Nationally - Vacation-Home Market Recovery Sluggish

CNBC's website ran an article about the 'long road' to recovery of the nations' vacation home marketplace. Since a vacation home is the definition of a discretionary expense, only those who have the extra cash, and feel confident spending it, are in the market for a second or vacation home. Nationally, many vacation areas are hurting when it comes to sales volume and home prices. Interestingly, Cape Cod is cited as a 'bright' spot in the otherwise struggling vacation home marketplace.

Check out the article on CNBC.com.....Here.

Cash Is King - In Real Estate Too!

What shouldn't really surprise us in the current real estate marketplace is that cash is king. Cash has always had a nice ring about it, but when mortgage loans get more scarce, sales where no mortgage is required are like music in a Realtor's ears. Just think - no mortgage contingencies, no appraisers, no banker's questions about furniture, holdbacks, and closing costs. In many cases, cash-in-hand provides significant bargaining power over often frustrated Sellers, who just want the process to be problem free.

The Wall Street Journal ran an article, yesterday, on cash buyers. Many of them are foreign nationals looking for a good investment. With prices down already, cash makes the deal even better!  Check out the WSJ article... here.

2011's Rental Season Looking Good!

Summer vacation rental bookings on the WeNeedaVacation.com website are off to a great start. They are up 26% from last year's start and 42.6% from 2009.  This is a good story, which bodes well for the Cape's economy, for home rental landlords, and (hopefully) for the Cape Cod real estate market.

There's probably a second reason for these improved numbers. The Internet is becoming a larger part of the rental marketplace, taking more & more bookings from local rental agents. Read the entire article on the CapeCodToday website...here. That Internet thing is going to be really big!

Multiple Offers On a Home? Who Would Have Thought?

With prices somewhat depressed and mortgage interest rates so low, it was inevitable that some well priced homes would be the recipient of multiple offers. That leaves the potential buyers with the possible 'problem' of having to bid-up to 'win' the property. That could simply mean offering more money or it could means offering better terms, such as all-cash. There hasn't been much head-to-head bidding on the Outer Cape, but it's bound to happen.

Read the article on SmartMoney.com, entitled "Home Buyers Face a New Challenge: Competition" that discusses competition and when to not play the competitive game.

Vacation Homes - Tax Considerations

Owning a vacation home presents a number of situations that have tax implications. Whether it be capital gains from the sale, or reporting rental income, you need to understand the rules. This article covers four areas that you'll find interesting...

• Is your vacation home a vacation home?
• Tax deductions for rental homes
• Mixed use of a vacation home
• Capital gains loophole closed by the IRS

Check out the whole article ... Here.

Open Houses - a Waste of Time?

Many home sellers feel that open houses are a great way to get lots of potential buyers through your home in a short time. Some agents feel that open houses are a good thing also. I've done a number of open houses and my experience is that they aren't a good use of my time and tend to be attended only by neighbors. I found this blog entry that fairly well summarizes both my experience and my feelings... read it Here.

Selling One To Buy Another?

Are you considering an 'upgrade'? Will you sell an investment or rental home to purchase another? You need to consider the tax implications of such a sale. As a second, rental, or investment home your profits are likely taxable, unless you take advantage of an IRS rule known as a "like-kind" exchange. This is sometimes referred to as a IRS 1031 exchange.

Think of a 1031 exchange as being similar to a IRA rollover, except with real estate instead of securities. There are lots of rules that need to be followed and you will need to hire an 'exchange agent', but the benefits of a 1031 exchange can be enormous. Check out 1031 exchanges on the Parker-Scheer website...Here.

Homebuyer's Tax Credit: Updated & Extended

It's now the law. Congress, and President Obama, have created and signed into law an extension of the first time home buyers tax credit of $8,000. Additionally, the law has provided for existing homeowners to also collect a tax credit of up to $6,500. There are lots of details, income limits, and 'requirements'. Read all about the new laws in CNBC's Investment Guide Special Report.

Unfortunately, neither the first time or the existing homeowner tax credits allow for coverage of investment or second home purchases, leaving the Outer Cape real estate market out. Bummer!

Tough Market Real Estate Marketing

I found an article on CNBC.com that pretty well summarizes what a home seller needs to do to make their property the most attractive property that a buyer sees in their 'hunt' for the perfect home. These rules apply for homes of all shapes, sizes, and locales.

Of note - I believe that the extreme 'seasonality' of the Outer Cape changes the discussion about a home's stale-ness factor discussed in the article. Here, except in extreme cases, the days-on-market often reflects the season the house entered the market, whether its been a rental property, etc. Read the article ... Here.

Listen To Me On NPR Radio

I was interviewed for a radio program on NPR radio, broadcast on August 14th. Go to WBUR.org to read the transcript and listen to the radio show. The radio show discussed the current slow Cape real estate marketplace and how now may be the ideal time to buy that 2nd home on the Outer Cape. One of my clients, Mark Andrade, also contributed.

New Cape Cod Second Home Study

The Cape Cod Commission just released a study on the state and direction of second home ownership on the Cape. A few interesting facts...

• 32% of all homes on the Cape rate as 'second homes' - an identified 49,563


• Wellfleet has the highest percentage of second homes - 64% (ed: WOW!)


• 32% of these second homes (an estimated 10,656) are likely to be converted to year-round use in the next 15 years

These stats (and a few others) will have a dramatic effect on the Cape and it's infrastructure as these homes become permanent residences, mostly to the water systems. Read the article from the Cape Codder, or take on the whole report at http://www.capecodcommission.org/.

Second-Home Owners - Likely "Out of Luck"

The Federal government seems to want to help just about everyone, except second home owners. Read the story on the Wall Street Journal's MarketWatch website.

Even the Financial Times Says It's Time To Buy on Cape Cod

Even the Financial Times says its time to buy on Cape Cod. The article titled "In Cape Cod We Trust" highlights that the time of opportunity is now. My RE/MAX Classic colleague, Thom Schoepfer, is quoted in the article. Thom said, “The Cape holds a place in the hearts and minds of people and there’s real value here. You get it from personal enjoyment and use, income if you rent your home out and appreciation if you hang on to it.”

It's a good read. The FT says that the drop in house prices in desirable communities, combined with historically low interest rates, has created a modest boom in the area’s holiday property market. “It’s all those magical stars aligning,” says Thom. Go the the Financial Times to read the article.