are part of Koolik Group Realty, a family-owned and operated real estate company serving buyers and sellers since 1990. The real estate firm is known for its responsiveness to clients, knowledge of the neighborhoods they specialize in and, above all, for its boundless passion for the real estate business.

For more information, contact Wendy and Elliot Koolik by phone at 561.393.9997 x113, online at www.ElliotKoolik.com or by e-mail at EKoolik@Koolik.com.

Tax Myths of Owning a Home

5 tax myths about owning a home

Owning a home tops the dream list for most Americans, and for plenty of good reasons. It's a shelter for your family, a gathering place for your friends and a good long-term investment.

Tax breaks are also frequently cited as motivation for moving from renting to owning, and there are many ways a home can cut your tax bill.

But, as is often the case with the U.S. tax code, homeownership tax benefits are not always clear-cut. That frequently leads to some bad information floating around.

While myths, half-truths and misconceptions may abound, we've narrowed it down to five that, if you buy into them, could cost you.

1. My mortgage interest will reduce my tax bill.

This is true for the majority of homeowners, but not for all. And this tax break won't work forever.
To take tax advantage of your home loan's interest, you must itemize and come up with a total that exceeds your standard amount. On 2006 tax returns, the standard deductions will be $5,150 for single taxpayers, $7,550 for head of household filers and $10,300 for married couples who file jointly. These amounts increase a bit each year to account for inflation.

"Given home prices these days, most owners are itemizing," says Mark Luscombe, principal tax analyst with CCH Inc. of Riverwoods, Ill. By the time they count mortgage interest, property taxes and other nonhome deductions, such as state taxes and charitable gifts, their itemized totals easily surpass their allowable standard deductions.

But most is not all.

Taxpayers who buy a home late in the year, for instance, might find the standard deduction is more beneficial, at least initially, says Kathy Tollaksen, a CPA at Sikich LLP in Aurora, Ill. In these cases, where you make only a few payments in a tax year, depending on your loan you might not pay much interest, at least not enough to exceed standard amounts.

Timing also could reduce or eliminate other home-related tax breaks.

"Quite a few states have real estate taxes that are calculated in arrears. That is, they have already been paid or mostly paid (by the seller) by the time you buy," says Tollaksen. "In the first year, you're seeing taxes that are someone else's responsibility so you're not getting the full tax value of your real estate taxes."

The benefit of mortgage interest also could be a myth if you've lived in your home for a long time. In this case, you likely are paying more toward your loan's principal instead of interest. So homeowners at the end of a loan term don't get much, if any, from this tax break.

Or, as Bob D. Scharin, senior tax analyst and editor of Warren, Gorham & Lamont/RIA's monthly tax journal "Practical Tax Strategies," puts it, "Every deductible expense you incur may not produce a deduction."

2. All costs related to my home are deductible.

There are no two ways about this one. It's flat-out false.

"Some buyers think, hope, they can write off everything connected with the house," says Tollaksen. "Not so. Association fees and property insurance costs are not deductible."

Neither is private mortgage insurance, which your lender probably required if your down payment was less than 20 percent.

And you can't deduct basic maintenance, repair or home improvement costs either.

Tollaksen says, "I've had people say, 'I put a new roof on my home; can I deduct that?' No."

If you try to write off these expenses, expect to hear from the Internal Revenue Service and to pay a higher tax bill (and possible penalties and interest) after you refigure your taxes without the disallowed deductions.

However, you still need to keep track of these expenses.

"If you convert the home to rental property or sell it," she says, "these costs will affect the property's tax basis."

A home's basis is critical when it comes time to sell. And selling is also a tax area in which many people fall for myth No. 3.

3. I must use money from my home sale to buy another residence.

This used to be the only way to get around a tax bill on a home sale. Even then, you were only able to defer taxes by purchasing a new residence of equal or greater value with the profits from your other house. When you sold your final house, you'd owe those long-deferred taxes you had rolled over throughout the years. Home sellers age 55 or older were allowed a once-in-a-lifetime tax exemption of up to $125,000 in sale profit.

But on May 7, 1997, home-sale tax law changed. Still, almost a decade later, many homeowners are confused about the tax implications of selling.

"I recently heard some neighbors talking about having to buy another house when they sell to avoid the taxes," says Scharin. "If the last time you sold the house was before 1997, you're thinking of those old rules."

