General Real Estate News

First a disclaimer. I can not give tax advice and this isn’t tax advice. Please, consult a tax professional for advice, not your Realtor, hairdresser, trainer, or the neighborhood group on your favorite social network.

Recently an older couple who are considering moving told me that they might want a mortgage on their new place because it is a tax deduction. Of course, the mortgage isn’t deductible but the interest on it is.

Just because something is tax deductible does not mean that you will get a tax deduction. Most people get a larger deduction by taking the standard deduction rather than itemizing.

Do you itemize? Can you itemize? should you itemize? If you answered yes to all three then maybe a nice big mortgage is for you.

The interest paid on a home mortgage is only a tax deduction for those who itemize.  There is also now a limit on how much mortgage interest can be deducted.

In 2023 a married couple filing jointly may take a standard deduction of $27,700. For more than 80% of taxpayers, the standard deduction is greater than itemized deductions, which is why they do not itemize.

Before choosing to pay interest on a mortgage because it is a tax deduction consult your tax preparer or an expert. For people who really like to make interest payments to banks, I guess. mortgage is always a good thing.

The wealthy benefit the most from the mortgage interest deduction. In fact, it is one of the larger government subsidies for the wealthy, that costs U.S. taxpayers 70 billion a year.

HUD  Makes $113 Million Available in Affordable Housing Vouchers in 2023.

Also, some Minnesota property taxpayers and renters get money refunded back by the State of Minnesota.  but only if they apply for it within the next two years.

There is also a property tax deferral program through the State of Minnesota for persons who are over 65.  Sometimes there is confusion over these programs because property taxes are paid to the county but refunds come from the state.

Taxes are never simple which is why I get extra cranky around tax time.

2023 Fair Housing Trends Report – Highlights
There were 33,007 fair housing complaints received in 2022 – the highest number of complaints ever reported in a single year; Overall complaints were 5.74 percent higher than the previous year;
Complaints based on source of income and domestic violence increased;
Even with this record-setting number of complaints, most incidents of housing discrimination go undetected or unreported.

The full report is available online from the National Fair Housing Alliance.

The fact that complaints are up is probably a good thing. Often persons who are discriminated against do not even know that they were discriminated against. g complaint

If you believe you were discriminated against in housing you can and should file a complaint.

A Realtor® is a member of the National Association of Realtors. (NAR) For the first time since 2012 NAR membership declined. NAR ended the year with 1,580,971 members representing a 1.67% decline from 2022.

Minnesota Realtors membership went down by 2.34% in 2023. There are 21,809 Realtors in Minnesota. Washington saw the largest decline in membership decline of 9.51%.

Membership in Puerto Rico increased by almost 23%.

For the last few years, there has been a surplus of Realtors and at the same time home sales have been declining.

The National Association of Realtors lost a major lawsuit last fall and the last two presidents have resigned. The most recent CEO retired sooner than he had planned. Yet I think the reason membership went down is because home sales are down and at the same time unemployment is low.

A couple of weeks ago a jury in a Federal court case the National Association of Realtors was found guilty of being part of a conspiracy that caused consumers to pay more for real estate brokerage services. In other words, the conspiracy has kept real estate commissions high.

The jury laid the conspiracy at the feet of every one of the defendants: NAR, Keller Williams, Anywhere (formerly, Realogy), RE/MAX, HomeServices of America, and two of its subsidiaries HSF Affiliates and BHH Affiliates.

The jurors found that the conspiracy had caused the plaintiffs to pay more for real estate brokerage services when selling their homes than they would have without the conspiracy.

It all has to do with how sellers’ agents split their commissions with buyer’s agents.

The plaintiffs who are home sellers in the class action suite were awarded over 1.8 billion dollars.

The National Association of Realtors has stated that it will appeal and there are more lawsuits against real estate companies waiting in the wings.

I have no idea how this will all end. The judge has not ruled yet. I am a member of the National Association of Realtors, which is why I have resisted the urge to write commentary about the lawsuit. I am writing about it now because it is a big deal and may have a lasting impact on the real estate industry and on how real estate is bought and sold.

For some reason, most in the real estate industry seemed to think NAR would win. It will be interesting to see how this affects my business and how the home buying and selling process might change.

There is a lot of confusion among Realtors and a lot of misinformation. The National Association of Realtors (1.5 million members) is not giving us much information right now.

According to the national association of Realtors home sales were down by 2.2% in July year over year.  This is mainly because there were fewer houses on the market.

Here are some highlights from the Realtor confidence index:

• 74% of respondents reported that properties sold in less than one month. This is down slightly from 76% a month ago and down from 82% in July 2022.
• 26% of buyers had all-cash sales, unchanged from last month and up slightly from 24% in July 2022.
• Homes listed received an average of 3.0 offers, down from 3.5 last month and up from 2.8 offers in July 2022.
• Due to the lack of housing inventory, the pace of the market, and the use of technology, 9% of buyers purchased a home based only on a virtual tour, showing, or open house without physically seeing the home. Down slightly from one month ago and flat from one year ago.

If you want to know more about home sales in your neighborhood ask a Realtor.

Also see: July 2023 Home sales in St. Paul