Don't worry. Most taxpayers still get a nice break. Now, if you live in the house for two of the five years before you sell, the IRS won't collect tax on sale profit of up to $250,000 if you're single or $500,000 if you and your spouse file a joint return.

"The law change has really affected people's behavior," says Luscombe. "Before, it didn't really matter much whether you sold frequently or held onto your home for a long term. You, basically, could roll over the gain into a larger home and people could avoid tax until they sold for the final time without putting it into a replacement home.

"Now the law rewards people who sell frequently. In this current market, people who sell every couple of years can get and keep their gain," Luscombe says. "But people who buy and hold might find they have reached the point where the gain exceeds the exclusion."

That means they face unexpectedly high tax bills, even at the lower 15-percent capital gains rate. The profit could also push them into a higher overall tax bracket, meaning they would make too much to claim some deductions, credits or exemptions. They also might even end up owing alternative minimum tax.

Another problematic consequence, says Luscombe, is that when the new rules took effect, people basically quit keeping records related to their homes.

"They thought: Since we're never going to be taxed on the sale, there's no need to keep track of what we paid and what improvements we made," he says. The improvements add to your home's basis, which you subtract from the sale price to determine your profit and whether any of it is taxable.

"Now with inflation in the housing market, a lot of people are selling homes in excess of the gains without any way to show that their tax bill should be less," says Luscombe.

4. Putting my child on my home's title is a smart tax move.

Worries about taxes on a residence sometimes lead homeowners to fall for this myth. It's a particularly tricky one, because it combines confusion about residential taxes with the even more complex estate-tax area.

"Sometimes we'll hear about taxpayers who, in doing some quick back-of-the-envelope estate planning, decide to put their home in the children's names," says Tollaksen. "The thinking is: My son or daughter won't have to worry about this when I die."

The goals: Avoid probate, keep the home in the family and get the property out of the parent's estate for those tax purposes. Such a move, however, could produce other tax problems for your children.

Unless the child moves into the newly deeded house with the parent and lives there long enough (two of the previous five years) to make the house the child's main residence, too, says Tollaksen, the son or daughter won't get the $250,000 or $500,000 residential tax break when the child later decides to sell. Without establishing primary residency in the house, either before or after the parent passes away, the child's ownership is viewed as an investment property.

Other parents opt to simply add a child's name along with theirs on the title to the house, known legally as a joint tenancy. It doesn't mean that all the owners live in the home, but simply that two or more people hold title to the property.

This, too, can produce tax complications.

Generally, when someone inherits a property, its value is stepped up. That means when the owner dies, the property becomes worth its fair market value that day.

But if the child co-owns the property with his parent, the child doesn't get to fully use stepped-up basis. Tax law considers the addition of the child's name to the title as a gift. And, along with that half of the home, the child receives half the basis that his or her parent has in the property.

This is known as the property's carry-over basis. And it could be costly.

Consider, for example, that you bought your house many years ago and your basis in the property is $50,000. You add your daughter to the title. When you die, she inherits your half of the home, which by then is worth $250,000. A buyer offers $300,000 for the home.

Pretty good deal, right? From a real estate perspective, yes. But not when it comes to your daughter's tax bill on the sale.

Tax bill on the sale

Rather than owing taxes on just $50,000 more than the house's stepped-up market value, your daughter will owe on three times that amount. Here's the math:

1. Parent owns home with a basis of: $50,000
2. Parent adds child to title, "giving" child carry-over basis of: $25,000
3. At parent's death, house is worth $250,000
4. The inherited half now has a stepped-up basis of: $125,000
5. Home subsequently sells for: $300,000
6. Child's total adjusted basis (line 2 plus line 3) is:$150,000
7. Taxes due on sale profit (line 4 sale price less line 5 basis) of:$150,000

What had been done with the best parental intention turned out to carry a big price because of this homeownership tax myth.

5. If I take a capital loss when I sell my home, I can write it off.

This myth, like No. 2, was probably started by wishful homeowners. Sorry, it's just as wrong.

It is true that real estate, like any other asset, has the potential to go down as well as up in value. But unlike most of those other holdings, you cannot write off any loss you suffer if you must sell your main residence for less than what you paid.

That's because your residence, under tax law, is considered personal property.

"When you sell your home for a loss, it's not like other capital items," says Scharin. "You don't get to deduct personal property that you sell for a loss."

"It's the same as any personal property that declines in value," says Luscombe, "like that old TV you sold to the neighbor kid so he could take it to college. You sold it for much less than you paid, but you can't take a loss."

You do, however, have to pay tax on gains you make when selling personal property.

But at least you now know the difference between fact and fiction when it comes to your residential property, which will help you make appropriate real estate and tax decisions in the future.

Article is written by freelance writer Kay Bell writes Bankrate's tax stories from her home in Austin, Texas, and blogs on tax topics at Don't Mess with Taxes

About Elliot and Wendy Koolik: Elliot and Wendy Koolik are a recognized leader in the Boca Raton luxury and country club real estate communities. While they are active in all of Palm Beach County, they focus on Boca Raton, Delray Beach and Highland Beach.

Elliot and Wendy Koolik are part of Koolik Group Realty, a family-owned and operated real estate company serving buyers and sellers since 1990. The real estate firm is known for its responsiveness to clients, knowledge of the neighborhoods they specialize in and, above all, for its boundless passion for the real estate business.

For more information, contact Wendy and Elliot Koolik by phone at 561.393.9997 x113, www.ElliotKoolik.com or by e-mail EKoolik@Koolik.com.

The Right Realtor for You

Top 9 tips on choosing your Boca Raton Realtor

1. There are thousands of Boca Raton Real Estate Agents, as well as Realtors in Delray Beach and Highland Beach. Some are new to the industry, and some are well qualified. What will help you the most is someone with years of real estate experience who can successfully help you in the buying and selling process.
   
   
2. Everyone knows a real estate agent. They may be a friend, a family member, or even your mail man. Nowadays, it seems as though everyone has their real estate license. But, what can be most helpful is having an agent who is familiar with the Boca Raton, Delray Beach and Highland beach area to help inform you of the neighborhoods, schools, market conditions, zoning regulations and local economy.
   
   
3. Whether you’re buying or selling, having a real estate agent who keeps you up-to-date with new listings and conditions as they impact the market, is crucial. Palm Beach County real estate is an ever changing real estate market, and for that reason, must be diligently studied on a daily basis.
   
   
4. Find an agent who is treating their career – like a career. Too many real estate agents in Florida are only part time. Don’t short change yourself – use an agent who only works as a full-time real estate agent.
   
   
5. Finding a home is only half the battle. Make sure your realtor has partnerships set up throughout Boca Raton, Delray Beach, and Highland Beach so you can access their connections throughout the mortgage, insurance, title, and inspection industry to get you the best pricing possible.
   
   
6. Interviewing your real estate agent can tell you a lot about their personality. If you are buying a home, spending several hours a day in a car with a real estate agent who smokes can be torture if you don’t smoke. If you’re listing your home for sale and you’re a laid back person, having a high strung realtor can aggravate you very quickly. Do your homework – check out their personality.
   
   
7. Buying a home, whether it’s your first or your tenth can be very hectic. Finding a realtor who will guide you through the complexities of buying and/or selling a house can dramatically eliminate a lot of hassles and stress.
   
   
8. Time is valuable – and in the real estate industry, it’s even more valuable. For every second you hesitate, you maybe losing out on buying your dream home or losing out on selling your home. Make sure the right real estate agent doesn’t waste your time. When an offer is made to buy/or sell a home, require your realtor to disclose to all parties that an acceptance or a counter offer must be made in 24 to 48 hours.
   
   
9. Accessibility is very important. You’re realtor should provide you with personal, one-on-one attention, as well as several options to advertise your home and contact them. Compare several realtors and see what marketing techniques they use as well as how easy they make it for you to contact them. Obviously – the more the better.
   

A good, qualified realtor is like finding a needle in haystack. Knowing someone with a real estate license doesn’t necessarily mean they are best person for the job.

Take the time and do your homework - - you’ll save yourself a lot of headaches in the end.


About Elliot and Wendy Koolik: Elliot and Wendy Koolik are a recognized leader in the Boca Raton luxury and country club real estate communities. While they are active in all of Palm Beach County, they focus on Boca Raton, Delray Beach and Highland Beach.

Elliot and Wendy Koolik are part of Koolik Group Realty, a family-owned and operated real estate company serving buyers and sellers since 1990. The real estate firm is known for its responsiveness to clients, knowledge of the neighborhoods they specialize in and, above all, for its boundless passion for the real estate business.

For more information, contact Wendy and Elliot Koolik by phone at 561.393.9997 x113, www.ElliotKoolik.com or by e-mail EKoolik@Koolik.com.

Mortgage Rates Fall

30-year mortgage falls to 6.48%


The benchmark 30-year fixed rate mortgage average fell in the week ending Thursday, to 6.48% from 6.52%, according to Freddie Mac. The mortgage agency said its weekly survey showed the 15-year loan decreased to 6.18% from 6.2%. The 1-year Treasury-indexed adjustable rate fell to 5.6% from 5.65%, while the 5-year hybrid ARM also decreased, to 6.14% from 6.18%.

"The Fed has acknowledged that it is closely monitoring the housing market as it slows down from last year's record pace," said Frank Nothaft, Freddie Mac chief economist, in a statement.

"Although this fuels arguments about whether we will experience a soft landing or a bursting housing bubble, market watchers also perceive that it possible that the Fed may stop raising short-term interest rates over the near term. This perception takes upward pressure off mortgage rates."

As Posted on www.MarketWatch.com

Choosing Your New Community

Questions to Ask to find the Right Community for You

“Neighborhoods have personalities, and finding one that’s right for you can be as difficult as finding the perfect home,” explains Elliot Koolik. “We know that a house is a building, but it is your community that will establish your new social life, your children’s playmates, your hobbies and activities of interest, and all of the services available to you and/or your family.”

Wendy Koolik adds, “People want to feel as comfortable in their neighborhoods as they do in their homes. They like to know they’ll be welcome and safe from the day they move in – and for years to come.”

Here are some of the basics the Kooliks suggest you look at when you’re choosing your new neighborhood:

• Proximity to work centers, highways, public transportation and other transit options.
• Access to basic services like grocery stores, restaurants, post offices and cleaners.
• Proximity and quality of hospitals and medical centers.
• Proximity to parks and recreation facilities, especially for families with children.
  

Wendy Koolik also advises home-seekers to choose an agent who concentrates on specific neighborhoods. “He or she can provide good information about the inner workings of the community, neighborhood events and the overall personality of the area,” she explains.

Here are some other important factors to investigate:

Appearance

Drive around or take a walk through the neighborhood. Note the general upkeep. Well-kept, tidy yards show a pride of ownership that affects property values.

Schools

For families with young children, a good school district is essential. Local schools report how much is spent per child and test scores also should be readily available.

Transportation and Amenities

Time your commute to know how long – not just how far – it is to work. How close are the highways? What about parks and recreational facilities? What about the closest grocery store, bank or post office?

Property Values

Check recent sales for homes in the neighborhood. Ask how much property taxes have increased. Your real estate agent should have this information at his or her fingertips.

Utilities

Learn what utility costs are by asking your real estate agent or by calling the water, gas, cable and electric companies for rates. Utilities can add substantially to the monthly cost of a home.

Elliot Koolik offers this final tip. “Spend time in the community at different times of night and day. Visit local stores and restaurants, check out nearby attractions and pick up the local paper. And, the absolute best way to get the feel of a neighborhood is by talking to its residents. Don’t be shy about speaking to your future neighbors. Remember, they were once the new kids on the block!”

About Wendy and Elliot Koolik: Wendy and Elliot Koolik are a recognized leader in the Boca Raton luxury and country club real estate communities. While they are active in all of Palm Beach County, they focus on Boca Raton, Delray Beach and Highland Beach.

Wendy and Elliot Koolik are part of Koolik Group Realty, a family-owned and operated real estate company serving buyers and sellers since 1990. The real estate firm is known for its responsiveness to clients, knowledge of the neighborhoods they specialize in and, above all, for its boundless passion for the real estate business.

For more information, contact Wendy and Elliot Koolik by phone at 561.393.9997 x113, online at www.ElliotKoolik.com or by e-mail at EKoolik@Koolik.com.

**As Seen in the Palm Beach County Sun-Sentinel Sunday Newspaper**

My first blog!

Today I started my first blog. I am excited to comment on the local Boca Raton, Delray Beach and Highland Beach luxury real estate market. Look for my comments and information soon!